[Federal Register Volume 69, Number 78 (Thursday, April 22, 2004)]
[Rules and Regulations]
[Pages 21717-21731]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 04-9142]


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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[CA258-0442(A); FRL-7645-7]


Determination of Attainment of the 1-Hour Ozone Standard; 
Determination Regarding Applicability of Certain Clean Air Act 
Requirements; Approval and Promulgation of Ozone Attainment Plan; San 
Francisco Bay Area, CA

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final rule.

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SUMMARY: EPA is determining that the San Francisco Bay Area (Bay Area) 
ozone nonattainment area has attained the 1-hour ozone national ambient 
air quality standard (NAAQS) by the deadline required by the Clean Air 
Act (CAA), September 20, 2006. Based on this determination, we are also 
determining that the CAA's requirements for reasonable further progress 
and attainment demonstrations and for contingency measures for the 1-
hour ozone standard are not applicable to the area for so long as the 
Bay Area continues to attain the 1-hour ozone standard.
    In addition, EPA is approving the following elements of the 2001 
ozone attainment plan for the Bay Area (2001 Plan): Emissions 
inventory, reasonably available control measures (RACM); commitments to 
adopt and implement specific control measures; motor vehicle emissions 
budgets (MVEBs); and commitments for further study measures.
    In 2001, EPA disapproved certain components of the 1999 ozone 
attainment plan for the Bay Area: The RACM demonstration, the 
attainment demonstration, and the MVEBs. Because of this disapproval 
the 2 to 1 offset sanction under CAA section 179(b)(2) was imposed in 
the Bay Area on April 22, 2003. Based on the proposed approval of these 
elements of the 2001 Plan, EPA made an interim final determination that 
resulted in a stay of the offset sanction and deferral of the highway 
sanction. EPA's approval of RACM and the MVEBs in the 2001 Plan 
terminates the sanctions clock for those plan elements.
    Based on the attainment determination for the Bay Area, elsewhere 
in this Federal Register EPA is taking interim final action to stay the 
offset sanction and defer the highway sanction triggered by the 
attainment demonstration disapproval for as long as the area continues 
to attain the 1-hour ozone standard because that plan requirement has 
been suspended.

DATES: Effective Date: This rule is effective on May 24, 2004.

ADDRESSES: You can inspect copies of the administrative record (docket 
number CA258-0442(A)) for this action at EPA's Region 9 office during 
normal business hours by appointment. The address is U.S. EPA Region 
IX--Air Division, 75 Hawthorne Street, San Francisco, CA.

FOR FURTHER INFORMATION CONTACT: Ginger Vagenas, EPA Region IX, (415) 
972-3964, [email protected].

SUPPLEMENTARY INFORMATION: Throughout this document, ``we,'' ``us'' and 
``our'' refer to EPA.

Table of Contents

I. Background
II. Attainment Finding for the Bay Area
    A. Attainment Finding
    B. EPA's Responses to Comments on the Proposed Finding of 
Attainment
    1. Comments Regarding Timing of the Finding of Attainment
    2. Comments Regarding the Data on Which the Attainment Finding 
Is Based
    3. Comments Regarding the Impact of an Attainment Finding on the 
2001 Plan and on Air Quality in the Bay Area
    C. Applicability of Clean Air Act Planning Requirements in Areas 
Attaining the 1-Hour Ozone Standard
    D. EPA Responses to Comments on Applicability of Clean Air Act 
Requirements
    1. Comments Regarding EPA's Clean Data Policy
    2. Comments Regarding the Applicability of EPA Policies to the 
Bay Area
    E. Effects of the Attainment Finding on the Bay Area and of a 
Future Violation of the 1-Hour Ozone NAAQS
III. Approval of Bay Area 2001 Plan
    A. Approval of Bay Area 2001 Plan
    B. EPA's Responses to Comments on the Proposed Approval of the 
2001 Plan
    1. Comments on the Proposed Approval of the Emissions Inventory
    2. Comments on the Proposed Approval of RACM
    3. Comments on the Proposed Approval of the Control Measure 
Commitments
    4. Comments on the Downwind Transport of Air Pollution
    5. Comments on Additional Plan Elements
    6. Comments on the Impact of the State Law and Court Orders
    7. Comments on the Interim Final Determination
IV. Effect of the Attainment Determination and 2001 Plan Action on 
Transportation Conformity
V. Statutory and Executive Order Reviews

I. Background

    Upon enactment of the Clean Air Act Amendments of 1990, the Bay 
Area was classified as a moderate nonattainment area for the 1-hour 
ozone NAAQS. 56 FR 56694 (November 6, 1991). EPA redesignated the Bay 
Area to attainment in 1995, based on then current air quality data (60 
FR 27029, May 22, 1995), and subsequently redesignated the area back to 
nonattainment without classification on July 10, 1998 (63 FR 37258), 
following renewed violations of the 1-hour ozone standard. Upon the Bay 
Area's redesignation to nonattainment, we required the State to submit 
a state implementation plan (SIP) addressing applicable CAA provisions, 
including a demonstration of attainment as expeditiously as practicable 
but no later than November 15, 2000.
    The Bay Area Air Quality Management District (District or BAAQMD), 
along with its co-lead agencies--the Metropolitan Transportation 
Commission and the

[[Page 21718]]

Association of Bay Area Governments--prepared a 1-hour ozone attainment 
plan, which was submitted to EPA by the California Air Resources Board 
(CARB) on August 13, 1999. On September 20, 2001 (66 FR 48340), we 
approved the emissions inventories, reasonable further progress (RFP) 
provisions, control measure commitments, and contingency measures in 
that plan. In the same rulemaking, we disapproved the remaining 
portions of the SIP, i.e., the attainment demonstration, MVEB, and RACM 
demonstration, issued a finding that the area failed to attain by the 
applicable deadline, and set a new attainment deadline of as 
expeditiously as practicable but no later than September 20, 2006. The 
effective date of the final disapproval (October 22, 2001) started 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 
federal implementation plan (FIP) under CAA section 110(c)(1). 62 FR 
43796 (August 15, 1997). The Bay Area became subject to the 2 to 1 
offset sanction under CAA section 179(b)(2) on April 22, 2003.
    On November 30, 2001, CARB submitted the 2001 Plan for the Bay Area 
addressing the new attainment deadline. On February 14, 2002, we found 
the MVEBs in the 2001 Plan adequate. 67 FR 8017 (February 21, 2002). On 
July 16, 2003 (68 FR 42174), we proposed to approve the following 
elements of the 2001 Plan: Emissions inventory, RACM demonstration, 
attainment assessment, MVEBs, and commitments to adopt control measures 
and to adopt and submit a plan revision by April 15, 2004 based on new 
modeling. On the same date, we issued an interim final determination 
that the 2001 Plan corrects the deficiencies in the 1999 Plan, thereby 
staying the CAA section 179 offset sanction and deferring the 
imposition of the highway sanction triggered by our September 20, 2001 
disapproval. 68 FR 42172.
    On October 31, 2003 (68 FR 62041), we proposed to find that the San 
Francisco Bay Area ozone nonattainment area had attained the 1-hour 
ozone standard by its CAA mandated attainment date of September 20, 
2006. Based on this proposed finding, we also proposed to suspend the 
attainment demonstration, RFP and contingency measure requirements of 
the CAA for the Bay Area for so long as the area continues to attain 
the 1-hour ozone standard.
    On January 30, 2004, CARB withdrew the attainment assessment, the 
RFP demonstration, the contingency measures, and the technical 
correction to the attainment assessment (Appendix F) in the 2001 Plan 
from EPA's consideration as revisions to the Bay Area SIP.\1\ In the 
same letter, the State also specifically requested that EPA approve the 
motor vehicle emissions budgets in the 2001 Plan.
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    \1\ See January 30, 2004 letter from Catherine Witherspoon, 
Executive Officer, CARB, to Wayne Nastri, Regional Administrator, 
U.S. EPA Region 9. This letter is subsequently referred to as the 1/
30/04 Witherspoon letter.
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II. Attainment Finding for the Bay Area

A. Attainment Finding

    In this action, EPA is finalizing its proposed finding of 
attainment for the Bay Area. The 1-hour ozone NAAQS is 0.12 parts per 
million (ppm) not to be exceeded on average more than one day per year 
over any three-year period. 40 CFR 50.9 and appendix H. We determine if 
an area has attained the 1-hour standard by calculating, at each 
monitor, the average number of days over the standard per year during 
the preceding three-year period.\2\ We use all available, quality 
assured monitoring data and we generally base our determination of 
attainment or failure to attain on the area's design value as of its 
applicable attainment deadline. In this case, the attainment deadline 
(September 20, 2006) has not been reached, so we are making our 
attainment finding based on the Bay Area's current air quality data and 
design value, which demonstrate attainment of the 1-hour standard. See 
section II.E. for a discussion of consequences of future violations.
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    \2\ See generally 57 FR 13506 (April 16, 1992) and Memorandum 
from D. Kent Berry, Acting Director, Air Quality Management 
Division, EPA, to Regional Air Office Directors; ``Procedures for 
Processing Bump Ups and Extensions for Marginal Ozone Nonattainment 
Areas,'' February 3, 1994 (Berry memorandum). While explicitly 
applicable only to marginal areas, the general procedures for 
evaluating attainment in this memorandum apply regardless of the 
initial classification of an area because all findings of attainment 
are made pursuant to the same procedures.
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    The design value for the Bay Area for 2001-2003 was 0.123 ppm, 
which is below the 0.12 ppm standard using the applicable rounding 
convention discussed below. No monitor in the Bay Area recorded an 
average of more than one exceedance of the 1-hour ozone standard per 
year during the 2001 to 2003 period. Documentation of the monitoring 
data and design value calculation can be found in the docket for this 
rulemaking.
    Our October 31, 2003 proposed attainment finding was based on all 
available air quality data collected from the monitoring network, which 
we determined met our regulations for state air quality monitoring 
networks. On November 12, 2003, the District submitted an interim 
certification that the data had been quality assured.\3\ On December 1, 
2003, Jack Broadbent, Executive Officer/Air Pollution Control Officer, 
BAAQMD, sent a letter to Deborah Jordan, EPA, (12/1/03 Broadbent 
letter) transmitting the District's formal certification in accordance 
with 40 CFR part 58 that the ozone ambient air monitoring data 
submitted to EPA are complete and accurate. The quality assurance 
process did not result in any changes to the data.
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    \3\ See November 12, 2003 email from Mark Stoelting, BAAQMD, to 
Catherine Brown, EPA, and Catherine Brown's November 21, 2003 
response.
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    Because the Bay Area's design value was below the 0.12 ppm 1-hour 
ozone standard and the area averaged one or fewer exceedances per year 
at each monitor for the 2001 to 2003 period, we find that the Bay Area 
attained the 1-hour ozone standard by its CAA mandated attainment 
deadline of September 20, 2006. Based on this final attainment 
determination, we are also determining that the CAA requirements for 
RFP, an attainment demonstration and contingency measures for the 1-
hour ozone standard are not applicable to the Bay Area for so long as 
the area continues to attain the standard. For a discussion of EPA's 
policy and legal basis for suspending these requirements, see our 
proposed attainment determination at 68 FR 62044.
    Finally, based on our final attainment determination, elsewhere in 
this Federal Register, we are taking interim final action to stay the 
offset sanction and defer the highway sanction for the attainment 
demonstration because that plan requirement has been suspended. The 
stay/deferral will remain in effect for as long as the area continues 
to attain the 1-hour ozone standard.

B. EPA's Responses to Comments on the Proposed Finding of Attainment

    EPA's proposed action provided a 30-day public comment period. 
During this period, we received comments from seven parties. We 
summarize the most significant comments and provide our responses 
below; the entire set of comments and responses can be found in the 
docket in a separate Response to Comment document (RTC).
1. Comments Regarding Timing of the Finding of Attainment
    Comment 1: Several commenters expressed support for a determination 
that the Bay Area has attained the 1-

[[Page 21719]]

hour ozone standard. Another commenter concurred with the determination 
that Bay Area's monitoring network meets or exceeds EPA's specified 
requirements. In contrast, other commenters pointed to the Bay Area's 
prior history of slipping back out of attainment following EPA action 
redesignating the area to attainment in 1995 and recent year-to-year 
differences in design values as a reason for exercising caution in 
making an attainment finding. One commenter stated that, in light of 
the small margin of attainment, EPA should scrutinize the foundation 
for the asserted finding of attainment.
    Response: A determination that an area has attained the standard is 
based on an objective review of air quality data. The 1-hour ozone 
NAAQS is 0.12 ppm, not to be exceeded on average more than one day per 
year over any three year period. A review of the data from the prior 
three years (2001-2003) indicates that the Bay Area has met this 
standard. 68 FR 62042-62043.
    The redesignation of an area to attainment under CAA section 
107(d)(3)(E) is a separate process from a finding of attainment. Unlike 
an attainment finding where we need only determine that the area has 
had the prerequisite number of clean years, a redesignation requires 
multiple determinations. Under section 107(d)(3)(E) these 
determinations are:
    1. We must determine, at the time of the redesignation, that the 
area has attained the relevant NAAQS.
    2. The state must have a fully approved SIP for the area.
    3. We must determine that the improvements in air quality are due 
to permanent and enforceable reductions in emissions resulting from 
implementation of the SIP and applicable federal regulations and other 
permanent and enforceable reductions.
    4. We must have fully approved a maintenance plan for the area 
under section 175A.
    5. The state must have met all the nonattainment area requirements 
applicable to the area.
2. Comments Regarding the Data on Which the Attainment Finding is Based
    Comment 2: The data do not support a finding of attainment. The 
District previously reported two separate exceedances on July 10, 2002, 
of 160 parts per billion (ppb) and 151 ppb, respectively, and stated 
that EPA should recognize the July 10, 2002 reading of 151 ppb at 4 
p.m. as a separate exceedance from the 160 parts per billion (ppb) 
exceedance from earlier that day. As of December 1, 2003, the 
District's website stated that the region experienced three violations 
of the 1-hour ozone NAAQS at Livermore in 2002.
    Response: An area's ozone attainment status is determined by 
calculating the average number of days over a three-year period on 
which it exceeds the ozone standard. See 40 CFR 50.9(a) and 40 CFR part 
50, Appendix H. Therefore, multiple hourly exceedances on any single 
day count as only one exceedance. The Bay Area's website apparently 
mistakenly counted a reading of 0.123 ppm at Livermore on August 9, 
2002 as an exceedance of the 1-hour ozone NAAQS. As explained at length 
in the proposed finding of attainment (68 FR 62043, October 31, 2003), 
and discussed below (see response to comment 6), rounding conventions 
and the form of the standard dictate that values between 0.120 and 
0.124, inclusive, are to be rounded to 0.12 parts per million.
    Comment 3: According to EPA guidance, an attainment finding should 
be based on certified data, however, the proposal was published before 
the data were certified. EPA's guidance demands quality assured data 
from states to establish evidence of attainment. The EPA memorandum 
``Procedures for Processing Requests to Redesignate Areas to 
Attainment'' signed by John Calcagni, Director Air Quality Management 
Division, OAQPS, dated September 4, 1992 (9/4/92 Calcagni memo)\4\ 
states that ``[t]he data should be collected and quality-assured in 
accordance with 40 CFR 58 and recorded in the Aerometric Information 
Retrieval System (AIRS) in order for it to be available for the public 
to review.'' EPA has cited this memo as applicable authority for the 
proposed rulemaking, and cannot pick and choose portions as applicable 
and inapplicable without explanation. The Administrative Procedure Act 
(APA) and CAA direct that EPA's decision-making must be based on data 
and information in the record and available to the public, and the law 
of the Ninth Circuit clearly requires that when EPA acts on SIPs, it 
must comply with its own rules. Delaney v. EPA, 898 F.2d 687, 693 (9th 
Cir. 1990). The data and information purportedly supporting the 
proposed action are simply unavailable, or were unavailable during the 
comment period.
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    \4\ This memo is available online at http://www.epa.gov/ttn/naaqs/ozone/ozonetech/940904.pdf.
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    Response: Air quality data are available to EPA and the general 
public on a real-time basis from the District's website. EPA based its 
proposal on this publicly available monitoring data that indicated the 
Bay Area had attained the 1-hour ozone standard. While the data for 
2003 had not yet been quality assured at the time of the proposal, the 
District maintains a monitoring network that meets or exceeds all 
applicable requirements. See 68 FR 62042-62043 and ``System Audit of 
the Ambient Monitoring Program of Bay Area Air Quality Management 
District,'' available online at http://www.epa.gov/region09/air/sfbayoz/tsd1003.pdf. EPA had no reason to believe the quality assurance 
process would indicate there had been problems with the data and so 
proceeded with the proposed finding.
    On November 12, 2003, the District notified EPA that it had 
quality-assured the data from the 2003 ozone season and submitted it to 
AIRS. See footnote 3. Thus the quality-assured data were accessible to 
the public on that date, i.e., during the public comment period. The 
November 12, 2003 notification was followed by the 12/1/03 Broadbent 
letter, which confirmed that the data had been collected and quality 
assured in conformance with 40 CFR part 58. The quality assurance 
process did not result in any changes to the data. While the proposal 
was published shortly before the data were certified, this final 
rulemaking is based on data that were collected and quality assured in 
conformance with EPA regulations.
    Comment 4: Improved air quality in the Bay Area is not the product 
of real, permanent, surplus, and enforceable emissions reductions, as 
required by the CAA and EPA policy and guidance. It came as a result of 
a significant economic downturn that reduced, temporarily, emissions 
from all sectors of the emissions inventory and the weather had not 
been particularly ozone conducive. Because recent Bay Area ozone levels 
result from a combination of temporarily favorable economic and 
meteorological conditions rather than documentation of the 
effectiveness of permanent and enforceable measures, an attainment 
finding is inappropriate and obligations for RFP, attainment 
demonstration and contingency measure should not be suspended in the 
Bay Area.
    Response: The requirement to determine that clean air is the result 
of permanent and enforceable emissions reductions is a criterion for 
the redesignation of an area to attainment under CAA section 
107(d)(3)(E). It need not be met for a finding of attainment or for the 
suspension of the associated RFP, attainment demonstration, and 
contingency measure requirements.
    That aside, we believe that the finding of attainment itself 
addresses in part the

[[Page 21720]]

concern about unusually favorable meteorological conditions. We have 
long recognized that meteorological conditions have a profound effect 
on ambient ozone concentrations. In setting the current 1-hour ozone 
standard in 1979, we changed the form of the standard, i.e., the 
criterion for determining attainment, from a deterministic form ``no 
more than once per year'' to a statistical form ``when the expected 
number of days per year is less than or equal to one'' over a three-
year period in order to properly account for the random nature of 
meteorological variations. The three-year period for averaging the 
expected number of exceedances was a reasoned balance between evening 
out meteorological effects and properly addressing real changes in 
emission levels. See the proposed and final actions promulgating the 
current 1-hour ozone standard at 43 FR 26962, 26968 (June 22, 1978) and 
44 FR 8202, 8218 (February 8, 1979).
    Comment 5: Even if EPA has the discretion to dismiss SIP 
requirements upon a finding of attainment, it would be an abuse of 
discretion to dismiss these requirements without a finding that the 
reductions are permanent and enforceable in the circumstances of the 
Bay Area's recession and weather conditions. Given the narrow margin of 
attainment, it is inappropriate to relax the SIP through elimination of 
the RFP, attainment demonstration, and contingency measures 
requirements.
    Response: As noted above, EPA is not dismissing or eliminating 
these requirements. Rather, we interpret the requirements for an 
attainment demonstration, an RFP demonstration and contingency measures 
as inapplicable to an area that has attained the standard, but only for 
so long as the area remains in attainment. The requirements will again 
apply if such an area violates the standard. In order to be 
redesignated to attainment of the ozone standard, the State will be 
required to demonstrate, among other things, that the reductions 
contributing to the attainment record are permanent and enforceable, 
and that atypical weather conditions were not responsible for the 
improvement in air quality. CAA section 107(d)(3)(E)(iii).
    Comment 6: EPA's methodology for rounding off conflicts with 
Congress's intent that 0.12 ppm should be read as 0.120 ppm, as 
evidenced by section 181 of the CAA, at Table 1. See also 40 CFR 50.9, 
which states that the equivalent unit for the standard is 235 ug/m\3\. 
(Livermore's design value is 245 ug/m\3\). Finally, the specific 
regulation for the ozone standard contains no provision for rounding 
off, unlike the regulation for CO. (Compare 40 CFR 50.9 with 40 CFR 
50.8(d)).
    Response: In our proposed finding of attainment, we explained that 
the 1-hour ozone NAAQS is 0.12 parts-per-million; it is not expressed 
in parts-per-billion, nor does it contain three digits.\5\ Because air 
quality monitors and models express results in three digits, EPA 
applies the established rounding convention to determine whether the 
measurements meet or exceed the standard. Under the rounding 
convention, 0.005 rounds upward and 0.004 rounds downward, so that a 
0.124 parts per billion (ppb) ozone level meets the NAAQS of 0.12 ppm, 
while a 0.125 parts per billion (ppb) ozone level rounds up to 0.13 ppm 
and thus exceeds the NAAQS. The use of rounding neither changes the 
NAAQS nor relaxes it.
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    \5\ See 40 CFR 50.9(a) and footnote 8 of the October 31, 2003 
proposal (68 FR 62043). Also see ``Guideline for the Interpretation 
of Ozone Air Quality Standards.'' U.S. Environmental Protection 
Agency, Office of Air, Noise and Radiation, Office of Air Quality 
Planning and Standards, Research Triangle Park, North Carolina 
27711, January 1979, EPA-450/4-79-003, OAQPS No. 1.2-108. In the 
1979 guidance document, EPA states, ``[i]t should be noted that the 
stated level of the standard is taken as defining the number of 
significant figures to be used in comparisons with the standard. For 
example, a standard level of .12 ppm means that measurements are to 
be rounded to two decimal places (.005 rounds up), and, therefore, 
.125 ppm is the smallest concentration value in excess of the level 
of the standard.'' This document is available on line at http://www.epa.gov/ttn/naaqs/ozone/ozonetech/guide-o3.htm.
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    The commenter's reliance on the design values set forth in Table 1 
of section 181(a)(1) is misplaced. These design values are used to 
classify nonattainment areas, not to determine whether an area has 
attained the standard. See American Trucking Associations, Inc. v. EPA, 
175 F.3d 1027, 1047 (D.C. Cir. 1999) (``* * * although the numbers in 
the classification table are based upon the 0.12 ppm ozone NAAQS, they 
are neither equivalent to nor a codification of the NAAQS.'').
    EPA's procedure for calculating the design value for classification 
purposes is different from the analysis used for purposes of 
determining attainment. Under EPA's classification procedures, it is 
possible for an area that lacks a full set of monitoring data to be 
designated nonattainment and to have a design value of less than 0.125 
parts per billion (ppb). Under these circumstances, the area would be 
classified as a marginal nonattainment area. See Memorandum from 
William G. Laxton dated June 18, 1990, ``Ozone and Carbon Monoxide 
Design Value Calculations'' (Laxton Memo), available at http://www.epa.gov.ttn/naaqs/ozone/ozonetech/laxton.htm. The procedures set 
forth in the Laxton Memo constitute the ``interpretation methodology 
issued by the Administrator most recently before November 15, 1990.'' 
Finally, the translation of the standard from ppm to ug/m3 is provided 
for informational purposes only and does not constitute an alternative 
form of the standard.
3. Comments Regarding the Impact of an Attainment Finding on the 2001 
Plan and on Air Quality in the Bay Area
    Comment 7: EPA should direct the District to include in the next 
SIP submittal a safety margin of additional emissions reductions to 
compensate for the narrow margin of attainment. EPA should also mandate 
that the 2004 SIP contain sufficient contingency measures to achieve 
emissions reductions totaling 3% of the emissions inventory should the 
region experience a subsequent violation. See ``General Preamble for 
the Interpretation of Title I of the Clean Air Act Amendments of 1990'' 
(General Preamble), 57 FR 13510-11, April 16, 1992. EPA should 
institute extraordinary measures to respond immediately in the event of 
a future violation. The Bay Area's design value, which is just 2 parts 
per billion (ppb) below the attainment level, indicates that 
contingency measures must be included in the upcoming SIP. Only the 
requirement of federally enforceable contingency measures can provide 
any reasonable assurance that air pollution control efforts and 
emissions reductions will continue aggressively in the likely event 
that the area subsequently exceeds the 1-hour ozone standard once 
again. EPA should change course and take final action on the 2001 SIP 
as submitted and require appropriate emissions inventory adjustments to 
incorporate the effect of episodic control measures and reduced 
emissions activity from the economic recession experienced during 
modeled episode days.
    Response: As noted above, our determination that the Bay Area has 
attained the standard is based on an objective review of air quality 
data. No information has been presented that casts doubt on the 
accuracy of the data, therefore we are proceeding with our finding of 
attainment. Our guidance provides for the suspension of the attainment 
demonstration, RFP and contingency measure requirements applicable to 
the Bay Area upon such a finding.\6\ In our proposed action on the

[[Page 21721]]

2001 plan, we proposed to approve as part of the attainment assessment 
the commitment by CARB and the co-lead agencies to submit a SIP 
revision by April 15, 2004 (68 FR 42181, July 16, 2003). Consistent 
with the suspension of the attainment demonstration requirement, the 
State has withdrawn the commitment in the 2001 plan to submit a 2004 
SIP revision from EPA consideration.\7\ Therefore EPA cannot act on 
this commitment and, as a result, there is currently no federally 
enforceable requirement for a 2004 SIP.
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    \6\ Memorandum from John S. Seitz, Director, OAQPS, EPA, to 
Regional Air Directors, entitled ``Reasonable Further Progress, 
Attainment Demonstrations, and Related Requirements for Ozone 
Nonattainment Areas Meeting the Ozone National Ambient Air Quality 
Standard,'' May 10, 1995 (http://www.epa.gov/ttn/oarpg/t1/memoranda/clean15.pdf). This memo is subsequently referred to as the ``Clean 
Data Policy'' or the ``Seitz memo.''
    \7\ 1/30/04 Witherspoon letter.
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    The co-lead agencies have, however, expressed their intent to shift 
their focus to developing a maintenance plan to support a redesignation 
request if EPA finalizes its finding of attainment. Should the Bay Area 
violate the 1-hour standard prior to redesignation, the attainment 
demonstration, RFP and contingency measure requirements will be once 
again imposed. Also note that, among other things, an approvable 
maintenance plan must include contingency measures that are designed to 
promptly address a violation of the standard. Finally, even without the 
adoption of additional measures, ozone precursor emissions in the Bay 
Area will continue to decline as a result of previously adopted state, 
local, and federal measures. Between 2003 and 2006, emissions of oxides 
of nitrogen (NOX) will decline 81 tpd and volatile organic 
compound (VOC) emissions will decline 52 tpd. 2001 Plan, p. 32-33. 
These numbers do not include additional reductions to be achieved by 
the implementation of Smog Check 2 in the Bay Area, which was mandated 
by the California legislature after adoption of the 2001 Plan.
    Comment 8: While EPA's Notice of Proposed Rulemaking on the 
determination of attainment specified three SIP elements that ``no 
longer apply to the Bay Area'' EPA did not elect to change or withdraw 
the District's outstanding enforceable commitment to secure 26 tpd of 
additional VOC emissions reductions. In light of the data indicating 
attainment, there could be some question whether all of the enforceable 
commitments remain valid, but EPA did not in the Notice of Proposed 
Rulemaking, authorize the rescission of the commitment to achieve an 
additional 26 tpd of reductions. Given the restatement of commitment by 
State and local agencies and EPA's failure to specify which, if any of 
the State's prior ``enforceable commitments'' should not be included in 
the 2004 mid-course review, the District must completely fulfill its 
``enforceable commitments'' as pledged as part of the 2001 SIP 
submittal package. EPA has endorsed this concept in the proposed 8-hr 
implementation policy. Other commenters stated that EPA should 
expressly determine that the 26 tpd reduction is no longer necessary 
for the Bay Area to reach attainment.
    Response: In our proposed finding of attainment, we discussed the 
CAA requirements that would be suspended should we finalize the 
proposal. 68 FR 62044. Those requirements are the RFP, the attainment 
demonstration, and contingency measure requirements. The suspension of 
these requirements, and our rationale supporting it, apply so long as 
the area continues to attain the 1-hour ozone NAAQS. Consistent with 
the suspension of the attainment demonstration requirement, the State 
has withdrawn the attainment assessment in the 2001 Plan, which 
includes the associated commitments to undertake a mid-course review 
and to achieve additional reductions as necessary to attain the 1-hour 
ozone standard. See 1/30/04 Witherspoon letter. A mid-course review, 
the purpose of which is to evaluate progress toward attainment, and a 
commitment to adopt the measures necessary to attain the standard are 
unnecessary in an area that has attained the standard. Finally we note 
that our final implementation guidance for the 8-hour standard has not 
yet been issued.\8\
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    \8\ On June 2, 2003, EPA published in the Federal Register a 
proposed rule to implement the 8-hour ozone NAAQS. 68 FR 32803.
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    Comment 9: A loss of progress could occur as a result of a finding 
of attainment. The proposed finding of attainment provides an incentive 
for areas to defer SIP preparation in hopes that they might achieve 
clean data before the deadline to perform a deferred SIP element 
preparation arrives. Part of the State's rationale for employing the 
mid-course review was the absence of competent modeling to demonstrate 
attainment in the Bay Area. EPA's proposed action undermines the 
State's prior commitment to use the more technically robust CCOS \9\ 
model and more recent data to both model attainment in the Bay Area and 
quantify the effect of Bay Area emissions upon downwind district 
attainment. As the District has finally developed a model through the 
CCOS process, EPA must insist on the completion of the modeling 
exercise in the 2004 mid-course review SIP to identify issues 
associated with the federal 1-hour ozone standard, the state ozone 
standard, the 8 hour federal ozone standard, and transport issues.
---------------------------------------------------------------------------

    \9\ In an effort to establish a more reliable database for ozone 
analysis, the Central California Ozone Study (CCOS), a large field 
measurement program, was conducted in the summer of 2000.
---------------------------------------------------------------------------

    Response: We disagree with the commenter's assessment of the impact 
of the attainment finding. The State and the co-lead agencies have all 
acknowledged the need to address the state ozone standard, the federal 
8-hour standard, and downwind transport of air pollution and have 
pledged to continue their efforts.\10\ Despite the commenters' 
concerns, work on the CCOS modeling does not appear to have slackened. 
In fact, given the technical challenges, EPA is satisfied that work is 
progressing as quickly as could be expected. Should the Bay Area once 
again violate the standard, new modeling based on CCOS data would be 
available to support an attainment demonstration. In addition, much of 
the work being done to prepare a maintenance plan and to prepare the 
state clean air plan will be transferrable to the nonattainment 
requirements that would once again apply.
---------------------------------------------------------------------------

    \10\ In the District's October 16, 2003 letter to Catherine 
Witherspoon, CARB (10/16/03 Norton letter), Executive Officer 
William Norton states that the District ``want[s] to reduce local 
ozone and transport, and to maintain progress toward the state 
standard.'' In a January 16, 2004 letter to Catherine Witherspoon, 
CARB (1/16/04 co-lead agencies letter), the directors of the co-lead 
agencies recognize that they ``have a continuing obligation to 
reduce emissions further in order to attain and maintain all 
national ambient air quality standards and to make expeditious 
progress toward California standards.'' They state their commitment 
to ``continuing [their] ozone control program in order to reduce 
ozone levels in the Bay Area and to address transport to downwind 
regions.'' In closing, they acknowledge the ``need to make progress 
toward the California 1-hour standard, address transport to downwind 
regions, and meet the national 8-hour ozone standard.'' In the 1/30/
04 Witherspoon letter, the State recognizes ``the importance of a 
continuing commitment to further emission reductions that will * * * 
contribute to better air quality in downwind areas.''
---------------------------------------------------------------------------

    Comment 10: The steps and delays that are embedded in EPA's 
proposed approach in the event of a future exceedance verify that EPA's 
future actions will be ineffective at bringing the region back onto the 
path of true attainment. EPA should make a commitment in its final 
notice to act immediately upon the observance of a single Livermore 
violation because, even if the EPA were to move swiftly, it could take 
three years to get a new attainment plan in place (6 months for 
rulemaking, 12 months for plan submittal, 18 months to act). Commenters 
fear that EPA will wait until the end of the ozone season, then

[[Page 21722]]

await quality assured data, which would add 12 months to the process. 
Commenters request that EPA specify the protocol for making a 
determination of a violation in the event of an exceedance [at 
Livermore] in July, 2004.
    Response: As described in the proposed rule, should the Bay Area 
violate the 1-hour standard prior to EPA redesignating the area to 
attainment, we will notify the State that we have determined that the 
area is no longer attaining the 1-hour standard. We will also provide 
notice to the public in the Federal Register and will at that time 
indicate what pertinent SIP provisions apply and when a SIP revision 
addressing those provisions must be submitted. The public will have an 
opportunity to comment on our determinations. In the event of an 
exceedance, EPA will work closely with the District to facilitate 
prompt quality assurance of the data. We also note we would not be 
precluded from initiating the above process in advance of submittal of 
quality assured data. In setting the due date for submittal of the SIP 
revisions, EPA will consider all the relevant circumstances. For 
example, should the Bay Area violate the 1-hour standard, EPA will take 
into account the history of the area and the date on which the Bay Area 
violates the 1-hour standard.
    Comment 11: The CAA states that an area shall be classified as 
nonattainment if the area contributes to ambient air quality in a 
nearby area that does not meet the federal standard (CAA section 
107(d)(1)(A)(i)). Activities in the Bay Area that generate ozone 
precursors translate into substantial contributions to ozone 
nonattainment status in the Sacramento Valley and San Joaquin Valley 
air basins; CARB has concluded that pollution generated in the Bay Area 
has a significant, and at least in one case, overwhelming impact on the 
Sacramento region.
    Another commenter noted that the federal CAA and case law establish 
that downwind ozone transport concerns are an appropriate basis to deny 
designation of ozone attainment status to an upwind area even if 
monitoring limited to the upwind area shows compliance. Air district 
boundaries established to regulate localized pollutants cannot be used 
to ignore adverse effects which emanate beyond these boundaries when 
highly mobile pollutants such as ozone precursors are involved. Until 
EPA takes regulatory action to designate the Bay Area nonattainment for 
the 8-hour ozone standard it is premature to rely on that designation 
to deal with as yet unresolved transport issues. Because the Bay Area 
plan has not addressed transport contribution to downwind areas it is 
premature to relieve the area of the nonattainment designation and 
reasonably available control technology (RACT) and other requirements 
that are needed to demonstrate attainment in the downwind areas.
    Response: CAA section 107(d)(1)(A)(i) applies to the submission by 
state governors of initial designations following promulgation of new 
or revised standards and is thus unrelated to determinations of 
attainment. Similarly, the cases cited \11\ concern the permissible 
scope of EPA's authority in redesignating areas from nonattainment to 
attainment. Moreover, in determining whether an area has attained the 
1-hour ozone standard, EPA does not evaluate whether it meets all other 
requirements of the Act. Thus, while EPA does interpret CAA section 
110(a)(2)(A) and (D) to require States to address intrastate and 
interstate transport, EPA does not need to determine whether the State 
has regulated emissions from the Bay Area for purposes of transport in 
determining whether the Bay Area has attained the ozone standard. To 
the extent that emissions from the Bay Area significantly contribute to 
nonattainment or maintenance of the ozone standard in downwind areas, 
the State will need to address those contributing emissions in the 
context of an attainment demonstration for the downwind areas. Further, 
as a result of our attainment finding, certain CAA requirements are 
suspended but will once again be imposed should the Bay Area violate 
the standard prior to redesignation. As described in our response to 
comment 1, a redesignation to attainment requires that several 
additional requirements be fulfilled. Finally, note that in today's 
action, EPA is approving the RACT control measure commitments included 
in the 2001 Plan.
---------------------------------------------------------------------------

    \11\ Illinois State Chamber of Commerce v. USEPA, 775 F.2d 1141 
(7th Cir. 1985) and State of Ohio v. Ruckelshaus, 776 F.2d 1333 (6th 
Cir. 1985).
---------------------------------------------------------------------------

    Comment 12: Under the Clean Data Policy, EPA must ensure that the 
Bay Area submits the CCOS local attainment demonstration and regional 
assessment of the influence of Bay Area transported air pollution. 
(Seitz memo, page 7.)
    Response: The Seitz memo provides that ``[d]eterminations made by 
EPA in accordance with the [Clean Data Policy] would not shield an area 
from EPA action to require emission reductions from sources in the area 
where there is evidence, such as photochemical grid modeling, showing 
that emissions from sources in the area contribute significantly to 
nonattainment in, or interfere with maintenance by, other nonattainment 
areas. EPA has the authority under the Act (* * * section 110(a)(2)(A) 
in the case of intrastate areas) to require emissions reductions if 
necessary and appropriate to deal with transport situations.'' For many 
years, the effort to address transport has been stymied by an inability 
to define the transport problem due to lack of data. At the present 
time, the Bay Area District, several downwind areas, and CARB are 
engaged in an effort to refine modeling based on the CCOS. Once 
complete, the modeling should provide a better understanding of the 
degree to which air pollution generated in the Bay Area affects air 
quality in downwind areas. The co-lead agencies and CARB have 
acknowledged the need to address transport \12\ in addition to their 
obligations to achieve the state 1-hr and new federal 8-hr ozone 
standard. As a result, EPA fully expects that diligent efforts to 
finalize CCOS modeling will continue and that those results will be 
used to revise SIPs if appropriate.
---------------------------------------------------------------------------

    \12\ See footnote 10.
---------------------------------------------------------------------------

    Comment 13: Commenters expressed concern with the fate of the motor 
vehicle emissions budgets submitted with the 2001 Plan,\13\ and the 
conformity and emissions consequence if those budgets were not 
approved. One commenter noted that the conformity budgets are an 
important tool to limit transported emissions from the Bay Area and 
argued that the budgets must remain in effect, if not be made more 
stringent, to further mitigate transported emissions. Another commenter 
urged that EPA maintain MVEBs consistent with attainment during periods 
of normal economic activity until the area has qualified for 
redesignation.
---------------------------------------------------------------------------

    \13\ On February 14, 2002, EPA found the motor vehicle emission 
budgets in the 2001 Plan to be adequate for transportation 
conformity purposes. EPA's letter to CARB conveying the adequacy 
finding, along with responses to public comments regarding the 
adequacy of the budgets can be found at http://www.epa.gov/region09/air/sfbayoz/#0202.
---------------------------------------------------------------------------

    Reponse: As noted above and discussed in section IV below, the co-
lead agencies and CARB have requested that EPA fully approve the motor 
vehicle emissions budgets in the 2001 Plan. In this action, EPA is 
finalizing its approval of those budgets.

C. Applicability of Clean Air Act Planning Requirements in Areas 
Attaining the 1-Hour Ozone Standard

    When we redesignated the Bay Area back to nonattainment in 1998, we 
concluded that the area became subject to the provisions of subpart 1 
rather than subpart 2 of part D of the Clean Air Act. 63 FR 37258 (July 
10, 1998). CAA

[[Page 21723]]

subpart 1 at section 172(c) requires states to submit plans with 
certain revisions that are tied to the attainment demonstration:
    1. A demonstration that the plan will result in annual incremental 
reductions in emissions of ozone precursors for the purposes of 
ensuring attainment of the 1-hour ozone standard by 2006. This 
provision is known as the reasonable further progress (RFP) 
demonstration or plan, CAA section 172(c)(2);
    2. A demonstration that the plan will result in attainment of the 
1-hour ozone standard as expeditiously as practicable but not later 
than September 20, 2006, CAA section 172(c)(1);
    3. Contingency measures that will be undertaken if the area fails 
to make reasonable further progress to attain the standard by the 
applicable attainment date, CAA section 172(c)(9).
    We believe that it is reasonable to interpret the CAA to not 
require these provisions for ozone nonattainment areas that are 
determined to be meeting the 1-hour ozone standard. We discuss our 
reasoning in the Seitz memo, in the proposal for this action, and below 
in our response to comments.\14\
---------------------------------------------------------------------------

    \14\ We have also explained at length in other actions our 
rationale for the reasonableness of this interpretation of the Act 
and incorporate those explanations by reference here. See 61 FR 
20458 (May 7, 1996) (Cleveland-Akron-Lorrain, Ohio); 60 FR 36723 
(July 18, 1995) (Salt Lake and Davis Counties, Utah); 60 FR 37366 
(July 20, 1995) and 61 FR 31832-33 (June 21, 1996) (Grand Rapids, 
MI). Our interpretation has also been upheld by the U.S. Court of 
Appeals for the Tenth Circuit in Sierra Club v. EPA, 99 F.3d 1551 
(10th Cir. 1996).
---------------------------------------------------------------------------

    We received comments on the proposed attainment determination 
regarding the applicability of certain CAA planning requirements to the 
Bay Area. The comments and our responses are summarized below.

D. EPA Responses to Comments Regarding Applicability of Clean Air Act 
Requirements

1. Comments Regarding EPA's Clean Data Policy
    Comment 14: Several commenters concurred with EPA's determination 
that attainment demonstration, contingency measures and RFP 
requirements do not apply. In contrast, a number of commenters contend 
that EPA has no authority in this situation to eliminate SIP 
requirements without a formal redesignation. Congress created a process 
for determining whether a region should be treated differently as to 
its requirements for planning and pollution controls if the region 
monitored attainment. That process is called redesignation under 
section 107(d)(3) of the Act. Redesignation actions involve a more 
complete and robust State submittal, and have the additional security 
of data collected during the period between the end of the attainment 
demonstration period and EPA's action on redesignation. Under the Act 
designation determines the applicable controls. There is nothing in the 
CAA that explicitly states that upon only a finding of attainment, the 
EPA can jettison SIP requirements. EPA says it is implicit, but that 
would require splitting apart an explicit redesignation process. 
Congress did not provide for that, and such an action would frustrate 
the purposes of the Act and redesignation process.
    Response: In today's action, we are finalizing our determination 
that the Bay Area has attained the 1-hour ozone standard by its 
statutory deadline of September 20, 2006 as demonstrated by three 
consecutive years without a violation. As a result, we are also 
finalizing our determination that certain Clean Air Act requirements 
are not applicable to the Bay Area. The statutory basis for finding 
that these planning requirements are not applicable is described in the 
proposal and in the Clean Data Policy. See 68 FR 62041, 62044--62045; 
Seitz memo at 2-5. Contrary to the commenter's assertion, we are not 
eliminating any applicable requirements. Rather, we have interpreted 
the requirements of sections 172(c)(1), 172(c)(2), and 172(c)(9) as not 
being applicable once an area has attained the standard, as long as it 
continues to do so. This is not a waiver of requirements that by their 
terms clearly apply; it is a determination that certain requirements 
are written so as to be operative only if the area is not attaining the 
standard. Our interpretation is consistent both with the CAA's goal of 
achieving and maintaining clean air, and with the concomitant policy 
goal of avoiding costly and unnecessary emission reductions, and, as 
mentioned above, has been upheld in the Tenth Circuit in Sierra Club v. 
EPA, 99 F.3d 1551.
2. Comments Regarding the Applicability of EPA Policies to the Bay Area
    Comment 15: EPA cites Sierra Club v. EPA, 99 F.3d 1551 (10th Cir. 
1996) as authority for the waiver of CAA requirements. Several 
commenters, however, contend that the case was incorrectly decided. 
Further, commenters argue that the Bay Area is distinguishable from 
Utah in several respects:

    In contrast to the 0.123 ppm design value in the Bay Area, the 
design value in Utah is 0.111 ppm, well below the 1-hour standard.
    The emissions that achieved improved air quality were determined 
by the court to be enforceable (unlike the Spare the Air program).
    The Bay Area is recognized to be a nonattainment area for the 8-
hour ozone standard.
    The Bay Area is an upwind district for transport purposes. The 
court observed that air quality controls designed to surpass the 
applicable ozone standard would be costly and unnecessary.

    Response: In Sierra Club, the Tenth Circuit Court of Appeals upheld 
the rationale in the Seitz memo as it applies to moderate ozone 
nonattainment areas. There, pending completion of the redesignation 
process, and based on three years of air quality data, EPA found that 
two Utah Counties designated as nonattainment for ozone and classified 
as moderate had attained the ozone NAAQS. As a result, EPA determined 
that the CAA's moderate area requirements for attainment and RFP 
demonstrations, and contingency measures (sections 182(b)(1)(A) and 
172(c)(9)) were inapplicable. Finding that this determination was a 
logical extension of EPA's original interpretation in the General 
Preamble, the Court accorded deference to EPA's statutory 
interpretation that once a moderate ozone nonattainment area has 
attained the NAAQS, the moderate area CAA requirements for RFP, 
attainment and contingency measures no longer apply. Id. at 1556. 
Although the Bay Area is a non-classified nonattainment area, there is 
no doubt that the analogous subpart 1 area provisions serve exactly the 
same purpose as the provisions at issue in Sierra Club for moderate 
areas. Thus the Court's reasoning in that case applies equally to the 
Bay Area situation. Finally, EPA expects that fact patterns will vary 
from one area to the next but we do not believe such variations 
undermine the legal and policy bases for our interpretation of the 
applicability of CAA requirements in areas that have attained the 
standard.
    Comment 16: In a similarly situated area, EPA did not determine 
attainment until it was able to redesignate the area to attainment and 
thus its residents had assurance of maintenance in the form of a 
maintenance plan. See EPA's St. Louis rulemaking, 68 FR 25418, May 12, 
2003.
    Response: CAA section 179(c) provides that ``[a]s expeditiously as 
practicable after the applicable attainment date for any nonattainment 
area, but not later than 6 months after such date, the Administrator 
[of EPA] shall determine, based on the area's air quality as of the 
attainment date, whether the area attained the standard

[[Page 21724]]

by that date.'' See also CAA section 181(b)(2). Thus the statute 
provides for findings of attainment based on air quality. The Clean 
Data Policy provides for such findings prior to the attainment date 
applicable to a nonattainment area. The policy indicates that EPA's 
regional offices will conduct individual rulemakings concerning areas 
that have three consecutive years of clean data demonstrating 
attainment to make binding determinations that such areas have attained 
the standard and need not submit SIP revisions addressing the CAA 
requirements that are no longer applicable. Seitz memo, p. 6. Thus the 
timing of attainment findings is authorized by the statute and dictated 
by longstanding Agency policy.
    Comment 17: EPA's Clean Data Policy only addresses subpart 2 
authority. Since the Bay Area is designated nonattainment under subpart 
1, it is not applicable to the Bay Area.
    Response: EPA's Clean Data Policy specifically addresses the RFP 
requirement in CAA section 172(c)(as defined in section (171(1)) and 
the contingency measure requirement in section 172(c)(9). Both of these 
statutory provisions apply to the 2001 Plan. With respect to the 
attainment requirement, the policy addresses the attainment requirement 
in section 182 which does not apply to the Bay Area plan. However, the 
analysis of that requirement applies equally to the section 172(c)(1) 
attainment requirement that does apply to the 2001 Plan. See Seitz 
memo, pages 3-5.
    Comment 18: EPA's action is not supported by EPA's adopted guidance 
and policy documents. Specifically, John Calcagni's October 28, 1992 
memo entitled ``State Implementation Plan (SIP) Actions Submitted in 
Response to Clean Air Act (Act) Deadlines' (10/28/92 Calcagni memo) is 
inconsistent with EPA proposed action on the specific issue of whether 
the Bay Area's SIP requirements may be relaxed at this stage. ``States, 
however, are statutorily obligated to meet SIP requirements that become 
due any time before an area is actually redesignated to attainment. [. 
. .] Hence, if there is a failure of the State to meet a statutory 
deadline [and, ergo, a SIP commitment to mid-course review] for an 
area, (before EPA has redesignated the area as attainment), a finding 
of failure to submit should be made. This, in turn, begins the 
sanctions process.'' 10/28/92 Calcagni memo, pages 3-4. This properly 
describes how the Act works--areas must still meet all SIP commitments 
after a determination of attainment, but before the redesignation is 
complete. Otherwise there is a gap in SIP coverage that is irrational 
and illegal. Logically, since an area must meet all applicable part D 
SIP requirements, including section 172(c) elements, in order to gain 
redesignation, section 107(d)(3)(E), these SIP requirements must be 
present at the time of redesignation. It would make little sense to 
excuse their inclusion now, then to require their adoption immediately 
prior to redesignation. The SIP must be continually effective during 
the period between determination of attainment and redesignation. EPA 
cannot rewrite the Act and waive the otherwise applicable part D SIP 
requirements during this ``gap'' period.
    Response: The 10/28/92 Calcagni memo addresses the historical 
situation in which certain states were planning to submit redesignation 
requests prior to November 15, 1992 in an attempt to be exempted from 
implementing mandatory CAA programs due to start in November of that 
year (e.g., oxygenated fuels program, stage II vapor recovery rules, 
etc.). The memo explains that while the approvability of a 
redesignation request is based on requirements in place on the date of 
the complete submittal, until the redesignation was finalized, states 
would be statutorily bound to implement those programs. The types of 
mandatory programs covered by the 10/28/92 Calcagni memo are 
distinguishable from the planning requirements suspended by a finding 
of attainment. In the Clean Data Policy, EPA has interpreted the 
attainment demonstration, RFP, and contingency provisions of the Act to 
be inapplicable to an area that is attaining the ozone standard as long 
as the area continues to attain or is redesignated to attainment.\15\ 
This interpretation is based on the language and purpose of those 
provisions. By contrast, the requirements for mandatory programs 
addressed by the 10/28/92 Calcagni memo do not contain qualifying 
language tied to attainment, such as ``for the purpose of ensuring 
attainment of the applicable ambient air quality by the applicable 
date.'' Compare, e.g., stage II vapor recovery (section 182(b)(3)) with 
RFP (section 171(1)).
---------------------------------------------------------------------------

    \15\ See also 9/4/92 Calcagni memo at p. 6: ``The requirements 
for reasonable further progress, identification of certain emissions 
increases, and other measures needed for attainment will not apply 
for redesignations because they only have meaning for areas not 
attaining the standard.''
---------------------------------------------------------------------------

    Comment 19: The 9/4/92 Calcagni memo indicates that the Bay Area 
retains its obligation to model attainment as required by the mid-
course review commitment as part of its redesignation showing: ``No 
such supplemental modeling is required for O3 non-attainment areas 
seeking redesignation'' (page 3, emphasis added). The term 
``supplemental'' reflects EPA's requirement that ordinary modeling of 
attainment, as required for all SIPS and which is contained in and was 
deferred by California's ``enforceable commitment'' must still be 
provided. EPA explains the purpose for supplemental modeling, which 
applies with vigor to the initial modeling requirement as follows: 
``Modeling may be necessary to determine the representativeness of the 
monitored data. Id., page 3. If the data should be supported by 
modeling for redesignation, it should similarly be supported by 
modeling to support the determination of attainment, particularly where 
the region's actual emissions inventory has been depressed by economic 
forces and the District stands at the cusp of finalizing the modeling 
it has postponed for over a decade. While commenters recognize that the 
9/4/1992 Calcagni memo purports to address redesignation actions, they 
assert that EPA itself cites this guidance as authority supporting 
EPA's proposal to delete RFP, attainment demonstration and contingency 
measure requirements from the Bay Area SIP. 68 FR 62044.
    Response: EPA disagrees that its reference to the 9/4/92 Calcagni 
memo somehow retroactively modifies the scope of that memo. The purpose 
of our reference to the memo was to illustrate the consistency of our 
position that RFP becomes unnecessary when an area attains the 
standard. On page 6, the memo states that the ``requirements for 
reasonable further progress * * * will not apply for redesignation 
because they only have meaning for areas not attaining the standard.'' 
Emphasis added.
    The 9/4/92 Calcagni memo states the following: ``The state must 
show that the area is attaining the applicable NAAQS. There are two 
components involved in making this demonstration which should be 
considered interdependently. The first component relies upon ambient 
air quality data. * * * The second component relies upon supplemental 
EPA-approved air quality modeling. No such supplemental modeling is 
required for O3 (ozone) nonattainment areas seeking redesignation * * * 
'' (pages 2 and 3). This document explains that supplemental modeling 
may be needed, for example, in sulfur dioxide and carbon monoxide 
areas, where emissions are localized and a small number of monitors may 
not be representative of air quality (page 3). In contrast, ozone is 
not a localized

[[Page 21725]]

pollutant, and the Bay Area has an extensive monitoring network 
consisting of 24 monitors operating each year from 2001 through 2003 as 
described in EPA's proposal at 68 FR 62043. Consistent with the 
language in the memo and the rationale in calling for modeling in some 
cases for some pollutants and not in other cases, modeling would not be 
required for redesignation of ozone areas. The memo should not be read 
to create a requirement for modeling in an area that has been 
determined to be attaining the ozone standard.
    Finally, we reiterate that a finding of attainment does not delete 
CAA requirements. The requirements for an attainment demonstration, 
RFP, and contingency measures are suspended by the finding only as long 
as the area continues to attain the standard or until the area is 
formally redesignated.

E. Effects of the Attainment Finding on the Bay Area and of a Future 
Violation of the 1-Hour Ozone NAAQS

    Based on our finding that the Bay Area is attaining the 1-hour 
ozone standard, we are finding that the State of California is no 
longer required to submit an RFP plan, an attainment demonstration, or 
contingency measures for the area.
    The lack of a requirement to submit these SIP revisions will exist 
only as long as the Bay Area continues to attain the 1-hour ozone 
standard. If we subsequently determine that the area has violated the 
1-hour ozone standard (prior to a redesignation to attainment), the 
basis for the determination that the area need not make these SIP 
revisions would no longer exist. Thus, a determination that an area 
need not submit these SIP revisions amounts to no more than a 
suspension of the requirements for so long as the area continues to 
attain the standard.
    Should the Bay Area begin to violate the 1-hour standard, we will 
notify California that we have determined that the area is no longer 
attaining the 1-hour standard. We also will provide notice to the 
public in the Federal Register. Once we determine that the area is no 
longer attaining the 1-hour ozone standard then California will be 
required to address the pertinent SIP requirements within a reasonable 
amount of time. We will set the deadline for the State to submit the 
required SIP revisions at the time we make a nonattainment finding. 
California must continue to operate an appropriate air quality 
monitoring network, in accordance with 40 CFR part 58, to verify the 
attainment status of the area. The air quality data relied upon to 
determine that the area is attaining the ozone standard must be 
consistent with 40 CFR part 58 requirements and other relevant EPA 
guidance.

III. Approval of Bay Area 2001 Plan

A. Approval of the 2001 Plan

    In this action, EPA is finalizing its proposed approval of the 
following elements of the 2001 Plan: The emissions inventories, RACM, 
commitments to adopt and implement specific control measures, the motor 
vehicle emissions budgets, and further study commitments. The 
commitments to adopt and implement specific control measures \16\ are 
listed in Tables 1, 2, and 3 below, and the commitments to conduct 
further study of potential control measures, are listed in Table 4 
below. We are approving a VOC motor vehicle emissions budget of 164.0 
tons per day and a NOX motor vehicle emissions budget of 
270.3 tons per day, both for the year 2006.
---------------------------------------------------------------------------

    \16\ We are approving the adoption and implementation dates of 
the new measures and the total emissions reductions they are 
cumulatively projected to achieve. We are approving all dates, 
including those that have passed, in order to make the commitments 
enforceable by EPA and citizens under the CAA.

                                                Table 1.--New Stationary and Area Source Control Measures
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                         Estimated VOC    Estimated NOX
                                                                                        Adoption on     Implementation     reduction        reduction
        2001 SIP No.            BAAQMD  regulation No.          Source category             date             date        (tpd), 2000 to   (tpd), 2000 to
                                                                                                                              2006             2006
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                          Measures To Be Adopted by the BAAQMD
--------------------------------------------------------------------------------------------------------------------------------------------------------
SS-11......................  8-3........................  Improved Architectural             \17\2001        2003-2004              2.9  ...............
                                                           Coatings Rule.
SS-12......................  8-5........................  Improved Storage of                    2002             2002              1.9  ...............
                                                           Organic Liquids Rule.
SS-13......................  8-14 and 8-19..............  Surface Preparation and                2002             2003              0.3  ...............
                                                           Cleanup Standards for
                                                           Metal Parts Coating.
SS-14......................  8-16.......................  Aqueous Solvents..........             2002             2003              3.0  ...............
SS-15......................  TBD........................  Petroleum Refinery Flare               2003             2004         \18\ TBD  ...............
                                                           Monitoring.
SS-16......................  8-18.......................  Low-Emission Refinery                  2003             2004              TBD  ...............
                                                           Valves.
SS-17......................  8-10.......................  Improved Process Vessel                2003             2004              0.1  ...............
                                                           Depressurization Rule.
    Total..................  ...........................  ..........................  ...............  ...............              8.2              0.0
--------------------------------------------------------------------------------------------------------------------------------------------------------

      
---------------------------------------------------------------------------

    \17\ For commitments in the plan that do not identify the month, 
as in Tables 1, 2, and 3, or the day of the month, as in Table 4, 
EPA interprets the deadline to be no later December 31st of the 
noted year or the last day of the month, respectively.
    \18\ At the time of plan adoption, the BAAQMD was not able to 
determine the amount of emissions reductions that could be achieved 
by adoption of rules implementing SS-15 and 16. The District 
indicated that the reductions were to be determined (TBD). 
Therefore, the emission reduction total for SS-11 through SS-17 does 
not include reductions from these two measures.

                                   Table 2.--New Mobile Source Control Measure
----------------------------------------------------------------------------------------------------------------
                                                                                 Estimated VOC    Estimated NOX
                                                Request \19\    Implementation     reduction        reduction
     2001 SIP No.          Source category          date             date        (tpd), 2000 to   (tpd), 2000 to
                                                                                      2006             2006
----------------------------------------------------------------------------------------------------------------
                                      Measure To Be Requested by the BAAQMD
----------------------------------------------------------------------------------------------------------------
MS-1..................  Motor Vehicle                    2002        2002-2003              4.0  ...............
                         Inspection and
                         Maintenance
                         Program--Liquid
                         Leak Inspection and
                         Improved
                         Evaporative System
                         Test.
    Total.............  ....................  ...............  ...............              4.0              0.0
----------------------------------------------------------------------------------------------------------------

     
---------------------------------------------------------------------------

    \19\ California Health & Safety Code (H&SC) 44003 gives 
California Air Pollution Control Districts the authority to request 
that the Department of Consumer Affairs (DCA) implement all or parts 
of the motor vehicle inspection and maintenance program in their 
areas. In the 2001 Plan, the BAAQMD, which was subject only to the 
basic smog check program, committed to opting into the Liquid Leak 
Inspection and Improved Evaporative System Test elements of enhanced 
smog check. In 2002, State law was amended (AB 2637--Cardoza) to 
mandate expeditious DCA implementation of full enhanced inspection 
and maintenance in the Bay Area, which delivers substantially 
greater emissions reductions than the MS-1 commitment in the 2001 
Plan.


[[Page 21726]]



                                  Table 3.--New Transportation Control Measures
----------------------------------------------------------------------------------------------------------------
                                                                                Estimated VOC     Estimated NOX
   2001  SIP No.    Control measure      Description and         Schedule     reduction (tpd),  reduction (tpd),
                      description     implementation steps                      2000 to 2006      2000 to 2006
----------------------------------------------------------------------------------------------------------------
 TCM A...........   Regional          Program includes       FY 2003.          See Below......   See Below.
                    Express Bus       purchase of            Complete once
                    Program.          approximately 90 low   $40 million in
                                      emission buses to      funding
                                      operate new of         pursuant to
                                      enhanced express bus   Government Code
                                      services. Buses will   Section
                                      meet all applicable    14556.40 is
                                      CARB standards, and    approved by the
                                      will include           California
                                      particulate traps or   Transportation
                                      filters. MTC will      Commission and
                                      approve $40 million    obligated by
                                      in funding to          bus operators.
                                      various transit
                                      operators for bus
                                      acquisition. Program
                                      assumes transit
                                      operators can
                                      sustain service for
                                      a five year period.
                                      Actual emission
                                      reductions will be
                                      determined based on
                                      routes selected by
                                      MTC.
 TCM B...........   Bicycle/          Fund high priority     FY 2004-2006.     See Below......   See Below.
                    Pedestrian        projects in            Complete once
                    Program.          countywide plans       $15 million in
                                      consistent with TDA    TDA Article 3
                                      funding                is allocated by
                                      availability. MTC      MTC.
                                      would fund only
                                      projects that are
                                      exempt from CEQA,
                                      have no significant
                                      environmental
                                      impacts, or
                                      adequately mitigate
                                      any adverse
                                      environmental
                                      impacts. Actual
                                      emission reductions
                                      will be determined
                                      based on the
                                      projects funded.
 TCM C...........   Transportation    Program provides       FY 2004-2006.     See Below......   See Below.
                    for Livable       planning grants,       Complete once
                    Communities       technical              $27 million in
                    (TLC).            assistance, and        TLC grant
                                      capital grants to      funding is
                                      help cities and        approved by MTC.
                                      nonprofit agencies
                                      link transportation
                                      projects with
                                      community plans. MTC
                                      would fund only
                                      projects that are
                                      exempt from CEQA,
                                      have no significant
                                      environmental
                                      impacts, or
                                      adequately mitigate
                                      any adverse
                                      environmental
                                      impacts. Actual
                                      emission reductions
                                      will be determined
                                      based on the
                                      projects funded.
 TCM D...........   Additional        Operation of 55 land   FY 2001.          See Below......   See Below.
                    Freeway Service   miles of new roving    Complete by
                    Patrol.           tow truck patrols      maintaining
                                      beyond routes which    increase in FSP
                                      existed in 2000. TCM   mileage through
                                      commitment would be    December 2006.
                                      satisfied by any
                                      combination for
                                      routes adding 55
                                      miles. Tow trucks
                                      used in service are
                                      new vehicles meeting
                                      all applicable CARB
                                      standards.
 TCM E...........   Transit Access    Take credit for        BART--SFO         See Below......   See Below.
                    to Airports.      emission reductions    service to
                                      from air passengers    start in FY
                                      who use BART to SFO,   2003. Complete
                                      as these reductions    by maintaining
                                      are not included in    service through
                                      the Baseline.          2006.
     Total.......  ................  .....................  ................   0.5............   0.7
----------------------------------------------------------------------------------------------------------------


                    Table 4.--Further Study Measures
------------------------------------------------------------------------
                                                        Timeline for
        2001 SIP No.                 Measure             completion
------------------------------------------------------------------------
FS-1........................  Study Potential for   April 2002.
                               Accelerating
                               Particulate Trap
                               Retrofit Program
                               for Urban Buses.
FS-2........................  Update MTC High       December 2002.
                               Occupancy Vehicle
                               Lane Master Plan.
FS-3........................  Study Air Quality     April 2003.
                               Effects of High
                               Speed Freeway
                               Travel.
FS-4........................  Evaluate Parking      July 2003.
                               Management
                               Incentive Program.
FS-5........................  Enhanced Housing      December 2003.
                               Incentive Program.
FS-6........................  Further Smog Check    December 2003.
                               Program
                               Improvements.
FS-7........................  Parking Cash Out      December 2003.
                               Pilot Program.
FS-8........................  Refinery Pressure     December 2003.
                               Vessels, Blowdown
                               Systems, and Flares.
FS-9........................  Refinery Wastewater   December 2003.
                               Systems.
FS-10.......................  Organic Liquid        December 2002.
                               Storage Tanks.
FS-11.......................  Marine Tank Vessel    December 2003.
                               Activities.
------------------------------------------------------------------------

B. EPA's Responses to Comments on the Proposed Approval of the 2001 
Plan

    EPA's proposed action provided a 30-day public comment period. 
During this period, we received comments from six parties. We are 
responding only to comments that pertain to the plan elements on which 
we are taking final action.
1. Comments on the Proposed Approval of the Emissions Inventory
    Comment 20: The 2001 Plan's emissions inventory is inaccurate and 
may drastically underestimate precursor emissions. It contains errors 
that should have been known and could have been corrected at the time 
of submittal. It is evident that better, more current and accurate data 
were known to the District and available for incorporation into the 
2001 Plan.

[[Page 21727]]

    Response: In order to be approvable, CAA section 172(c)(3) requires 
that the emissions inventory must be comprehensive, accurate, and 
current. We proposed to approve the emissions inventories in the 2001 
Plan because, when evaluated in the context of the time in which they 
were developed, the inventories accurately incorporated the best 
available data. Subsequent to the submittal of the 2001 Plan, the 
District, in fulfillment of its 2001 Plan commitment to undertake 
several further study measures, collaborated with representatives of 
community groups and industry to study emissions and potential controls 
from certain sources of air pollution. Some of these studies revealed 
that there are flaws in the inventory. This was not particularly 
surprising--inventory data is constantly being reevaluated and 
refined--and, in general, the quality of technical data and analyses 
techniques will continually improve.
    Once a plan has been adopted, EPA does not generally require plan 
elements such as emissions inventories and attainment demonstrations to 
be revisited and updated in response to new information.\20\ There will 
always be situations when new, better information is on the horizon. 
Evaluating a plan element based on information that was not available 
at the time of submittal would create a moving target that would be 
impossible to meet. We do not, therefore, believe it is appropriate to 
disapprove the inventories based on data that was developed subsequent 
to submittal of the 2001 Plan.
---------------------------------------------------------------------------

    \20\ The U.S. Court of Appeals for the District of Columbia 
Circuit recently addressed a similar issue and affirmed EPA's 
position. Sierra Club v. EPA, 356 F.3d 296 (DC Cir. 2004).
---------------------------------------------------------------------------

    The commenter fails to provide a concrete example of substantiated 
data that was available at the time of Plan adoption that is not 
included in the inventory. The version of EMFAC the commenter notes 
would have provided improved accuracy for motor vehicle emissions was 
not yet approved and available for use by the co-lead agencies when the 
2001 Plan was being developed. See also section III.4. of the RTC.
    Comment 21: EPA must specify a much more broad series of emissions 
inventory corrections in the 2004 SIP than those indicated in the 
proposed approval of the 2001 Plan. A commenter notes that reductions 
from Smog Check II, which was approved by the California legislature 
for the Bay Area in September 2002, need to be factored into the 
inventory. In addition, the commenter stated that, according to an 
article in the Los Angeles Times published on January 16, 2003, CARB 
has discovered errors in the South Coast Air Basin's emissions 
inventory and, because the Bay Area relies on many of the same CARB-
derived emissions factors, those errors are therefore present in the 
Bay Area's inventory and must be corrected in the next inventory.
    Response: We agree with the general point made by the commenter: 
inventories must be comprehensive, accurate, and current. In the notice 
of proposed rulemaking, we stated that if the findings in the draft 
technical assessment documents \21\ regarding the inventory numbers are 
confirmed, the inventory submitted with the subsequent plan must 
reflect the new data. In addition, we noted that the inventories must 
be modified to incorporate data generated by the most recent model 
developed by CARB and accepted by EPA to determine emissions from motor 
vehicles. We did not intend to imply that those items can be considered 
an exhaustive list of future corrections because there is no way to 
predict the state of knowledge that will exist when the next inventory 
is submitted to EPA. Other refinements to the numbers that are made 
before the next inventory is submitted, including (but not limited to) 
any additional corrections and any adjustments to reflect the adoption 
of new regulations, must of course be included.
---------------------------------------------------------------------------

    \21\ The District has prepared technical assessment documents 
(TADs) that describe its findings with respect to further study 
measures. The TADs can be viewed online at http://www.baaqmd.gov/enf/RefineryFSM/refinery.asp.
---------------------------------------------------------------------------

    EPA finds the emissions inventory in the 2001 Plan to be very 
detailed. The emission categories are well documented, comprehensive, 
accurate, and current. The emissions inventory was prepared following 
the procedures in EPA guidance,\22\ using either EPA emission factors 
found in AP-42 or other appropriate emission factors combined with Bay 
Area specific activity data to estimate emissions from each type of 
emissions source. This approach is the customary method used for 
preparing emissions inventories and the one required by EPA guidance. 
Emission inventories are not static but are constantly updated and 
renewed as new information, techniques, and studies are made available. 
EPA finds the emissions inventory in the SIP to be sufficiently 
detailed.
---------------------------------------------------------------------------

    \22\ See 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, 
available online at www.epa.gov/ttn/chief/ei_guide.html.
---------------------------------------------------------------------------

    While we acknowledge that various inventory enhancements and 
corrections (including those to which the commenters allude) need to be 
reflected in future plan and budget updates, we believe that such 
inaccuracies, taken together, do not rise to such a level of importance 
that they justify our rejection of the current inventories and budgets 
as insufficient to provide an adequate framework for air planning.
2. Comments on the Proposed Approval of RACM
    Comment 22: Commenters contend that the 2001 Plan fails to include 
many measures that should be considered RACM for the Bay Area. Further, 
they allege that EPA has not provided sufficient support for its 
proposed determination that the RACM analysis is adequate.
    Response: CAA section 172(c))(1) requires nonattainment area plans 
to provide for the expeditious implementation of all reasonably 
available control measures. EPA's principle guidance interpreting the 
Act's RACM requirement is found in the General Preamble. See also 
``Guidance on the Reasonably Available Control Measures (RACM) 
Requirement and Attainment Demonstration Submissions for Ozone 
Nonattainment Areas,'' from John S. Seitz, Director, Office of Air 
Quality Planning and Standards, to EPA Regional Air Division Directors, 
November 30, 1999. Under our interpretation, a state does not need to 
adopt measures that would not advance the attainment date for the 
applicable standard.\23\ The Bay Area's and the State's previously 
enacted control measures, along with the measures committed to in the 
2001 Plan that have already been adopted and implemented, have resulted 
in improved air quality sufficient to qualify the Bay Area for a 
finding of attainment at the end of the 2003 ozone season. We therefore 
conclude that those controls reflect RACM and are approving the plan as 
meeting the RACM requirement of CAA section 172(c)(1).
---------------------------------------------------------------------------

    \23\ EPA's interpretation of the section 172(c)(1) RACM 
requirement has been upheld by the District of Columbia and Fifth 
Circuit Courts of Appeal in, respectively, BCCA Appeal Group et al. 
v. EPA, 348 F.3d 93 (5th Cir. 2003) and Sierra Club v. EPA, 294 F.3d 
155 (DC Cir. 2002).
---------------------------------------------------------------------------

3. Comments on the Proposed Approval of the Control Measure Commitments
    Comment 23: The TCMs in the 2001 Plan are not approvable; they are 
impermissibly vague in their quantification of emissions reductions and 
are unenforceable. The 2001 Plan

[[Page 21728]]

lumps the TCMs for the purposes of calculating emissions reductions. 
This complicates the legal enforceability of the measures, which 
renders the SIP and the TCMs unapprovable. Specific emissions 
reductions should be assigned to the TCMs.
    Response: Since the emission reductions associated with most TCMs 
(e.g. demand management TCMs) are interdependent, it is not unusual for 
the impacts of TCMs to be assessed on a cumulative basis. This is 
particularly the case when, as here, the total emission reductions from 
the measures are small. The 2001 Plan provides an enforceable 
commitment to implement the TCMs to reduce VOC emissions by 0.5 tpd and 
NOX emissions by 0.7 tpd between 2000 and 2006. The 
effectiveness of the TCMs in meeting this commitment will be documented 
in future conformity determinations. In order to show timely 
implementation as required in future conformity analyses (40 CFR 
93.113) MTC must document that the TCMs are being implemented on 
schedule. Because the enforceable commitment is to achieve the 
cumulative emissions reductions by 2006, MTC must also document those 
reductions. MTC should also document the extent to which the 
implementation of the individual TCMs meets the identified levels. For 
example, for TCM A, MTC should identify the number of low-emission 
buses that were purchased.
4. Comments on the Downwind Transport of Air Pollution
    Comment 24: CAA section 107(a) directs states to address intrastate 
transport ``by submitting an implementation plan for such state which 
will specify the manner in which the national primary and secondary 
ambient air quality standards will be achieved and maintained within 
each air quality control region in such State.'' The currently approved 
statewide SIP, the 1994 SIP, does not adequately address the topic. 
Given the universal acceptance of the fact that the Bay Area is an 
upwind contributor of air pollution to downwind areas that violate the 
ozone NAAQS, EPA may not lawfully approve the Bay Area SIP until it 
specifically addresses air pollution transport sufficiently to 
eliminate significant consequences to downwind Districts. The Bay Area 
SIP is not adequate unless and until it is part of a statewide SIP that 
comprehensively addresses air pollution transport.
    Response: CAA section 107(a) simply affirms that each state has the 
primary responsibility for assuring the air quality within its borders 
and for determining how this goal is to be achieved. The commenter 
attempts to improperly transform this straightforward statutory 
provision into one that establishes a SIP requirement concerning 
intrastate transport. The nonattainment area plan requirements for the 
Bay Area are contained in sections 110(a) and 172(c). While EPA does 
interpret CAA section 110(a)(2)(A) to require states to address 
intrastate transport, they have significant latitude in how they choose 
to do so. Thus EPA, in acting on the 2001 Plan, does not need to 
determine whether the State has regulated emissions from the Bay Area 
for purposes of transport. To the extent that emissions from the Bay 
Area significantly contribute to nonattainment or maintenance of the 
ozone standard in downwind areas, however, the State will need to 
address those contributing emissions in the context of an attainment 
demonstration for the downwind areas.
5. Comments on Additional Plan Elements
    Comment 25: The Clean Air Act requires that plans provide an 
affirmative demonstration of their authority and ability to implement 
the proposed plan. The District has failed to include such a 
demonstration in the SIP.
    Response: In BCCA Appeal Group, the U.S. Court of Appeals for the 
Fifth Circuit agreed with the holdings of other federal circuit courts 
that the determination of what constitutes ``necessary assurances'' 
should be left to the discretion of EPA. The Fifth Circuit found that 
EPA was entitled to rely on a certification of legal authority to 
implement an ozone plan for Houston-Galveston by the State of Texas' 
legal counsel. Here, the State in its ``Completeness Checklist for SIP 
Revision: 2001 Bay Area Ozone Plan,'' (Checklist), section 2.1(c), has 
certified that it, as well as the District and MTC, have the necessary 
legal authority under State law to adopt and implement the plan. EPA 
has routinely accepted such checklists as evidence of the requisite 
legal authority and the Fifth Circuit ruling validates that Agency 
decision.
6. Comments on the Impact of the State Law and Court Orders
    Comment 26: The District committed several violations of State law 
during its hasty plan promulgation process, and is currently subject to 
an order of the San Francisco County Superior Court to correct those 
violations. Statement of Decision and Order Thereon (Order), filed July 
24, 2003, Communities for a Better Environment, et al. v. Bay Area Air 
Quality Management District, et al., San Francisco County Superior 
Court Case No. 323849.\24\ Until the District cures these violations, 
it is plainly without authority to implement the SIP or provide the 
assurances required by the Act. This provides an independent basis for 
EPA's disapproval of the Plan's adequacy. CAA section 110(a)(2)(E) and 
40 CFR part 51, Appendix V, section 2.1(c) and (e).
---------------------------------------------------------------------------

    \24\ The Order of the San Francisco Superior Court has been 
appealed. Communities for a Better Environment et al. v. Bay Area 
Air Quality Management District et al., First Appellate District 
Case Nos. A103991, A104179. EPA is aware that the parties have 
recently reached a settlement of these appeals that, if approved by 
the State courts, would result in the vacatur of the July 24, 2003 
Order. However, because that vacatur has not yet occurred, EPA 
responds in this action to the public comments concerning the July 
24, 2003 Order.
---------------------------------------------------------------------------

    Based on the California Public Records Act, Government Code section 
6250, et seq., the petitioners in the above case claimed that the 
District improperly destroyed files necessary to enforce the 2001 Plan 
and the District's rules. The parties settled the issue through a 
stipulated agreement and an order of the Court under which the District 
agreed to halt its practice of destroying enforcement records without 
notice and to institute practices assuring permanent preservation of 
District notices of violation and other enforcement file materials. 
However, some enforcement records were destroyed prior to the order. 
Because of the destruction of these documents, it is certain that at 
least some repeat violators will not be subject to the proper form of 
enforcement because records of their prior violations are unavailable. 
The District is therefore unable to provide assurance to EPA that it 
has the resources to implement the Plan and enforce its rules.
    Response: The Court Order cited by the commenter requires the 
District to comply with California Government Code section 60203 prior 
to any destruction of certain public records. That section allows the 
destruction of such records if they are ``* * * photographed, 
microphotographed, reproduced by electronically recorded video images 
on magnetic surfaces, recorded in the electronic data processing 
system, recorded on optical disk, reproduced on film or any other 
medium that is a trusted system and that does not permit additions, 
deletions, or changes to the original document. * * *'' Thus, 
reproductions of these documents must be made before the originals can 
be destroyed.
    The commenter's claim that the alleged destruction of certain of 
the District's enforcement files has resulted

[[Page 21729]]

in the inability of the District to enforce its rules or implement the 
Bay Area plan is unsubstantiated. Assuming, arguendo, that the 
information in any files that may have been destroyed is necessary to 
the ongoing efforts of the District to implement the plan and enforce 
its rules, there are clearly numerous methods of preserving and 
recording data short of retaining reproductions of original documents. 
More importantly, even if some repeat violators are not treated as such 
as a result of missing records, that circumstance would not be 
sufficient to impair an overall enforcement program. Nor would it call 
into question the District's ability to otherwise implement its plan. 
The commenter has provided a conclusion but no support for it.
    Comment 27: The District violated the California Environmental 
Quality Act (CEQA) by adopting the Plan without first preparing an 
adequate environmental impact report. The Court ruled that the 
District's environmental review documentation of the 2001 Plan was 
vague and that the District's actions did not accord Petitioners an 
adequate opportunity to comment on whether the low VOC solvents 
required by the adopted rules to implement SS-13 and SS-14 could have 
adverse impacts. The Court ordered the District to prepare an EIR for 
the adoption of the rules to implement SS-13 and SS-14. Thus EPA's 
action on the adequacy of the plan is premature and inappropriate under 
the Act and EPA's regulations. The Court's CEQA ruling clearly reflects 
the State Court's conclusion that the District failed to follow all the 
procedural requirements of the State's laws in conducting and 
completing the adoption and issuance of the plan, as required under 40 
CFR Part 51, App V, 2.1(e).
    Response: The commenter's contention has no merit. In this action, 
EPA is approving two control measure commitments in the plan known as 
SS-13 and SS-14. The Court's order on the CEQA claim does not, however, 
implicate these two control measure commitments. In addition to 
declining to set aside the District's adoption of the 2001 plan, the 
Court noted that, after its adoption of the plan, the District adopted 
rules to implement SS-13 and SS-14. The Court then ordered the District 
to prepare an EIR for the adoption of these rules. EPA in today's 
action is not approving the rules that are the actual subject of the 
Court's order. Therefore the CEQA defect addressed by Court's order is 
not relevant to EPA's action here.
    Comment 28: The State Court has held that the 2001 Plan violates 
section 40233 of the California Health and Safety Code and ordered that 
the co-lead agencies develop a plan for public comment that 
accomplishes the necessary 26 tons of VOC emissions reductions no later 
than 60 days from the notice of entry of the order. Section 
110(a)(2)(E) of the Clean Air Act prohibits approval of a state clean 
air plan if it violates state clean air laws.
    Response: In addition to withdrawing the attainment assessment in 
the 2001 plan, the State has withdrawn the associated commitment by the 
co-lead agencies and CARB to adopt and submit measures to achieve 26 
tpd of VOC emission reductions. As a result of our final attainment 
finding for the area and the resulting suspension of the CAA's 
attainment demonstration requirement for the Bay Area, these plan 
elements are not currently required. Therefore the State Court's 
holding that the 2001 plan violates section 40233 of the California 
Health and Safety Code is not relevant.
    Comment 29: The CAA and EPA's regulations require assurances that 
the 2001 Plan and all of its elements were properly adopted. Several 
defects in the State's process and/or legal authority jeopardize the 
Plan and its implementation. CEQA was intended to be an environmental 
full disclosure statute and the EIR process necessarily requires 
consideration of alternatives and adoption of feasible alternatives or 
mitigation measures that substantially lessen or avoid adverse effects. 
The EIR process also promotes public involvement in agency decision 
making. The San Francisco Superior Court's finding that additional 
environmental disclosure and process is required is damning evidence of 
the flaws in the public review and involvement processes leading to 
plan adoption.
    Response: EPA's completeness criteria require evidence that the 
State has the necessary legal authority under state law to adopt and 
implement the plan and evidence that the State followed all of the 
procedural requirements of its laws and constitution in conducting and 
completing the adoption/issuance of the plan. 40 CFR part 51, Appendix 
V, section 2.1(c) and (e). EPA regulations require public notice and 
hearings. 40 CFR 51.102. The commenter appears to believe that these 
requirements compel the State to comply with every aspect of all of its 
laws and regulations. That is not the case. The State need only 
demonstrate that it has the legal authority to adopt the plan and that 
it has followed all of the requirements in the State law and 
constitution that are related to adoption of the plan. The State has 
provided evidence that it has met these requirements. See Checklist, 
section 2.1(b) and (c). Contrary to the commenters's assertions, the 
State Court Order actually supports this conclusion: ``The Court finds 
no violation of the Clean Air Act or other applicable authority 
occurred with respect to the Air Resources Board's adoption and 
transmittal of the 2001 [plan] to the Environmental Protection 
Agency.'' Order, p. 6.
7. Comments on the Interim Final Determination
    Based on our proposed approval of the 2001 Plan (68 FR 42174), we 
made an interim final determination that California had corrected the 
deficiencies for which a sanctions clock began on October 22, 2001 (68 
FR 42172, July 16, 2003). The comments we received and our responses 
are included in the RTC document.

IV. Effect of the Attainment Determination and 2001 Plan Action on 
Transportation Conformity

    CAA section 176(c) requires that federally funded or approved 
transportation actions in nonattainment areas ``conform'' to the area's 
air quality plans. Conformity ensures that federal transportation 
actions do not worsen an area's air quality or interfere with its 
meeting the air quality standards.
    One of the primary tests for conformity is to show that 
transportation plans and improvement programs will not cause motor 
vehicle emissions higher than the levels needed to make progress toward 
and to meet the air quality standards. These motor vehicle emissions 
levels are set in an area's attainment, maintenance and/or RFP 
demonstrations and are known as the ``transportation conformity 
budgets.''
    EPA and the Federal Highway Administration have developed guidance 
that indicates that budgets must be deemed adequate or approved before 
they can be used.\25\ As stated previously, we found the motor vehicle 
emissions budgets in the 2001 Plan

[[Page 21730]]

adequate on February 14, 2002. 67 FR 8017. We are approving those 
budgets in this action.\26\ Note that typically, under 40 CFR 
93.118(e)(1), the motor vehicle emission budget, once approved, cannot 
be replaced by another unless the new budget comes from an approved 
SIP. However, as discussed in our proposed approval of the budgets in 
the 2001 Plan (68 FR 42174, 42181), EPA is approving the vehicle 
emission budgets in that plan only until new budgets developed with 
EMFAC2002 are submitted and found adequate for conformity purposes. See 
67 FR 1464 (January 11, 2002). Budgets developed with EMFAC2002 will be 
more accurate than those developed using EMFAC2000.\27\ Therefore, by 
limiting the duration of our approval of the EMFAC2000-derived budgets 
to the point when the updated budgets are found adequate, the updated 
budgets may be in place within a few months of their submission. For 
further discussion of the rationale for, and the effect of, this 
limitation, please see our promulgation of a limitation on motor 
vehicle emission budgets associated with various California SIPs, at 67 
FR 69139 (November 15, 2002).
---------------------------------------------------------------------------

    \25\ See EPA memorandum ``Conformity Guidance on Implementation 
of March 2, 1999 Conformity Court Decision'' (EPA420-F-99-025, May 
14, 1999); available online at http://www.epa.gov/otaq/transp/conform/policy.htm#030299. This guidance was developed in response 
to a 1999 decision of the U.S. Court of Appeals for the District of 
Columbia Circuit that requires EPA to make certain changes in its 
conformity regulations (40 CFR 93.100 et. seq) to provide that 
budgets must be deemed adequate or approved, rather than simply 
submitted, in order to be used in conformity determinations. 
Environmental Defense Fund v. EPA, et al., 167 F. 3d 641 (DC Cir. 
1999). As a result, EPA interprets 40 CFR 93.109(c)(5)(ii) to apply 
to budgets that have been deemed adequate or have been approved, not 
merely submitted. EPA's current proposal to modify the conformity 
regulations (68 FR 62690, 62724, November 5, 2003) confirms this 
interpretation of the conformity rule.
    \26\ In our proposed attainment finding we noted that ``[i]f the 
attainment demonstration is withdrawn . . . the continued 
applicability of the budgets could be affected.'' 68 FR 62045. The 
State did not, however, withdraw the budgets in the 2001 Plan when 
it withdrew the attainment assessment but, in fact, specifically 
requested that EPA approve them. See 1/30/04 Witherspoon letter. 
Further, the State and District continue to implement the control 
measures that brought the area into attainment. Thus the final 
attainment finding has no effect on those budgets.
    \27\ Because EMFAC2000 has certain technical limitations, EPA 
approved it only for use in development of ozone motor vehicle 
emissions factors for SIP development and future conformity 
determinations in the San Francisco Bay Area. It was superior to 
prior models available for use in the area and the improved 
EMFAC2002 was not yet available. 68 FR 42181.
---------------------------------------------------------------------------

    We believe that the State and co-lead agencies should move promptly 
to develop and submit a maintenance plan. The maintenance plan 
submittal should include, in addition to the maintenance year budgets, 
replacement 2006 budgets that are revised based on the latest approved 
version of EMFAC. Should EPA determine that the Bay Area is again 
subject to the 1-hour ozone attainment demonstration requirement as a 
result of a new violation of the 1-hour standard prior to 
redesignation, the State should submit a replacement 2006 budget with 
the attainment demonstration. Again, this replacement budget must use 
the latest approved version of EMFAC.

V. Statutory and Executive Order Reviews

    Under Executive Order 12866 (58 FR 51735, October 4, 1993), this 
action is not a ``significant regulatory action'' and therefore is not 
subject to review by the Office of Management and Budget. For this 
reason, this action is also not subject to Executive Order 13211, 
``Actions Concerning Regulations That Significantly Affect Energy 
Supply, Distribution, or Use'' (66 FR 28355, May 22, 2001). This action 
merely approves state law as meeting federal requirements and imposes 
no additional requirements beyond those imposed by state law. It also 
finds that the San Francisco Bay Area has attained a previously 
established national ambient air quality standard based on an objective 
review of measured air quality data. Finally, it determines that 
certain Clean Air Act requirements no longer apply to the San Francisco 
Bay Area because of the attainment finding. Accordingly, the 
Administrator certifies that this rule will not have a significant 
economic impact on a substantial number of small entities under the 
Regulatory Flexibility Act (5 U.S.C. 601 et seq.). Because this rule 
approves pre-existing requirements under state law and does not impose 
any additional enforceable duty beyond that required by state law, it 
does not contain any unfunded mandate or significantly or uniquely 
affect small governments, as described in the Unfunded Mandates Reform 
Act of 1995 (Pub. L. 104-4).
    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 (65 
FR 67249, November 9, 2000). This action also does not have Federalism 
implications because it does 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). This action merely approves a state rule 
implementing a Federal standard, and does not alter the relationship or 
the distribution of power and responsibilities established in the Clean 
Air Act. This 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), because it is not economically 
significant.
    In reviewing SIP submissions, EPA's role is to approve state 
choices, provided that they meet the criteria of the Clean Air Act. In 
this context, in the absence of a prior existing requirement for the 
State to use voluntary consensus standards (VCS), EPA has no authority 
to disapprove a SIP submission for failure to use VCS. It would thus be 
inconsistent with applicable law for EPA, when it reviews a SIP 
submission, to use VCS in place of a SIP submission that otherwise 
satisfies the provisions of the Clean Air Act. Thus, the requirements 
of section 12(d) of the National Technology Transfer and Advancement 
Act of 1995 (15 U.S.C. 272 note) do not apply. This rule does not 
impose an information collection burden under the provisions of the 
Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.).
    The Congressional Review Act, 5 U.S.C. 801 et seq., as added by the 
Small Business Regulatory Enforcement Fairness Act of 1996, generally 
provides that before a rule may take effect, the agency promulgating 
the rule must submit a rule report, which includes a copy of the rule, 
to each House of the Congress and to the Comptroller General of the 
United States. EPA will submit a report containing this rule and other 
required information to the U.S. Senate, the U.S. House of 
Representatives, and the Comptroller General of the United States prior 
to publication of the rule in the Federal Register. A major rule cannot 
take effect until 60 days after it is published in the Federal 
Register. This action is not a ``major rule'' as defined by 5 U.S.C. 
section 804(2).
    Under section 307(b)(1) of the Clean Air Act, petitions for 
judicial review of this action must be filed in the United States Court 
of Appeals for the appropriate circuit by June 21, 2004. Filing a 
petition for reconsideration by the Administrator of this final rule 
does not affect the finality of this rule for the purposes of judicial 
review nor does it extend the time within which a petition for judicial 
review may be filed, and shall not postpone the effectiveness of such 
rule or action. This action may not be challenged later in proceedings 
to enforce its requirements. (See section 307(b)(2).)

List of Subjects in 40 CFR Part 52

    Environmental protection, Air pollution control, Incorporation by 
reference, Intergovernmental relations, Ozone, Reporting and 
recordkeeping requirements.


[[Page 21731]]


    Dated: April 1, 2004.
Laura Yoshii,
Acting Regional Administrator, Region IX.


0
Part 52, chapter I, title 40 of the Code of Federal Regulations is 
amended as follows:

PART 52--[AMENDED]

0
1. The authority citation for Part 52 continues to read as follows:

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

Subpart F--California

0
2. Section 52.220 is amended by adding paragraph (c)(323) to read as 
follows:


Sec.  52.220  Identification of plan.

* * * * *
    (c) * * *
    (323) The following plan was submitted on November 30, 2001 by the 
Governor's designee.
(i) Incorporation by Reference
(A) Bay Area Air Quality Management District
    (1) San Francisco Bay Area Ozone Attainment Plan for the 1-hour 
National Ozone Standard (Section 3: Emission Inventory; Section 5: 
Control Strategy, except subsection ``Demonstrating Reasonable Further 
Progress''; Appendix B: Control Measure Descriptions; Appendix C: 
Reasonably Available Control Measure Analysis; Appendix E: Further 
Study Measure Descriptions;) adopted on October 24, 2001.

[FR Doc. 04-9142 Filed 4-21-04; 8:45 am]
BILLING CODE 6560-50-P