[Federal Register Volume 80, Number 80 (Monday, April 27, 2015)]
[Proposed Rules]
[Pages 23245-23248]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2015-09729]



[[Page 23245]]

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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[EPA-R06-OAR-2014-0378; FRL-9926-93-Region 6]


Approval and Promulgation of Implementation Plans; Arkansas; 
Prevention of Significant Deterioration; Greenhouse Gas Plantwide 
Applicability Limit Permitting Revisions

AGENCY: Environmental Protection Agency (EPA).

ACTION: Proposed rule.

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SUMMARY: The Environmental Protection Agency (EPA) is proposing to 
approve one revision to the Arkansas State Implementation Plan (SIP) 
submitted by the Arkansas Governor to the EPA on January 7, 2014. This 
submittal revises the Arkansas Prevention of Significant Deterioration 
(PSD) Permitting Program to incorporate by reference federal plantwide 
applicability limit (PAL) permitting provisions to enable the State of 
Arkansas to issue PSD PALs to sources with greenhouse gas (GHG) 
emissions. The EPA is proposing to find that the January 7, 2014 
revision to the Arkansas SIP is consistent with federal requirements 
for PSD permitting. The EPA is also proposing ministerial changes to 
the Code of Federal Regulations (CFR) to reflect recent EPA SIP 
approvals to the Arkansas PSD program and to show that SIP deficiencies 
identified in prior partial disapprovals have been addressed. We are 
proposing this action under section 110 and part C of title I of the 
Clean Air Act (CAA or the Act).

DATES: Written comments should be received on or before May 27, 2015.

ADDRESSES: Submit your comments, identified by Docket No. EPA-R06-OAR-
2014-0378, by one of the following methods:
     www.regulations.gov: Follow the on-line instructions.
     Email: Ms. Adina Wiley at [email protected].
     Mail or delivery: Ms. Adina Wiley, Air Permits Section 
(6PD-R), Environmental Protection Agency, 1445 Ross Avenue, Suite 1200, 
Dallas, Texas 75202-2733.
    Instructions: Direct your comments to Docket ID No. EPA-R06-OAR-
2014-0378. The EPA's policy is that all comments received will be 
included in the public docket without change and may be made available 
online at http://www.regulations.gov, including any personal 
information provided, unless the comment includes information claimed 
to be Confidential Business Information (CBI) or other information the 
disclosure of which is restricted by statute. Do not submit information 
through http://www.regulations.gov or email, if you believe that it is 
CBI or otherwise protected from disclosure. The http://www.regulations.gov Web site is an ``anonymous access'' system, which 
means that the EPA will not know your identity or contact information 
unless you provide it in the body of your comment. If you send an email 
comment directly to the EPA without going through http://www.regulations.gov, your email address will be automatically captured 
and included as part of the comment that is placed in the public docket 
and made available on the Internet. If you submit an electronic 
comment, the EPA recommends that you include your name and other 
contact information in the body of your comment along with any disk or 
CD-ROM submitted. If the EPA cannot read your comment due to technical 
difficulties and cannot contact you for clarification, the EPA may not 
be able to consider your comment. Electronic files should avoid the use 
of special characters and any form of encryption and should be free of 
any defects or viruses. For additional information about the EPA's 
public docket, visit the EPA Docket Center homepage at http://www.epa.gov/epahome/dockets.htm.
    Docket: The index to the docket for this action is available 
electronically at www.regulations.gov and in hard copy at EPA Region 6, 
1445 Ross Avenue, Suite 700, Dallas, Texas. 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).

FOR FURTHER INFORMATION CONTACT: Ms. Adina Wiley, (214) 665-2115, 
[email protected]. To inspect the hard copy materials, please 
schedule an appointment with Ms. Adina Wiley or Mr. Bill Deese at (214) 
665-7253.

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

Table of Contents

I. Background
    A. Summary of the EPA's Tailoring Rule and GHG PALs Rule
    B. Summary of the January 7, 2014 Arkansas SIP Submittal
    C. Ministerial Changes to the CFR
II. The EPA's Evaluation
III. Proposed Action
IV. Incorporation by Reference
V. Statutory and Executive Order Reviews

I. Background

    The Act at section 110(a)(2)(C) requires states to develop and 
submit to the EPA for approval into the state SIP, preconstruction 
review and permitting programs applicable to certain new and modified 
stationary sources of air pollutants for attainment and nonattainment 
areas that cover both major and minor new sources and modifications, 
collectively referred to as the New Source Review (NSR) SIP. The CAA 
NSR SIP program is composed of three separate programs: Prevention of 
Significant Deterioration (PSD), Nonattainment New Source Review 
(NNSR), and Minor NSR. PSD is established in part C of title I of the 
CAA and applies in areas that meet the National Ambient Air Quality 
Standard (NAAQS)--``attainment areas''--as well as areas where there is 
insufficient information to determine if the area meets the NAAQS--
``unclassifiable areas.'' The NNSR SIP program is established in part D 
of title I of the CAA and applies in areas that are not in attainment 
of the NAAQS--``nonattainment areas.'' The Minor NSR SIP program 
addresses construction or modification activities that do not emit, or 
have the potential to emit, beyond certain major source thresholds, and 
thus do not qualify as ``major,'' and applies regardless of the 
designation of the area in which a source is located. The EPA 
regulations governing the criteria that states must satisfy for EPA 
approval of the NSR programs as part of the SIP are contained in 40 CFR 
51.160-51.166.

A. Summary of the EPA's Tailoring Rule and GHG PALs Rule

    On June 3, 2010, the EPA issued a final rule, known as the 
Tailoring Rule, which phased in permitting requirements for GHG 
emissions from stationary sources under the CAA PSD and title V 
permitting programs (75 FR 31514). For Step 1 of the Tailoring Rule, 
which began on January 2, 2011, PSD or title V requirements applied to 
sources of GHG emissions only if the sources were subject to PSD or 
title V ``anyway'' due to their emissions of non-GHG pollutants. These 
sources are referred to as ``anyway sources.'' Step 2 of the Tailoring 
Rule, which began on July 1, 2011, applied the PSD and title V 
permitting requirements under the CAA to sources that were classified 
as major, and, thus, required to obtain a permit, based solely on their 
potential GHG emissions and to modifications of otherwise major sources 
that required a

[[Page 23246]]

PSD permit because they increased only GHG above applicable levels in 
the EPA regulations.
    On July 12, 2012, the EPA promulgated the final ``Prevention of 
Significant Deterioration and Title V Greenhouse Gas Tailoring Rule 
Step 3 and GHG Plantwide Applicability Limits'' (GHG Tailoring Rule 
Step 3 and GHG PALs).\1\ 77 FR 41051. In the Tailoring Rule Step 3 
portion of this rule, the EPA decided against further phase in of the 
PSD and Title V requirements to apply to sources emitting lower levels 
of greenhouse gas emissions. Thus, the thresholds for determining PSD 
applicability based on emission of greenhouse gases remained the same 
as established in Step 2 of the Tailoring Rule. The Step 3 portions of 
the EPA's July 12, 2012 final rule are not relevant to today's proposed 
action on the Arkansas SIP revision.
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    \1\ For a complete history of EPA's rulemakings related to GHG 
emissions please review the following final actions: ``Endangerment 
and Cause or Contribute Findings for Greenhouse Gases Under Section 
202(a) of the Clean Air Act.'' 74 FR 66496 (December 15, 2009).
    ``Interpretation of Regulations that Determine Pollutants 
Covered by Clean Air Act Permitting Programs.'' 75 FR 17004 (April 
2, 2010).
    Light-Duty Vehicle Greenhouse Gas Emission Standards and 
Corporate Average Fuel Economy Standards; Final Rule.'' 75 FR 25324 
(May 7, 2010).
    Prevention of Significant Deterioration and Title V Greenhouse 
Gas Tailoring Rule; Final Rule.'' 75 FR 31514 (June 3, 2010).
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    The GHG PALs portion of the July 12, 2012 final rule promulgated 
revisions to the EPA regulations under 40 CFR part 52 for establishing 
PALs for GHG emissions. For a full discussion of the EPA's rationale 
for the GHG PALs provisions, see the notice of final rulemaking at 77 
FR 41051. A PAL establishes a site-specific plantwide emission level 
for a pollutant that allows the source to make changes at the facility 
without triggering the requirements of the PSD program, provided that 
emissions do not exceed the PAL level. Under the EPA's interpretation 
of the federal PAL provisions, such PALs are already available under 
PSD for non-GHG pollutants and for GHGs on a mass basis, and the EPA 
revised the PAL regulations to allow for GHG PALs to be established on 
a carbon dioxide equivalent (CO2e) basis as well. See 77 FR 41052. The 
EPA finalized these revisions in an effort to streamline federal and 
SIP PSD permitting programs by allowing sources and permitting 
authorities to address GHGs using a PAL in a manner similar to the use 
of PALs for non-GHG pollutants. See 77 FR 41051, 41052.

B. Summary of the January 7, 2014 Arkansas SIP Submittal

    On April 2, 2013, the EPA approved a revision to the Arkansas SIP 
providing the State of Arkansas the authority to regulate and permit 
emissions of GHGs under the Arkansas PSD Program and simultaneously 
rescinded the GHG PSD FIP for Arkansas. See 78 FR 19596. Arkansas 
submitted on January 7, 2014, regulations specific to the Arkansas GHG 
PSD permitting program for approval by the EPA into the Arkansas SIP. 
The January 7, 2014, SIP revision submittal includes the PSD permitting 
provisions that were adopted on June 28, 2013, at the Arkansas 
Pollution Control and Ecology Commission's (``Commission'') Regulation 
Number 19, Regulations of the Arkansas Plan of Implementation for Air 
Pollution Control (hereinafter Regulation 19 at 19.904(A)(1) and (G)(1) 
that provide the Arkansas Department of Environmental Quality (ADEQ) 
the ability to issue GHG PSD PALs consistent with the ``Prevention of 
Significant Deterioration and Title V Greenhouse Gas Tailoring Rule 
Step 3 and GHG Plantwide Applicability Limits Final Rule'' (77 FR 
41051). The January 7, 2014 submittal also included a non-substantive 
revision to the Regulation 19.904(E)(3) to correct a reference to 
federal air quality models for PSD permitting. Today's proposal and the 
accompanying Technical Support Document (TSD) present our rationale for 
approving these regulations as meeting the minimum federal requirements 
for the adoption and implementation of the PSD SIP permitting programs.

C. Ministerial Changes to the CFR

    We are proposing ministerial changes to 40 CFR 52.170(e) and 40 CFR 
52.172(b) which reflect that deficiencies identified in in our partial 
disapproval of ADEQ's December 17, 2007 and March 28, 2008 SIP 
submittals for the 1997 8-hour ozone NAAQS have been adequately 
addressed by the State. We are proposing the changes because we fully 
approved the revisions to the Arkansas PSD program providing the 
authority to regulate and permit emissions of GHGs on April 2, 2013 (78 
FR 19596). As a result of our full approval of the Arkansas PSD program 
for GHGs, the partial disapproval is no longer applicable.
    We are also proposing a ministerial change to 40 CFR 52.181(a) to 
show that the EPA approved a revision to the Arkansas PSD program on 
April 2, 2013, to provide the state the authority to regulate and 
permit GHGs. See 78 FR 19596.

II. The EPA's Evaluation

    The EPA's most recent approval to the Arkansas PSD program was on 
March 4, 2015, where we updated our approval of the Arkansas PSD 
program to include the December 1, 2014 submitted revisions to provide 
the ADEQ the authority to regulate and permit emissions of fine 
particulate matter and its precursors consistent with federal 
requirements. Our March 4, 2015 final action did not address the 
pending submittal regarding the GHG PSD PALs submitted on January 7, 
2014. See 80 FR 11573.
    The State of Arkansas has adopted and submitted one revision to the 
PSD program on January 7, 2014, affecting Regulation 19.904--Adoption 
of Regulations, Sections 19.904(A)(1), (E)(3), and (G)(1). The 
revisions to Regulation 19.904(A)(1) and (G)(1) have been submitted to 
provide for the issuance of GHG PSD PAL permits through the 
incorporation by reference of the federal regulations at 40 CFR 
52.21(aa) and the adoption of revisions to the definition of 
``Greenhouse gases'' that are consistent with the requirements 
promulgated by EPA in our final rule on July 12, 2012, titled 
``Prevention of Significant Deterioration and Title V Greenhouse Gas 
Tailoring Rule Step 3 and GHG Plantwide Applicability Limits.'' See 77 
FR 41501. In addition, the revision to Regulation 19.904(E)(3) updates 
a reference to the federal air quality models used for PSD permitting.
    The ADEQ has adopted and submitted regulations that are consistent 
with the federal regulations for the permitting of GHG-emitting sources 
through a GHG PSD PAL effective as of August 13, 2012. The detailed 
analysis in our TSD demonstrates that the revisions to Regulation 
19.904(A)(1) incorporate by reference the GHG PSD PAL provisions at 40 
CFR 52.21(aa), effective on August 13, 2012. The revisions to 
Regulation 19.904(G)(1) revise the Arkansas PSD SIP provisions for GHG 
PSD permitting to amend the definition of ``GHGs'' to mirror the 
provisions promulgated by the EPA on July 12, 2012, effective on August 
13, 2012, for the issuance of GHG PSD PALs.
    On June 23, 2014, the United States Supreme Court, in Utility Air 
Regulatory Group v. Environmental Protection Agency,\2\ issued a 
decision addressing the application of PSD permitting requirements to 
GHG emissions. The Supreme Court said that the EPA may not treat GHGs 
as an air pollutant for purposes of determining whether a

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source is a major source (or modification thereof) required to obtain a 
PSD permit. The Court also said that the EPA could continue to require 
that PSD permits, otherwise required based on emissions of pollutants 
other than GHGs, contain limitations on GHG emissions based on the 
application of Best Available Control Technology (BACT).The Supreme 
Court decision effectively upheld PSD permitting requirements for GHG 
emissions under Step 1 of the Tailoring Rule for ``anyway sources'' and 
invalidated PSD permitting requirements for Step 2 sources.
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    \2\ 134 S.Ct. 2427 (2014).
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    In accordance with the Supreme Court decision, on April 10, 2015, 
the U.S. Court of Appeals for the District of Columbia Circuit (the 
D.C. Circuit) issued an amended judgment vacating the regulations that 
implemented Step 2 of the Tailoring Rule, but not the regulations that 
implement Step 1 of the Tailoring Rule. A copy of the judgment is 
included in the docket to this rulemaking.\3\ The amended judgment 
preserves, without the need for additional rulemaking by the EPA, the 
application of the Best Available Control Technology (BACT) requirement 
to GHG emissions from sources that are required to obtain a PSD permit 
based on emissions of pollutants other than GHGs (``anyway'' sources). 
The D.C. Circuit's judgment vacated the regulations at issue in the 
litigation, including 40 CFR 51.166(b)(48)(v), ``to the extent they 
require a stationary source to obtain a PSD permit if greenhouse gases 
are the only pollutant (i) that the source emits or has the potential 
to emit above the applicable major source thresholds, or (ii) for which 
there is a significant emissions increase from a modification.''
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    \3\ Original case is Coalition for Responsible Regulation v. 
EPA, D.C. Cir., No. 09-1322, 06/26/20, judgment entered for No. 09-
1322 on 04/10/2015.
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    The EPA may need to take additional steps to revise federal PSD 
rules in light of the Supreme Court decision and recent D.C. Circuit 
judgment. In addition, the EPA anticipates that many states will revise 
their existing SIP-approved PSD programs. The EPA is not expecting 
states to have revised their existing PSD program regulations at this 
juncture. However, the EPA is evaluating PSD program submissions to 
assure that the state's program correctly addresses GHGs consistent 
with both decisions.
    Arkansas's existing approved SIP contains the greenhouse gas 
permitting requirements required under 40 CFR 51.166, as amended in the 
Tailoring Rule. As a result, the State's SIP-approved PSD permitting 
program continues to require that PSD permits (otherwise required based 
on emissions of pollutants other than GHGs) contain limitations on GHG 
emissions based on the application of BACT when sources emit or 
increase greenhouse gases in the amount of 75,000 tons per year (tpy), 
measured as carbon dioxide equivalent. Although the SIP-approved 
Arkansas PSD permitting program may also currently contain provisions 
that are no longer necessary in light of the D.C. Circuit's judgment or 
the Supreme Court decision, this does not prevent the EPA from 
approving the submission addressed in this rule. Arkansas's January 7, 
2014 SIP submission does not add any greenhouse gas permitting 
requirements that are inconsistent with either decision.
    Likewise, this revision does add to the Arkansas SIP elements of 
the EPA's July 12, 2012 rule implementing Step 3 of the phase in of PSD 
permitting requirements for greenhouse gases described in the Tailoring 
Rule, which became effective on August 13, 2012. Specifically, the 
incorporation of the Step 3 rule provisions will allow GHG-emitting 
sources to obtain PALs for their GHG emissions on a CO2e 
basis. The GHG PAL provisions, as currently written, include some 
provisions that may no longer be appropriate in light of both the D.C. 
Circuit judgment and the Supreme Court decision. Since the Supreme 
Court has determined that sources and modifications may not be defined 
as ``major'' solely on the basis of the level of greenhouse gases 
emitted or increased, PALs for greenhouse gases may no longer have 
value in some situations where a source might have triggered PSD based 
on greenhouse gas emissions alone. However, PALs for GHGs may still 
have a role to play in determining whether a modification that triggers 
PSD for a pollutant other than greenhouse gases should also be subject 
to BACT for greenhouse gases. These provisions, like the other GHG 
provisions discussed previously, may be revised at some future time. 
However, these provisions do not add new requirements for sources or 
modifications that only emit or increase greenhouse gases above the 
major source threshold or the 75,000 tpy greenhouse gas level in 
section 52.21(b)(49)(iv). Rather, the PALs provisions provide increased 
flexibility to sources that wish to address their GHG emissions in a 
PAL. Since this flexibility may still be valuable to sources in at 
least one context described above, we believe that it is appropriate to 
approve these provisions into the Arkansas SIP at this juncture.
    In a related matter, on July 12, 2013 the D.C. Circuit, in Center 
for Biological Diversity v. EPA,\4\ vacated the provisions of the 
Biomass Deferral, which had delayed (for three years) the applicability 
of PSD and title V requirements to biogenic CO2 emissions. 
While the opportunity to seek rehearing of this D.C. Circuit decision 
remains open and thus the ultimate disposition of the Federal 
regulations implementing the Biomass Deferral has not yet been 
determined, the three-year deferral expired on July 21, 2014. 
Consistent with 40 CFR 51.166(b)(48)(ii)(a), the provision in the 
approved Arkansas PSD SIP at Regulation 19.904(G)(2)(b) implementing 
the Biomass Deferral does not apply after the July 21, 2014 date 
contained therein. Thus, this prior approval does not conflict with the 
D.C. Circuit's decision.
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    \4\ 722 F.3d 401 (D.C. Cir. 2013).
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    ADEQ has also adopted and submitted a revision to the SIP-approved 
provisions at Regulation 19.904(E)(3) to update the reference to the 
federal air quality models to be used for PSD permitting. The reference 
now reads 40 CFR 52.21(l)(2) as opposed to the prior incorrect 
reference to 40 CFR 52.21(2). The EPA proposes to find that the ADEQ 
has correctly revised the Arkansas PSD program to reference federal 
requirements.

III. Proposed Action

    The EPA is proposing to approve the January 7, 2014 submitted 
revisions to the Arkansas PSD Permitting Program at Regulation 
19.904(A)(1), (E)(3), and (G)(1) into the Arkansas SIP. The EPA is 
proposing to determine that the January 7, 2014 revision is approvable 
because the submitted rules are adopted and submitted in accordance 
with the CAA and are consistent with the EPA's regulations regarding 
PSD permitting for emissions of GHGs. Therefore, the EPA proposes to 
approve the following as a revision to the Arkansas PSD SIP:
     Substantive revisions to Regulation 19.904(A)(1) 
incorporating by reference the federal GHG PSD PAL permitting 
provisions,
     Revisions to Regulation 19.904(E)(3) to update the 
reference to federal PSD air quality models at 40 CFR 52.21(l)(2), and
     Substantive revisions to Regulation 19.904(G)(1) 
establishing the requirements for GHG PSD PAL permits consistent with 
federal requirements.
    The EPA is also proposing ministerial changes to 40 CFR 52.170(e) 
and 40 CFR 52.172(b) which reflect that deficiencies

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identified in our partial disapproval of the December 17, 2007 and 
March 28, 2008 Arkansas SIP submittals for the 1997 8-hour ozone NAAQS 
were addressed by our approval of Arkansas PSD program revisions which 
provide the authority to regulate and permit emissions of GHGs on April 
2, 2013 (78 FR 19596). We are also proposing a ministerial change to 40 
CFR 52.181(a) to reflect that the EPA approved a revision to the PSD 
program for the authority to regulate and permit emissions of GHGs on 
April 2, 2013 (78 FR 19596).
    The EPA is proposing these actions under section 110 and part C of 
the Act, and for the reasons stated above.

IV. Incorporation by Reference

    In this rule, the EPA is proposing to include in a final EPA rule 
regulatory text that includes incorporation by reference. In accordance 
with the requirements of 1 CFR 51.5, the EPA is proposing to 
incorporate by reference the revisions to the Arkansas PSD Program at 
Regulation 19.904 discussed in section II of this preamble. The EPA has 
made, and will continue to make, these documents generally available 
electronically through www.regulations.gov and/or in hard copy at the 
appropriate EPA office (see the ADDRESSES section of this preamble for 
more information).

V. Statutory and Executive Order Reviews

    Under the CAA, the Administrator is required to approve a SIP 
submission that complies with the provisions of the Act and applicable 
Federal regulations. 42 U.S.C. 7410(k); 40 CFR 52.02(a). Thus, in 
reviewing SIP submissions, the EPA's role is to approve state choices, 
provided that they meet the criteria of the CAA. Accordingly, this 
action merely proposes to approve state law as meeting Federal 
requirements and does not impose additional requirements beyond those 
imposed by state law. For that reason, this action:
     Is not a ``significant regulatory action'' subject to 
review by the Office of Management and Budget under Executive Orders 
12866 (58 FR 51735, October 4, 1993) and 13563 (76 FR 3821, January 21, 
2011);
     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 rule is not proposed to apply on any Indian 
reservation land or in any other area where the EPA or an Indian tribe 
has demonstrated that tribe has jurisdiction. In those areas of Indian 
country, the proposed rule does not have tribal implications and will 
not impose substantial direct costs on tribal governments or preempt 
tribal law as specified by Executive Order 13175 (65 FR 67249, November 
9, 2000).

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 oxides, 
Volatile organic compounds, and Incorporation by reference.

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

    Dated: April 17, 2015.
Ron Curry,
Regional Administrator, Region 6.
[FR Doc. 2015-09729 Filed 4-24-15; 8:45 am]
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