[Federal Register Volume 67, Number 25 (Wednesday, February 6, 2002)]
[Notices]
[Pages 5586-5595]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-2837]


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ENVIRONMENTAL PROTECTION AGENCY

[FRL-7138-2]


Equipment Containing Ozone Depleting Substances at Industrial 
Bakeries

AGENCY: Environmental Protection Agency (EPA).

ACTION: Notice of Bakery Partnership Program and response to comments.

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SUMMARY: The Environmental Protection Agency announces a unique 
voluntary Partnership Program for the baking industry. Commercial 
bakeries use large quantities of chlorofluorocarbons and other 
chemicals that contribute to depletion of the ozone layer in industrial 
process refrigeration appliances. Failure to comply with the stringent 
leak detection and repair requirements under 40 CFR part 82 of the 
regulations implementing Title VI of

[[Page 5587]]

the Clean Air Act can result in the release of tens of thousands of 
pounds of ozone-depleting chemicals to the atmosphere, and expose 
companies to enforcement liability.
    Accordingly, EPA is offering incentives for those commercial 
bakeries that agree to reduce or eliminate leaks of ozone-depleting 
substances (ODS) used in refrigeration equipment. Companies that elect 
to participate agree to audit certain appliances, comply with leak 
detection and repair requirements, and phaseout Class I industrial 
process refrigeration appliances and thus qualify for reduced penalties 
and a waiver of civil liability for past violations. Penalties are 
reduced even further (in some cases eliminated) for companies that 
replace existing refrigeration units with systems that use non-ozone 
depleting chemicals.
    The terms of the agreement allow companies a high degree of choice 
in designing the most cost-effective compliance strategy and 
considering whether to switch to non-ODS systems. EPA encourages 
companies to take advantage of this voluntary partnership, which offers 
an economical way to protect the atmosphere and assure compliance with 
the Clean Air Act.
    This announcement indicates how EPA expects to exercise its 
enforcement discretion in settling potential past violations of 40 CFR 
part 82 with companies that elect to participate, and which agree to 
meet certain conditions. It is designed to help companies assess their 
liabilities and determine whether it is reasonable to audit and correct 
violations in return for reduced penalties and a waiver of past civil 
liability. The use of the terms ``must'' and ``shall'' establish 
presumptions as to the terms and conditions and EPA's response. As 
always, EPA reserves the right to exercise its discretion differently 
if presented with unusual or compelling circumstances. This notice 
establishes no new rights or obligations on behalf of EPA or any other 
party, except to the extent specific terms are agreed to in 
administrative orders on consent.
    On December 10, 2001, the Environmental Protection Agency [EPA] 
published a proposed voluntary program for the baking industry and 
sought comments. The comment period has closed and comments have been 
received. The proposed Bakery Partnership Program has been revised in 
several ways based on the helpful comments. Some comments have been 
editorial in nature, providing clarifying language which have been 
adopted. Others have been more substantive, most of which have been 
incorporated into this final announcement.
    The most important change is that EPA agrees with the comment that 
the starting date for the program should be moved forward from March 
15, 2002 to April 26, 2002. In addition, EPA agrees with the comment 
that an alternative dispute resolution mechanism should be available if 
the informal attempts to resolve disagreements are not successful, and 
believes that this mechanism is the most appropriate means to resolve 
those few factual disputes that may arise. EPA also agrees that Class I 
units should have the option of shutting down these units rather than 
converting them.
    Participation in the partnership program is purely voluntary, and 
this is not a rule, but it does combine the advantages of 
predictability and reduced penalties with incentives to move away from 
the use of ozone depleting substances (ODS). Participating companies 
will be asked to agree to phaseout use of the more hazardous Class I 
ODS by July 15, 2003, reflecting the fact that use of these substances 
is being rapidly phased out under existing rules. Bakeries that have 
installed non-ODS systems by April 26, 2002, can avoid all penalties 
under this agreement. Bakeries that install non-ODS systems after that 
date but no later than July 15, 2004 (unless an extension is granted) 
are limited to penalties of $10,000 per appliance. All other appliances 
that do not install non-ODS systems must pay a per pound penalty for 
any leaks that cross a high threshold, but again, this per pound 
penalty can be avoided by conversion to non-ODS systems. Companies 
already under national investigation for violations are not eligible to 
participate in this program.

DATES: No more comments are being solicited. Key dates in the program 
are listed below.

ADDRESSES: Comments and other notices that were or may be received may 
be reviewed by the public at Bakery Partnership Program, the Docket 
Clerk, Enforcement and Compliance Docket and Information Center (Mail 
Code 2201A), Docket Number EC-2001-007, U.S. Environmental Protection 
Agency, Ariel Rios Building, 1200 Pennsylvania Ave, NW, Washington, DC 
20460. Other notices under this Bakery Partnership Program may be sent 
electronically to: [email protected]. Attach electronic notices as an 
ASCii (text) file, and avoid the use of special characters and any form 
of encryption. Be sure to include the docket number, EC-2001-007 on 
your document. Notices may also be faxed to (202) 501-1011. Notices may 
be mailed or delivered in person to Enforcement and Compliance Docket 
and Information Center, U.S. Environmental Protection Agency, Ariel 
Rios Building, Room 4033, 1200 Pennsylvania Ave, NW, Washington, DC 
20460. Persons interested in reviewing this docket may do so by calling 
(202) 564-2614 or (202) 564-2119, with the understanding that 
confidential business information will not be released to the public.

FOR FURTHER INFORMATION CONTACT: Mr. Charles Garlow, Air Enforcement 
Division (2242A), US EPA, 1200 Pennsylvania Ave NW., Washington, DC 
20460, telephone 202-564-1088.

SUPPLEMENTARY INFORMATION:
    Many industries, including most industrial bakeries, use ozone 
depleting substances [ODS], such as CFCs and hydrochlorofluorocarbons 
[HCFCs], to cool their products. Like other industrial sources, most 
industrial bakeries have industrial process refrigeration appliances 
that are subject to 40 CFR part 82, subpart F. The equipment that 
produces the product contains CFCs or other ozone depleting substances 
in jackets around the product. The equipment may sometimes leak these 
coolants in sizeable quantities into the air, but not into the product. 
If certain leak rates are exceeded, the company may be required to 
retrofit or retire the equipment.
    EPA has concluded two large industrial process refrigeration 
enforcement cases, one of which involved a company with bakeries in 
several states. In both cases, the companies voluntarily chose to 
replace their industrial process refrigeration appliances with 
equipment designed to prevent pollution. The ozone depleting coolant 
was replaced by a cooling system that uses a secondary loop containing 
a cooling solution, glycol, that is not an ozone depleting substance. 
Although the primary loop of the refrigeration system may still contain 
some ozone depleting substances, the quantity is greatly reduced, and 
the ODS refrigerant is located where vibration and the potential for 
leaks is greatly reduced. The EPA wants to encourage all companies with 
industrial process refrigeration appliances that may be leaking to 
consider a similar pollution prevention approach to ensuring their 
compliance with the refrigerant recycling and emissions reduction 
regulations found at 40 CFR part 82, subpart F.
    EPA is inviting the baking industry to participate in a voluntary 
program to address these potential violations. The

[[Page 5588]]

program offers an expedited way for companies to correct past 
violations and prevent future ones, in return for a release from past 
liabilities and reduced penalties. The largest trade association 
representing bakeries has accepted this invitation on behalf of its 
members. The total number of industrial bakeries is not exactly known 
yet, but it is believed that there may be over 1000 bakeries in the 
United States. Each bakery will likely have one or more industrial 
process refrigeration appliances that are subject to the regulations, 
such as mixers or chillers, at each bakery. Many of these industrial 
process refrigeration appliances have already been converted to non-
ODS, pollution prevention equipment.
    In the interests of promoting fast, efficient and widespread 
emission reductions, and better compliance with the regulatory 
structure, EPA intends to offer and enter into agreements with baking 
companies providing that they:
     Audit their facilities;
     Identify problem areas;
     Pay a greatly reduced penalty, and propose solutions that 
will protect the environment; and,
     Ensure greater compliance with the refrigerant recycling 
and emissions reduction regulations found at 40 CFR part 82, subpart F.
    EPA's proposal offers clear and consistent terms to reduce 
uncertainty and eliminate the need for extended, individualized 
negotiations. Presented here are the basic elements, illustrations and 
a chronology of key steps that EPA and participants will be expected to 
complete. The basic elements of the program are as follows:
     Notice to EPA. Bakeries not already the subject of a 
national enforcement investigation or action, and which had or have 
industrial process refrigeration appliances containing 50 pounds or 
more of ODS refrigerants, are eligible to participate. Companies 
intending to participate should notify EPA by April 26, 2002, and as 
soon thereafter as possible, but no later than April 30, 2002, submit a 
signed Bakery Partnership Agreement to EPA. If some of the industrial 
process refrigeration appliances have been converted to non-ODS systems 
prior to April 26, 2002, a count of these appliances should also be 
provided. If, during the audit, a more accurate tally is obtained, an 
updated notice may be submitted at that time. Annex A contains a sample 
notice of intent to participate, which can be updated with the number 
of appliances to be audited by April 30, 2002. It can be sent by 
electronic mail or postal mail, but electronic mail or e-mail is 
preferred.
     Annualized leak rate. For the purposes of this Partnership 
Agreement, the annualized leak rate shall be calculated for every 
instance in which refrigerant was added to the appliance. The leak rate 
shall be calculated by the formula agreed upon by EPA in its 
publication, Compliance Guidance for Industrial Process Refrigeration 
Leak Repair Regulations under Section 608 of the Clean Air Act.
     Audit. Participating companies must audit up to June 15, 
2003, i.e., assess the compliance status of all their industrial 
process refrigeration appliances and facilities. They must then report 
to EPA a summary of their findings, by July 15, 2003. If a company 
complies with the entire program, EPA intends to grant a release from 
civil liability for the matters identified and corrected, so long as 
reduced penalties are paid as described below. However, if violative 
conduct is not identified and corrected, EPA is not granting any 
release from civil liability for such problems. Good faith participants 
in this Partnership Program will receive a release for the period of 
time prior to September 30, 2000, even though this period may not have 
been audited. For example, if a facility has installed non-ODS 
technology on any of their appliances prior to the April 26, 2002 start 
date for this Partnership Program, such an appliance need not be 
audited, and a complete release from civil liabilities and penalties 
will be granted for such appliances. By non-ODS systems, EPA means 
systems that contain no ODS at all [e.g. HFC systems or ammonia 
systems], or no ODS in the secondary loop, but may contain an ODS in 
the primary loop. Typically, the ODS in the primary loop [compressor] 
is a much smaller volume, and is not subjected to the vibration in the 
process areas that may cause greater leaks. If the primary loop 
contains less than 50 pounds of ODS, as is frequently the case, then 
the appliance is exempt from the leak repair regulations. It is still 
subject, however, to other requirements such as the ``no venting'' 
requirement of 40 CFR 82.154(a).
     Class I appliances. All Class I appliances must be audited 
and converted either to a non-ODS system, or to a system using an ODS 
with an ozone depleting potential [ODP] of less than 0.1, or shut down 
(permanently taken out of service). Class I appliances are those 
containing Class I controlled substances, listed in appendix A to 
subpart A of 40 CFR part 82, and include CFC refrigerants (e.g., R-12). 
Leaks from these Class I appliances are more damaging to the Earth's 
ozone layer than an equivalent amount of leakage from Class II 
appliances. The phaseout of the production of CFCs was completed as of 
December 31, 1995. Since the availability of CFCs will continue to 
decrease over time, EPA believes that this is a good time to switch to 
a less ozone-depleting technology. EPA estimates that the vast majority 
of appliances in this industry have already switched from using Class I 
ODS to either Class II or non-ODS systems. Participating companies must 
identify their Class I appliances and submit a plan for shutdown or 
change/conversion to either the Class II ODS with an ODP of 0.1 or 
less, such as R-22, or to a non-ODS system. The audits must be 
completed and plans must be submitted to EPA by July 15, 2002. An 
Administrative Order on Consent [AOC] will incorporate a company pledge 
to complete the audits of Class II appliances and to submit plans, if 
needed, for those appliances by July 15, 2003 and pay penalties as 
specified in the agreement. EPA expects the plans for Class I 
appliances to be fully implemented by July 15, 2003, but may grant 
additional time in exceptional circumstances pursuant to 40 CFR 
82.156(i)(7).
     Class II appliances. All Class II appliances must be 
audited by June 15, 2003. Class II appliances are those containing 
Class II controlled substances, listed in appendix B to subpart A of 40 
CFR part 82 (including all HCFC refrigerants, such as R-22). If any of 
these appliances are being changed/converted to non-ODS systems, then 
plans to accomplish this must be submitted by July 15, 2003 as agreed 
to in the July 2002 AOC.
     CAFO. EPA will issue to participating companies, pursuant 
to the authority of Section 113(d) of the Clean Air Act, Compliance 
Agreement Final Orders [CAFOs] that reflect the audit findings, 
implementation plans and schedule of corrections, any reduced penalties 
that must be paid, and a release from civil liability conditioned on 
completion of the implementation plans and corrections. EPA will issue 
CAFOs at the completion of all audits in July of 2003. If a company has 
only Class I appliances, EPA will issue the CAFO in July of 2002. 
Companies must also commit to compliance with all regulations.
     Plan Implementation. By July 15, 2003 for Class I 
appliances and by July 15, 2004 for Class II appliances, all plans for 
equipment changes/conversions should be completely implemented, unless 
extensions are granted pursuant to 40 CFR 82.156(i)(7).
     Program Completion. By July 15, 2004 or such later date 
when all

[[Page 5589]]

conversions are completed, the participating company will notify EPA 
and EPA will respond with a confirmation letter acknowledging the 
completion of the Bakery Partnership Program.

Penalties

     Per appliance penalty. A penalty of $10,000 shall be paid 
for each ODS containing appliance, regardless of whether violations are 
identified or not, except that no penalties are due for any appliance 
converted to a non-ODS system before April 26, 2002. No bakery facility 
must pay more than $50,000 in these penalties. This penalty will be 
paid with other penalties no later than 30 days after receipt of the 
CAFO.
     Per pound penalties. Additional ``per pound'' penalties 
for all appliance leaks discovered during the audit, occurring after a 
35% annualized leak rate, must be calculated on a 12-month basis, 
beginning when the auditing period starts, i.e., September 30, 2000. At 
the end of the 12-month period following a 35% annualized leak rate, 
per pound penalty calculations cease, unless a subsequent 35% 
annualized leak rate is discovered, in which case another 12 month 
period of calculation begins. Per pound penalty calculations end June 
15, 2003.
     No per pound penalties for replacement with non-ODS 
system. Switching to a non-ODS system is encouraged. If a participating 
company agrees to replace an ODS system with a non-ODS system in an 
appliance, no ``per pound'' penalties need be paid for that appliance. 
If a company is facing high per pound penalties for a particular 
appliance but has decided that it does not make technical or economic 
sense for the company to convert that particular appliance to a non-ODS 
system, it may instead substitute another appliance[s] and still avoid 
the per pound penalties for the first appliance. The first appliance, 
however, must still be brought into full compliance. This ``bubbled 
compliance'' concept would allow a company to substitute the first 
appliance with another appliance or appliances that have 120% of the 
full charge of the appliance that will not be changed/converted to a 
non-ODS system. For example, if a 1000 pound appliance has very high 
per pound penalties that the company wishes to avoid, it may avoid 
those penalties either by converting this appliance to a non-ODS 
system, or by converting one or more other ODS containing appliances 
[that were not already required to convert to non-ODS systems] that 
have a total charge of at least 1200 pounds. This could be one other 
appliance with a full charge of 1200 pounds, or two appliances of 600 
pounds each, or some other combination of appliances that total at 
least 1200 pounds of refrigerant. If the two 600 pound appliances in 
this example had per pound penalties of their own, those penalties 
would still be due, unless some other appliance or appliances in turn 
were converted to non-ODS systems in their stead, at the 1.2 to 1 
ratio, as described above.
     Start-up period. No leaks will be counted as part of the 
per pound calculation for the period 60 days after a new installation 
or after an appliance is changed/converted to a non-ODS or lower than 
0.1 ODP system, considered as a ``start up'' period.
     Per pound amounts. Per pound penalties will be calculated 
per appliance as follows: $20 per pound up to 500 pounds, $30 per pound 
for 501-1000 pounds and $40 per pound for the pounds over 1000, during 
each 12 month period after a 35% annualized leak rate is identified.
    In summary, to participate in the Partnership Program, all sources 
must achieve and maintain full compliance with the refrigerant 
recycling and emissions reduction regulations found at 40 CFR part 82, 
subpart F. In addition, appliances using Class I substances must be 
audited and changed/converted. Appliances using Class II substances 
must be audited. Owners of Class I and II appliances may elect to 
convert to non-ODS systems to avoid paying fees for higher leaks. Each 
company will sign an Administrative Order on Consent [AOC] on or before 
July 15, 2002 and sign a Consent Agreement Final Order [CAFO] on or 
before July 15, 2003, which will specify a conditional waiver of 
liability. These are the main points of interest in this Partnership 
Agreement. There are some other minor details that are mentioned in the 
Partnership Agreement and the other Annexes, which should be self-
explanatory. Other approaches to achieving the objectives of this 
program were considered by EPA and the industry representatives, but 
this approach was chosen as being the best from the point of view of 
administrative ease of implementation and environmental improvement.

Here Is an Example of What a Participating Company May Encounter 
During Participation in This Partnership Agreement

    If a company is eligible and wants to participate, it should send a 
notice to EPA by April 26, 2002, identifying the company and its 
facilities. If this company has five bakeries and five appliances in 
each bakery, for a total of 25 appliances, seven of which have been 
converted to a non-ODS system prior to April 26, 2002, then there will 
be a $10,000 penalty per appliance for the 18 ODS containing 
appliances. This company will, however, get a release from civil 
liability for all 25 appliances for problems identified and corrected. 
The company is best advised to pay particular attention to their Class 
I appliances, if any, as audits must be conducted and a decision on 
these appliances must be made by July 15, 2002. If there are four Class 
I appliances, these should be audited first to determine what per pound 
``penalties'' may be due for these appliances. If the per pound 
penalties determined from this audit indicate that a large per pound 
penalty may be due for several of these appliances, then this may be 
persuasive in deciding to convert these appliances to a non-ODS system 
in order to avoid the per pound penalties. If, instead, the company 
chooses to convert some or all of the Class I appliances to a Class II 
ODS refrigerant with an ODP of less than 0.1, rather than a non-ODS 
system, then the per pound penalties will still be due and payable by 
30 days after receipt of the CAFO, which should be shortly after July 
2003. Auditing and calculation of per pound penalties should continue 
through June 15, 2003 to ensure continued compliance and lowered 
emissions.
    By July 15, 2002, the company must prepare a plan and submit this 
plan to EPA, indicating which of the appliances are the Class I 
appliances, and what changes or conversions the company pledges to make 
to them, with a schedule for the work anticipated. The company should 
submit, along with the plans, the auditing summaries for the Class I 
appliances [see the sample below]. EPA will incorporate the plans for 
these four Class I appliances, along with the company's pledge to 
continue auditing the other appliances and to prepare and submit plans 
for them within a year in an Administrative Order on Consent [AOC], 
which should be signed by the company and then by EPA. EPA will return 
a copy of the signed AOC to the company.
    For the other Class II appliances, a similar audit of compliance 
should begin, covering the period from September 30, 2000 until June 
15, 2003. Per pound penalties, if any, should be calculated for these 
appliances. As with the Class I appliances, if the company wishes to 
avoid paying these per pound penalties, it may do so by agreeing to 
convert the Class II systems to non-ODS systems. The company should 
make that decision and submit plans, if any, for

[[Page 5590]]

such conversions to EPA by July 15, 2003. These plans will be 
incorporated in the CAFO. EPA expects that these plans will be 
implemented by July 15, 2004, with the possibility of extensions if 
additional time is needed.
    When calculating per pound penalties, this company should look at 
each appliance and calculate its per pound penalties, if any. If, for 
example, the first Class I appliance had a 50% annualized leak rate in 
October 2000 and thereafter in the next 12 months had small and large 
leaks totaling 1500 pounds, then the per pound penalty for these 1500 
pounds would be calculated as follows: $20 per pound for the first 500 
pounds or $10,000; $30 per pound for pounds 501-1000 or $15,000; and 
$40 per pound for pounds 1001-1500 or $20,000. Thus, the total for this 
12-month block period would be $45,000 [$10,000 + $15,000 + $20,000]. 
If a large leak rate was discovered in December 2000, that does not 
start another 12-month block period up to December 2001, as this is a 
leak inside the October 2000-2001 12-month period. If after October 
2001 this same appliance had another annualized leak greater than 35%, 
for example, a 90% annualized leak rate, then leaks after that point 
would be calculated as above and added to the $45,000 total. This 
process should continue through June 15, 2003 and a total per pound 
penalty should be calculated for this appliance, and for all other 
appliances. The company then has the option of paying this per pound 
penalty or avoiding it by submitting a plan for converting to a non-ODS 
system. EPA hopes that this financial incentive will cause more 
companies to choose conversion to non-ODS systems while still giving 
the company the flexibility to decide which option is best for it.
    On July 15, 2003, the company should submit audit summaries and 
plans for any equipment changes/conversions that it intends to make to 
the Class II appliances. It should also be prepared to pay any 
penalties that may be due shortly after the CAFO, signed by both 
parties, is received by the company. EPA will also prepare a CAFO with 
the release from civil liability for all matters that the company has 
identified as being a potential problem and corrected. This listing of 
problems discovered by the audit can be included in the plan for 
equipment changes/conversions or can be listed separately. It can 
include matters such as technician certification, better recordkeeping 
systems, equipment certifications, etc. Problem areas, or violations, 
not so identified and corrected will not receive a release from 
liability, so it is very important to identify all these problem areas 
and correct all these problems. EPA may inspect and request information 
to ensure that the audits are being conducted fully and properly.
    By July 15, 2004, the company will have completed the equipment 
changes/conversions, unless more time is needed, and corrected other 
problems identified in the audit. The company will send a letter 
certifying that all these matters have been attended to, and EPA will 
reply accepting this certification and thanking the company for 
participating. This is the end of the program for this company.

Key Dates

September 30, 2000

    Begins period of compliance audit and monthly measurement of annual 
leak rates from industrial process refrigeration appliances for all 
partnership participants.
    ``Look-back'' period gives credit to companies that have taken 
steps to improve leak management.

April 26, 2002

    Notice of intent to participate in Partnership Program is due. Name 
and address of facilities. All penalties waived for appliances that 
have been converted to non-ODSs by April 26, 2002.
    Program open to all companies not subject of national enforcement 
investigation.

April 30, 2002

    Companies must identify charging capacity and location of all 
appliances using over 50 lbs of Class I or Class II ODS, and those 
which have converted to use of non-ODS refrigerant in primary loop by 
April 26, 2002.
    Companies commit, by signing the Bakery Partnership Agreement, to 
complete audit and submit implementation plans by July 15, 2002, to 
convert Class I appliances to at least Class II, and to pay stipulated 
penalties or switch to non-ODS refrigeration appliances by July 15, 
2003 (unless extension granted).

July 15, 2002

    EPA issues administrative order/information request on consent 
[AOC] to participating companies reflecting company's commitment to 
complete audit by June 15, 2003 and submit implementation plans for 
Class II appliances by July 15, 2003.
    Companies that have switched all appliances to non-ODS by April 26, 
2002 may receive compliance agreement/final order (CAFO) discharging 
all liabilities for past violations without payment of penalty.

June 15, 2003

    Audits are completed.

July 15, 2003

    Bakeries submit audit results and final implementation plans.
    Bakeries pay stipulated penalties for the 12 months following any 
single month in which annualized leak rate exceeds 35%, but:

--Bakeries can avoid stipulated penalties if implementation plan 
commits to replace leaking appliance with non-ODS system no later than 
July 15, 2004 (unless program grants extension).
--Bakeries can ``bubble'' by substituting ODS conversion at another 
appliance (must have charge 120% greater than leaking appliance).

    All Class I ODS appliances must convert to at least Class II ODS 
appliances by July 15, 2003, unless program grants extension.
    EPA issues compliance agreement/final order [CAFO] reflecting 
conversion to Class II or non-ODS systems, and payment of stipulated 
penalties.

July 15, 2004

    Bakeries must complete conversion to non-ODS systems reflected in 
implementation plans, unless program has granted an extension.

Key Definitions

    Annualized leak rate--(pounds of refrigerant added/pounds of full 
charge)  x  (365 days/# days since refrigerant last added) x 100%.
    Appliance--industrial process refrigeration device containing 50 
pounds or more of ODS refrigerants.
    Class I--an ODS listed in appendix A to 40 CFR part 82, subpart A.
    Class II--an ODS listed in appendix B to 40 CFR part 82, subpart A.
    ODS--ozone depleting substance.
    Facility--a discrete parcel of real property or such a parcel 
improved by Participating Company's building, structure, factory, 
plant, premises, or other thing, related to Participating Company's 
wholesale baking/bakery business, and containing at least one appliance 
as defined in this agreement.
    Non-ODS system--systems that contain no ODS at all [e.g. HFC 
systems or ammonia systems] or no ODS in the secondary loop, but may 
contain an ODS in the primary loop.

Additional Sources of General Information

    To find out more about compliance with Title VI of the Clean Air 
Act,

[[Page 5591]]

access the EPA's web site at www.epa.gov/ozone. The EPA and the 
Chemical Manufacturer's Association (CMA) have developed a guidance 
document entitled Compliance Guidance For Industrial Process 
Refrigeration Leak Repair Regulations Under Section 608 of the Clean 
Air Act [see http://www.epa.gov/ozone/title6/608/compguid/compguid.html] that provides greater detail than the discussion on the 
EPA web site. The guidance document is intended for those persons who 
are responsible for complying with the requirements. The guidance 
should not be used to replace the actual regulations published in the 
Federal Register on August 8, 1995 (60 FR 40420) [see http://www.epa.gov/spdpublc/title6/608/leakfrm.txt] ; however, it can act as a 
supplement to explain the requirements. Reliance on this guidance alone 
will likely not result in compliance. Another useful web site is one 
pertaining to general leak repair: http://www.epa.gov/ozone/title6/608/leak.html. EPA has also made available a sample inspector's checklist 
to the trade association, which is available online at http://www.epa.gov/ozone/title6/608/compguid/compguid.html or http://www.epa.gov/oeca/ore/aed/bakery/index.html or by contacting the Ozone 
Hotline at 800-296-1996.

Conclusion

    EPA believes that the above-described program is the best, most 
cost-effective way to achieve immediate environmental improvement and 
achieve significant progress in resolving the myriad compliance 
concerns that may be present in this industry. Its terms, conditions 
and protections will be available only to those companies that are 
eligible, elect to participate, and abide by the conditions of the 
program.

    Dated: January 30, 2002.
Eric Schaeffer,
Director, Office of Regulatory Enforcement, Office of Enforcement and 
Compliance Assurance.
Attachments
    Partnership Agreement with Annexes: Sample Identification of 
Facilities due April 26, 2002; Sample AOC; Sample CAFO.

Ozone-Depleting Substance Emission Reduction Bakery Partnership 
Agreement

    The United States Environmental Protection Agency (``EPA'') and 
__________ (``Participating Company''), the parties to this 
agreement, desire to enter into and be bound by the terms of this 
Ozone-Depleting Substance (ODS) Emission Reduction Bakery 
Partnership Agreement (``Agreement'').

Introduction

    The Agreement specifies an audit, self-disclosure and corrective 
action program, which shall result in a release from liability for 
the conditions that are identified and corrected. This Agreement 
incorporates the features of the Bakery Partnership Program as 
detailed in the Federal Register notice on this topic, published 
February 6, 2002.

Applicability

    1. This Partnership Agreement shall apply to and be binding upon 
both EPA and Participating Company, including but not limited to its 
officers, directors, agents, servants, employees, successors, and 
assigns. Participating Company shall give notice of this Agreement 
to any successor in interest prior to the transfer of any ownership 
interest in any machinery subject to Title VI, Clean Air Act (42 
U.S.C. 7671 et. seq.) (the ``Act'') and its incorporating 
regulations, 40 CFR Part 82 (``Regulations''). EPA, in cooperation 
with baking industry trade officials and trade journals, notified 
the baking industry of this program.
    2. In order for a Participating Company to be eligible to 
participate in this Agreement, the Participating Company must be a 
wholesale bakery not currently under corporate-wide investigation by 
EPA for a violation of Title VI of the Clean Air Act.

Definitions

    3. ``Participating Company'' means any eligible company and its 
wholly- or partially-owned subsidiaries, including all their 
bakeries, that agree to abide by the conditions of this Agreement.
    4. ``Corporate-wide investigation'' means an investigation that 
requires information disclosure from either (1) five or more 
facilities owned by a company that seeks to be a Participating 
Company or (2) all facilities that are subject to Title VI and owned 
by a company that seeks to be a Participating Company.
    5. ``Non-ODS system'' means pollution prevention technology 
recommended to and agreed upon by EPA that supplants standard ODS 
technology, including but not limited to glycol, chilled water, or 
other non-ODS coolant in a secondary loop system or totally non-ODS 
systems, such as HFCs or ammonia.
    6. ``Facility'' means a discrete parcel of real property or such 
a parcel improved by Participating Company's building, structure, 
factory, plant, premises, or other thing, related to Participating 
Company's baking/bakery business, containing at least one appliance.
    7. ``Retrofit'' means to install new or modified parts in an 
appliance that were not provided as a part of the originally 
manufactured equipment. The retrofitted appliance must use a 
refrigerant with an ozone depleting potential that is lower than 
that which was used before the retrofit.
    8. ``Retire'' means to withdraw an appliance from service and 
replace it with an appliance containing a refrigerant with an ozone 
depleting potential that is lower than that which was used in the 
retired appliance.
    9. ``Appliance'' means an industrial process refrigeration 
appliance containing 50 pounds of more of ODS refrigerant that is 
housed within the facility.
    10. ``ODS'' means Ozone Depleting Substance used as a 
refrigerant.

Initial Notice and Submission of Partnership Agreement

    11. Participating Company represents that:
    a. It notified EPA of Participating Company's intent to 
participate in the Ozone Depleting Substance Emission Reduction 
Bakery Partnership Program by 5:00 PM Eastern Time, April 26, 2002, 
by identifying the facilities owned by the Participating Company.
    b. It submitted this executed Partnership Agreement by April 30, 
2002. Annex A, submitted with this Agreement, or updated shortly 
thereafter, is a true, accurate, and complete identification of:
    i. Name of the Participating Company; and
    ii. Name, street address, ZIP code, and city of each facility at 
which the Participating Company believes any subject appliance is 
presently located; and
    iii. State in which the facility is located; and
    iv. EPA region in which the facility is located; and
    v. The number or best estimate of the number of appliances with 
more than 50 pounds of refrigerant when fully charged, as determined 
by calculation, weight, manufacturer supplied information, or an 
established range as described in 40 CFR 82.152; and
    vi. The number or best estimate of the number of non-ODS 
industrial process refrigeration appliances.
    c. Participating Company certifies that it is eligible to be a 
participating company, that is, it meets the qualifications 
specified in paragraphs 2 and 3.
    d. Participating Company agrees to audit all its facilities as 
specified below and disclose the summary results of such audits to 
EPA and correct any and all violations in accordance with this 
Agreement.
    e. Participating Company agrees to toll the applicable statute 
of limitations during the life of the Agreement as it may apply to 
the violations that may have occurred within the time period five 
years prior to the signing of this Agreement.
    f. In the event that ownership of a facility subject to this 
Agreement is (or was) transferred during the period covered by the 
Agreement, the Agreement shall apply to the former owner for the 
period during which the facility was owned by the former owner, 
provided all applicable terms and conditions are otherwise 
satisfied. The Agreement shall also apply prospectively, according 
to its terms, to the party to whom the facility is transferred.

Audit Conduct, Report and Plans

    12. Participating Company agrees to assist EPA with EPA's review 
of company's audit results. Such assistance may take the form of 
responding to telephone calls for clarification and other reasonable 
informal inquiries, without the need for formal information demands.
    13. Participating Company agrees to identify all facilities with 
applicable industrial process refrigeration appliances.
    14. Participating Company agrees to undertake a reasonable 
investigation, and to

[[Page 5592]]

the extent it can reasonably assemble such information, report to 
EPA for each applicable appliance, dates of service, beginning 
September 30, 2000 and continuing until June 15, 2003; pounds of 
refrigerant added; days since the last addition of refrigerant; 
percent annualized leak rate; and any associated comments by using a 
spreadsheet such as the one contained in Annex C. To the extent that 
a change in system components, such as a new compressor, may have 
altered the full charge, or where other special conditions arise, 
these conditions should be noted in the comments section.
    15. Participating Company agrees to complete audits of all 
industrial process refrigeration appliances at each facility, except 
for those appliances converted to a non-ODS system prior to April 
26, 2002, and notify EPA with a summary of the audit results as 
specified in the preceding paragraph and corrective actions planned, 
as necessary, by July 15, 2002 for Class I appliances and by July 
15, 2003 for Class II appliances. Participating Company may, at its 
sole discretion, include commercial and comfort cooling appliances 
subject to 40 CFR 82.156(i) in the audit for compliance and receive 
a release from liability for problems identified and corrected.
    16. Participating Company agrees to calculate the total per 
appliance and per pound penalties, if any, due and owing by July 15, 
2003 in accordance with the method outlined in the Federal Register 
final announcement of the Bakery Partnership Program, and to submit 
this calculation to EPA.
    17. Participating Company agrees to provide, in writing, by July 
15, 2003, the steps that Participating Company will take to achieve 
continuous compliance with the requirements of 40 CFR Part 82. Such 
measures may include, but are not limited to, such things as 
training, record keeping, replacement, repair, installation of non-
ODS systems. See Annex E for additional, required Compliance Plan 
elements. Participating Company agrees to implement this Plan.

Audit Compliance Program

    18. For all Class I appliances Participating Company will 
complete an audit and submit plans for the retrofit of these 
appliances with an ODS having an ozone depleting potential of 0.1 or 
less or retirement/replacement with a non-ODS system. Plans for 
these Class I appliances must be submitted by July 15, 2002, with a 
schedule for the completion of these activities within one year, 
unless additional time is allowed pursuant to 40 CFR 82.156(i)(7). 
These plans will be incorporated in an Administrative Order on 
Consent [AOC]. See Annex B.
    19. For Class II appliances, Participating Company will sign an 
Administrative Order on Consent agreeing to develop, within the next 
twelve months, plans, where needed, for the replacement of these 
Class II appliances with non-ODS systems.
    20. If any appliance within a facility owned by Participating 
Company contains a refrigerant that is not an EPA-approved 
refrigerant for that particular end-use (such as R-409A use in an 
industrial process refrigeration appliance) or is not in compliance 
with use restrictions of an approved refrigerant, Participating 
Company must take immediate steps to properly recover said 
refrigerant from the appliance (in accordance with the Regulations) 
and replace it with an approved refrigerant, in accordance with any 
use restrictions. Recovered refrigerant must be sent to an EPA-
certified refrigerant reclaimer for ultimate reclamation or 
disposal.

Certification of Complete Compliance

    21. Participating Company shall sign and submit to EPA a 
Certification of Complete Compliance (Annex D) when all plans, 
retrofits and other steps necessary to ensure continuous compliance 
have been finalized.

Employee Participation

    22. Participating Company shall provide a procedure for its 
employees to report violations or potential problems to the auditing 
team. Participating Company agrees to ensure that employees who 
disclose violations or potential violations to the auditing team 
under the Act and the Regulations are not subject to adverse job 
actions (including without limitation disciplinary action, denial of 
promotion, bonuses or pay) on the basis of such employee disclosing 
such violations or potential violations in accordance with company 
policies.

Participating Company Records Retention

    23. Participating Company agrees to keep and retain on site or 
readily available any and all records from April 26, 1999 until two 
years after the conclusion of all obligations under this Agreement. 
Records for appliances that have been converted to non-ODS systems 
need not be retained for more than three years prior to the 
completion of the conversion to the non-ODS system. Such records 
shall be kept by both Participating Company and its employees, 
agents and any contractors working for Participating Company. All 
records are required to be retained for this period of time to 
facilitate review by EPA, should EPA choose to conduct such a 
review. Participating Company agrees to notify all employees, agents 
and contractors that any such record is not to be destroyed.

Penalties

    24. A ``per applicance'' penalty of $10,000, with a cap of 
$50,000 per facility, shall be due and owing for each industrial 
process refrigeration appliance that does not qualify as a non-ODS 
system by April 26, 2002. A ``per pound'' penalty, as specified in 
the above-referenced Federal Register notice, shall be calculated 
for each appliance, unless equipment conversions to non-ODS systems 
eliminate this penalty.
    25. The total penalty shall be paid within 30 days of receipt of 
the signed CAFO which should be shortly after July 2003.

Forbearance

    26. EPA agrees to forbear on Part 82 civil enforcement activity 
against Participating Company during the course of this Agreement, 
provided that Participating Company is in compliance with this 
Agreement. EPA may, however, inspect and request information to 
ensure that the audits are being conducted fully and properly. EPA 
does not forbear or relinquish any right to access and inspection 
under this agreement.
    27. Participating Company understands that any violations 
discovered by EPA subsequent to the completion of the audit or 
compliance efforts and/or the expiration of this Agreement are 
subject to standard regulatory enforcement. That is, nothing in this 
Agreement, other than the release from civil liability for problems/
violations disclosed and corrected, is to the derogation of EPA's 
full enforcement and compliance authority at the conclusion of the 
Partnership.
    28. If EPA believes that the Participating Company has 
miscategorized or mischaracterized any problem/violation under this 
Agreement, the Dispute Resolution section of this Agreement shall be 
utilized.

Release From Liability/CAFO

    29. Participating Company understands and acknowledges that 
participation in the Program will not absolve Participating Company 
or its employees from any criminal liability. In considering whether 
to refer a matter for criminal prosecution, EPA will be guided by 
its Self-Audit Policy. In general, it is EPA's policy to refer 
matters for criminal prosecution only in cases involving a high 
degree of harm and/or misconduct.
    30. EPA agrees to execute an administrative Consent Agreement 
Final Order conditionally releasing Participating Company from civil 
liability for any and all violations or potential violations that 
have been self-disclosed and corrected, on condition that 
Participating Company pays penalties that may be due and completes 
the plans with compliance schedules that have been submitted and 
agreed upon by the Participating Company and the EPA. A complete 
release from civil liability will be granted for any appliance that 
is converted to a non-ODS system. Good faith participants in this 
Partnership Program will receive a civil release for the period of 
time prior to September 30, 2000, even though this period may not be 
audited.
    31. EPA and Participating Company will execute an Administrative 
Compliance Order on Consent and CAFO confirming the plans and 
penalties agreed upon by the parties.

Publicity

    32. Participating Company may publicize that it is partnering 
with the EPA in an effort to reduce ODS emissions.
    33. Upon request by the Participating Company, EPA will 
recognize and acknowledge Participating Company's participation and 
assistance under the Program.

Access and Inspection

    34. Without prior notice, any authorized representative of EPA 
(including a designated contractor), upon presentation of 
credentials at any of Participating Company's facilities, may enter 
such location(s) at reasonable times to determine compliance with 
this Agreement. Access under this clause is subject to the normal 
health and safety and

[[Page 5593]]

confidentiality requirements in effect at such facilities.

Dispute Resolution

    35. Should the need arise, Participating Company agrees to first 
engage in informal dispute resolution with EPA's Air Enforcement 
Division/Regional staff concerning any determination made by EPA in 
its review of the program. Such informal dispute resolution will 
consist of negotiations between Participating Company and the 
designated attorney(s) and/or Division Director of the Air 
Enforcement Division at the address in paragraph 42. To exercise 
informal dispute resolution, Participating Company shall send a 
written notice to EPA outlining the nature of the dispute or 
disagreement and request informal negotiations to resolve the 
dispute. EPA will respond to such requests within 15 days. Such 
period of informal negotiations shall not extend beyond thirty (30) 
days from the date when EPA responds, unless the parties agree 
otherwise in writing. Both parties will attempt to achieve a 
solution acceptable to all.
    36. Should the Participating Company be dissatisfied with the 
results of the informal dispute resolution, the Participating 
Company may request that the dispute be negotiated with the 
assistance of a non-binding mediator, by notifying in writing the 
Director of the Air Enforcement Division and other members of the 
informal negotiations team. EPA will respond to such requests within 
15 days. The costs of such mediation will be shared equally by the 
Participating Company and EPA. EPA may reject the request for 
mediation if costs are deemed unreasonable. A convenor will assist 
in the selection of a mutually acceptable neutral mediator. 
Mediation shall not extend beyond thirty (30) days from the date 
when the mediator first meets with the parties, unless the parties 
agree otherwise in writing.
    37. It is anticipated that any disputes will be resolved by the 
process of negotiation outlined above. Participating Company agrees 
that resolution within EPA is the sole and final dispute resolution 
mechanism.

Effective Date

    38. This Agreement shall become effective upon the date signed 
by the parties to this agreement (below).

Miscellaneous

    39. Nothing in this Agreement will relieve the Participating 
Company of its obligation to comply with any other Clean Air Act 
provision, other environmental law, or applicable environmental 
regulations, either state or Federal.
    40. Participating Company agrees to accept service from EPA by 
mail with respect to all matters relating to this Agreement at the 
address listed below (if different from the one listed in Annex A).

----------------------------------------------------------------------

----------------------------------------------------------------------

----------------------------------------------------------------------

----------------------------------------------------------------------

    41. EPA agrees to accept service from Participating Company by 
mail with respect to all matters relating to this Agreement at the 
address listed below.
    Electronically preferred: [email protected] or Title VI 
Coordinator, Attention: Charlie Garlow, US EPA Air Enforcement 
Division, 1200 Pennsylvania Ave NW., Mail Code 2242A, Washington, DC 
20460 202-564-1088.

Integration

    42. This Agreement, and the Annexes and Federal Register notice 
incorporated by reference in this Agreement, represents the final 
form of the contract between EPA and Participating Company. No oral 
modifications to the Agreement will be binding upon either party.

Signatures

    43. EPA and the Participating Company represent that they have 
examined this Agreement and the attached and incorporated Annexes 
and Federal Register notice and agree to the terms by signing and 
dating below.
    44. Each person signing this Agreement represents that he or she 
is authorized to legally bind the party on whose behalf he or she is 
signing.
    45. Agreed To:
By:--------------------------------------------------------------------
[Participating Company]

Date:------------------------------------------------------------------

By:--------------------------------------------------------------------
US Environmental Protection Agency

Date:------------------------------------------------------------------

Annex A  Sample Identification of All Facilities Owned by Participating 
Company

    Note: EPA's Regions are shown on a map at http://www.epa.gov/epahome/aboutepa.htm.

----------------------------------------------------------------------------------------------------------------
                                                                                           No. of ODS-containing
Participating company/facility name    Location, mailing          State          Region         and non-ODS
                                       address, city, zip                                   appliances, if known
----------------------------------------------------------------------------------------------------------------
Marvy Bread/Plant 4................  123 Main St, Lodi      CA...............          9   15 ODS, 5 non-ODS.
                                      94588.
----------------------------------------------------------------------------------------------------------------

Annex B  Sample Administrative Order on Consent

United States Environmental Protection Agency

In the Matter of: [Participating Company] Respondent. Bakery 
Partnership Program, Agreement Number________, Findings and Order

    Pursuant to Sections 113(a)(3) and 114 of the Clean Air Act 
(``CAA''), consistent with the Bakery Partnership Program identified 
above and entered into between the United States Environmental 
Protection Agency (``EPA'') and Respondent, and based upon available 
information, EPA hereby makes and issues the following Findings and 
Order, with the expressed consent of Respondent:

Findings

    1. Respondent is a Participating Company under the above-
identified Bakery Partnership Program.
    2. EPA promulgated regulations for the control of Ozone 
Depleting Substances, appearing in 40 CFR Part 82, Subpart F.
    3. Respondent owns or operates certain affected equipment under 
Part 82 that contains or contained Ozone Depleting Substances, at 
facilities identified in Attachment A attached hereto.

Order

    4. Respondent shall retrofit or replace the referenced equipment 
as specified in Attachment A by the date(s) there indicated. Where 
additional time may be required to complete these actions, 
application to EPA shall be timely made pursuant to 40 CFR 
82.156(i)(7).
    5. Within 12 months of this Order, Respondent shall prepare and 
submit to EPA plans for the conversion of Class II appliances to 
non-ODS systems, for the appliances identified in Attachment B, 
attached hereto.
    6. Consistent with the Bakery Partnership Agreement entered into 
between EPA and [the Participating Company], per appliance and per 
pound penalties shall be calculated and submitted to EPA by July 15, 
2003.
    7. Pursuant to Section 113(a) of the CAA, failure to comply with 
this Order may lead to a civil action to obtain compliance or an 
action for penalties.

Issued this ______ day of ______, 2003

----------------------------------------------------------------------
U.S. Environmental Protection Agency

    8. [Participating Company] consents to the issuance of this 
Order and further agrees not to contest EPA's authority to issue 
this Order.

Signed this ______ day of ______, 2003

----------------------------------------------------------------------
For [Participating Company]

Annex C  Leak Rate Calculation Sheet for each Appliance Sample

    Beanie Bread/Plant 4. The Appliance Serial Number 456789 
containing 350 pounds full charge of R-22.
    The leak rate is calculated by dividing the number of pounds 
added by the full charge [here 350 pounds]. Then multiply that 
number by 365 days. Then divide that number by days since the last 
add. Multiply that number by 100 to express it as a percentage, if 
over 35%.

[[Page 5594]]



----------------------------------------------------------------------------------------------------------------
                                                                          Percent of
                Date                  Lbs added    Days since last add    leak rate            Comments
----------------------------------------------------------------------------------------------------------------
10/28/00...........................          112  base.................  ...........  ..........................
2/20/01............................           60  115..................           54  ..........................
2/27/01............................           14  7....................  ...........  ..........................
5/31/01............................           30  93...................           33  ..........................
6/18/01............................          166  18...................          961  ..........................
12/3/01............................          100  168..................           62  ..........................
                                                                                      Total pounds added since
                                                                                       high leak rate = 310
                                                                                       pounds  x  $20 per pound
                                                                                       = $6200, the ``per
                                                                                       pound'' penalty.
----------------------------------------------------------------------------------------------------------------

Annex D Certification of Completion and Compliance

    I certify, based on personal inspection, that correction of the 
violations/problems identified as a part of the Bakery Partnership 
Agreement with the United States Environmental Protection Agency, 
dated________is complete.
    I certify that __________, Participating Company, has corrected 
all violations, and training, recordkeeping, equipment replacement, 
and all other necessary and prudent measures have been taken to 
ensure complete compliance with Title VI, Clean Air Act (42 U.S.C. 
7671 et seq.).
    I certify that the following summary of the actions taken are 
true and complete:

----------------------------------------------------------------------

----------------------------------------------------------------------

----------------------------------------------------------------------

    I certify that I am an officer of __________, Participating 
Company, and am duly authorized to sign and complete this 
Certification of Compliance on behalf of Participating Company.

----------------------------------------------------------------------
Name (print)

----------------------------------------------------------------------
Signature

----------------------------------------------------------------------
Date

Annex  E  Compliance Plan Required Elements--For Appliances Containing 
Greater Than 50 Pounds of a Class I or Class II Substance

    A. Each Participating Company will have at least one employee in 
each facility responsible for ensuring compliance with the 
refrigerant Compliance Plan.
    B. Only technicians certified in accordance with 40 CFR Part 82 
will perform refrigerant-related service on refrigerant containing 
appliances.
    C. Technicians will have available for use and use, as required, 
recycle/recovery equipment certified pursuant to 40 CFR 82.156.
    D. Repairs to refrigerant-leaking appliances will be conducted 
within the time frames outline in 40 CFR 82.156.
    E. Initial verification tests on industrial process equipment 
will be conducted following any refrigerant-related repairs.
    F. Follow-up verification tests on industrial process equipment 
will be conducted within thirty days of any refrigerant-related 
repairs.
    G. Leak rates will be calculated (a) when refrigerant is added 
to appliances containing greater than 50 pounds of a Class I or 
Class II substance and (b) when the follow-up verification test 
reveals an unsuccessful repair.
    H. Procedures documenting what additional action will be taken 
as a result of a failed repair will be written.
    I. Each Participating Company will maintain the following 
records in a single location at each facility:
    1. An inventory of appliances containing greater than 50 pounds 
of a Class I or Class II substance and their refrigerant capacities.
    2. A unique identification for each appliance containing greater 
than 50 pounds of a Class I or Class II substance.
    3. Date the refrigerant-related service is performed on each 
appliance containing greater than 50 pounds of a Class I or Class II 
substance.
    4. Type of refrigerant-related service performed on each 
appliance containing greater than 50 pounds of a Class I or Class II 
substance.
    5. Amount and type of refrigerant added to each appliance 
containing greater than 50 pounds of a Class I or Class II 
substance.
    6. Name of the technician performing work on each appliance 
containing greater than 50 pounds of a Class I or Class II 
substance.
    7. A copy of the technician certification card for all 
technicians performing work.
    8. Refrigerant purchase records.
    9. A copy of the recycle/recovery equipment owner's 
certification.
    J. Each participant will provide refresher training on the 
refrigerant compliance program annually for facility personnel 
responsible for oversight of maintenance and service of refrigerant-
containing appliances.

Sample CAFO

United States Environmental Protection Agency, Washington, DC

In the Matter of: [Participating Company] Respondent. Docket No. 
CAA-HQ-2003-XXX, Consent Agreement and Final Order

I. Preliminary Statement

    1. The United States Environmental Protection Agency (``EPA'') 
and [Participating Company] have entered into a voluntary Bakery 
Partnership Agreement, pursuant to which an audit of compliance 
status and self-correction program has been undertaken. It was 
further agreed by the parties that certain civil penalties would be 
paid pursuant to the administrative authority of Section 113(d) of 
the Clean Air Act (``CAA''), 42 U.S.C. 7413(d).
    2. This Consent Agreement and Final Order [CAFO] is issued 
pursuant to the authority of 40 CFR 22.13(b), 22.18(b)(2) and (3), 
which pertain to the quick resolution and settlement of matters 
without the filing of a complaint.
    3. This Consent Agreement and Final Order resolves the liability 
for violations that may have been discovered pursuant to an audit of 
the Respondent's facilities regarding compliance with Title VI of 
the Clean Air Act, Stratospheric Ozone Protection, and more 
particularly 40 CFR Part 82, Subpart F, relating to recycling and 
emissions reductions from appliances containing ozone depleting 
substances.

II. Consent Agreement

    4. As a result of the voluntary audit conducted pursuant to the 
Bakery Partnership Agreement, EPA and Respondent have agreed to 
resolve this matter by executing this Consent Agreement.
    5. For the purpose of this proceeding, Respondent does not 
contest the jurisdiction of this tribunal, consents to the 
assessment of a civil penalty as specified below, and consents to 
implement the corrective action Plans and Other Conditions, attached 
hereto.
    6. The execution of this Consent Agreement is not an admission 
of liability by Respondent, and Respondent neither admits nor denies 
any specific factual allegations contained herein. EPA alleges that 
one or more of the conditions contained in the attached Summary of 
Audit Findings constitutes a violation of 40 CFR part 82.
    7. As a complete settlement for all conditions specified in the 
attached Summary of Audit Findings, Respondent hereby agrees to pay 
to the United States a civil penalty as specified in the attached 
Penalty Calculation. EPA agrees to conditionally release Respondent 
from civil liability for the conditions, and only those conditions, 
identified in the attached Summary of Audit Findings, except for 
those appliances that are identified as having been or being 
converted to non-ozone depleting substances, for which a complete 
release of civil liability is granted. This release is conditioned 
upon the satisfactory completion of the Plans and Other Conditions 
attached hereto, and the timely payment of the civil penalty. Good 
faith participants in this Partnership Program will receive a 
release for the period of time prior to September 30, 2000, even 
though this period may not be audited. The parties agree that the 
attached Summary of Audit Findings, Penalty Calculation and Plans 
and Other Conditions are incorporated herein by reference and made a 
part of this CAFO.

[[Page 5595]]

    8. Respondent waives its right to request an adjudicatory 
hearing on any issue addressed in this Consent Agreement.
    9. Respondent and EPA represent that they are duly authorized to 
execute this Consent Agreement and that the parties signing this 
Agreement on their behalf are duly authorized to bind Respondent and 
EPA to the terms of this Consent Agreement.
    10. Respondent agrees not to claim or attempt to claim a federal 
income tax deduction or credit covering all or any part of the civil 
penalty paid to the United States Treasurer.
    11. Respondent and EPA stipulate to issuance of the proposed 
Final Order below.
[Participating Company], Respondent

By---------------------------------------------------------------------

(Print name)-----------------------------------------------------------

Title:-----------------------------------------------------------------

Dated:-----------------------------------------------------------------

U.S. Environmental Protection Agency, Complainant

By---------------------------------------------------------------------

Dated:-----------------------------------------------------------------
Headquarters EPA

III. Final Order

    It is hereby ordered and adjudged as follows:
    12. Respondent shall comply with all terms of the Consent 
Agreement.
    13. For the reasons set forth above, Respondent is hereby 
assessed a penalty in the amount of $________.
    14. Respondent shall pay the assessed penalty no later than 
thirty (30) calendar days from the date a conformed copy of this 
Consent Agreement and Final Order (``CAFO'') is received by 
Respondent.
    15. All payments under this CAFO shall be made by certified 
check or money order, payable to the United States Treasurer, mailed 
to: U.S. Environmental Protection Agency, (Washington D.C. Hearing 
Clerk), P.O. Box 360277, Pittsburgh, Pennsylvania 15251-6277.
    A transmittal letter, indicating Respondent's name, complete 
address, and this case docket number must accompany the payment. 
Respondent shall file a copy of the check and of the transmittal 
letter with the Headquarters Hearing Clerk.
    16. Failure to pay the penalty assessed under this CAFO may 
subject Respondent to a civil action pursuant to Section 113(d)(5) 
of the CAA, 42 U.S.C. 7413(d)(5), to collect any unpaid portion of 
the assessed penalty, together with interest, handling charges, 
enforcement expenses, including attorneys fees, and nonpayment 
penalties. In any such collection action, the validity, amount, and 
appropriateness of this order or the penalty assessed hereunder are 
not subject to review.
    17. Pursuant to 42 U.S.C. 7413(d)(5) and 31 U.S.C. 3717, 
Respondent shall pay the following amounts:
    a. Interest. Any unpaid portion of the assessed penalty shall 
bear interest at the rate established pursuant to 26 U.S.C. 
6621(a)(2) from the date a conformed copy of this CAFO is received 
by Respondent; provided, however, that no interest shall be payable 
on any portion of the assessed penalty that is paid within 30 days 
of the date a copy of this CAFO is received by Respondent.
    b. Attorney Fees, Collection Costs, Nonpayment Penalty. Pursuant 
to 42 U.S.C. 7413(d)(5), should Respondent fail to pay on a timely 
basis the amount of the assessed penalty, Respondent shall be 
required to pay, in addition to such penalty and interest, the 
United States' enforcement expenses, including but not limited to 
attorney fees and costs incurred by the United States for collection 
proceedings, and a quarterly nonpayment penalty for each quarter 
during which such failure to pay persists. Such nonpayment penalty 
shall be ten percent of the aggregate amount of Respondent's 
outstanding penalties and nonpayment penalties accrued from the 
beginning of such quarter.
    18. This document constitutes an ``enforcement response'' as 
that term is used in the CAA Penalty Policy for the purposes of 
determining Respondent's ``full compliance history'' as provided in 
Section 113(e) of the CAA, 42 U.S.C. 7413(e).
    19. Each party shall bear its own costs, fees, and disbursements 
in this action.
    20. The provisions of this CAFO shall be binding on Respondent, 
its officers, directors, employees, agents, servants, authorized 
representatives, successors and assigns.
    It is so ordered.
    Dated this ______ day of ______, 1999.

----------------------------------------------------------------------
Environmental Appeals Judge
Environmental Appeals Board
U.S. Environmental Protection Agency

Certificate of Service

    I certify that the forgoing Consent Agreement and Final Order 
was sent to the following persons, in the manner specified, on the 
date below:
    Original hand-delivered: Eurika Durr, EAB Hearing Clerk, U.S. 
Environmental Protection Agency, Mail Code 1103B, 607 14th Street NW 
Suite 500, Washington, D.C. 20005.
    Copy by certified mail, return receipt requested:

________, Registered Agent for
[Participating Company]
[Participating Company's address]

Dated:-----------------------------------------------------------------

----------------------------------------------------------------------
U.S. EPA

Sample Summary of Findings

Annex C  Leak Rate Calculation Sheet for each Appliance Sample

    Marvy Bread/Plant 4. The Appliance Serial Number 456789 
containing 350 pounds full charge of R-22.
    The leak rate is calculated by dividing the number of pounds 
added by the full charge [here 350 pounds]. Then multiply that 
number by 365 days. Then divide that number by days since the last 
add. Multiply that number by 100 to express it as a percentage, if 
over 35%.

----------------------------------------------------------------------------------------------------------------
                                                                          Percent of
                Date                  Lbs added    Days since last add    leak rate            Comments
----------------------------------------------------------------------------------------------------------------
10/28/00...........................          112  base.................  ...........  ..........................
2/20/01............................           60  115..................           54  ..........................
2/27/01............................           14  7....................  ...........  ..........................
5/31/01............................           30  93...................           33  ..........................
6/18/01............................          166  18...................          961  ..........................
12/3/01............................          100  168..................           62  ..........................
                                                                                      Total pounds added since
                                                                                       high leak rate = 310
                                                                                       pounds  x  $20 per pound
                                                                                       = $6200, the ``per
                                                                                       pound'' penalty.
----------------------------------------------------------------------------------------------------------------

    Technician Certifications for two technicians, Joe Jones and Sam 
Spade, at Plant 4 were missing. Those certifications are now on 
file.
    Service records before September 30, 2000 were missing.

Sample Penalty Calculation

    Marvy Bread Plant 4 The Appliance Serial Number 456789 
containing 350 pounds full charge of R-22.
    Per pound penalty: $6,200--waived as this machine is being 
converted to non-ODS.
    Per appliance penalty: 10,000.
    Total Penalty: $10,000.

Sample Plans and Other Conditions

    Beanie Bread agrees to convert the Bun Mixer at Plant 4, Serial 
Number 45678, to a non-ODS system.
    Completion date: July 30, 2004.
    Beanie Bread agrees to develop a computer based recordkeeping 
program to ensure that complete and accurate records are retained as 
required.
    Completion date: September 30, 2003.

[FR Doc. 02-2837 Filed 2-5-02; 8:45 am]
BILLING CODE 6560-50-P