[Federal Register Volume 70, Number 24 (Monday, February 7, 2005)]
[Rules and Regulations]
[Pages 6355-6361]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 05-2303]


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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 63

[OAR-2003-0194; FRL-7869-7]
RIN 2060-AL89


National Emission Standards for Hazardous Air Pollutants for 
Leather Finishing Operations

AGENCY: Environmental Protection Agency (EPA).

ACTION: Direct final rule; amendments.

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SUMMARY: The EPA is taking direct final action on amendments to the 
national emission standards for hazardous air pollutants (NESHAP) for 
leather finishing operations, which were issued on February 27, 2002, 
under section 112 of the Clean Air Act (CAA). The direct final 
amendments clarify the frequency for categorizing leather product 
process types, modify the definition of ``specialty leather,'' add a 
definition for ``vacuum mulling,'' and add an alternative procedure for 
determining the actual monthly solvent loss from an affected source. We 
are issuing the amendments as a direct final rule, without prior 
proposal, because we view the revisions as noncontroversial and 
anticipate no significant adverse comments. However, in the Proposed 
Rules section of this Federal Register, we are publishing a separate 
document that will serve as the proposal to amend the national emission 
standards for leather finishing operations if significant adverse 
comments are filed.

DATES: The direct final rule is effective on February 28, 2005 without 
further notice, unless EPA receives adverse written comment by February 
17, 2005 or by February 22, 2005 if a public hearing is requested. If 
significant adverse comments are received, EPA will publish a timely 
withdrawal in the Federal Register indicating which provisions will 
become effective, and which provisions are being withdrawn due to 
adverse comment.

ADDRESSES: Submit your comments, identified by Docket ID No. OAR-2003-
0194, by one of the following methods:
     Federal eRulemaking Portal: http://www.regulations.gov. 
Follow the on-line instructions for submitting comments.
     Agency Web site: http://www.epa.gov/edocket. EDOCKET, 
EPA's electronic public docket and comment system, is EPA's preferred 
method for receiving comments. Follow the on-line instructions for 
submitting comments.
     E-mail: [email protected].
     Fax: (202) 566-1741.
     Mail: EPA Docket Center, EPA, Mailcode: 6102T, 1200 
Pennsylvania Avenue, NW., Washington, DC 20460. Please include a 
duplicate copy, if possible.
     Hand Delivery: Air and Radiation Docket, EPA, 1301 
Constitution Avenue, NW., Room B-108, Washington, DC 20460. Such 
deliveries are only accepted during the Docket's normal hours of 
operation, and special arrangements should be made for deliveries of 
boxed information.
    We request that a separate copy also be sent to the contact person 
listed below (see FOR FURTHER INFORMATION CONTACT).
    Instructions: Direct your comments to Docket ID No. OAR-2003-0194. 
EPA's policy is that all comments received will be included in the 
public docket without change and may be made available online at http://www.epa.gov/edocket, including any personal information provided, 
unless the comment includes information claimed to be Confidential 
Business Information (CBI) or other information whose disclosure is 
restricted by statute. Do not submit information that you consider to 
be CBI or otherwise protected through EDOCKET, regulations.gov, or e-
mail. The EPA EDOCKET and the federal regulations.gov websites are 
``anonymous access'' systems, which means EPA will not know your 
identity or contact information unless you provide it in the body of 
your comment. If you send an e-mail comment directly to EPA without 
going through EDOCKET or regulations.gov, your e-mail address will be 
automatically captured and included as part of the comment that is 
placed in the public docket and made available on the internet. If you 
submit an electronic comment, EPA recommends that you include your name 
and other contact information in the body of your comment and with any 
disk or CD-ROM you submit. If EPA cannot read your comment due to 
technical difficulties and cannot contact you for clarification, EPA 
may not be able to consider your comment. Electronic files should avoid 
the use of special characters, any form of encryption, and be free of 
any defects or viruses. For additional information about EPA's public 
docket visit EDOCKET on-line or see the Federal Register of May 31, 
2002 (67 FR 38102).
    Docket: All documents in the docket are listed in the EDOCKET index 
at http://www.epa.gov/edocket. Although listed in the index, some 
information is not publicly available, i.e., CBI or other information 
whose disclosure is restricted by statute. Certain other material, such 
as copyrighted material, is not placed on the Internet and will be 
publicly available only in hard copy form. Publicly available docket 
materials are available either electronically in EDOCKET or in hardcopy 
at the Air and Radiation Docket, EPA/DC, EPA West, Room B102, 1301 
Constitution Ave., NW., Washington, DC. The Public Reading Room is open 
from 8:30 a.m. to 4:30 p.m., Monday through Friday, excluding legal 
holidays. The telephone number for the Public Reading Room is (202) 
566-1744, and the telephone number for the Air Docket is (202) 566-
1742.

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FOR FURTHER INFORMATION CONTACT: Mr. William Schrock, Organic Chemicals 
Group, Emission Standards Division (C504-04), Office of Air Quality 
Planning and Standards, U.S. EPA, Research Triangle Park, North 
Carolina 27711; telephone number (919) 541-5032; facsimile number (919) 
541-3470; electronic mail (e-mail) address: [email protected].

SUPPLEMENTARY INFORMATION: Since these rule amendments do not add 
substantive requirements and ease certain compliance obligations, EPA 
finds that there is good cause to make the rule amendments immediately 
effective upon the close of the comment period, within the meaning of 5 
U.S.C. section 553(d).
    Regulated Entities. Categories and entities potentially regulated 
by this action include:

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                  Category                    NAICS * code              Examples of regulated entities
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Industry...................................            3161   Leather finishing operations.
                                                      31611   Leather finishing operations.
                                                     316110   Leather finishing operations.
Federal government.........................  ..............   Not affected.
State/local/tribal government..............  ..............   Not affected.
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\*\ North American Industrial Classification System.

    This table is not intended to be exhaustive, but rather provides a 
guide for readers regarding entities likely to be regulated by this 
action. To determine whether your facility is regulated by this action, 
you should carefully examine the applicability criteria in 40 CFR 
63.5285. If you have any questions regarding the applicability of this 
action to a particular entity, consult the person listed in the 
preceding FOR FURTHER INFORMATION CONTACT section.
    Worldwide Web (WWW). In addition to being available in the docket, 
an electronic copy of today's document will also be available on the 
WWW through EPA's Technology Transfer Network (TTN). Following 
signature by the EPA Administrator, a copy of the direct final rule 
amendments will be posted on the TTN's policy and guidance page for 
newly proposed or promulgated rules at http://www.epa.gov/ttn/oarpg. 
The TTN provides information and technology exchange in various areas 
of air pollution control. If more information regarding the TTN is 
needed, call the TTN HELP line at (919) 541-5384.
    Comments. We are publishing the direct final rule amendments 
without prior proposal because we view the amendments as 
noncontroversial and do not anticipate significant adverse comments. 
However, in the Proposed Rules section of this Federal Register notice, 
we are publishing a separate document that will serve as the proposal 
to amend the national emission standards for leather finishing 
operations if significant adverse comments are filed. If we receive any 
significant adverse comments on one or more distinct amendments, we 
will publish a timely withdrawal in the Federal Register informing the 
public which provisions will become effective, and which provisions are 
being withdrawn due to adverse comment. We will address all public 
comments in a subsequent final rule, should the Agency determine to 
issue one. Any of the distinct amendments in today's direct final rule 
for which we do not receive significant adverse comment will become 
effective on the previously mentioned date. We will not institute a 
second comment period on the direct final rule amendments. Any parties 
interested in commenting must do so at this time.
    Judicial Review. Under section 307(b)(1) of the CAA, judicial 
review of the direct final rule amendments is available only by filing 
a petition for review in the U.S. Court of Appeals for the District of 
Columbia Circuit by February 28, 2005. Under section 307(d)(7)(B) of 
the CAA, only an objection to the direct final rule amendments which 
was raised with reasonable specificity during the period for public 
comment can be raised during judicial review. Moreover, under section 
307(b)(2) of the CAA, the requirements established by the direct final 
rule amendments may not be challenged separately in any civil or 
criminal proceedings brought by EPA to enforce these requirements.
    Outline. The following outline is provided to aid in reading the 
preamble to the direct final rule amendments.

I. Background
    A. Frequency of Testing for Product Process Type Categorization
    B. Revised Specialty Leather Definition
    C. Alternative Procedure for Determining Actual Solvent Loss
II. Amendments to 40 CFR Part 63, Subpart TTTT
III. Statutory and Executive Order Reviews
    A. Executive Order 12866, Regulatory Planning and Review
    B. Paperwork Reduction Act
    C. Regulatory Flexibility Act (RFA), as Amended by the Small 
Business Regulatory Enforcement Fairness Act of 1996 (SBREFA), 5 
U.S.C. 601 et seq.
    D. Unfunded Mandates Reform Act
    E. Executive Order 13132, Federalism
    F. Executive Order 13175, Consultation and Coordination with 
Indian Tribal Governments
    G. Executive Order 13045, Protection of Children from 
Environmental Health Risks and Safety Risks
    H. Executive Order 13211, Actions Concerning Regulations that 
Significantly Affect Energy Supply, Distribution or Use
    I. National Technology Transfer and Advancement Act of 1995
    J. Congressional Review Act

I. Background

    The EPA promulgated NESHAP for leather finishing operations on 
February 27, 2002 (67 FR 9156). The final rule (40 CFR part 63, subpart 
TTTT) includes standards for hazardous air pollutants (HAP), as well as 
monitoring, performance testing, recordkeeping, and reporting 
requirements related to those standards. Today's action includes direct 
final rule amendments to clarify the frequency for categorizing leather 
product process types, modify the definition of ``specialty leather,'' 
add a definition for ``vacuum mulling,'' and add an alternative 
procedure for determining the actual monthly solvent loss from an 
affected source.

A. Frequency of Testing for Product Process Type Categorization

    We noticed that the promulgated standards were silent regarding how 
often an affected source will perform appropriate testing to properly 
categorize each finish application in one of four leather product 
process operations: (1) Upholstery operations with less than four grams 
of finish add-ons, (2) upholstery operations with four grams or more of 
finish add-ons, (3) water-resistant/specialty, and (4) nonwater-
resistant. In the final rule, to determine whether a leather finish 
application is categorized as ``water-resistant'' or ``nonwater-
resistant,'' you must use the Maeser Flexes test method on finished 
leather samples according to

[[Page 6357]]

American Society for Testing and Materials (ASTM) Designation D2099-00, 
or use an alternative testing method approved by the Administrator (40 
CFR 63.5345-63.5350). We are amending the final rule to clarify that 
once you have determined that a unique finish application corresponds 
to one of the four product process operations, the applied finish 
categorization can remain valid for up to 5 years, provided there are 
no changes in the applied finish chemical characteristics. However, if 
the chemical characteristics of the applied finish change, or if you 
operate for 5 years with an unchanged applied finish formula, you must 
re-categorize the applied finish using appropriate testing procedures 
to document the leather product process operation to which the applied 
finish will correspond. Thus, once a leather finish application has 
been categorized through proper documentation, you will need to renew 
the categorization every 5 years or when the applied finish chemical 
characteristics change, whichever occurs sooner.

B. Revised Specialty Leather Definition

    The definition of specialty leather in the final rule states that 
it is a select grade of chrome tanned, bark retanned, or fat liquored 
leather that is retanned through the application of greases, waxes, and 
oils in quantities greater than 25 percent of the dry leather weight. 
The specialty leather definition was added to the final rule after 
commenters to the proposed rule noted that leather that has been 
retanned with greater than 25 percent greases, fats, and oils requires 
finishing with coatings that contain more solvents and, therefore, more 
HAP to achieve proper adhesion of the finish to the leather and produce 
the color and textures the market demands.
    While the definition in the final rule appeared to cover all the 
specialty leather produced at the time, one leather finishing company 
(Horween Leather Company) raised the issue that they finish leather 
that should meet the definition of ``specialty'' based on the amount of 
solvent they are required to use in the coatings. These products, 
however, did not meet the definition of specialty leather in the final 
rule. In fact, in order to produce some high-quality dress or 
performance shoe leathers, higher solvent-based finishes are required 
to provide the rich color, luster, or an oily/tacky feel demanded by 
the market. These leathers are produced by retanning with oils, fat, 
and greases of less than 25 percent which does not qualify them for the 
specialty leather category.
    In a letter sent via a facsimile on December 3, 2002, Horween 
Leather provided EPA with technical information relating to the solvent 
content of the coatings required for their proposed specialty leather 
products and the oil, fat, and grease content of the retanned leather. 
This information clearly showed that higher solvent coatings were 
required to achieve satisfactory product qualities down to some oil, 
fat, and grease content of approximately 12 percent. EPA discussed this 
information with representatives of Horween, as well as with coatings 
experts for the leather industry, to determine whether alternatives for 
the higher solvent coatings could be used with lower oil, fat, and 
grease content leather and achieve the same results. After considering 
these discussions and reviewing the data, EPA determined that the only 
means of producing this leather with the lower fat, oil, and grease 
content and achieving the same results is by revising the specialty 
leather definition.
    The revised specialty leather definition in the direct final rule 
amendments lowers the minimum percentage of applied grease, waxes, and 
oil used for retanning the leather to greater than 12 percent of the 
dry leather weight. This revision enables leather finishers to use the 
higher solvent coatings required to achieve the desired results since 
no other options exist. The Agency estimates that this change in 
definition will only affect one or two facilities that produce this 
specialty leather and will enable them to meet market demand for 
products with a lower fat, oil, and grease content. The fraction of 
leather produced at these facilities that will be affected by this 
change is estimated to be approximately 3 percent of their total amount 
of leather finished in a year. This change will therefore have the 
effect of moving this quantity of leather from the non-water resistant 
leather category with an emission limit of 3.7 pounds of HAP loss per 
1,000 square feet of leather finished to the water resistant/specialty 
leather category with an emission limit of 5.6 pounds of HAP loss per 
1,000 square feet of leather finished.
    In addition to lowering the percentage of oil, fat, and grease, we 
are revising the specialty leather definition to also include high-
quality dress or performance shoe leather that can withstand one or 
both of the following visual tests: Moisture injection into the leather 
using vacuum mulling without signs of blistering, or prolonged ironing 
at 200 [deg]F for smoothing out surface roughness without finish lift 
off. As noted above, one of the reasons for using higher solvent 
coatings was to achieve a higher level of adhesion. Vacuum mulling and 
prolonged ironing are used as an indicator of coating adhesion to the 
leather substrate and are, therefore, being incorporated into the 
definition. Incorporating these criteria into a revised specialty 
leather definition allows for these mostly low-production quantities of 
high-quality dress or performance shoe leathers to be appropriately 
categorized as ``specialty leather'' products.

C. Alternative Procedure for Determining Actual Solvent Loss

    After promulgation of the final rule, we received several comment 
letters on behalf of the trade organization, Leather Industries of 
America (LIA), and two leather finishing companies (Prime Tanning 
Company and S.B. Foot Tanning Company). The primary issue centered on 
the potential recordkeeping burden of a finish inventory log to 
determine the actual monthly solvent loss from an affected source. As 
stated in the final rule, each source must record the pounds of each 
type of finish applied for each leather product process operation and 
the mass fraction of HAP in each applied finish. The basis for this 
type of recordkeeping was that each source knew the chemical 
composition of each applied finish and was capable of measuring the 
amount of finish as applied to each leather product; thus, a ``measure-
as-you-directly-apply'' approach appears generally reasonable.
    Two leather finishing companies indicated that current company 
practices determine actual monthly solvent loss through mass balance 
calculations based on a detailed inventory of stored chemicals, at the 
beginning- and end-of-each month, and business purchasing records to 
indicate additions to the inventory of chemical supplies. Thus, the net 
loss of finishing solvents is determined by subtracting the end-of-the 
month chemical inventory from the beginning-of-the-month chemical 
inventory and adding the quantities of all chemicals purchased during 
the same 1-month period. Typically, a unique finish application is 
prepared by removing known quantities of chemicals from a storage 
location, and the unique finish is formulated in a separate location, 
commonly referred to as a mixing room. In situations when an excess 
amount of finish is formulated, the companies indicated that the excess 
amount is generally accounted for in the mass balance procedures as 
consumed by the process (i.e., fugitive solvent loss). This assumption 
is often taken as a

[[Page 6358]]

simplifying step which results in a conservative and slightly 
overestimated measure of the solvent loss. Excess finish may eventually 
be used in other finish applications; thus, its use and consumption by 
the process may not be immediate. Nonetheless, the excess amount is 
immediately accounted for as a solvent loss.
    In other situations, the companies indicated they may choose to 
dispose of the excess finish and make an appropriate adjustment in 
their corresponding mass balance calculations. If the disposed 
quantities of finish are small, the companies may choose to record the 
disposed quantity in the mass balance as consumed by the process (i.e., 
fugitive solvent loss). Again, this assumption is a simplifying step 
which results in a conservative and slightly overestimated measure of 
the solvent loss. However, the companies may choose to record the 
quantity as disposed and remove the quantity from the mass balance, so 
it is neither listed as released to the air nor is the quantity of 
solvent listed as remaining in the inventory.
    The two companies indicated it would cause an extreme labor and 
cost burden to change and implement a ``measure-as-you-directly-apply'' 
approach. Furthermore, they stated that their current ``mass balance'' 
approach is just as accurate in determining actual monthly solvent 
losses as the ``measure-as-you-directly-apply'' approach. Both of these 
leather finishing companies provided sufficient supporting 
documentation that their current solvent measurement procedures are 
capable of accurately determining the quantity of solvent finishes used 
each month and determining the mass fraction of HAP in the consumed 
solvent finishes.
    Therefore, in today's action, we are allowing a monthly chemical 
inventory mass balance as an alternative procedure in 40 CFR 63.5335(b) 
for determining actual monthly HAP loss from an affected source. A 
monthly chemical inventory mass balance is appropriate, as long as the 
source follows its detailed mass balance procedures and calculations in 
its plan for demonstrating compliance, in accordance with 40 CFR 
63.5325. Regardless of which approach is used to determine finish loss, 
each source is still required to maintain a written or printed log that 
documents the total quantity of solvents/finishes used each month in 
the process and the mass fraction of HAP in each solvent/finish.

II. Amendments to 40 CFR Part 63, Subpart TTTT

    Today's action includes amendments that add an alternative 
procedure for determining the actual monthly solvent loss from an 
affected source, clarify the frequency in which leather product process 
types must be categorized, modify the definition of ``specialty 
leather,'' and add a definition for ``vacuum mulling.''
    Section 63.5335 of 40 CFR part 63 is amended by adding a new 
alternative requirement for maintaining a finish application log based 
on a detailed chemical inventory mass balance. This was accomplished by 
splitting paragraph (b) into two subparagraphs to list the two 
acceptable methodologies for determining actual monthly solvent loss 
from an affected source. The revised paragraph (b)(1) includes the 
previous requirements for maintaining a log of finish types as they are 
applied to a leather product process. Previously, these requirements 
were listed in paragraphs (b)(1) through (7) of Sec.  63.5335. However, 
the requirements have been redesignated, without any further changes, 
as paragraphs (b)(1)(i) through (vii). Paragraph (b)(2) of Sec.  
63.5335 includes the new alternative requirements for maintaining a 
finish application log based on a detailed chemical inventory mass 
balance.
    Section 63.5345 is amended by adding paragraph (d) to clarify the 
frequency for the two types of upholstery product process operations 
which must be categorized.
    Section 63.5350 is amended by clarifying the frequency for water-
resistant and nonwater-resistant product process operations which must 
be categorized, incorporating the revised definition of specialty 
leather, and by providing alternative visual test criteria to support 
the categorization of high-quality dress or performance shoe leather as 
specialty leather. We have also clarified the frequency for 
categorizing specialty leather product process operations.
    Section 63.5460 is amended by revising the definition for the term 
specialty leather and adding a definition for the term vacuum mulling.

III. Statutory and Executive Order Review

A. Executive Order 12866, Regulatory Planning and Review

    Under Executive Order 12866 (58 FR 51735, October 4, 1993), the 
Agency must determine whether the regulatory action is ``significant'' 
and, therefore, subject to Office of Management and Budget (OMB) review 
and the requirements of the Executive Order. The Executive Order 
defines ``significant regulatory action'' as one that is likely to 
result in a rule that may:
    (1) Have an annual effect on the economy of $100 million or more or 
adversely affect in a material way the economy, a sector of the 
economy, productivity, competition, jobs, the environment, public 
health or safety, or State, local, or tribal governments or 
communities;
    (2) Create a serious inconsistency or otherwise interfere with an 
action taken or planned by another agency;
    (3) Materially alter the budgetary impact of entitlements, grants, 
user fees, or loan programs or the rights and obligations of recipients 
thereof; or,
    (4) Raise novel legal or policy issues arising out of legal 
mandates, the President's priorities, or the principles set forth in 
the Executive Order.
    It has been determined that the direct final rule amendments are 
not a ``significant regulatory action'' under the terms of Executive 
Order 12866 and are, therefore, not subject to OMB review.

B. Paperwork Reduction Act

    This action does not impose any new information collection burden. 
This action modifies a definition and adds a new definition to the 
final standards. It also adds an alternative option for determining HAP 
loss from the process. Since this action only clarifies the existing 
standards and adds an option, this action will not increase the 
information collection burden. The OMB has previously approved the 
information collection requirements contained in the existing 
regulations under the provisions of the Paperwork Reduction Act, 44 
U.S.C. 3501 et seq., and has assigned OMB control number 2060-0478 (EPA 
ICR No. 1985.02).
    Copies of the Information Collection Request (ICR) document(s) may 
be obtained from Susan Auby, by mail at the Office of Environmental 
Information, Collection Strategies Division; U.S. EPA (2822T); 1200 
Pennsylvania Ave., NW., Washington, DC 20460, by email at 
[email protected], or by calling (202) 566-1672. A copy may also be 
downloaded off the Internet at http://www.epa.gov/icr. Include the ICR 
number in any correspondence.
    Burden means the total time, effort, or financial resources 
expended by persons to generate, maintain, retain, or disclose or 
provide information to or for a Federal agency. This includes the time 
needed to review instructions; develop, acquire, install, and utilize 
technology and systems for the purposes of

[[Page 6359]]

collecting, validating, and verifying information, processing and 
maintaining information, and disclosing and providing information; 
adjust the existing ways to comply with any previously applicable 
instructions and requirements; train personnel to be able to respond to 
a collection of information; search data sources; complete and review 
the collection of information; and transmit or otherwise disclose the 
information.
    An agency may not conduct or sponsor, and a person is not required 
to respond to a collection of information unless it displays a 
currently valid OMB control number. The OMB control numbers for EPA's 
regulations are listed in 40 CFR part 9 and 48 CFR chapter 15.

C. Regulatory Flexibility Act

    The EPA has determined that it is not necessary to prepare a 
regulatory flexibility analysis in connection with the direct final 
rule amendments.
    For purposes of assessing the impact of today's direct final rule 
amendments on small entities, small entities are defined as: (1) A 
small business that has fewer than 750 employees; (2) a small 
governmental jurisdiction that is a government of a city, county, town, 
school district or special district with a population of less than 
50,000; and (3) a small organization that is any not-for-profit 
enterprise which is independently owned and operated and is not 
dominant in its field.
    After considering the economic impacts of today's direct final rule 
amendments on small entities, the EPA has concluded that this action 
will not have a significant impact on a substantial number of small 
entities. The direct final rule amendments will not impose any new 
requirements on small entities.

D. Unfunded Mandates Reform Act

    Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), Public 
Law 104-4, establishes requirements for Federal agencies to assess the 
effects of their regulatory actions on State, local, and tribal 
governments and the private sector. Under section 202 of the UMRA, the 
EPA generally must prepare a written statement, including a cost-
benefit analysis, for proposed and final rules with ``Federal 
mandates'' that may result in expenditures by State, local, and tribal 
governments, in the aggregate, or by the private sector, of $100 
million or more in any 1 year. Before promulgating an EPA rule for 
which a written statement is needed, section 205 of the UMRA generally 
requires the EPA to identify and consider a reasonable number of 
regulatory alternatives and adopt the least-costly, most cost-
effective, or least burdensome alternative that achieves the objectives 
of the rule. The provisions of section 205 do not apply when they are 
inconsistent with applicable law. Moreover, section 205 allows the EPA 
to adopt an alternative other than the least-costly, most cost 
effective, or least-burdensome alternative if the Administrator 
publishes with the final rule an explanation why that alternative was 
not adopted. Before the EPA establishes any regulatory requirements 
that may significantly or uniquely affect small governments, including 
tribal governments, it must have developed under section 203 of the 
UMRA a small government agency plan. The plan must provide for 
notifying potentially affected small governments to have meaningful and 
timely input in the development of EPA regulatory proposals with 
significant Federal intergovernmental mandates, and informing, 
educating, and advising small governments on compliance with the 
regulatory requirements.
    The EPA has determined that the direct final rule amendments do not 
contain a Federal mandate that may result in expenditures of $100 
million or more for State, local, and tribal governments, in the 
aggregate, or the private sector in any 1 year. The direct final rule 
amendments apply only to affected sources in the leather finishing 
industry and clarify the frequency for categorizing leather product 
process types, modify the definition of ``specialty leather,'' add a 
definition for ``vacuum mulling,'' and add an alternative procedure for 
determining the actual monthly solvent loss from an affected source 
and, therefore, impose no additional burden on sources. Therefore, the 
direct final rule amendments are not subject to the requirements of 
sections 202 and 205 of the UMRA.

E. Executive Order 13132, Federalism

    Executive Order 13132 (64 FR 43255, August 10, 1999) requires the 
EPA to develop an accountable process to ensure ``meaningful and timely 
input by State and local officials in the development of regulatory 
policies that have federalism implications.'' ``Policies that have 
federalism implications'' are defined in the Executive Order to include 
regulations that has ``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.''
    The direct final rule amendments do not have federalism 
implications. They will not have substantial direct effects on the 
States, on the relationship between the national government and the 
States, or on the distribution of power and responsibilities among the 
various levels of government, as specified in Executive Order 13132. 
The direct final rule amendments apply only to affected sources in the 
leather finishing industry and clarify the frequency for categorizing 
leather product process types, modify the definition of ``specialty 
leather,'' add a definition for ``vacuum mulling,'' and add an 
alternative procedure for determining the actual monthly solvent loss 
from an affected source and, therefore, impose no additional burden on 
sources. Thus, Executive Order 13132 does not apply to the direct final 
rule amendments.
    In the spirit of Executive Order 13132 and consistent with EPA 
policy to promote communications between the EPA, State and local 
governments, the EPA specifically solicits comment on the direct final 
rule amendments from State and local officials.

F. Executive Order 13175, Consultation and Coordination With Indian 
Tribal Governments

    Executive Order 13175 (65 FR 67249, November 9, 2000) requires the 
EPA to develop an accountable process to ensure ``meaningful and timely 
input by tribal officials in the development of regulatory policies 
that have tribal implications.'' The direct final rule amendments do 
not have tribal implications, as specified in Executive Order 13175. 
The direct final rule amendments apply only to affected sources in the 
leather finishing industry and clarify the frequency for categorizing 
leather product process types, modify the definition of ``specialty 
leather,'' add a definition for ``vacuum mulling,'' and add an 
alternative procedure for determining the actual monthly solvent loss 
from an affected source and, therefore, impose no additional burden on 
sources. Thus, Executive Order 13175 does not apply to the direct final 
rule amendments.
    The EPA specifically solicits additional comment on the direct 
final rule amendments from tribal officials.

G. Executive Order 13045, Protection of Children From Environmental 
Health Risks and Safety Risks

    Executive Order 13045 (62 FR 19885, April 23, 1997) applies to any 
rule that: (1) Is determined to be ``economically significant'' as 
defined under Executive Order 12866 and (2) concerns and

[[Page 6360]]

environmental health or safety risk that the EPA has reason to believe 
may have a disproportionate effect on children. If the regulatory 
action meets both criteria, the EPA must evaluate the environmental 
health or safety effects of the planned rule on children, and explain 
why the planned regulation is preferable to other potentially effective 
and reasonably feasible alternatives considered by the EPA.
    The EPA interprets Executive Order 13045 as applying only to those 
regulatory actions that are based on health or safety risks, such that 
the analysis required under section 5-501 of the Executive Order has 
the potential to influence the regulation. Today's direct final rule 
amendments are not subject to Executive Order 13045 because they are 
based on technology performance, not health or safety risks. 
Furthermore, the direct final rule amendments have been determined not 
to be ``economically significant'' as defined under Executive Order 
12866.

H. Executive Order 13211, Actions Concerning Regulations That 
Significantly Affect Energy Supply, Distribution, or Use

    The direct final rule amendments are not subject to Executive Order 
13211 (66 FR 28355, May 22, 2001) because they are not a significant 
regulatory action under Executive Order 12866.

I. National Technology Transfer and Advancement Act of 1995

    Section 12(d) of the National Technology Transfer and Advancement 
Act of 1995 (NTTAA), Public Law No. 104-113, 12(d) (15 U.S.C. 272 
note), directs the EPA to use voluntary consensus standards in its 
regulatory activities unless to do so would be inconsistent with 
applicable law or otherwise impractical. Voluntary consensus standards 
are technical standards (e.g., materials specifications, test methods, 
sampling procedures, and business practices) that are developed or 
adopted by voluntary consensus standards bodies. The NTTAA directs the 
EPA to provide Congress, through OMB, explanations when the Agency 
decides not to use available and applicable voluntary consensus 
standards.
    No new standard requirements are cited in the direct final rule 
amendments. Therefore, the EPA is not proposing or adopting any 
voluntary consensus standards in the direct final rule amendments.

J. Congressional Review Act

    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. The EPA will submit a report containing the direct final 
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 direct final rule in the Federal Register. 
The direct final rule is not a ``major rule'' as defined by 5 U.S.C. 
804(2).

List of Subjects in 40 CFR Part 63

    Environmental protection, Air pollution control, Hazardous 
substances, Reporting and recordkeeping requirements.

    Dated: February 1, 2005.
Stephen L. Johnson,
Acting Administrator.

0
For the reasons stated in the preamble, title 40, chapter I, part 63 of 
the Code of the Federal Regulations is amended as follows:

PART 63--[AMENDED]

0
1. The authority citation for part 63 continues to read as follows:

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

Subpart TTTT--[AMENDED]

0
2. Section 63.5335(b) is revised to read as follows:


Sec.  63.5335  How do I determine the actual HAP loss?

* * * * *
    (b) Use one of the procedures listed in either paragraph (b)(1) or 
(b)(2) of this section for determining the actual HAP loss from your 
affected sources. Regardless of which procedure is used to determine 
HAP loss, each source is still required to maintain a written or 
printed log that documents the total quantity of solvents/finishes used 
each month in the process and the mass fraction of HAP in each solvent/
finish.
    (1) Measure Finish as Applied. Use a finish inventory log to record 
the pounds of each type of finish applied for each leather product 
process operation and the mass fraction of HAP in each applied finish. 
Figure 1 of this subpart shows an example log for recording the minimum 
information necessary to determine your finish usage and HAP loss. The 
finish inventory log must contain, at a minimum, the information for 
each type of finish applied listed in paragraphs (b)(1)(i) through 
(vii) of this section:
    (i) Finish type;
    (ii) Pounds (or density and volume) of each finish applied to the 
leather;
    (iii) Mass fraction of HAP in each applied finish;
    (iv) Date of the recorded entry;
    (v) Time of the recorded entry;
    (vi) Name of the person recording the entry;
    (vii) Product process operation type.
    (2) Chemical Inventory Mass Balance. Determine the actual monthly 
HAP loss from your affected source through mass balance calculations. 
You must follow your detailed mass balance procedures and calculations 
in your plan for demonstrating compliance in accordance with Sec.  
63.5325. The HAP mass balance must be based on a detailed inventory of 
stored chemicals at the beginning and end of each month, and business 
purchasing records to indicate additions to the inventory of chemical 
supplies. The net loss of chemicals used for finish applications is 
determined by subtracting the end of the month chemical inventory from 
the beginning of the month chemical inventory and adding the quantities 
of all chemicals purchased during the same 1-month period. In 
situations when an excess amount of finish is formulated, you must have 
documented procedures on how the excess amount is accounted for in the 
mass balance.
* * * * *

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3. Section 63.5345 is amended by adding paragraph (d) to read as 
follows:


Sec.  63.5345  How do I distinguish between the two upholstery product 
process operations?

* * * * *
    (d) For each leather product with a unique finish application, you 
must maintain records to support how the leather product was 
categorized to a product process operations type. You must repeat the 
leather product categorization to a product process operation type no 
less frequently than once every 5 years if the applied finish chemical 
characteristics of the leather product have not changed, or when the 
applied finish chemical characteristics of the leather product change, 
whichever is sooner.

0
4. Section 63.5350 is amended as follows:
0
a. adding paragraph (b)(3),
0
b. revising paragraphs (c) introductory text and (c)(2), and
0
c. adding paragraphs (c)(3) and (c)(4).

[[Page 6361]]

Sec.  63.5350  How do I distinguish between the water-resistant/
specialty and nonwater-resistant leather product process operations?

* * * * *
    (b) * * *
    (3) For each leather product with a unique finish application, you 
must maintain records to support how the leather product was 
categorized to a product process operations type. You must repeat the 
leather product categorization to a product process operation type no 
less frequently than once every 5 years if the applied finish chemical 
characteristics of the leather product have not changed, or when the 
applied finish chemical characteristics of the leather product do 
change, whichever is sooner.
    (c) To determine whether your product process operation produces 
specialty leather, you must meet the criteria in paragraphs (c)(1) and 
(2), or (c)(3) of this section:
* * * * *
    (2) The leather must be retanned through the application of grease, 
waxes, and oil in quantities greater than 12 percent of the dry leather 
weight. Specialty leather is also finished with higher solvent-based 
finishes that provide rich color, luster, or an oily/tacky feel. 
Specialty leather products may include, but are not limited to, 
specialty shoe leather and top grade football leathers.
    (3) The leather must be a high-quality dress or performance shoe 
leather that can withstand one of the visual tests in paragraph 
(c)(3)(i) or (ii) of this section:
    (i) Moisture injection into the leather using vacuum mulling 
without signs of blistering.
    (ii) Prolonged ironing at 200[deg] F for smoothing out surface 
roughness without finish lift off.
    (4) For each leather product with a unique finish application, you 
must maintain records to support how the leather product was 
categorized to a product process operations type. You must repeat the 
leather product categorization to a product process operation type no 
less frequently than once every 5 years if the applied finish chemical 
characteristics of the leather product have not changed, or when the 
applied finish chemical characteristics of the leather product do 
change, whichever is sooner.

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5. Section 63.5460 is amended by revising the definition for the term 
``Specialty leather'', and adding, in alphabetical order, a definition 
for the term ``Vacuum mulling'' to read as follows:


Sec.  63.5460  What definitions apply to this subpart?

* * * * *
    Specialty leather means a select grade of chrome tanned, bark 
retanned, or fat liquored leather that is retanned through the 
application of grease, waxes, and oil in quantities greater than 12 
percent of the dry leather weight or high-quality dress or performance 
shoe leather that can withstand one or more of the following visual 
tests: moisture injection into the leather using vacuum mulling without 
signs of blistering, or prolonged ironing at 200[deg] F for smoothing 
out surface roughness without finish lift off. Specialty leather is 
also finished with higher solvent-based finishes that provide rich 
color, luster, or an oily/tacky feel. Specialty leather products are 
generally low volume, high-quality leather, such as specialty shoe 
leather and top grade football leathers.
* * * * *
    Vacuum mulling means the injection of water into the leather 
substrate using a vacuum process to increase the moisture content of 
the leather.
* * * * *
[FR Doc. 05-2303 Filed 2-4-05; 8:45 am]
BILLING CODE 6560-50-P