[Federal Register Volume 71, Number 149 (Thursday, August 3, 2006)]
[Rules and Regulations]
[Pages 43979-43984]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E6-12483]


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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[EPA-R09-OAR-2006-0571, FRL-8204-8]


Approval and Promulgation of Implementation Plans for Arizona; 
Maricopa County PM-10 Nonattainment Area; Serious Area Plan for 
Attainment of the 24-Hour and Annual PM-10 Standards

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final rule.

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SUMMARY: EPA is taking final action under the Clean Air Act (CAA) to 
approve the Best Available Control Measure (BACM) and the Most 
Stringent Measure (MSM) demonstrations in the serious area particulate 
matter (PM-10) plan for the Maricopa County portion of the metropolitan 
Phoenix (Arizona) nonattainment area (Maricopa County area). EPA is 
also granting Arizona's request to extend the attainment deadline from 
2001 to 2006. EPA originally approved these demonstrations and granted 
the extension request on July 25, 2002. Thereafter EPA's action was 
challenged in the U.S. Court of Appeals for the Ninth Circuit. In 
response to the Court's remand, EPA has reassessed the BACM 
demonstration for the significant source categories of on-road motor 
vehicles and nonroad engines and equipment exhaust, specifically 
regarding whether or not California Air Resources Board (CARB) diesel 
is a BACM. EPA has also reassessed the MSM demonstration.

DATES: Effective Date: This rule is effective on September 5, 2006.

ADDRESSES: You can inspect copies of the docket for this action at 
EPA's Region IX office during normal business hours by appointment at 
the following locations: Environmental Protection Agency, Region IX, 75 
Hawthorne Street, San Francisco, CA 94105-3901. Air and Radiation 
Docket and Information Center, U.S. Environmental Protection Agency, 
Room B-102, 1301 Constitution Avenue, NW., (Mail Code 6102T), 
Washington, DC 20460.

FOR FURTHER INFORMATION CONTACT: Doris Lo, EPA Region IX, (415) 972-
3959, [email protected].

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

I. Summary of Proposed Action

    On July 1, 2005, EPA proposed to re-approve the BACM and MSM 
demonstrations in the Maricopa County

[[Page 43980]]

area's serious area PM-10 plan.\1\ EPA also proposed again to grant 
Arizona's request for an extension of the area's attainment deadline 
from December 31, 2001 to December 31, 2006. 70 FR 38064. This proposed 
action responded to a remand by the U.S. Court of Appeals for the Ninth 
Circuit on the issue of whether CARB diesel must be included in the 
serious area plan as a BACM and a MSM. See Vigil v. Leavitt, 366 F.3d 
1025, amended at 381 F.3d 826 (9th Cir. 2004). EPA re-examined the 
feasibility of CARB diesel for both the on-road motor vehicle exhaust 
and nonroad engines and equipment exhaust source categories. In its 
proposed approval in response to the remand, EPA concluded that 
implementation of CARB diesel is not feasible for on-road motor 
vehicles because Arizona cannot obtain a CAA section 211(c)(4) waiver 
of federal preemption and it is not feasible for nonroad engines and 
equipment because of the uncertainties with fuel availability, storage 
and segregation and concerns about program effectiveness due to owners 
and operators fueling outside the Maricopa County area. 70 FR 38064.
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    \1\ On July 25, 2002, EPA approved multiple documents submitted 
to EPA by Arizona for the Maricopa County area as meeting the CAA 
requirements for serious PM-10 nonattainment areas for the 24-hour 
and annual PM-10 national ambient air quality standards (NAAQS). 
Among these documents is the ``Revised MAG 1999 Serious Area 
Particulate Plan for PM-10 for the Maricopa County Nonattainment 
Area,'' February 2000 (MAG plan) that includes the BACM 
demonstrations for all significant source categories (except 
agriculture) for both the 24-hour and annual PM-10 standards and the 
State's request and supporting documentation, including the most 
stringent measure analysis (except for agriculture) for an 
attainment data extension for both standards. EPA's July 25, 2002 
final action included approval of these elements of the MAG plan. 
For a detailed discussion of the MAG plan and the serious area PM-10 
requirements, please see EPA's proposed and final approval actions 
at 65 FR 19964 (April 13, 2000), 66 FR 50252 (October 2, 2001), and 
67 FR 48718 (July 25, 2002).
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II. Public Comments and EPA Responses

    EPA received two comment letters: One from Joy E. Herr-Cardillo, 
Staff Attorney, Arizona Center for Law in the Public Interest (ACLPI), 
on behalf of Phoenix residents Robin Silver, Sandra L. Bahr and David 
Matusow; and one from Nancy C. Wrona, Director, Air Quality Division, 
Arizona Department of Environmental Quality (ADEQ). In general, the 
comments from ACLPI oppose our proposed rule and the comments from ADEQ 
support our proposed rule. EPA appreciates the time and effort made by 
the commenters in reviewing the proposed rule and providing comments. 
We have summarized the comments and provided our responses below.

A. On-Road Motor Vehicle Exhaust

    Comment 1: ACLPI asserts that EPA is allowing Arizona to exclude 
CARB diesel as a BACM simply because the State did not request a CAA 
section 211(c)(4)(A) waiver. ACLPI states that section 211(c)(4)(A) 
generally prohibits the state from implementing fuel controls that are 
not identical to any Federal standard in place, but that the statute 
allows EPA to ``approve an otherwise preempted state fuel measure as 
necessary if no other measures would bring about timely attainment, or 
if other measures exist and are technically possible to implement but 
are unreasonable or impracticable.''
    ACLPI argues that the appropriate question is not whether the State 
has requested a waiver, but rather whether it has provided a reasoned 
justification for failure to include CARB diesel as a control measure. 
ACLPI believes that the State has not provided such a justification and 
that under our ``guidance'' at 56 FR 58658, when a control measure is 
rejected, the state must provide a reasoned justification. ACLPI 
includes the following sentence, purportedly from that Federal Register 
notice, to buttress this point: `` `[t]he burden is on the State to 
demonstrate that an available control method for an existing source is 
infeasible or otherwise unreasonable and, therefore, would not 
constitute RACM [or BACM].' ''
    ACLPI contends that EPA's speculation that the state would not 
qualify for a waiver because CARB diesel is not necessary for 
attainment cannot excuse the state's failure to provide a reasoned 
justification. ACLPI asserts that EPA cannot simply rely for this 
purpose on the State's demonstration that the area will not attain 
until December 2006 because EPA improperly approved that date without 
CARB diesel as a MSM.
    Finally, ACLPI comments that EPA's conclusion that CARB diesel is 
not needed for attainment conflicts with the Agency's guidance at 59 FR 
42011-42012 that ``the BACM analysis must be independent of the 
attainment analysis * * *.''
    Response: Initially we note that we did not rely on Arizona's 
failure to request a CAA section 211(c)(4) waiver in accepting the 
State's exclusion of CARB diesel as a BACM. Rather, we acknowledged 
that a state is eligible to obtain a waiver of federal preemption under 
certain circumstances, but concluded that Arizona would not have been 
able to obtain such a waiver here.
    Under section 211(c)(4)(C)(i),\2\ EPA can approve the 
implementation of CARB diesel by Arizona only if the Agency ``finds 
that the State control or prohibition is necessary to achieve the 
national primary or secondary ambient air quality standard that the 
plan implements.'' Further, EPA ``may find that a State control or 
prohibition is necessary to achieve the standard if no other measures 
that would bring about timely attainment exist, or if other measures 
exist and are technically possible to implement, but are unreasonable 
or impracticable.'' Because EPA has approved the state's demonstration 
of attainment of the PM-10 NAAQS (67 FR 48718), EPA believes that the 
state would not be able to provide a demonstration that CARB diesel is 
necessary to achieve the NAAQS for PM-10 and thus would not be able to 
obtain a section 211(c)(4)(C)(i) waiver necessary to implement CARB 
diesel for on-road motor vehicles. 70 FR 38064, 38065.\3\
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    \2\ In August 2005, CAA section 211(c)(4)(C) was amended and 
renumbered by the Energy Policy Act of 2005, 42 USCS 15801 et seq. 
The amendments place additional restrictions on EPA's authority 
under that provision.
    \3\ Because we have determined that we could not approve CARB 
diesel into the Arizona SIP under section 211(c)(4)(C)(i), we 
believe that we need not address the effect of the new provisions of 
the Energy Policy Act of 2005 in today's action.
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    We agree with ACLPI that generally an appropriate inquiry, among 
others, in a BACM analysis is whether there exists a reasoned 
justification for excluding a control measure. 65 FR 19964, 19967 
(April 13, 2000). However, a BACM analysis is not undertaken in a 
vacuum. If it is not possible for the State to obtain a waiver under 
section 211(c)(4), it would not be able to implement CARB diesel in the 
nonattainment area. Therefore it is not necessary for the State to 
provide a reasoned justification for rejecting CARB diesel as BACM. The 
State should not be compelled to undertake a pointless analysis.\4\
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    \4\ To support its contention that the burden is on the state to 
demonstrate that a measure is not a BACM, ACLPI misquotes a sentence 
from an unrelated EPA proposed rule as: ``[t]he burden is on the 
State to demonstrate that an available control method * * * is 
infeasible and, therefore, would not constitute RACM [or BACM].'' 
The actual quotation is from a Federal Register notice in which EPA 
describes a moderate area PM-10 guidance document and states: 
``[t]he burden is on the State to demonstrate that an available 
control method * * * is infeasible and, therefore, would not 
constitute RACM [or RACT].'' 56 FR 58656, 58658 (November 21, 1991) 
(emphasis added; brackets in original). There is nothing so 
definitive in EPA's serious area guidance regarding the 
responsibility of the State to provide the primary justification for 
rejecting a measure as BACM. Moreover, the Ninth Circuit, in 
determining that it could not find in EPA's approval of the MAG plan 
the reasoned justification for rejecting CARB diesel, observed that 
``Arizona has offered one explanation, which EPA has declined to 
ratify, and EPA has not proffered an adequate explanation of its 
own.'' 381 F. 3d at 843.

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[[Page 43981]]

    ACLPI's assertion that EPA cannot rely on the State's demonstration 
that the area will not attain until December 2006 because EPA 
improperly approved that date without CARB diesel as a MSM is also 
misguided. In granting the State's request for an extension of the 
attainment deadline from December 31, 2001 to December 31, 2006 under 
CAA section 188(e), EPA concluded that the MAG plan ``includes the most 
stringent measures that are included in the implementation plan of any 
State or are achieved in practice in any State, and can feasibly be 
implemented in the area.'' 67 FR at 48739. As we explained in our final 
approval of the State's PM-10 plan, section 188(e) does not compel the 
adoption of every possible MSM. We have interpreted the MSM requirement 
consistent with how we have historically interpreted the general RACM 
provision in section 172(c)(1), i.e., we have long held that a state is 
not obligated to adopt and implement measures that will not contribute 
to expeditious attainment. We are interpreting the MSM requirement 
using the same principle.
    Before we can grant an attainment date extension, the state must 
show that its plan will result in attainment by the ``most expeditious 
alternative date practicable.'' See CAA sections 188(e) and 
189(b)(1)(A)(ii). If a state can show that including a certain set of 
potential MSM would not result in more expeditious attainment, then it 
is reasonable and consistent with the Act not to require their 
inclusion as a condition of approval. Id. at 48723-48724. Here we 
appropriately concluded that the implementation of CARB diesel would 
not advance attainment of the PM-10 NAAQS and thus was not required to 
be adopted under the MSM requirement. Id. at 48725. As a result, having 
determined that the State had demonstrated that attainment by December 
31, 2006 was the most expeditious alternative date under section 
188(e), EPA properly granted the State's request for an attainment date 
extension to that date.
    Finally, EPA disagrees that its conclusion, pursuant to section 
188(e), that CARB diesel is not needed for expeditious attainment 
conflicts with the Agency's BACM guidance. There is nothing in EPA's 
guidance for PM-10 serious area plans (59 FR 41998 (August 16, 1994)) 
that requires that a BACM analysis be entirely independent of 
attainment questions. More importantly, the Act does not link the BACM 
and attainment demonstration requirements. As noted in EPA's guidance, 
under section 189(b)(2), states have only 18 months following 
reclassification to submit their BACM demonstrations, but up to four 
years to submit attainment demonstrations. Therefore, EPA concluded 
that ``Congress intended BACM demonstrations to be based more on the 
feasibility of implementing the measures rather than on an analysis of 
the attainment needs of the area.'' 59 FR at 42012. In contrast, the 
Act does not specify an implementation deadline for MSM. However, 
because the clear intent of section 188(e) is to minimize the length of 
any attainment date extension, the implementation of MSM must 
necessarily take into account the attainment needs of the area. 66 FR 
at 50282.

B. Nonroad Engines and Equipment Exhaust

    Comment 2: Fuel availability: ACLPI comments that to conclude that 
CARB diesel is not a BACM due to uncertainty about the fuel's 
availability in Maricopa County, EPA relies principally on outdated 
information (the state's submission in 1999 and a MathPro study 
conducted in 1998) and incomplete information that fails to consider 
the availability (as of January 1, 2006) of similar diesel fuel in 
Texas (approved into the Texas SIP by EPA at 66 FR 57196 (2001)) as 
well as in California.
    Response: The conditions EPA relied on from the 1998 and 1999 
documents still exist, i.e., Arizona has no refineries and therefore 
must depend on refineries in other states for fuel supplies, 
principally California, New Mexico, and Texas. Even though CARB diesel 
fuel is produced in California, and to some extent may be produced to 
meet Low Emission Diesel (LED) fuel requirements in eastern and central 
Texas as discussed below, there are limits on refinery capacity in each 
state, as evidenced by (1) our discussion in the proposed rule of 
projected refining capacity for CARB diesel in California, which ACLPI 
does not dispute, and (2) the recent disruption of fuel production, 
including diesel fuel, in the aftermath of Hurricanes Katrina and Rita.
    As a result of fuel supply problems caused by hurricane damage to 
refineries and other oil production facilities in the Gulf Coast area, 
EPA issued waivers of certain gasoline and diesel fuel requirements, 
initially applicable in all 50 states, for a sixteen day period from 
August 31 to September 15, 2005. The initial waiver was extended for a 
smaller number of states, including New Mexico and Texas, for highway 
diesel fuel sulfur content through October 25, 2005. Additionally, EPA 
granted a waiver of the start date for the Texas LED fuel through 
January 31, 2006.
    Arizona and California fuel supplies were also affected by the 
hurricanes, since California depends on imports for 5 to 10% of its 
gasoline supply, and Arizona depends on California and Texas for a 
great majority of its gasoline supply. Arizona requested and received a 
waiver of its SIP-approved Reid Vapor Pressure (RVP) gasoline 
requirement for the Phoenix area through its duration, September 30, 
2005. California requested and received waivers of its SIP-approved RVP 
gasoline requirement through October 31, 2005, the end of its summer 
RVP gasoline restriction. For copies of the relevant waivers, see EPA's 
fuel waiver Web site at http://www.epa.gov/compliance/katrina/waiver/index.html or EPA's docket for this rule.
    The issuance of these fuel waivers illustrates the limits on 
refinery capacity in the states cited by ACLPI, California and Texas, 
which provide the great majority of fuel supplies to Arizona. This 
limitation, in addition to the information provided in the proposed 
rule on current projections of CARB diesel production in California, 
supports our conclusion that there is continuing uncertainty regarding 
Arizona's sources of fuel supplies as indicated in the 1998 study and 
1999 report.
    ACLPI also states that EPA relied on incomplete information by 
failing to consider the availability (as of January 1, 2006 \5\) of 
similar diesel fuel in Texas as well as in California. As noted above, 
CARB diesel may be produced to meet the LED fuel requirements in 
eastern and central Texas, but it is not required as a result of (1) 
the permissible use of substitutes for LED fuel that achieve equivalent 
NOX reductions but not necessarily equivalent PM reductions, 
and (2) recent changes that removed the low sulfur requirement from the 
LED rule. See 70 FR 58325. We note that California has made the low 
sulfur requirement of its CARB diesel rule more stringent, implementing 
a 15 ppm sulfur content requirement as of

[[Page 43982]]

September 1, 2006 at the retail level,\6\ but Texas has eliminated the 
sulfur content requirement completely, deferring to federal 
requirements for low sulfur content for both highway and nonroad diesel 
fuel. (See footnote 8 for a brief description of these requirements.)
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    \5\ As noted above, the LED start date for retailers has now 
been moved to January 31, 2006, following issuance by EPA of fuel 
waivers dated September 27 and October 18, 2005, as a result of the 
supply disruptions caused by Hurricanes Katrina and Rita. See the 
EPA website noted above for copies of the relevant waivers. 
Additionally, EPA has approved two subsequent SIP revisions making 
changes to the LED fuel program. See 70 FR 17321 (April 6, 2005) and 
70 FR 58325 (October 6, 2005).
    \6\ See Section 2281(a)(2)-(3) of the California Diesel Fuel 
Regulations, with amendments effective August 14, 2004, at the 
following Web site: http://www.arb.ca.gov/fuels/diesel/081404dslregs.pdf pdf.
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    A significant difference between CARB diesel and the Texas LED fuel 
program is the ability of fuel producers to meet the LED obligations by 
using substitutes that achieve equivalent NOX emission 
reductions. For example, a producer may be able to achieve equivalent 
NOX reductions by substituting early introduction of low 
sulfur gasoline, at least until all relevant EPA requirements for low 
sulfur gasoline have been implemented, or by the use of diesel fuel 
with additives which do not necessarily meet the LED limit on aromatic 
hydrocarbons and the minimum cetane number but would still achieve the 
same NOX reductions.\7\ Substitutes in the Texas LED program 
that achieve equivalent NOX reductions are not designed to 
achieve the PM emission reductions that would be critical if CARB 
diesel fuel were to be required in the Maricopa County area.
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    \7\ See Sections 114.312(f) and 114.318 of the LED fuel program 
regulations, which provide for alternative diesel fuel formulations 
and alternative emission reduction plans, at the following Web site: 
http://www.tceq.state.tx.us/implementation/air/sip/cleandiesel.html. Although Section 114.312(f) provides that 
alternative diesel fuel formulations must provide comparable or 
better reductions of NOX and PM, three of the four 
alternative diesel fuel formulation approval letters to date have 
cited NOX reductions alone, or (in one case) reductions 
of NOX and hydrocarbons, but not PM, as the basis for 
approval. (See approval letters for TXLED-A-00001, dated May 10, 
2005, TXLED-A-00005, dated December 13, 2005, and TXLED-A-00006, 
dated April 26, 2006, at the same website.) Section 114.318 provides 
that the alternative emissions reduction plan must demonstrate 
emission reductions associated with LED compliance through an 
equivalent substitute fuel strategy that is achieved through diesel 
fuel or early gasoline sulfur reduction offsets that meet specified 
NOX reduction requirements or a combination of such 
strategies.
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    Another significant difference between CARB diesel and the Texas 
LED fuel program is the elimination in the latter of the low sulfur 
requirement. EPA approved this change into the relevant Texas ozone 
SIPs because the low sulfur requirement did not directly reduce the VOC 
or NOX emissions that are precursors to the formation of 
ozone, and because EPA's requirements for low sulfur diesel fuel will 
begin implementation in 2006 and 2007.\8\ None of the Texas ozone 
attainment demonstration SIP submissions relied on sulfur emission 
reductions from the LED fuel program.
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    \8\ As noted in the proposed rule, federal requirements for low 
sulfur diesel fuel for nonroad use will be implemented at 15 ppm in 
2010; beginning in 2007, the federal requirement for low sulfur 
diesel fuel for nonroad use will begin implementation at 500 ppm. 
Federal requirements for low sulfur diesel fuel for highway use will 
be implemented at 15 ppm in 2006. 70 FR 70498 (November 22, 2005). 
As noted in the MAG plan, Arizona already restricts the sulfur 
content of nonroad diesel fuel in the Maricopa County area to 500 
ppm. (MAG plan, page 9-47.)
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    EPA specifically states, however, that reducing sulfur emissions 
(through implementing the low sulfur standard) does reduce sulfur 
dioxides and particulate matter emissions. 70 FR at 58326. However, 
since there are no SO2 or PM-10 nonattainment areas in the 
eastern and central areas of Texas (the LED covered area), and no 
monitored violations of these standards in these areas, removing the 
low sulfur standard was not critical to the LED fuel program. Id. 
Removing the low sulfur standard, however, means the LED fuel program 
is no longer equivalent to CARB diesel for an area such as Maricopa 
County which ACLPI argues needs CARB diesel to meet the PM-10 
standards.
    Thus, ACLPI's claim that EPA relied on incomplete information in 
failing to consider availability of CARB diesel fuel in Texas is not 
compelling. The LED fuel program is not equivalent to CARB diesel 
because it allows substitution of other fuels, including gasoline, that 
achieve equivalent NOX emission reductions, and has recently 
been revised to eliminate the low sulfur requirement which would 
directly affect PM emission reductions. Furthermore, the LED fuel 
requirement was developed for ozone nonattainment areas in Texas, not 
PM nonattainment areas.
    Comment 3: Fuel storage and supply: ACLPI comments that EPA raises 
a potential problem of future fuel storage and supply but does not 
evaluate it except by relying on hypothetical observations of a single 
ADWM employee. ACLPI states that since the presumption when evaluating 
potential BACM is in favor of including the control measure unless a 
reasoned justification is offered to exclude it, this potential problem 
is not enough to justify excluding it.
    Response: Although ACLPI describes this ``potential problem'' as 
one of fuel storage and ``supply,'' EPA's proposed rule more accurately 
describes the scope of the problem as fuel storage and ``segregation.'' 
If the nonroad diesel fuel for the Maricopa County area were CARB 
diesel, there would be a third type of diesel fuel in addition to the 
two types (federal highway diesel fuel and Federal nonroad diesel fuel) 
currently required for distribution statewide. These three fuels, and 
the three types of gasoline that are required for the state (Cleaner 
Burning Gasoline for the Maricopa County area, oxygenated gasoline for 
Tucson in the winter, and conventional gasoline for the rest of the 
state), as well as jet fuel, must be stored and transported separately 
in the fuel storage and distribution systems. These systems include 
pipelines, terminal tanks, truck tanks, and retail tanks. If not 
properly segregated, the fuels can be contaminated which would 
complicate the fuel distribution system since the contaminated fuels 
would need to be re-blended to be suitable for another use.\9\
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    \9\ Additionally, as noted in our proposed rule, if nonroad 
diesel fuel is not kept segregated strictly for nonroad use, and it 
is available for use by both on-road vehicles as well as nonroad 
engines and equipment, the nonroad diesel fuel would be preempted 
just as if it were intended only for use by on-road vehicles. 70 FR 
at 38066, footnote 8.
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    The Arizona Department of Weights and Measures (ADWM) is the State 
agency responsible for implementing and enforcing fuels requirements in 
the State. The cited employee, the Air and Fuel Quality Program 
Manager, regularly gathers information from representatives of fuel 
suppliers and distributors about the storage of different types of fuel 
for distribution in the State as part of a routine effort to assess the 
potential for fuel supply interruptions. This employee regularly 
reports on this information to the Governor's office as part of an 
effort to anticipate and resolve potential problems with fuel supply or 
demand.\10\ Thus, this employee has the authority and the experience to 
know if tank farms for fuel storage in the Maricopa County area are at 
maximum capacity.\11\
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    \10\ See December 22, 2005 Memorandum, ``December 20, 2005 
telephone conversation with Duane Yantorno, Air and Fuel Quality 
Program Manager, Arizona Department of Weights and Measures, Ira 
Domsky, Deputy Director, Division of Air Quality, Arizona Department 
of Environmental Quality, Carol Weisner, EPA Region 9, and Wienke 
Tax, EPA Region 9, on Feasibility of Requiring CARB Diesel Fuel in 
Maricopa County PM-10 Nonattainment Area.'' Yantorno confirmed the 
next day, after speaking with representatives of fuel suppliers and/
or distributors, that the two large tank farms in the Maricopa area 
are at or near maximum capacity. One of the facilities might be able 
to accommodate a different type of fuel for storage, but the other 
could not.
    \11\ These tank farms are the large terminal tanks available for 
storing fuel once the fuel has been off-loaded from a pipeline or 
other distribution method.
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    Additionally, ADEQ notes in its August 1, 2005 comment letter on 
our proposed rule that ``breakout tankage'' does not exist on the 
eastern part of the pipeline. Breakout tankage, unlike the storage 
tanks located in the Maricopa

[[Page 43983]]

County area, are storage tanks at intermediate terminals outside the 
area. On the West Kinder Morgan pipeline, intermediate terminals are 
located in Colton, California; on the East Kinder Morgan pipeline, 
intermediate terminals are located in El Paso, Texas, and Tucson, 
Arizona.\12\ ADEQ comments that refiners from Texas or New Mexico 
wanting to bring CARB diesel to the Maricopa market would have to barge 
it through the Panama Canal to California for distribution through the 
western pipeline system to find adequate ``breakout tankage'' for 
storing the fuel separately.
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    \12\ See December 22, 2005 Memorandum cited in footnote 9.
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    Comment 4: Fueling outside Maricopa County: ACLPI comments that EPA 
relies on speculation that nonroad diesel fuel users will refuel 
outside the nonattainment area to avoid paying the higher cost of CARB 
diesel. ACLPI claims that EPA's only support comes from MAG plan 
statements, which are themselves unsupported, and irrelevant comments 
about the trucking industry, and it ignores EPA's explicit rejection of 
this argument in the 2001 SIP approval of the Texas low emission diesel 
fuel control.
    Response: It is the size of the covered area, as well as the 
incentive to avoid the higher cost of CARB diesel fuel, that EPA cited 
as its principal reasons for the uncertainty in effectiveness of 
implementing CARB diesel in the Maricopa area for nonroad engines and 
equipment alone. 70 FR 38064. Because of the markedly different 
circumstances, ACLPI's reliance on statements from the Texas LED SIP 
approval are misplaced. Texas will require sale of LED fuel which, as 
noted in response to Comment 2 above, is not equivalent to CARB diesel 
fuel, for use by both on-road vehicles and nonroad engines and 
equipment in an area that includes 110 counties in eastern and central 
Texas with borders from 153 to 454 miles wide, as noted in the excerpt 
quoted by ACLPI. This area includes most of the largest cities in 
Texas: Houston, Dallas, San Antonio, and Austin. Similarly, California 
requires sale of CARB diesel fuel statewide (approximately 58 counties 
totaling 163,696 square miles, http://www.dof.ca.gov/HTML/FS_DATA/stat-abs/tables/a1.xls) for use by both on-road vehicles and nonroad 
engines and equipment.
    The Maricopa County area that would be covered by a CARB diesel 
fuel program, by contrast, is much smaller (approximately 66 miles 
across its widest point, as we noted in our proposed rule (70 FR at 
38067) and would be limited to fuel for nonroad engines and equipment. 
As ADEQ noted in its August 1, 2005 comment letter, enforcement of the 
requirement would be virtually impossible because it would be 
relatively easy to evade, either by purchasing Federal nonroad diesel 
fuel outside the covered area, or by purchasing Federal highway diesel 
fuel within the covered area.\13\
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    \13\ For Federal tax purposes, nonroad diesel fuel is dyed red 
to distinguish it easily from highway diesel fuel. Both Federal and 
Arizona excise taxes apply to highway diesel fuel but not to nonroad 
diesel fuel. Arizona law (as noted in ADEQ's August 1, 2005 comment 
letter) provides for refunds to users of taxed highway diesel fuel 
who demonstrate they actually used the fuel in nonroad equipment. 
This ability to seek a refund means the Arizona excise tax on 
highway diesel fuel ($0.26 per gallon) is probably not a significant 
obstacle to someone who wants to avoid the presumably higher cost of 
CARB diesel by purchasing highway diesel fuel which would not be 
subject to the CARB diesel fuel requirements. EPA notes, however, 
that Arizona sales and use tax (8% of the purchase price of the 
fuel) would likely apply to purchases of highway diesel fuel that 
are shown to be for nonroad use, and would be deducted from the 
refund. See January 20, 2006 Memorandum, ``January 12, 2006 
telephone conversation between Tim Lee, Director of Revenue Audits, 
Arizona Department of Transportation, and Carol Weisner, EPA Region 
9, regarding Arizona excise tax on diesel fuel.''
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    In both California and Texas, the size of the covered areas and the 
application of the requirement to both highway vehicles and nonroad 
engines and equipment establish much more extensive programs that 
essentially provide only one type of diesel fuel for sale in very large 
geographic areas, substantially reducing the potential for evading the 
special diesel fuel requirements.

C. MSM Demonstration and Extension of Attainment Date

    Comment 5: ACLPI states that, because EPA did not undertake a new 
analysis of CARB diesel as a MSM for purposes of the attainment date 
extension, ACLPI incorporates by reference comments it submitted ``in 
response to previous rulemakings, as well as the arguments and analysis 
set forth in the Opening and Reply briefs filed in Vigil * * * 
(specifically Opening Brief, pp. 21-27; \14\ Reply Brief, pp. 9-18.)''
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    \14\ EPA notes that the discussion of MSM begins on p. 24 of 
ACLPI's Opening Brief.
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    Response: The Vigil Court's remand of EPA's approval of the 
attainment date extension is limited. The Court concluded that ``[w]e 
also remand the question of Arizona's eligibility for the extension, 
insofar as that question depends on EPA's determination regarding 
MSM.'' (Emphasis added). 381 F. 3d at 487. Therefore to the extent that 
ACLPI intends to incorporate by reference its comments and arguments on 
aspects of the extension other than MSM, it is precluded from raising 
them in this rulemaking.
    While ACLPI does not specify, we assume that by ``previous 
rulemakings'' it is referring to EPA's proposed approvals of the 
serious PM-10 plan for the Maricopa County area at 65 FR 19964 (April 
13, 2000) and 66 FR 50252 (October 2, 2001). ACLPI commented on these 
proposed actions in letters from Joy Herr-Cardillo to Frances Wicher, 
EPA Region 9, dated July 20, 2000 and November 1, 2001. EPA has 
previously addressed the arguments relating to MSM and the attainment 
date extension as it relates to MSM raised by ACLPI in their briefs and 
these letters. See 67 FR at 48722-48725 and EPA's Response Brief in 
Vigil at 10-12 and 30-34. Discussions also relevant to these issues can 
be found in EPA's proposed approvals of the serious PM-10 plan for the 
Maricopa County area at 65 FR 19964 and 66 FR 50252.

III. Final Action

    In response to the Vigil Court's remand, EPA is again approving the 
BACM demonstration in the MAG plan for the source categories of on-road 
and nonroad vehicle exhaust without CARB diesel. CARB diesel is not 
feasible for on-road motor vehicles because Arizona cannot obtain a CAA 
section 211(c)(4)(C)(i) waiver for purposes of PM-10 attainment. CARB 
diesel is not feasible for nonroad engines and equipment because of the 
uncertainties with fuel availability, storage and segregation and 
concerns about program effectiveness due to owners and operators 
fueling outside the Maricopa County area. Therefore, EPA is also again 
approving the MSM demonstration in the MAG plan and the associated 
extension of the attainment deadline for the area from December 31, 
2001 to December 31, 2006.
    In its remand to EPA, the Vigil Court did not vacate our approval 
of the MAG plan as it relates to the BACM and MSM demonstrations, and 
the associated extension of the attainment deadline for the Maricopa 
County area. These actions are codified at 40 CFR 52.123(j)(2), (4) and 
(7) and remain in effect. See 67 FR at 48739.

IV. 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,

[[Page 43984]]

``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. 
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. 
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 October 2, 2006. 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, Nitrogen dioxide, Particulate 
matter, Reporting and recordkeeping requirements, Volatile organic 
compounds.

    Dated: July 14, 2006.
Laura Yoshii,
Acting Regional Administrator, Region IX.
[FR Doc. E6-12483 Filed 8-2-06; 8:45 am]
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