[Federal Register Volume 73, Number 83 (Tuesday, April 29, 2008)]
[Rules and Regulations]
[Pages 23107-23111]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E8-8969]



40 CFR Part 52

[EPA-R05-OAR-2004-WI-0002; FRL-8557-5]

Redesignation of the Forest County Potawatomi Community 
Reservation to a PSD Class I Area; Dispute Resolution with the State of 

AGENCY: Environmental Protection Agency (EPA).

ACTION: Notice of dispute resolution.


SUMMARY: The purpose of this notice is to announce the EPA resolution 
of an intergovernmental dispute over a request by the Forest County 
Potawatomi Community (FCP Community) to redesignate portions of the FCP 
Community reservation as a non-Federal Class I area under the Clean Air 
Act (CAA or Act) program for Prevention of Significant Deterioration 
(PSD) of air quality. On June 8, 1995, the Governors of Wisconsin and 
Michigan raised concerns about EPA's proposal to approve the request of 
the FCP Community to redesignate portions of its reservation as a non-
Federal Class I area and asked EPA to enter negotiations with the 
parties to resolve the dispute as provided for in the CAA. The State of 
Michigan and the FCP Community were unable to reach an agreement 
concerning the redesignation. After fully considering the concerns 
raised by the State of Michigan, EPA has determined that it is not 
proper in these particular circumstances to disapprove the FCP 
Community's redesignation request. The Class I redesignation is 
described in a final rulemaking notice also published in this Federal 
Register. The Class I designation will result in lowering the allowable 
increases in ambient concentrations of particulate matter, sulfur 
dioxide, and nitrogen oxide within the reservation.

DATES: This action is effective on May 29, 2008.

FOR FURTHER INFORMATION CONTACT: Constantine Blathras, Air Permits 
Section, Air Programs Branch (AR-18J), Environmental Protection Agency, 
Region 5, 77 West Jackson Boulevard, Chicago, Illinois 60604-3507; 
telephone number: 312-886-0671; fax number: 312-886-5824; e-mail 
address: [email protected].

SUPPLEMENTARY INFORMATION: Throughout this document whenever ``we,'' 
``us,'' or ``our'' is used, we mean EPA.

I. General Information

A. Does This Action Apply to Me?

    This action will apply to applicants to the PSD construction permit 
program on Class I trust lands of the Forest County Potawatomi 

B. How Can I Get Copies Of This Document and Related Information?

    1. Docket. EPA has established a docket for this action under 
Docket ID No. EPA-R05-OAR-2004-WI-0002. Publicly available docket 
materials are available either electronically in http://www.regulations.gov or in hard copy at the U.S. Environmental 
Protection Agency, Air Docket, in the EPA Headquarters Library, Room 
Number 3334 in the EPA West Building, located at 1301 Constitution 
Ave., NW., Washington, DC. The EPA/DC Public Reading Room hours of 
operation will be 8:30 a.m. to 4:30 p.m. Eastern Standard Time (EST), 
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. The docket is also available 
during normal business hours for public inspection and copying at the 
Air Programs Branch, Region 5, EPA (AR-18J), 77 West Jackson Boulevard, 
Chicago, Illinois 60604.
    2. Electronic Access. You may access this Federal Register document

[[Page 23108]]

electronically through the EPA Internet under the ''Federal Register'' 
listings at: http://www.epa.gov/fedrgstr. In addition to being 
available in the docket and on the EPA Federal Register Internet Web 
site, an electronic copy of this notice is also available on the EPA's 
New Source Review (NSR) Web site, under Regulations & Standards, at 

C. How is This Notice Organized?

    The information in this notice is organized as follows:

I. General Information
    A. Does this Action Apply to Me?
    B. How Can I Get Copies Of This Document and Related 
    C. How is this Notice Organized?
II. This Notice
    A. Area Proposed for Redesignation
    B. Authority for Invoking Dispute Resolution Procedures
    C. Agency Action

II. This Notice

A. Area Proposed for Redesignation

    On February 14, 1995, the FCP Community submitted a request to the 
EPA to approve the redesignation of the air quality status of the FCP 
Community's Reservation from ``Class II'' to ``Class I'' under the 
CAA's PSD regulations. The area of FCP Community reservation lands that 
has been proposed for redesignation to Class I comprises 10,818 acres, 
all of which is located in Forest County, Wisconsin.

B. Authority for Invoking Dispute Resolution Procedures

    Section 164(e) of the CAA and 40 CFR 52.21(t) provide the current 
statutory and regulatory framework for resolving disputes between 
states and Tribes over redesignation of an area or for permits for new 
major emitting facilities that may cause or contribute to a cumulative 
change in air quality under the PSD program. Section 164(e) provides 
that if the Governor of an affected state or the appropriate Indian 
Governing Body of an affected Tribe disagrees with a request for 
redesignation by either party, then the governor or Indian ruling body 
may request that EPA negotiate with the parties to resolve the dispute. 
The statute provides that either party can ask the Administrator for a 
recommendation to resolve the dispute, and if the parties fail to reach 
an agreement during the negotiations, ``the Administrator shall resolve 
the dispute and his determination, or the results of the agreements 
reached through other means, shall become part of the applicable plan 
and shall be enforceable as part of such plan.'' Section 164(e), 42 
U.S.C. 7474(e).
    Similarly, if a permit is proposed to be issued for any new major 
emitting facility proposed for construction in any state which the 
Governor of an affected state or the governing body of an affected 
Indian Tribe determines will cause or contribute to a cumulative change 
in air quality in excess of that allowed within the affected state or 
reservation, the Governor or Tribal ruling body may invoke the same 
dispute resolution mechanism. States or Tribes with Class I areas 
cannot, however, ``veto'' permits that may adversely affect those 
    In resolving a dispute, the statute directs EPA to ``consider the 
extent to which the lands involved are of sufficient size to allow 
effective air quality management or have quality related values of such 
area.'' As further discussed in the response to comments concerning the 
disputed issues, the CAA and its implementing regulations do not 
contain a minimum size requirement for area redesignation by a state or 
Tribe, and the size of the redesignated area is relevant only to the 
extent that it may impact effective air quality management or air 
quality related values (AQRVs). The Act does not define AQRVs nor 
identify specific AQRVs other than visibility (See section 165(d)(2)(B) 
of the Act), but in the legislative history to the Act, AQRVs are 
described as follows:

    The term ``air quality related values'' of Federal lands 
designated as Class I includes the fundamental purposes for which 
such lands have been established and preserved by the Congress and 
the responsible Federal agency. For example, under the 1916 Organic 
Act to establish the National Park Service (16 U.S.C. 1), the 
purpose of such national park lands ``is to conserve the scenery and 
the natural historic objects and the wildlife therein and to provide 
for the enjoyment of the same in such manner and by such means as 
will leave them unimpaired for the enjoyment of future 

C. Agency Action

1. Background on Redesignation Request
    Pursuant to section 164(c), 42 U.S.C. 7474(c), the FCP Community 
Tribal Council formally submitted a proposal to redesignate certain FCP 
Community reservation lands from Class II to Class I to the EPA on 
February 24, 1995. A Class I air quality designation provides greater 
protection for air resources by decreasing the increases allowed in the 
ambient concentrations of particulate matter, sulfur dioxide, and 
nitrogen oxides from any new major stationary sources or major 
modifications to existing sources in the vicinity. The types of 
facilities whose emissions could impact these lower limits are 
generally new or expanding large industrial sources such as electric 
utilities and pulp and paper mills. No new operating permits or 
additional controls would be required for existing sources solely as a 
result of a Class I designation.
    Along with reducing allowable concentrations of key pollutants, 
Class I areas may also include AQRVs which are intended to further 
protect air quality. In the case of the FCP Community redesignation, 
the Tribe has proposed acidic and mercury deposition as the AQRVs it is 
seeking to protect. Because state officials were concerned about AQRVs 
and other issues, an intergovernmental dispute eventually developed and 
the parties ultimately sought dispute resolution under section 164(e).
    By statute, the Agency must approve or disapprove a request for 
redesignation. Accordingly, on June 29, 1995, EPA published a notice in 
the Federal Register (FR) proposing to approve the redesignation 
request by the FCP Community to Class I area status. The notice 
provided for a 60 day public comment period. However, on June 8, 1995, 
the Governors of Wisconsin and Michigan sent a joint letter to EPA 
objecting to EPA's proposal to grant the FCP Community request for 
redesignation and requesting dispute resolution. The June 8 letter 
focused on two concerns, first, the states' perception that EPA lacked 
rules to handle such redesignation requests and the implementation of 
non-federal Class I areas, and second, that a non-federal Class I area 
would ``significantly infringe upon the ability of our state 
governments to manage the natural resources of our states.'' \1\

    \1\ Letter from Governor Tommy G. Thompson and Governor John 
Engler to Carol Browner, June 8, 1995.

    To address their concerns, the Agency published a FR notice (60 FR 
40139) on August 7, 1995, postponing the scheduled August 2, 1995 
public hearing and extending, at the states' request, the public 
comment period indefinitely while the Agency attempted to negotiate 
with the states and respond to the issues they had raised.
    As already noted, section 164(e) of the Act allows either the 
Governor of a state or the Indian ruling body that disagrees with a 
proposed redesignation to request the Administrator to enter into 
negotiations with the parties involved to resolve the dispute. In 
response to the Governors' letter, EPA contracted with a professional 
mediation service (RESOLVE, Inc.) to provide mediation

[[Page 23109]]

services. During 1995, Wisconsin and the FCP Community began work 
toward developing a Memorandum of Understanding, and invited Michigan 
to participate in this process. RESOLVE discussed the case with EPA and 
the parties, and circulated resumes and a list of potential mediators 
for comment by the parties, but the parties could not agree on a 
mediator and none was selected.
    In the meantime, in partial response to the states' request that 
EPA promulgate rules to address non-federal Class I areas, EPA had 
formed a senior workgroup to cooperatively develop options for 
consideration by the states and Tribes regarding roles and 
responsibilities of non-Federal Class I area managers. To gather public 
comment on different proposals, EPA published an advanced notice of 
proposed rulemaking (ANPR) on May 16, 1997. 62 FR 27158 (May 16, 1997). 
The EPA held public workshops in Chicago and Phoenix on the ANPR, and 
gathered testimony on the options for proposed rulemaking. 62 FR 33786 
(June 23, 1997). The states had requested that EPA's action of the FCP 
Community Class I request be delayed until after the Agency could 
complete this rulemaking, but the rulemaking was not finalized.\2\

    \2\ Thompson and Engler to Mary Nichols, February 6, 1977; 
Russell J. Harding, Director MDEQ, to EPA Air Docket, August 8, 
1997. In any case, the States viewed the ANPR as inadequate because 
``the rulemaking will not address all of our concerns related to 
Tribal Class I redesignation. The EPA must promulgate adequate rules 
governing all aspects of Class I redesignation before proceeding 
with a final decision on the Potawatomi or any other Tribal Class I 
requests (emphasis in original).''

    From 1995 through 1997, EPA engaged in an extended correspondence 
with Wisconsin and Michigan regarding the proposed redesignation and 
how to address both states' concerns, as reflected in the record for 
this action.
    Following nearly 2 years of discussions, however, the states and 
the Tribe had not reached a resolution of the issues that had been 
raised by the states, nor had EPA completed the public notice process 
on the proposed redesignation. The issues included for Michigan, in 
addition to the two concerns discussed above, that the Agency 
promulgate additional rules to implement the dispute resolution 
provision at CAA section 164(e), that the Agency impose its own 
requirement that non-federal Class I areas be limited to those 
exceeding 5,000 acres in size with specified ``uniqueness'' criteria, 
and that the Agency promulgate additional rules to cover all aspects of 
implementing the requirements of established non-federal Class I area 

    \3\ Letter from Russell J. Harding, MDEQ to Carlton Nash, Chief, 
Regulation Development Section, Region V EPA, September 15, 1997.

    In the absence of an agreed resolution of either of the states' 
issues, on July 10, 1997, EPA moved to bring closure to the rulemaking 
process by publishing a notice for two informational meetings and two 
public hearings on the FCP Community's redesignation request with a 
public comment period to close on September 15, 1997. 62 FR 37007 (July 
10, 1997). EPA held public hearings on the proposed redesignation on 
August 12, 1997, in Carter, Wisconsin, and August 13, 1997, in 
Rhinelander, Wisconsin. By the close of the public comment period, EPA 
had received more than 120 comments on the proposed redesignation.
    On April 21, 1998 \4\, Wisconsin requested that EPA reinitiate the 
dispute resolution process under section 164(e). In response, EPA sent 
letters to the State of Wisconsin, the State of Michigan, and the FCP 
Community requesting a meeting to begin the negotiations to resolve the 
dispute. EPA requested that the parties each identify its chief 
negotiator, and that each party submit a written list of issues that it 
wished to submit to the dispute resolution process. EPA, in 
consultation with the parties, requested RESOLVE to select a mediator, 
and this time, Triangle Associates, Inc., Seattle, Washington, was 
chosen to mediate the discussions.

    \4\ Letter from Governor Tommy Thompson to Richard Wilson, 
Acting Assistant Administrator for Air and Radiation. April 21, 

    EPA requested that the mediator interview each of the parties, 
discuss the issues submitted by each party, and structure a dispute 
resolution process tailored to the needs of this dispute. Following the 
initial interview, the Agency requested an initial meeting of all 
parties to agree upon a protocol, establish a list of issues 
appropriate for discussion under section 164(e), and plan a series of 
further meetings aimed at resolving the dispute.
    The first dispute resolution meeting occurred on September 2, 1998, 
at the Region 5 offices in Chicago, Illinois. Both the States of 
Wisconsin and Michigan participated in this meeting, although Michigan 
formally announced its participation solely as an ``observer.'' \5\ 
During this meeting, the states and the Tribe identified issues of 
concern and attempted to find areas of overlap that could potentially 
lead to resolution.

    \5\ Letter from [Gary R. Hughes, acting for] Russell J. Harding, 
Director MEDQ, to David A. Ullrich, Acting Regional Administrator, 
August 20, 1998.

    Following this first meeting, the parties requested that EPA 
examine the twenty-one issues submitted for dispute resolution to 
determine which would be appropriate for discussion and resolution 
under section 164(e) of the CAA. EPA Region 5, in consultation with 
EPA's headquarters offices (Office of Air and Radiation, Office of 
General Counsel, and Office of Air Quality Planning and Standards), by 
letter of November 6, 1998, ultimately submitted a list of six suitable 
topics for further discussion and resolution to the parties. These 
issues included: ``(1) Whether the lands proposed for redesignation are 
of sufficient size to allow for effective air quality management; (2) 
the extent to which the lands proposed for redesignation have 
sufficient size to have AQRVs; (3) the off-reservation impacts of 
redesignation as discussed in the [FCP Community's] Technical Report; 
(4) the Tribe's choice of mercury deposition as an AQRV; (5) the 
Tribe's choice of AQRVs; and (6) the roles and responsibilities of the 
respective parties in the dispute resolution discussion on September 2, 
1998.'' \6\ The Agency also informed the parties that the remaining 
issues were either unsuitable for discussion under the CAA section 
164(e), or where wholly within EPA's purview as a decision maker under 
CAA section 164(b) and 164(e).

    \6\ Letter from Stephen Rothblatt, Acting Director, Air and 
Radiation Division, Region 5, to George E. Meyer, Secretary WDNR, 
and Joseph Young, attorney for FCP, November 6, 1998 (cc to Denis 
Drake, MDEQ).

    On November 16, 1998, the Tribe and the State of Wisconsin held a 
second dispute resolution meeting in Green Bay, Wisconsin, but the 
State of Michigan elected not to participate in this meeting. Following 
several meetings, Wisconsin and the Tribe reached an agreement that 
resolved their dispute.
    The parties circulated the final agreement for signature, and the 
EPA Region 5 Regional Administrator concurred on the agreement on 
October 12, 1999. Consistent with CAA section 164(e), the terms of the 
agreement constitute the resolution of the dispute between Wisconsin 
and the Tribe.
    However, after observing the first dispute resolution session on 
September 2, 1998, the State of Michigan did not participate in any of 
the other dispute resolution sessions between the State of Wisconsin 
and the FCP Community. Triangle Associates, Inc. continued to keep 
Michigan abreast of the dispute resolution proceedings by forwarding 
the minutes of each negotiating session

[[Page 23110]]

to the state. Believing that the negotiations with Michigan had reached 
an impasse, on August 4, 1999, the Forest County Potawatomi Vice-
Chairman contacted EPA in writing to request that the Administrator 
resolve the dispute with the State of Michigan under section 164(e). On 
December 22, 1999, the MDEQ sent a letter to EPA requesting a meeting 
between the FCP Community and Michigan as a continuation of the dispute 
resolution Michigan had invoked under section 164(e), stating that 
while the state still considered all of the issues it had previously 
raised to be unresolved, ``in the interest of resolving this matter, I 
request that [EPA] begin a negotiation with the FCP Community and the 
State of Michigan, as a continuation of the dispute resolution process, 
and in an effort to address the comments and resolve the objections 
previously forwarded by the State of Michigan.'' \7\

    \7\ Letter from Russell J. Harding, MDEQ to Stephen Rothblatt, 
Acting Director, Air and Radiation Division, Region 5, December 22, 

    On April 25, 2000, Michigan submitted a list of twelve issues for 
discussion in the new round of dispute negotiations, which corresponded 
to issues previously raised by the state.\8\ On June 23, 2000, the FCP 
Community submitted a letter to EPA responding to Michigan's request 
for dispute negotiations. The EPA set up a meeting between Michigan, 
the FCP Community, and EPA on January 9, 2001, in Chicago, Illinois. 
The parties exchanged initial draft proposed principles for resolution 
of the dispute negotiation. After reviewing their respective proposed 
principles, the parties could not reach an agreement. On February 12, 
2001, the FCP Community submitted a letter to EPA requesting an EPA 
determination to resolve the dispute and adopt the FCP Community 
proposal as the final determination. On February 23, 2001, EPA sent a 
letter to both parties requesting that they submit to EPA their 
positions on the dispute negotiation and their proposals for 
resolution. On March 16, 2001, Michigan submitted its position on the 
section 164(e) resolution to EPA, reiterating the two central concerns 
originally identified in the joint-states' letter of June 8, 1995: (1) 
Lack of formally promulgated rules, and (2) potential impact of Class I 
area on state's air program management. The letter concluded ``if the 
EPA's final action does not impose any additional obligations upon 
Michigan's air program and does not subject Michigan air use permits to 
section 164(e) dispute resolution review, the need for Michigan to 
request review by the U.S. Sixth Circuit Court of Appeals of the 
designation of FCP Community lands may be obviated.'' \9\ On March 19, 
2001, the FCP Community submitted its position on the section 164(e) 
resolution to EPA.

    \8\ Letter from Russell J. Harding, MDEQ to Stephen Rothblatt, 
Acting Director, Air and Radiation Division, Region 5, April 25, 
    \9\ Letter from Russell J. Harding, MDEQ to Stephen Rothblatt, 
Acting Director, Air and Radiation Division, Region 5, March 16, 

    On February 3, 2003, the FCP Community contacted EPA to request 
that the Agency's actions on the rulemaking be suspended for a 90-day 
period to allow the Tribe to attempt a bilateral negotiation with the 
State of Michigan's new administration. EPA encouraged the parties to 
meet and offered to reinitiate the dispute resolution process with the 
third-party mediator should the parties request this. On February 14, 
2003, MDEQ responded that it would participate in bilateral 
discussions, but considered these outside the scope of the CAA section 
164(e) dispute resolution process.\10\ These discussions failed to 
produce an agreement, and in November 2003, the Tribe requested that 
EPA move forward with the rulemaking request.\11\
    Although EPA provided updates for the states and Tribe on the 
progress of completing the rulemaking process, there was no further 
resolution of the issues raised by Michigan by the time EPA published 
the proposed FIP in December 2006.

    \10\ Letter from Steven E. Chester, Director MDEQ, to Al Milham, 
Vice Chairman, FCP Community, February 14, 2003.
    \11\ Letter from Al Milham, Vice Chairman, FCP Community to 
Steve Rothblatt, Director, Air and Radiation Division, Region 5, 
November 24, 2003.

2. EPA's Decision Regarding the Dispute Resolution Between the FCP 
Community and the State of Michigan
    Michigan submitted extensive comments opposing the proposed Federal 
Implementation Plan (FIP) and reiterating its concerns regarding the 
redesignation. It objected to EPA's proposal to implement the 
redesignation through a FIP, to the validity of the agreement between 
Wisconsin and the Tribe, and to approving the redesignation before 
completing a rulemaking proposed in August 2006. See Proposed Rule: 
Review of New Sources and Modifications in Indian Country, 71 FR 48696 
(August 21, 2006).
    However, none of these comments provide a legally supportable basis 
for denying the redesignation. The CAA gives EPA only a very limited 
role in reviewing a redesignation request. As a general rule, EPA can 
``disapprove the redesignation of any area only if [it] finds, after 
notice and opportunity for public hearing, that such redesignation does 
not meet the procedural requirements'' in CAA section 164(b) and 40 CFR 
52.21. ``Once these procedural requirements are met, EPA must approve 
the request for redesignation.'' Administrator, State of Arizona v. 
EPA, 151 F.3d 1205, 1211 (9th Cir. 1998), hereafter Arizona v. EPA. EPA 
cannot ``re-weigh the effects of a proposed redesignation or second-
guess a tribe's decision to redesignate its reservation lands.'' Id. at 
    Where a neighboring state or tribe disagrees with the proposed 
redesignation of an area, section 164(e) provides a narrow exception to 
that general rule of limited EPA review. EPA believes that where there 
is a dispute, it must consider whether to resolve the dispute by 
disapproving the redesignation, based on the factors identified in 
164(e). If EPA resolves the dispute in favor of the party requesting 
redesignation, the dispute is terminated, and the only remaining 
question is whether the Tribe met the procedural requirements of 
164(b)(2). Because that inquiry involves only procedural adequacy, when 
EPA conducts that second inquiry, it cannot consider any information 
relating to any matter other than procedure, even if that information 
was considered in the dispute resolution. Consistent with that, EPA is 
treating this dispute resolution separately from the approval of the 
redesignation request and is publishing the two separately.
    In resolving a dispute over redesignation under 164(e), EPA ``must 
consider the extent to which the lands involved are of sufficient size 
to allow effective air quality management or have air quality related 
values.'' Arizona v. EPA, construing CAA section 164(e). EPA recognizes 
that this language requires EPA to consider the size of a reservation 
in resolving a dispute. Consistent with that, in a previous dispute, 
EPA rejected a state's claim that reservation lands consisting of five 
noncontiguous parcels totaling 632 acres, with the smallest having 
3.7594 acres should be disapproved; EPA found that the areas in 
question ``were not too small to allow effective air quality management 
or to have air quality related values.'' Arizona v. EPA (citing EPA 
finding with approval).
    In this dispute, the state has not seriously argued that the lands 
the Tribe has requested for redesignation were too small ``to allow 
effective air quality management or have air quality related

[[Page 23111]]

values.''\12\ Nevertheless, the statute directs EPA to consider that 

    \12\ The State's arguments regarding size have centered on the 
State's complaints that EPA has not unilaterally adopted regulations 
that impose minimum acreage requirements of 5,000 acres on non-
federal class I areas. See for example, Russell Harding to Carlton 
Nash, September 15, 1997, at 4; Letter from Russell Harding to 
Stephen Rothblatt, April 25, 2000.

    In its decision to grant the Class I redesignation request for the 
Yavapai-Apache reservation, EPA examined whether it would be difficult 
to perform a PSD air quality modeling analysis that assessed the 
impacts of a proposed source in such a situation. The EPA concluded 
that, based on the modeling tools available at that time, it would be 
relatively simple and practicable for a proposed source to project its 
impact on the Class I area parcels and evaluate the analysis. See 61 FR 
at 56457-56458. Moreover, current air quality planning and management 
tools have become increasingly sophisticated and refined and apply to a 
variety of area sizes and configurations, ranging from a single 
facility to large metropolitan areas. For example, EPA, in coordination 
with states has established nonattainment areas in states for the 
purpose of implementing nonattainment planning requirements for the 
lead National Ambient Air Quality Standards (NAAQS) that encompass 
areas of only a few square kilometers. See e.g., 40 CFR 81.310 and 40 
CFR 81.311. Conversely, there is an ozone transport region under the 
CAA for the purpose of ozone nonattainment planning that spans from 
Maine to northern Virginia. See section 184(a) of the CAA. Thus, EPA is 
reluctant to establish rigid criteria regarding the geographic size, 
geographic orientation, or population size of a Class I area that would 
automatically disqualify certain Tribes (or states) from exercising the 
authority conferred under section 164(c) to redesignate lands within 
Reservations. Arizona v. EPA.
    EPA believes it can evaluate the size of the lands in the proposed 
redesignation area based upon the Agency's experience in the Yavapai-
Apache redesignation and other air quality planning requirements. EPA 
also notes that it is expected to use caution in reversing 
redesignation requests in resolving disputes. 61 FR at 56454-56455, 
(citing CAA Legislative History, vol 3 at 326).
    The lands in this parcel are similar to the lands in Yavapai in 
containing noncontiguous parcels of various sizes. However, the lands 
here are many times larger, with a total acreage in excess of 10,000 
acres, compared with the 632 acres in Yavapai, and with the smallest 
parcel being 80 acres, more than twenty times larger than the 3.7594 
acre parcel in Yavapai. EPA recognizes the limits of fact matching, and 
does not believe that comparing acreage is necessarily dispositive in 
all cases. Nevertheless, it believes that based on both the result and 
the rationale in Arizona v. EPA, it has no basis for disapproving the 
redesignation based on size. EPA concludes that the size of the lands 
is not too small to allow effective air quality management or have 
    EPA must also consider whether it can consider any other factors, 
and, if so, how to do so. While 164(e) directs EPA to consider size in 
resolving a dispute, it does not mention other factors to consider, or 
discuss what discretion EPA may have with regard to considering other 
factors at all.
    EPA believes that the mandatory language directing EPA to consider 
whether the proposed redesignation lands ``are of sufficient size to 
allow air effective air quality management or have air quality related 
values'' clearly establishes size as the preeminent factor in resolving 
disputes. EPA also believes that the references to ``effective air 
quality management'' and ``air quality related values'' indicates that 
those factors, too, may be relevant in some circumstances, to the 
appropriate resolution of a dispute. Thus, for example, where EPA 
concludes that some other factor besides size precludes effective air 
quality management, it may have some limited authority to resolve a 
dispute by disapproving a redesignation because effective air quality 
management is impossible.
    EPA construes the reference to AQRVs in conjunction with a second 
use of the term in 164(e), providing that, if the parties so request, 
``EPA shall make a recommendation to resolve the dispute and protect 
the air quality related values of the land involved.'' 164(e) (emphasis 
added). Thus, EPA believes that it has limited discretion to consider 
protection of AQRVs in resolving a dispute, and that in some 
circumstances, it may resolve a dispute by denying a redesignation 
where approving the redesignation would not be consistent with 
protecting AQRVs.
    In sum, EPA has carefully considered the record in this case, and 
concludes it is not appropriate to deny the redesignation based on the 
size of the proposed area. EPA also concludes that the record does not 
show that the redesignation would preclude effective air quality 
management or be inconsistent with protecting AQRVs. EPA, therefore, 
resolves the dispute by rejecting the state's suggestion to deny the 
redesignation. EPA's approval decision is discussed in a separate 
    EPA also notes that it does not agree with the State of Michigan 
comment that additional rulemaking should be proposed before EPA can 
resolve the dispute or approve the redesignation. The statutes that 
govern this decision, sections 164(b)(2) and 164(e) contain no 
limitations on EPA's redesignation authority of the type Michigan 

List of Subjects in 40 CFR Part 52

    Environmental protection, Air pollution control, Carbon monoxide, 
Intergovernmental relations, Lead, Nitrogen dioxide, Ozone, Particulate 
matter, Reporting and recordkeeping requirements, Sulfur dioxides, 
Volatile organic compounds.

    Dated: April 18, 2008.
Stephen L. Johnson,
 [FR Doc. E8-8969 Filed 4-28-08; 8:45 am]