[Federal Register Volume 77, Number 182 (Wednesday, September 19, 2012)]
[Proposed Rules]
[Pages 58078-58081]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-22971]


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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[EPA-R09-OAR-2012-0734; FRL-9727-4]


Withdrawal of Approval of Air Quality Implementation Plans; 
California; San Joaquin Valley; 1-Hour and 8-Hour Ozone Extreme Area 
Plan Elements

AGENCY: U.S. Environmental Protection Agency (EPA).

ACTION: Proposed rule.

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SUMMARY: EPA is proposing to withdraw a March 8, 2010 final action 
approving state implementation plan (SIP) revisions submitted by the 
State of California under the Clean Air Act (CAA) to provide for 
attainment of the 1-hour ozone National Ambient Air Quality Standards 
(NAAQS) in the San Joaquin Valley extreme ozone nonattainment area. 
This proposed action is in response to a decision issued by the U.S. 
Court of Appeals for the Ninth Circuit (Sierra Club v. EPA, 671 F.3d 
955 (9th Cir. 2012)) remanding EPA's approval of these SIP revisions. 
In addition, EPA is proposing to withdraw our approval of a portion of 
a March 1, 2012 final rule approving SIP revisions submitted by 
California to provide for attainment of the 1997 8-hour ozone NAAQS in 
the San Joaquin Valley. The portion of this final action for which EPA 
is proposing to withdraw its approval addressed requirements regarding 
emissions growth caused by growth in vehicle miles traveled under the 
CAA. This proposed action is in response to a decision issued by the 
U.S. Court of Appeals for the Ninth Circuit (Association of Irritated 
Residents, 632 F.3d 584 (9th Cir. 2011), as amended Jan. 27, 2012), 
rejecting EPA's interpretation of the CAA, which had provided the basis 
for this portion of EPA's March 1, 2012 final rule.

DATES: Comments must be received on or before October 19, 2012.

ADDRESSES: Submit comments, identified by docket number EPA-R09-OAR-
2012-0734, by one of the following methods:
     Federal eRulemaking Portal: www.regulations.gov. Follow 
the on-line instructions.
     Email: [email protected].
     Mail or delivery: Frances Wicher, (AIR-2), U.S. 
Environmental Protection Agency Region 9, 75 Hawthorne Street, San 
Francisco, CA 94105.
    Instructions: All comments will be included in the public docket 
without change and may be made available online at www.regulations.gov, 
including any personal information provided, unless the comment 
includes Confidential Business Information (CBI) or other information 
whose disclosure is restricted by statute. Information that you 
consider CBI or otherwise protected should be clearly identified as 
such and should not be submitted through www.regulations.gov or email. 
The www.regulations.gov Web site is an ``anonymous access'' system, and 
EPA will not know your identity or contact information unless you 
provide it in the body of your comment. If you send email directly to 
EPA, your email address will be automatically captured and included as 
part of the public comment. If EPA cannot read your comments due to 
technical difficulties and cannot contact you for clarification, EPA 
may not be able to consider your comment.
    Docket: The index to the docket for this proposed action is 
available electronically on the www.regulations.gov Web site and in 
hard copy at EPA Region 9, 75 Hawthorne Street, San Francisco, 
California 94105. While all documents in the docket are listed in the 
index, some information may be publicly available only at the hard copy 
location (e.g., copyrighted material), and some may not be publicly 
available at either location (e.g., CBI). To inspect the hard copy 
materials, please schedule an appointment during normal business hours 
with the contact listed in the FOR FURTHER INFORMATION CONTACT section 
below.

FOR FURTHER INFORMATION CONTACT: Frances Wicher, Air Planning Office 
(AIR-2), (415) 972-3957, [email protected].

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

Table of Contents

I. San Joaquin Valley 2004 1-Hour Ozone Plan
    A. Background
    B. EPA's Proposed Action
II. VMT Emissions Offset Requirement for 1997 8-Hour Ozone Standard
    A. Background
    B. EPA's Proposed Action
III. Public Comment
IV. Statutory and Executive Order Reviews

[[Page 58079]]

I. San Joaquin Valley 2004 1-Hour Ozone Plan

A. Background

    On March 8, 2010, EPA fully approved state implementation plan 
(SIP) revisions submitted by the State of California to provide for 
attainment of the 1-hour ozone NAAQS in the San Joaquin Valley (SJV) 
extreme ozone nonattainment area. 75 FR 10420. The California Air 
Resources Board (CARB) had submitted these SIP revisions to satisfy the 
applicable requirements of part D, title I of the CAA following EPA's 
reclassification of the SJV area from severe to extreme nonattainment 
for the 1-hour ozone NAAQS effective May 17, 2004. 69 FR 20550 (April 
16, 2004).\1\ The SIP revisions that EPA approved consisted of the 
following four submissions: (1) The ``Extreme Ozone Attainment 
Demonstration Plan,'' adopted by the San Joaquin Valley Unified Air 
Pollution Control District (SJVUAPCD or District) in October 2004 and 
submitted by CARB on November 15, 2004 (2004 SIP); (2) amendments to 
the 2004 SIP adopted by the District in October 2005 and submitted by 
CARB on March 6, 2006 to, among other things, amend the control 
strategy (2005 Amendments); (3) the ``Clarifications Regarding the 2004 
Extreme Ozone Attainment Demonstration Plan,'' adopted by the District 
in August 2008 and submitted by CARB on September 5, 2008 to provide 
updates to the 2004 SIP related to reasonably available control 
technology (RACT) measures adopted by the SJVUAPCD, the rate-of-
progress (ROP) demonstration, and contingency measures (2008 
Clarifications); and (4) relevant portions of the ``2003 State and 
Federal Strategy for the California State Implementation Plan,'' 
adopted by CARB in October 2003 and submitted to EPA on January 9, 2004 
(2003 State Strategy), which identify CARB's regulatory agenda to 
reduce ozone and particulate matter in California and include statewide 
control measures applicable in the SJV. The 2003 State Strategy, as 
modified by CARB's resolution adopting it and CARB's resolution 
adopting the 2004 SIP, also includes State commitments to reduce 
emissions in the SJV area by specified amounts. The 2004 SIP relies in 
part on the 2003 State Strategy for the reductions needed to 
demonstrate attainment and ROP for the 1-hour ozone standard in the SJV 
area. See 75 FR 10420, 10421 (March 8, 2010).
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    \1\ EPA established a new 8-hour ozone standard in 1997 (62 FR 
38856 (July 18, 1997)) and subsequently revoked the 1-hour ozone 
standard effective June 15, 2005 in the SJV (40 CFR 50.9(b); 69 FR 
23951 (April 30, 2004) and 70 FR 44470 (August 3, 2005)). However, 
the SJV area remains subject to certain CAA requirements for the 1-
hour ozone standard through the anti-backsliding provisions in EPA's 
implementing regulations. See 40 CFR 51.905(a)(1) and 51.900(f).
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    These submittals, which we refer to collectively as the ``2004 1-
Hour Ozone Plan'' or ``Plan,'' contained the following required 
elements of a 1-hour ozone plan for the SJV: (1) A rate of progress 
(ROP) demonstration as required by CAA sections 172(c)(2) and 
182(c)(2); (2) ROP contingency measures as required by CAA sections 
172(c)(9) and 182(c)(9); (3) an attainment demonstration as required by 
CAA sections 182(c)(2)(A) and 181(a); (4) attainment contingency 
measures as required by CAA section 172(c)(9); (5) a reasonably 
available control measures (RACM) demonstration as required by CAA 
section 172(c)(1); (6) provisions for clean fuels/clean technologies 
for boilers as required by CAA 182(e)(3); and (7) vehicle miles 
traveled (VMT) provisions as required by CAA section 182(d)(1)(A), 
including the requirement regarding transportation control strategies 
and transportation control measures sufficient to offset any growth in 
emissions from growth in VMT or numbers of vehicle trips in the SJV 
area (VMT emissions offset requirement).
    The Sierra Club and several environmental groups filed a petition 
for review of EPA's March 8, 2010 approval of the 2004 1-Hour Ozone 
Plan, arguing, among other things, that EPA's action was arbitrary and 
capricious under the Administrative Procedure Act (APA) because it did 
not take into account new emissions inventory data that California had 
submitted subsequent to its submittal of the 2004 1-Hour Ozone Plan. On 
January 20, 2012, the U.S. Court of Appeals for the Ninth Circuit 
granted the petition with respect to this issue, holding that EPA's 
failure to consider the new emissions data rendered the Agency's action 
arbitrary and capricious under the APA and remanding EPA's action, in 
its entirety, for further proceedings consistent with the decision. See 
Sierra Club, et. al. v. EPA, 671 F.3d 955 (9th Cir. 2012) (Sierra 
Club). The court declined to reach the other issues raised in the 
petition for review.

B. EPA's Proposed Action

    Consistent with the Sierra Club court's remand, EPA is proposing to 
withdraw its March 8, 2010 approval of the 2004 1-Hour Ozone Plan (75 
FR 10420) in its entirety. This withdrawal, if finalized, would have 
the effect of removing the 2004 1-Hour Ozone Plan from the applicable 
California SIP and deleting the provisions in 40 CFR 52.220(c) where 
EPA's approval of the Plan is currently codified. See 40 CFR 
52.220(c)(317)(i)(B)(1), (c)(339)(i)(B)(1) and (ii)(C), 
(c)(348)(i)(A)(2), and (c)(369)-(371). The District has stated its 
intent to withdraw the Plan from EPA's consideration following EPA's 
withdrawal of approval, and to submit a new 1-hour ozone plan to EPA by 
June 30, 2013. See letter dated July 10, 2012, from Seyed Sadredin, 
Executive Director/APCO, SJVUAPCD, to Jared Blumenfeld, Regional 
Administrator, U.S. EPA Region IX, Re: ``San Joaquin Valley 1-hour 
Ozone Plan.'' Consistent with these representations, we understand that 
California intends to promptly withdraw the 2004 1-Hour Ozone Plan from 
EPA's consideration if EPA finalizes today's proposal. Accordingly, EPA 
is not proposing additional action on the 2004 1-Hour Ozone Plan at 
this time.
    As a consequence of EPA's reclassification of the SJV to extreme 
nonattainment for the 1-hour ozone standard in 2004, California was 
obligated to submit plan revisions for the SJV area meeting CAA and 
regulatory requirements for extreme 1-hour ozone nonattainment areas. 
Because California will be in default of these obligations should it 
withdraw the Plan from EPA's consideration, following such withdrawal 
EPA will promptly issue a finding of failure to submit pursuant to CAA 
section 179(a)(1), effective upon publication in the Federal Register. 
This finding would trigger mandatory sanctions under CAA section 179 
unless the deficiency is corrected within 18 months of such finding and 
would also trigger an obligation on EPA to promulgate a Federal 
Implementation Plan (FIP) under CAA section 110(c) unless California 
submits and we approve SIP revisions that correct the deficiency within 
two years of such finding. Should California fail to promptly withdraw 
the 2004 1-Hour Ozone Plan upon finalization of today's proposal, EPA 
plans to commence a new rulemaking addressing the approvability of the 
2004 1-Hour Ozone Plan.
    If California withdraws the 2004 1-Hour Ozone Plan, the plan 
elements under subparts 1 and 2 of part D, title I of the CAA for which 
the State will no longer have a valid submission and thus would be 
required to submit for the 1-hour ozone NAAQS for the SJV area are as 
follows: (1) A ROP demonstration meeting the requirements of CAA 
sections 172(c)(2) and 182(c)(2); (2) ROP contingency measures meeting 
the requirements of CAA sections 172(c)(9) and 182(c)(9); (3) an 
attainment

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demonstration meeting the requirements of CAA sections 182(c)(2)(A) and 
172(a)(2); (4) attainment contingency measures meeting the requirements 
of CAA sections 172(c)(9); (5) a reasonably available control measures 
(RACM) demonstration meeting the requirements of CAA section 172(c)(1); 
(6) provisions satisfying the requirements for clean fuels/clean 
technologies for boilers in CAA 182(e)(3); and (7) provisions 
satisfying the vehicle miles traveled (VMT) provisions of CAA section 
182(d)(1)(A), including the VMT emissions offset requirement. See 40 
CFR 51.905(a)(1) and 51.900(f); see also 75 FR 10420, 10436-37.

II. VMT Emissions Offset Requirement for 1997 8-Hour Ozone Standard

A. Background

    On March 1, 2012, EPA fully approved SIP revisions submitted by 
California to provide for attainment of the 1997 8-hour ozone NAAQS in 
the SJV extreme ozone nonattainment area (2007 8-Hour Ozone Plan).\2\ 
77 FR 12652 (March 1, 2012). This final rule, which was signed by the 
Regional Administrator on December 15, 2011, included a determination 
that the 2007 8-Hour Ozone Plan satisfied the VMT emissions offset 
requirement in CAA section 182(d)(1)(A).\3\ 77 FR at 12670. Although 
the 2007 8-Hour Ozone Plan does not contain a specific demonstration to 
address the VMT emissions offset requirement, EPA concluded, based on 
the Agency's then-current interpretation of CAA section 182(d)(1)(A), 
that California was not required to include additional transportation 
control strategies and transportation control measures to offset growth 
in emissions from growth in VMT in the SJV area for purposes of the 
1997 8-hour ozone NAAQS because the 2007 8-Hour Ozone Plan demonstrated 
that both volatile organic compounds and nitrogen oxides emissions from 
on-road mobile sources declined steadily over the entire period covered 
by the plan. 76 FR 57846, 57863 (September 16, 2011) (proposed rule) 
and 77 FR 12652, at 12666 and 12670 (March 1, 2012) (final rule).\4\
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    \2\ For a more detailed description of this SIP, see 76 FR 
57846, 57847 (September 16, 2011).
    \3\ Section 182(d)(1)(A) of the Act states as follows:
    Within 2 years after November 15, 1992, the State shall submit a 
revision that identifies and adopts specific enforceable 
transportation control strategies and transportation control 
measures to offset any growth in emissions from growth in vehicle 
miles traveled or numbers of vehicle trips in such area and to 
attain reduction in motor vehicle emissions as necessary, in 
combination with other emission reduction requirements of this 
subpart, to comply with the requirements of subsection (b)(2)(B) and 
(c)(2)(B) of this section (pertaining to periodic emissions 
reduction requirements). The State shall consider measures specified 
in section 7408(f) of this title, and choose from among and 
implement such measures as necessary to demonstrate attainment with 
the national ambient air quality standards; in considering such 
measures, the State should ensure adequate access to downtown, other 
commercial, and residential areas and should avoid measures that 
increase or related emissions and congestion rather than reduce 
them.
    \4\ As explained in these rulemakings, EPA has historically 
interpreted CAA section 182(d)(1)(A) to allow areas to meet the 
requirement by demonstrating that emissions from motor vehicles 
decline each year through the attainment year. See 57 FR 13498, at 
13521-15323 (April 16, 1992).
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    As explained in EPA's proposed and final rules, in Association of 
Irritated Residents v. EPA, 632 F.3d 584 (9th Cir. 2011) (AIR), the 
U.S. Court of Appeals for the Ninth Circuit held that CAA section 
182(d)(1)(A) requires states to adopt, among other things, 
transportation control measures and strategies whenever, due to growth 
in VMT, vehicle emissions are projected to be higher than they would 
have been had VMT not increased, even when aggregate vehicle emissions 
are actually decreasing. 76 FR 57846, 57863 and 77 FR 12652 at fn. 4. 
At the time of signature of the final rule approving the 2007 8-Hour 
Ozone Plan, December 15, 2011, the court had not yet issued its mandate 
in the AIR case and EPA had not adopted the court's interpretation for 
the reasons set forth in the Agency's petition for rehearing of the 
court's ruling on the VMT emissions offset requirement, pending a final 
decision by the court. Id. Accordingly, notwithstanding adverse 
comments on EPA's proposal with respect to this issue, EPA proceeded to 
fully approve the 2007 8-Hour Ozone Plan as satisfying the VMT 
emissions offset requirement in CAA section 182(d)(1)(A) on the basis 
of EPA's then-current interpretation of this requirement. On January 
27, 2012, the U.S. Court of Appeals for the Ninth Circuit denied EPA's 
petition for rehearing in AIR and issued an amended opinion. The 
mandate issued on February 13, 2012. See Association of Irritated 
Residents, et al., v. EPA, Nos. 09-71383 and 09-71404 (consolidated), 
632 F.3d 584 (9th Cir. 2011), reprinted as amended on January 27, 2012, 
686 F.3d 668, further amended February 13, 2012.
    EPA's final rule approving the 2007 8-Hour Ozone Plan was published 
on March 1, 2012 (77 FR 12652). Shortly thereafter, several 
environmental and community groups filed a lawsuit in the Ninth Circuit 
challenging that approval. Committee for a Better Arvin et al. v. EPA, 
No. 12-71332.

B. EPA's Proposed Action

    As noted above, the Ninth Circuit rejected EPA's prior 
interpretation of the VMT emissions offset requirement in section 
182(d)(1)(A), under which we had allowed states to demonstrate 
compliance through submittal of aggregate motor vehicle emissions 
estimates showing year-over-year declines in such emissions. This 
interpretation formed the basis for EPA's determination that the 2007 
8-Hour Ozone Plan satisfied the VMT emissions offset requirement. In 
response to the court's ruling in AIR, we are proposing to withdraw our 
March 1, 2012 determination that the 2007 8-Hour Ozone SIP satisfies 
the VMT emissions offset requirement in CAA section 182(d)(1)(A) 
because it is predicated on an interpretation of section 182(d)(1)(A) 
that has been rejected by the Ninth Circuit. The 2007 8-Hour Ozone Plan 
fails to identify, compared to a baseline assuming no VMT growth, the 
level of increased emissions resulting solely from VMT growth and to 
show how such increased emissions have been offset through adoption and 
implementation of transportation control strategies and transportation 
control measures. This withdrawal would be limited to our conclusion 
with respect to the VMT emissions offset requirement and would not 
affect any other element of our March 1, 2012 action on the 2007 8-Hour 
Ozone SIP.
    Because EPA's determination that the 2007 8-Hour Ozone SIP 
satisfied the VMT emissions offset requirement was made in the absence 
of any such demonstration submitted by the State, California will be in 
default of its obligation to submit a SIP revision satisfying this 
requirement if EPA finalizes the withdrawal of its determination that 
the obligation has been met. Therefore, simultaneously with a final 
action to withdraw our previous determination that the 2007 8-Hour 
Ozone Plan satisfies the VMT emissions offset requirement in CAA 
section 182(d)(1)(A), EPA intends to issue a finding that California 
has failed to submit a SIP revision to address this requirement, which 
would be effective upon publication in the Federal Register. This 
finding would trigger mandatory sanctions under CAA section 179 unless 
the deficiency is corrected within 18 months of such finding and would 
also trigger an obligation on EPA to promulgate a Federal 
Implementation Plan (FIP) under CAA section 110(c) unless California 
submits and we approve a SIP revision that corrects the

[[Page 58081]]

deficiency within two years of such finding.

III. Public Comment

    We will accept comments from the public on these proposals for the 
next 30 days. The deadline and instructions for submission of comments 
are provided in the ``Date'' and ``Addresses'' sections at the 
beginning of this preamble.

IV. Statutory and Executive Order Reviews

    This action merely proposes to withdraw previous EPA actions, or 
portions thereof, on SIP revisions submitted by California to provide 
for attainment of ozone standards in the San Joaquin Valley. As such it 
does not propose to impose additional requirements on any entity. For 
that reason, this proposed action:
     Is not a ``significant regulatory action'' subject to 
review by the Office of Management and Budget under Executive Order 
12866 (58 FR 51735 (October 4, 1993));
     Does not impose an information collection burden under the 
provisions of the Paperwork Reduction Act (44 U.S.C. 3501 et seq.);
     Is certified as not having a significant economic impact 
on a substantial number of small entities under the Regulatory 
Flexibility Act (5 U.S.C. 601 et seq.);
     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);
     Does not have Federalism implications as specified in 
Executive Order 13132 (64 FR 43255 (August 10, 1999));
     Is not an economically significant regulatory action based 
on health or safety risks subject to Executive Order 13045 (62 FR 19885 
(April 23, 1997));
     Is not a significant regulatory action subject to 
Executive Order 13211 (66 FR 28355 (May 22, 2001));
     Is not subject to requirements of Section 12(d) of the 
National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 
note) because application of those requirements would be inconsistent 
with the CAA; and
     Does not provide EPA with the discretionary authority to 
address, as appropriate, disproportionate human health or environmental 
effects, using practicable and legally permissible methods, under 
Executive Order 12898 (59 FR 7629 (February 16, 1994)).

In addition, this proposed action does not have Tribal implications as 
specified by Executive Order 13175 (65 FR 67249; November 9, 2000), 
because the SIP does not apply in Indian country located in the State, 
and EPA notes that it will not impose substantial direct costs on 
Tribal governments or preempt Tribal law.

List of Subjects in 40 CFR Part 52

    Environmental protection, Air pollution control, Intergovernmental 
relations, Nitrogen dioxide, Ozone, Volatile organic compounds.

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

    Dated: August 30, 2012.
Jared Blumenfeld,
EPA Regional Administrator, Region 9.
[FR Doc. 2012-22971 Filed 9-18-12; 8:45 am]
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