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Code · REGISTER · 2007-06-12 · Environmental Protection Agency (EPA) · Proposed Rules

Proposed Rules. Final rule

59,152 words·~269 min read·/register/2007/06/12/07-2237

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BILLING CODE 6560-50-P ENVIRONMENTAL PROTECTION AGENCY 40 CFR Part 82 [EPA-HQ-OAR-2006-0159; FRL-8325-5] RIN 2060-AN81 Protection of Stratospheric Ozone: Allocation of Essential Use Allowances for Calendar Year 2007 AGENCY: Environmental Protection Agency (EPA). ACTION: Final rule. SUMMARY: With this action, EPA is allocating essential use allowances for import and production of Class I stratospheric ozone-depleting substances
(ODSs)for calendar year 2007. Essential use allowances enable a person to obtain controlled Class I ODSs as part of an exemption to the regulatory ban on the production and import of these chemicals, which became effective as of January 1, 1996. EPA allocates essential use allowances for exempted production or import of a specific quantity of Class I ODSs solely for the designated essential purpose. The allocations in this action total 167.0 metric tons
(MT)of chlorofluorocarbons
(CFCs)for use in metered dose inhalers
(MDIs)for 2007. DATES: Effective Date: This final rule is effective June 12, 2007. ADDRESSES: EPA has established a docket for this action under Docket ID No. EPA-HQ-OAR-2006-0159. All documents in the docket are listed on the *www.regulations.gov* Web site. Although listed in the index, some information is not publicly available, e.g., CBI or other information whose disclosure is restricted by statute. Certain other material, such as copyrighted material, is not placed on the Internet and will be publicly available only in hard copy form. Publicly available docket materials are available either electronically through *www.regulations.gov* or in hard copy at the Air Docket, EPA/DC, EPA West, Room 3334, 1301 Constitution Ave., NW., Washington, DC. This Docket Facility is open from 8:30 a.m. to 4:30 p.m., Monday through Friday, excluding legal holidays. The Public Reading Room is open from 8:30 a.m. to 4:30 p.m., Monday through Friday, excluding legal holidays. The telephone number for the Public Reading Room is
(202)566-1744, and the telephone number for the Air Docket is
(202)566-1742. FOR FURTHER INFORMATION CONTACT: Kirsten Cappel, by regular mail: U.S. Environmental Protection Agency, Stratospheric Protection Division (6205J), 1200 Pennsylvania Ave., NW., Washington, DC 20460; by courier service or overnight express: 1310 L Street, NW., Room 1047C, Washington, DC 20005; by telephone:
(202)343-9556; by fax:
(202)343-2338; or by, e-mail: *cappel.kirsten@epa.gov* . SUPPLEMENTARY INFORMATION: Table of Contents I. Basis for Allocating Essential Use Allowances A. What are essential use allowances? B. Under what authority does EPA allocate essential use allowances? C. What is the process for allocating essential use allowances? D. What quantity of essential use allowances is EPA allocating? II. Response to Comments A. Proposed Level of Allocations B. Consideration of Stocks of CFCs in the Allocation of Essential Use Allowances C. Number of Months of Safety Stockpile D. Rulemaking Process and Timing E. The transition to Non-CFC MDIs III. Allocation of Essential Use Allowances for Calendar Year 2007 IV. Statutory and Executive Order Reviews A. Executive Order 12866: Regulatory Planning and Review B. Paperwork Reduction Act C. Regulatory Flexibility D. Unfunded Mandates Reform Act E. Executive Order 13132: Federalism F. Executive Order 13175: Consultation and Coordination With Indian Tribal Governments G. Executive Order 13045: Protection of Children From Environmental Health Risks and Safety Risks H. Executive Order 13211: Actions That Significantly Affect Energy Supply, Distribution, or Use I. National Technology Transfer and Advancement Act J. Congressional Review Act V. Judicial Review VI. Effective Date of This Final Rule I. Basis for Allocating Essential Use Allowances A. What are essential use allowances? Essential use allowances are allowances to produce or import certain ODSs in the U.S. for purposes that have been deemed “essential” by the U.S. Government and by the Parties to the Montreal Protocol on Substances that Deplete the Ozone Layer (Montreal Protocol). The Montreal Protocol is an international agreement aimed at reducing and eliminating the production and consumption 1 of ODSs. The elimination of production and consumption of Class I ODSs is accomplished through adherence to phase-out schedules for specific Class I ODSs, 2 which include CFCs, halons, carbon tetrachloride, and methyl chloroform. As of January 1, 1996, production and import of most Class I ODSs were phased out in developed countries, including the United States. 1 “Consumption” is defined as the amount of a substance produced in the United States, plus the amount imported into the United States, minus the amount exported to Parties to the Montreal Protocol (see Section 601(6) of the Clean Air Act). 2 Class I ozone depleting substances are listed at 40 CFR Part 82 subpart A, appendix A. However, the Montreal Protocol and the Clean Air Act (the Act) provide exemptions that allow for the continued import and/or production of Class I ODSs for specific uses. Under the Montreal Protocol, exemptions may be granted for uses that are determined by the Parties to be “essential.” Decision IV/25, taken by the Parties to the Protocol in 1992, established criteria for determining whether a specific use should be approved as essential, and set forth the international process for making determinations of essentiality. The criteria for an essential use, as set forth in paragraph 1 of Decision IV/25, are the following: “(a) That a use of a controlled substance should qualify as ‘essential’ only if:
(i)It is necessary for the health, safety or is critical for the functioning of society (encompassing cultural and intellectual aspects); and
(ii)There are no available technically and economically feasible alternatives or substitutes that are acceptable from the standpoint of environment and health;
(b)That production and consumption, if any, of a controlled substance for essential uses should be permitted only if:
(i)All economically feasible steps have been taken to minimize the essential use and any associated emission of the controlled substance; and
(ii)The controlled substance is not available in sufficient quantity and quality from existing stocks of banked or recycled controlled substances, also bearing in mind the developing countries' need for controlled substances.” B. Under what authority does EPA allocate essential use allowances? Title VI of the Act implements the Montreal Protocol for the United States. Section 604(d) of the Act authorizes EPA to allow the production of limited quantities of Class I ODSs after the phaseout date for the following essential uses:
(1)Methyl chloroform, “solely for use in essential applications (such as nondestructive testing for metal fatigue and corrosion of existing airplane engines and airplane parts susceptible to metal fatigue) for which no safe and effective substitute is available.” Under the Act, this exemption was available only until January 1, 2005. Prior to that date, EPA issued methyl chloroform allowances to the U.S. Space Shuttle and Titan Rocket programs.
(2)Medical devices (as defined in section 601(8) of the Act), “if such authorization is determined by the Commissioner [of the Food and Drug Administration], in consultation with the Administrator [of EPA] to be necessary for use in medical devices.” EPA issues allowances to manufacturers of MDIs, which use CFCs as propellant for the treatment of asthma and chronic obstructive pulmonary disease.
(3)Aviation safety, for which limited quantities of halon-1211, halon-1301, and halon-2402 may be produced “if the Administrator of the Federal Aviation Administration, in consultation with the Administrator [of EPA] determines that no safe and effective substitute has been developed and that such authorization is necessary for aviation safety purposes.” Neither EPA nor the Parties have ever granted a request for essential use allowances for halon, because in most cases alternatives are available and because existing quantities of this substance are large enough to provide for any needs for which alternatives have not yet been developed. The Parties to the Montreal Protocol, under Decision XV/8, have additionally allowed a general exemption for laboratory and analytical uses through December 31, 2007. This exemption is reflected in EPA's regulations at 40 CFR part 82, subpart A. While the Act does not specifically provide for this exemption, EPA has determined that an allowance for essential laboratory and analytical uses is allowable under the Act as a *de minimis* exemption. The *de minimis* exemption is addressed in EPA's final rule of March 13, 2001 (66 FR 14760-14770). The Parties to the Protocol subsequently agreed (Decision XI/15) that the general exemption does not apply to the following laboratory and analytical uses: Testing of oil and grease, and total petroleum hydrocarbons in water; testing of tar in road-paving materials; and forensic finger-printing. EPA incorporated this exclusion at Appendix G to subpart A of 40 CFR part 82 on February 11, 2002 (67 FR 6352). C. What is the process for allocating essential use allowances? Before EPA allocates essential use allowances, the Parties to the Montreal Protocol must first authorize the United States' request to produce or import essential Class I ODSs. The procedure set out by Decision IV/25 calls for individual Parties to nominate essential uses and the total amount of ODSs needed for those essential uses on an annual basis. The Montreal Protocol's Technology and Economic Assessment Panel
(TEAP)evaluates the nominated essential uses and makes recommendations to the Parties. The Parties make the final decisions on whether to authorize a Party's essential use nomination at their annual meeting. This nomination cycle occurs approximately two years before the year in which the allowances would be in effect. The allowances allocated through today's action were first nominated by the United States in January 2005. Once the Parties authorize the U.S. nomination, EPA allocates essential use exemptions to specific entities through notice-and-comment rulemaking in a manner consistent with the Act. For MDIs, EPA requests information from manufacturers about the number and type of MDIs they plan to produce, as well as the amount of CFCs necessary for production. EPA then forwards the information to the Food and Drug Administration (FDA), which determines the amount of CFCs necessary for MDIs in the coming calendar year. Based on FDA's determination, EPA proposes allocations for each eligible entity. Under the Act and the Montreal Protocol, EPA may allocate essential use allowances in quantities that together are below or equal to the total amount authorized by the Parties. EPA will not allocate essential use allowances in amounts higher than the total authorized by the Parties. For 2007, the Parties authorized the United States to allocate up to 1,000 MT of CFCs for essential uses. In a notice of proposed rulemaking published in the **Federal Register** on November 3, 2006 (71 FR 64668), EPA proposed to allocate 125.3 MT. D. What quantity of essential use allowances is EPA allocating? EPA proposed to allocate 125.3 MT of essential use allowances for 2007 in its November 2006 proposed rule. With today's final action, EPA is allocating 167.0 MT of essential use allowances for 2007 for the production and import of CFCs for the manufacture of essential use MDIs. EPA is allocating this amount based on a revised determination letter by FDA dated May 4, 2007. EPA has placed this revised determination letter in the docket for review. This quantity of 167.0 MT includes two increases from the amounts proposed in November 2006. First, EPA is allocating 22.4 MT to Armstrong Pharmaceuticals, Inc. (an increase from a proposed allocation of 0.0 MT) for the manufacture of epinephrine; second, EPA is allocating an additional 19.3 MT to 3M Pharmaceuticals (65.0 MT total for 2007) for the manufacture of essential use MDI products (Aerobid, Aerobid M, and Maxair Autohaler). The total allocation for 2007 of 167.0 MT is far below the 1,000 MT that the Parties to the Montreal Protocol authorized for the United States for 2007. It is also a significant reduction from the 1,002.4 MT allocated for 2006. These reductions demonstrate the U.S. commitment to decreasing the amount of CFCs allocated for essential uses. Furthermore, the 167.0 MT does not include an allocation for the manufacture of CFC-albuterol MDIs, indicating that the transition to non-CFC alternatives for this application is well underway. In its revised determination letter FDA informed EPA that Armstrong needed 22.4 MT of CFCs to manufacture generic epinephrine in 2007. EPA and FDA are allocating this amount to Armstrong to acquire CFC-114 for the manufacture of epinephrine, not CFCs to manufacture CFC-albuterol. In the revised determination letter, FDA articulated that Armstrong's allocation is specific to CFC-114 for the production of epinephrine MDIs. FDA stated, “In recent years, we aggregated the amounts for CFC-11, -12, -114 and provided recommendations on the total amounts of CFC necessary to protect the public health. This year, we provide recommendations for aggregated amount of CFCs, with one exception. We recommend that Armstrong Pharmaceuticals receive an allocation of 22.4 tonnes of CFC-114 for the manufacture of epinephrine CFC MDIs. We believe that this specific allocation is necessary to protect the public health, given the current essentiality determination as contained in 21 CFR 2.125(e).” Consistent with FDA's determination letter, EPA is allocating 22.4 MT of CFC-114 to Armstrong for the production of epinephrine MDIs for 2007. FDA also informed EPA in its revised determination letter that it determined that 3M needed an additional 19.3 MT of essential use allowances to manufacture essential use MDI products. These products include Aerobid, Aerobid M, and Maxair Autohaler. FDA noted to EPA that in making its revised determination, FDA reviewed supplementary information from MDI manufacturers, including more recent data on the quantities and types of CFCs held as well as more specific information on manufacturers' production plans for 2007. Based on this information, FDA recalculated the quantities and types of CFCs that would be medically necessary and recommended small increases in the allocations for two MDI manufacturers for calendar year 2007. In addition, FDA informed EPA that it applied the terms of Decision XVII/5, including the provision that each manufacturer maintain no more than a one-year operational supply of CFCs for essential uses. II. Response to Comments EPA received comments from twelve entities on the proposed rule, as discussed below. A. Proposed Level of Allocations One commenter opposed as too low EPA's proposed allocation of 125.3 MT of CFCs for MDIs, given that the Parties to the Montreal Protocol authorized 1,000 MT. The commenter stated that 125.3 MT would not suffice to ensure the continuous availability of CFCs necessary to meet expected demand. The commenter noted that the facility being used to produce CFC-11 and CFC-12 is the only facility doing so and it is sized for far larger volumes of production. According to the commenter, continuing to decrease the size of production runs makes manufacturing more inefficient, complex, and costly. The commenter urged EPA to set policies that enable the manufacture of CFCs and allow producers and users the ability to shift unused allocations from one year to the next so that supply can be more easily assured. In addition, the commenter urged EPA to re-allocate essential use allowances in 2007 for essential use CFCs that were not produced and subsequently conferred in 2006. The commenter also noted that production of CFC-114 during 2006 was not adequate to meet MDI producer demand for which 2006 essential use allowances existed. A second commenter provided similar comments and noted concern that qualified CFC producers may not be able or willing to produce a reliable supply in future years, citing the CFC-114 production shortfalls experienced by Honeywell as an example. The commenter expressed support for efforts by the U.S. Government to work with other Parties to the Montreal Protocol to establish a process for assessing the need for and feasibility of a final production campaign; the commenter stated that such efforts would support the ultimate phaseout of CFC production for MDIs while protecting public health by ensuring a smooth transition for MDIs. A third commenter also opposed as too low the quantity of essential use allowances proposed for allocation. The commenter submitted two sets of comments, one of which was supplementary and received after the end of the comment period, but which EPA considered. Both sets of comments were submitted as confidential business information (CBI); EPA has placed redacted versions of them in the docket. The commenter indicated that it received a proposed allocation of zero metric tons and urged EPA to allocate additional allowances so that it could meet anticipated market demand for CFC-albuterol and CFC epinephrine in 2007 and 2008. The commenter noted that with the withdrawal of Schering-Plough from the CFC market, Armstrong would be only manufacturer of CFC-albuterol. In addition, the commenter asserted, the elimination of Schering-Plough's Warrick branded CFC-albuterol product will create a dramatic shortfall in the supply of CFC inhalers and is likely to lead to serious market disruption unless Armstrong increases production to meet demand. The commenter urged EPA to provide for its propellant needs for both 2007 and 2008 in the 2007 rule. To support its argument, the commenter provided data from IMS, a pharmaceutical market research firm, indicating market trends of CFC-albuterol that suggest in 2006, CFC-albuterol comprised a significant amount of the total albuterol market. A fourth commenter that submitted CBI comments requested additional CFCs to manufacture its essential use MDIs. A redacted version of these comments has been placed in the docket. The commenter requested an additional 19.3 MT of CFCs to manufacture Aerobid, Aerobid M, and Maxair Autohaler. The commenter stated that without the additional allowances it would likely be unable to manufacture all of the MDIs forecasted by two of its customers. Another commenter noted that it understood the zero allocation proposed for its company for 2007 and stated that it has been working to acquire existing CFCs to satisfy essential needs. EPA also received comments that either supported the proposed allocations—in whole or in part—or believed they should be lower. One commenter stated that there should be no exemptions for any ODS. The commenter stated that allowing exemptions discourages the development of alternatives. Seven commenters supported some or all of the proposed allocations for 2007. Four expressed approval of EPA's allocation of zero essential use allowances for manufacture of albuterol MDIs, as determined by FDA. One commenter additionally stated that by allocating only what was necessary and not the entire amount allowed by the Parties, FDA and EPA are supporting the over-arching goals of the Montreal Protocol. The commenter also noted that the proposed allocations are consistent with FDA's final determination on albuterol non-essentiality and that EPA's phaseout timeline fully agrees with FDA's conclusions that an effective and orderly transition to HFA MDIs would be complete by December 31, 2008. One commenter supported EPA's choice to allocate only a portion of the essential use allowances granted to the United States by the Parties to the Montreal Protocol. The commenter stated that it supports EPA's decision to eliminate essential use allowances for those companies currently marketing both CFC and non-CFC albuterol MDIs. The commenter stated that the existing CFC stockpiles in the United States will be adequate to assure a smooth and timely transition to non-CFC albuterol inhalers. EPA received two sets of CBI comments from one commenter, both of which were received after the close of the comment period, but which EPA considered, which supported EPA's proposed zero allocation for the manufacture of CFC-albuterol MDIs. EPA has placed redacted versions of the comments in the docket. The commenter supported the proposed allocations, specifically the proposed zero allocations for albuterol MDIs containing CFCs. The commenter argued that the proposed zero allocation will facilitate the orderly transition to HFA albuterol inhalers, minimize the confusion and related compliance and safety issues raised by patients alternating between CFC and HFA inhalers, and ensure that additional CFCs are not needlessly released into the environment. The commenter noted that it had already begun to transition its supply of CFC-based albuterol inhalers to HFA inhalers. Additionally, the commenter asserted that an early transition to HFA inhalers would allow manufacturers, physicians, and pharmacists to act in a coordinated manner to educate patients and transition them in an orderly fashion. It noted that there are important differences between CFC and HFA inhalers that require patient counseling and that without an early and orderly transition facilitated by patient education and training, many patients will switch back and forth between the two inhalers or wait until the last minute. The commenter further noted that to support the transition to HFA-based albuterol, it has dedicated significant resources to support patients, physicians, pharmacists, and other stakeholders. The commenter stated that it had significantly increased the production of HFA albuterol inhalers and that it has the ability to increase production further if there is need. Additionally, the commenter stated that it has implemented a comprehensive plan to communicate information regarding the transition to key stakeholders. The commenter also noted that it has a patient assistance program for low-income patients and patients without health insurance. EPA allocates essential use allowances annually in accordance with the Act and the Montreal Protocol. For the 2007 control period, EPA, in consultation with FDA, evaluated the medical demand for essential use MDIs and determined the amount of CFCs needed to meet that demand. The U.S. Government first nominated an amount for essential use allowances for 2007 in January 2005 (1,493 MT). The Parties authorized 1,000 MT for the U.S. at the 17th Meeting of the Parties in 2006. Since the U.S. Government submitted its nomination for 2007, EPA and FDA have received more current information on the amount of CFCs needed to manufacture essential use MDIs, amounts of stockpiled CFCs available to manufacturers, and the availability of non-CFC alternatives. Neither the 1,493 MT nominated nor the 1,000 MT authorized accurately reflects the amount of CFCs necessary to meet medical needs in 2007. In making its determination for 2007 essential use allowances, FDA informed EPA that it undertook a similar analysis as completed in years past. FDA articulated to EPA that for each MDI manufacturer that requested essential use allowances, FDA evaluated a number of factors. FDA informed EPA that it took the following steps in making the 2007 determination for essential use allowances. First, FDA evaluated the medical necessity by evaluating the number of CFC MDIs necessary to protect public health in the U.S. (including consideration of current data on the prevalence of asthma and COPD) and the quantity of CFCs necessary to ensure the manufacture and continuous availability of those MDIs. Second, FDA analyzed the existing inventory of CFCs held by each MDI manufacturer as of May 1, 2006 and updated as of December 31, 2006. Third, FDA accounted for the implementation of the terms of Decision XVII/5, including the provision that manufacturers maintain no more than a one-year operational supply, and considered how manufacturers' existing CFC supplies would be drawn down as essential use MDIs were manufactured throughout the year. As was also articulated in the determination letter, revised May 4, 2007, FDA assumed that all manufacturers would procure the full quantity of CFCs allocated to them for the year. In response to the comments recommending allocation of essential use CFCs for multiple years, although EPA recognizes the difficulties associated with producing small amounts of CFCs per year, the Parties authorized an essential use exemption for CFC production and import for the 2007 control period only. Therefore, in accordance with the Decisions of the Parties, the United States allocated allowances to MDI manufacturers for 2007 control period. EPA understands that the U.S. manufacturer can increase the efficiency of its production run by combining the amount allocated by EPA for essential use production of pharmaceutical-grade CFCs for domestic use with the amount permitted under the Montreal Protocol, and authorized by EPA, for production of pharmaceutical-grade CFCs for export to Article 5 and non-Article 5 Parties, recognizing that the manufacturer may incur the cost of destroying the non-pharmaceutical grade portion of the run. EPA understands that the design of the Montreal Protocol and Title VI of the Act anticipated that ODS costs would increase during the transition to alternatives. However, the United States Government expects that this issue of a need for campaign production to meet the essential use health needs for CFCs for MDIs globally will be raised by the Parties to the Montreal Protocol at future meetings. With respect to the comments recommending higher allocations for 2007 to manufacture generic albuterol and generic epinephrine, FDA has informed EPA that additional essential use allowances will be needed for the manufacture of generic epinephrine in 2007. FDA made this determination based on information about the manufacturer's existing inventory, blend requirements, and production need, as well as implementation of the terms of Decision XVII/5, including the provision that manufacturers maintain no more than a one-year operational supply for CFCs for essential uses. FDA informed EPA that it did not agree with the comment that additional amounts of CFCs need to be allocated for the manufacture of CFC-albuterol in 2007 to meet the overall demand for albuterol. In the September 2006 letter to EPA (revised in May 2007), FDA stated that its determination of the amount of CFCs necessary for production of essential use MDIs is lower than the total amount requested by manufacturers, and in reaching its estimate, FDA took into account the manufacturers' production of MDIs that used CFCs as a propellant in 2006, their estimated production in 2007, and stockpile levels (as of December 31, 2006). FDA also stated that it considered comments received on the proposed rule for the allocation of CFCs in 2007. Finally, as articulated in its letter, FDA took into account that, at the time of the letter, roughly 40 percent of the albuterol MDIs currently produced were propelled by HFAs (HFA-134a) rather than CFCs. Given the publicly stated plans of Schering-Plough, a major albuterol CFC supplier, FDA has informed EPA that it believes the manufacture of CFC-albuterol will decrease in 2007 (and further decrease in 2008 as the phase-out date approaches). The manufacture and sale of albuterol HFA MDIs will increase sufficiently to meet the medical needs of patients for albuterol. FDA will continue to monitor closely the availability of albuterol to ensure that there is adequate supply to meet patient needs. FDA has informed EPA that HFA inhalers now make up approximately half the overall albuterol-levalbuterol inhaler market. Furthermore, according to FDA, HFA manufacturers report they currently have the ability to produce enough HFA albuterol MDIs to meet total market demand for albuterol MDIs. With respect to the commenter that requested additional CFCs to manufacture its essential use MDIs (Aerobid, Aerobid M, and Maxair Autohaler), FDA informed EPA that an increase of CFCs to 65.0 MT was necessary for 2007. FDA informed EPA that its revised determination was based on additional analysis of medical need and on supplementary information received from the MDI manufacturers, including more recent data on quantities of CFCs held. In addition, FDA informed EPA that it applied the terms of Decision XVII/5, including the provision that each manufacturer maintain no more than a one-year operational supply of CFCs for essential uses. In response to the comment that there should be no exemptions for any ODS and that allowing exemptions discourages the development of alternatives, in this instance, EPA and FDA do not believe that the allocation of essential uses for the manufacture of CFC MDIs precludes the development of alternatives, in part because EPA and FDA consider a company's progress in research and development of alternatives in evaluating a company's request for an essential use exemption. Finally, two commenters raised specific medical-related issues. One commenter, an asthmatic, expressed concern that the discontinuation of inhalers containing albuterol will leave no alternatives for asthmatics who are allergic to sulfites and sulfates. The commenter notes that he or she is allergic to sulfites and that the generic albuterol inhaler is going to be discontinued. In response, FDA informed EPA that HFA albuterol MDIs do not contain sulfites. Indeed, unlike CFC albuterol products, each albuterol HFA has a unique formulation, which should allow patients to find a product they tolerate and find effective, even if they feel one particular product is not sufficiently tolerable. A second commenter argued that the elimination of fluorocarbons is not necessary in aerosol albuterol items. The commenter stated that the non-aerosol form of albuterol poses several problems, such as difficulty in ascertaining when a canister is empty. In addition, the commenter noted that there is no sensation that a dosage of the non-aerosol medication is being received and that this may have profoundly negative medical repercussions. The commenter also asserted that because the disbursement of albuterol aerosol liquid goes into a mouth that is surrounding the canister and seals off the disbursement, no aerosol escapes into the surrounding atmosphere. Lastly, the commenter stated that the elimination of aerosol-dispensed respiratory medications will have a negative effect on patients. In its March 31, 2005 final rule (70 FR 17168), FDA determined that albuterol will no longer be designated as an “essential use” after December 31, 2008. FDA discussed issues associated with the essentiality of albuterol in that rule. Today's final action allocating CFCs for the manufacture of MDIs does not address the essentiality of albuterol. EPA notes that the non-ODS albuterol MDIs (i.e. HFA-albuterol) that are currently available to patients also contain an aerosol, HFA-134a. B. Consideration of Stocks of CFCs in the Allocation of Essential Use Allowances One commenter stated that EPA should not allocate any new essential use allowances for 2007, claiming that existing stockpiles of CFCs must be used before new essential use allowances may be granted. The commenter stated that EPA's proposed essential use allowances for 2007 were in contravention of Decision IV/25 of the Montreal Protocol, which provides that production and consumption of CFCs for essential uses is permitted only if the CFCs are “not available in sufficient quantity and quality from existing stocks.” The commenter stated that where stockpiles are in excess of essential need, EPA should first seek voluntary transfers, and second redistribute CFC stockpiles to where they are most needed. The commenter provided three supporting claims. First, the commenter provided data indicating that there are sufficient aggregate stockpiles available in the U.S. to cover the essential needs for 2007. The commenter recognized that these stockpiles are not evenly held by U.S. companies and urged EPA to take steps to redistribute them. Second, the commenter asserted that the Montreal Protocol and the Act support the “reallocation” of existing CFC stockpiles before new essential use allowances are allocated. The commenter argued that the objective of the Montreal Protocol supports an interpretation of Decision IV/25 that the Montreal Protocol Parties should deplete the aggregate CFC stockpiles available in their respective markets before allocating new essential use allowances to any MDI manufacturers. The commenter stated that it recognizes that Decisions XVII/5 and XVIII/7 state that Parties must consider the operational supply of each manufacturer in making essential use allowance decisions. However, the commenter asserted that it does not believe that these Decisions conflict with or supersede Decision IV/25 as the Parties can take into account both the aggregate CFC stockpile and each manufacturer's operational supply. Additionally, the commenter argued that Decision XII/2 provides for the transfer of essential use allowances and CFCs held by MDI producing companies in order to avoid unnecessary production. According to the commenter, Decision VII/28 provides for Parties, under certain circumstances, to reallocate excess essential use allowances or CFCs in their respective markets. Thus the commenter asserted that the Montreal Protocol supports compelling U.S. companies with excess CFCs to sell their stockpiles to the U.S. Government for reallocation. Furthermore, the commenter argued that the Act, specifically Section 615, grants EPA the right to take certain actions to prevent endangerment to public health or welfare. The commenter asserted that unnecessary emissions of CFCs will endanger public health or welfare due to the effects of stratospheric ozone depletion, and that EPA is justified in promulgating regulations that would allow it to mandate the reallocation of excess stockpiled CFCs. Lastly, the commenter stated that transfers or reallocations of CFCs are subject to all other Montreal Protocol (specifically, Decisions IV/25, XII/2, and XVII/5) and CAA parameters. Further, the commenter stated that EPA may not approve any transfer or reallocation of CFCs for any CFC MDI product approved after December 31, 2000 unless the essentiality criteria set out in paragraph 1(a) of Decision IV/25 are met, or to the extent the intended recipient maintains CFC stockpiles in excess of the one-year operational supply threshold. In assessing the amount of new CFC production required to satisfy 2007 essential uses, just as in 2006, EPA and FDA applied the terms of Decision XVII/5 including the provision on stocks of CFCs that indicates Parties should allocate such that manufacturers of MDIs maintain no more than a one-year operational supply of CFCs for essential uses. FDA's approach for 2007 was similar to that for 2006; first it calculated the quantity that each MDI manufacturer needed to produce essential use MDIs for the year and then it subtracted from that quantity any CFC stocks owned by that MDI manufacturer exceeding a one-year operational supply. The remainder, if more than zero, is the quantity of newly produced or imported CFCs needed by that manufacturer. In addition, FDA has informed EPA that consistent with Decision XVII/5, FDA evaluates each company on an individual basis, rather than an aggregate of all MDI manufacturers. So, while amounts of CFCs may be available for purchase in the marketplace, FDA and EPA only account for stocks owned by a particular MDI manufacturer in evaluating that manufacturer's CFC need. EPA agrees with the commenter that the objective of the Montreal Protocol is to reduce and eventually eliminate the production of ODSs, but that the essential use provision exists to ensure that an adequate supply of CFCs are available for those uses deemed “essential” by the Parties. EPA recognizes that in making the determination for essential uses for 2007, FDA took into account a number of considerations in assessing each MDI manufacturer's need, including the amount and type of CFC necessary to produce specific MDIs. The commenter's recommendation about redistribution of excess CFCs is outside the scope of the proposal on which this final rule is based. While the commenter suggests that EPA use Section 615 authority to redistribute excess CFCs, EPA does not believe that government-mandated redistribution is necessary at this time, and has not examined the extent of its authority for such action. EPA regulations currently allow transfer of both essential use allowances and essential use CFCs among essential use allowance holders. These mechanisms provide for redistribution of CFCs with minimal government involvement. The small number of participants in the market for essential use CFCs and the limited quantities of CFCs at issue further suggest that there is no need to expand EPA's role. In addition, any entity that chooses to hold stocks of essential use CFCs rather than sell to a willing purchaser runs the risk that the stocks will decline in value and ultimately become a liability for domestic use. EPA regulates transfers of essential use CFCs to ensure their proper use, and in approving transfers between domestic MDI manufacturers, EPA requires the companies involved to certify that the MDIs produced with the transferred essential use CFCs were approved by FDA before December 31, 2000. EPA does not apply the terms of Decision XVII/5, including the provision on manufacturers maintaining no more than a one-year operational supply, when assessing whether to approve a transfer of essential use CFCs. However, in determining annual essential use allocations for MDI manufacturers, FDA analyzes each MDI manufacturer's stocks of CFCs. Therefore, if a company obtains essential use CFCs during a particular year from another MDI manufacturer, FDA would account for those stocks in making its determinations for the year. EPA encourages, but does not mandate, such transfers. A second commenter noted that based on the projected use of its 2006 stockpile amounts, it would require additional CFCs to meet the increased demand for albuterol MDIs and epinephrine mist MDIs. EPA and FDA disagree with the commenter that additional essential use allowances should be allocated in 2007 for the production of CFC-albuterol MDIs. EPA and FDA believe that the commenter's projections assume a level of production exceeding that medically necessary. Further, this comment does not take into account all CFCs available to the company for albuterol production. When these factors are considered, EPA believes, based on consultation with FDA, that no additional CFC allowances for albuterol should be allocated in 2007. C. Number of Months of Safety Stockpile One commenter supported the zero allocation for albuterol manufacture in 2007, but voiced concern with the method by which FDA calculated essential use allowances. The commenter noted that while FDA appeared to have based its allocation recommendation on the operational supply rule established by paragraph 2 of Decision XVII/5, FDA implemented this paragraph by setting the minimum stockpile threshold at 12 months (as articulated in EPA's final rule allocating 2006 essential use allowances) while the Decision states that 12 months is the maximum operational supply that may be maintained by an MDI manufacturer. Recognizing that the Decision allows Parties to set the operational supply threshold at less than one year, the commenter recommended a threshold of one to three months. A second commenter noted that FDA applied the twelve-month cap on each company's operational supply of CFCs, as stated in paragraph 2 of Decision XVII/5, to determine that no allocations for manufacturers of CFC albuterol MDIs were necessary. The commenter stated that this interpretation was “logical, reasonable, and equitable,” but further stated that the twelve-month stockpile supply is a maximum amount and that a six-month supply stockpile allowance should be used in any future assessments of allocations. A third commenter expressed support for the calculation of anticipated CFC requirements for future manufacture of albuterol MDIs, as described in the proposed rule, and stated that the calculation is both reasonable and appropriate to ensure a smooth transition. The commenter noted that sufficient stockpiles of CFCs exist to meet albuterol CFC MDI production needs through the end of 2008. In addition, the commenter stated that an orderly transition to albuterol HFA implies a phase-out of albuterol CFC production before the December 31, 2008 deadline. After that deadline, section 610 of the Clean Air Act will prohibit the sale or distribution of albuterol CFC MDIs in interstate commerce. Therefore, the commenter states, retailers and suppliers must have adequate time to deplete their stock before then. Paragraph 2 of Decision XVII/5 states that Parties “shall take into account pre- and post-1996 stocks of controlled substances as described in paragraph 1(b) of Decision IV/25, such that no more than a one-year's operational supply is maintained by that manufacturer.” In making its determination for allocation of essential use allowances, FDA acted consistent with this provision by allowing manufacturers to maintain a supply of up to 12 months of the manufacturing operations. FDA calculates volumes to allow the manufacturer to end the calendar year with the appropriate level of stock. EPA and FDA do not agree that allowing manufacturers to maintain up to a 12-month supply is excessive because, in part, maintaining such an amount accounts for unexpected variability in the demand for MDI products or other unexpected occurrences in the market and therefore ensures that MDI manufacturers are able to produce their essential use MDIs. D. Rulemaking Process and Timing One commenter requested that EPA reconsider its allocations in light of Schering-Plough's October 13, 2006 announcement that it would end production of its Warrick Pharmaceutical brand CFC-albuterol MDIs early in 2007. According to the commenter, most customers believe that Warrick brand CFC-albuterol will not be available after early 2007. In this regard, the commenter noted that after the first quarter of 2007, Armstrong will be the sole producer and supplier of albuterol CFCs and that EPA must make an additional CFC allocation to Armstrong in order to avoid a dramatic shortfall in CFC supply relative to projected demand. With Schering-Plough's announcement, EPA and FDA expected that the manufacture of CFC-albuterol would be significantly lower in 2007 than 2006 and that this decrease will be balanced by an increase in HFA production and availability sufficient to meet patient needs. EPA and FDA expect a further decrease in albuterol CFC production in 2008, particularly in the months leading up to December 31, 2008, when all sales of CFC albuterol MDIs must cease. FDA has informed EPA that based on information it is receiving from HFA manufacturers, HFA manufacturers currently have the ability to produce enough HFA albuterol MDIs to meet total market demand for albuterol MDIs. Therefore FDA does not anticipate shortages of albuterol MDIs. One commenter indicated that it believed that CFCs should not be allocated to companies unless they have demonstrated good faith efforts to research and develop CFC-free alternatives. The commenter argued that EPA's interpretation of Paragraph 1 of Decision VIII/10—that the Parties will request information on research and development from companies but not use it as a basis for denying an essential use allowance request—is inadequate. The commenter asserted that the reiteration of the same language from Paragraph 1 of Decision XVIII/10 in Paragraph 3 of Decision XVIII/7 indicates that Parties did not believe that the plain intent of Decision VIII/10 was being followed and that at this stage of the phaseout the Parties are looking for demonstrations of commitment to the transition. The commenter also argued that Decisions VIII/10 and XVIII/7 warrant EPA to require companies requesting essential use allowances to demonstrate ongoing research and development of CFC-free alternatives and that EPA has the authority to do so under Sections 604(d)(2) and 615 of the CAA. EPA agrees that companies applying for essential use allocations to manufacture MDIs generally should demonstrate ongoing research and development of alternatives to CFC MDIs. To this end, in accordance with Decision VIII/10, since 1997 EPA has requested that applicants provide this information with their applications for CFC essential use nominations. EPA reiterated this policy in the final rules allocating essential use allowances for 2005 and 2006 (70 FR 49836 and 71 FR 58504, respectively). Each company that is receiving an essential use allocation has submitted information to EPA pertaining to its research and development efforts. In its essential use nominations, the U.S. Government articulates that the MDI manufacturers, for which the U.S. Government is submitting an essential use request, have submitted information demonstrating their on-going research and development activities in pursuit of alternatives to CFC MDIs. To this end, today's rulemaking is fully consistent with the Decisions to the Protocol. One commenter stated that EPA's essential use allowance allocation process and proposed allocations comport with general standards of administrative law. The commenter stated that the proposed rule allocating 2007 allowances clearly meets the non-arbitrariness standard of administrative law that a rulemaking agency must “examine relevant data” and that failure to do so could constitute arbitrary decision-making. The commenter specifically commended the use of company-specific stockpile information collected in a follow-up letter sent to companies on May 10, 2006, seeking information under the authority of Section 114 of the CAA. In addition, the commenter stated that the 2007 proposed rule correctly applied the “one-year operational supply” provision of Decision XVII/5 and that EPA disclosed FDA's methodology and allowed ample opportunity for public comments. Last, the commenter argued that EPA is required to provide an additional notice and comment opportunity for public comment on any material increase in any company's allocation (e.g. allocating essential use volumes to a company that EPA had proposed would not receive any). The commenter noted that this would include the posting of an explanatory letter from FDA on the docket articulating the reasons for the changes. The commenter requested that EPA provide notice and opportunity for public comment if it is considering allocating any volumes to manufacturers of CFC-albuterol MDIs. In response to the commenter's request for notice and an opportunity for public comment in the event that EPA issues material changes to a company's allocation, EPA believes that it has reasonably articulated the reasons that two companies are receiving additional allocations in this final rule and that further notice and comment on this issue is unnecessary. As stated in preceding paragraphs, FDA determined, based on additional information received, that essential use allowances should be increased for two companies. With respect to essential use allocations for the manufacture of CFC-albuterol, EPA confirms that it is not allocating any essential use allowances for the manufacture of CFC-albuterol MDIs in the 2007 allocation. EPA received three comments supporting its timeliness in starting the allocation process and granting allocations in the first quarter of the year to provide for better planning and security of supply. E. The Transition to Non-CFC MDIs One commenter provided information showing that HFA products have accounted for a small and largely constant share of the albuterol market over the past four years, and that CFC inhalers represented 92% of total albuterol sales through the first nine months of 2006, according to IMS data. The commenter stated that meeting the demand for CFC-albuterol with the withdrawal of Schering-Plough would require production of CFC-propelled units in 2007 and 2008. The commenter stated that EPA should allocate additional CFC allowances for albuterol production in 2007 and 2008 to allow for an orderly market transition to HFA albuterol. The commenter stated that failure to allocate CFC allowances for albuterol production in 2007 would create marketplace disruption and risk harm to public health, and provided the following justifications to substantiate that claim. First, the commenter argued that public and private reimbursement has not completely caught up to the changeover to HFA inhalers and gaps remain, particularly in Medicaid and Medicare Part D coverage. Citing IMS data, the commenter maintained that the wholesale prices for HFA albuterol are more than five times higher than for CFC albuterol. A shortage of less-expensive CFC-albuterol MDIs would deprive low-income asthma sufferers of access to inhalers, potentially forcing uninsured patients to seek relief in emergency rooms where treatment may be costly and untimely. Second, the commenter stated that converting a market from 92% CFC to 100% HFA requires a measured and orderly transition that shifts patients to HFA inhalers while allowing for scale-up of HFA production capacity, education of doctors and patients about the differences between CFC and HFA albuterol, and adaptation to HFA products by pharmacies and insurance companies. The commenter stated that FDA and patient advocates have stressed this point. Further, the commenter argued that a sudden, unexpected unavailability of CFC albuterol might endanger patient health because patients might not have sufficient time to safely transition and because not all formulations of HFA albuterol might be available in sufficient supplies. The commenter also asserted that HFA inhalers differ from CFC inhalers in taste and delivery feel and that noted that patients may need time to find the most agreeable formulation. Lastly, the commenter stated that pharmacists in states that rely on the Orange Book or the FDA to define “therapeutic equivalence,” and do not give discretion to pharmacists to substitute, will not be able to substitute HFA albuterol for CFC albuterol in cases where the prescription provides for CFC albuterol. Based on input from FDA, EPA disagrees that further allocations of essential use allowances for the manufacture of CFC-albuterol are medically necessary. For 2007 essential use allocations, FDA examined the amount of CFCs available from stocks to manufacture CFC albuterol as well as the supply of HFA albuterol in the marketplace and has determined that there is not a medical need to allocate allowances for CFC albuterol. According to FDA, based on information that FDA is receiving from HFA manufacturers, HFA manufacturers currently have the ability to produce enough HFA-albuterol MDIs to meet total market demand for albuterol MDIs. EPA and FDA understand that patients may incur additional costs to purchase albuterol inhalers as the market transitions to HFA MDIs. For example, EPA and FDA recognize that patients covered by medical insurance may encounter higher co-payments to purchase HFA albuterol. However, patient assistance programs exist to assist patients with the increased costs. For low-income patients, these programs include free and discounted medicines. To assist patients facing higher co-pays associated with the increased costs of the HFA MDIs, programs such as coupons and discounted HFA MDIs are being made available through physicians, at pharmacies, and at individual manufacturers' Web sites. Advocacy and non-profit groups have been pursuing education and outreach efforts in preparation for the December 31, 2008 phaseout of CFC-albuterol inhalers. They understand that educating doctors, patients, and pharmacies is paramount. FDA selected December 31, 2008, as the phaseout date largely because it provided sufficient time for the transition to HFA MDIs to occur. This time allows for patients to meet with their doctors and for their doctors to discuss the change to HFA MDIs. FDA is monitoring the supply of albuterol closely and does not anticipate any shortages in 2007. One commenter supported EPA's proposal to allocate no essential use allowances for 2007 for single-moiety albuterol CFC MDIs because satisfactory alternatives are available. The commenter asserted that the December 31, 2008 effective date of non-essentiality of CFC-albuterol MDIs is overly conservative. Two CFC-free alternatives to CFC-albuterol MDIs have been on the market for several years. In addition, the commenter stated that it is now clear that the bulk of the transition to CFC-free albuterol will occur well before 2008, provided that the companies' efforts to transition the market are not undercut. The commenter noted that two additional CFC-free alternatives to CFC-albuterol MDIs have been introduced into the market since FDA began its rulemaking process to remove the essential use designation for albuterol MDIs. According to the commenter, FDA has determined that approximately 40 percent of albuterol MDIs produced in 2006 used HFA-134a as their propellant and FDA anticipates that this will grow to 60 percent in 2007 and 80 percent in 2008. The commenter stated its belief that this estimate is overly conservative given that Warrick Pharmaceuticals, which currently produces approximately 70 percent of the albuterol CFC MDIs sold in the US, announced plans to cease manufacture of CFC inhalers in early 2007 and plans to transition patients to its HFA alternative. The commenter also noted that the only remaining risk to the successful transition of the albuterol MDI market is that those companies that do not have albuterol CFC-free alternatives on the market, and therefore have no interest in seeing the transition successfully concluded, may see the transition as an opportunity to gain temporary market share. The commenter argued that these companies could capitalize on patients who are displeased with the new prescriptions, and with adjustments to the inhalers' “taste and feel,” associated with alternatives. One commenter recommended that EPA state that CFC albuterol MDIs are not essential in the U.S. under Montreal Protocol criteria and that new CFC production for such uses is not necessary. The commenter noted that four CFC-free albuterol MDIs have been approved by FDA and are now on the market and that numerous patient assistance programs ensure that low-income and uninsured patients can afford these medications. Therefore, the commenter notes, CFC-albuterol MDIs are no longer essential under the Decision IV/25 criterion and essential use allowances may no longer legally be allocated for that use because technically and economically feasible alternatives are available. The commenter believes that, at a minimum, EPA should state that new production of CFCs for albuterol MDIs is *per se* not necessary. Similarly, another commenter noted that the preamble to Decision XVIII/7 states the need for Parties to limit essential use allocations. This commenter cites Decision IV/25, which states that CFCs for use in MDIs shall not qualify as essential “if technically and economically feasible alternatives or substitutes are available,” and the TEAP report concludes that “technically satisfactory alternatives” to CFC-based MDIs are available for short-acting beta-agonists. In 2005, FDA issued a final rule removing the essential use designation for CFC-albuterol MDIs as of December 31, 2008 (70 FR 17168). FDA based this decision on a comprehensive analysis that addressed, among other issues, the availability and convenience of non-ODS alternatives. FDA determined that December 31, 2008, was an appropriate date because it believed that adequate production capacity and supplies of HFA albuterol would be available to meet patient need. So, while alternatives to CFC-albuterol MDIs were available at that time, the supply and the capacity of manufacturers to produce sufficient amounts of HFA MDIs to meet the demand for albuterol were not yet adequate. A date of December 31, 2008 was chosen to provide time for a smooth and successful transition to occur and to prevent a shortage in the market that would affect patients' ability to receive albuterol. That transition is well underway, but some production of CFC-albuterol remains necessary and albuterol remains listed in 21 CFR 2.125(e). One commenter stated that based on current market conditions, it believes that the total supply of albuterol MDIs (both HFA and CFC inhalers) in the market should continue to meet demand during the transition to HFA. The commenter noted that it has significantly increased the amount of HFA albuterol inhalers that it produces, and that it is in the position to increase its supply further if the need arises. It further noted that based on publicly available data, it appears that another HFA albuterol inhaler manufacturer has also increased supply of its HFA albuterol inhaler. Lastly, the commenter stated that its communications from FDA indicate that FDA, based on discussions with all manufacturers of albuterol inhalers, is not anticipating near-or medium-short-term shortages of albuterol MDIs. In this regard, the commenter argued that there is no need for incremental CFC-based albuterol MDIs beyond the previously approved 2006 CFC allocations to meet overall albuterol demand in the United States. Two commenters supported EPA's proposed allocation and asserted that a gradual transition from CFC albuterol to HFA albuterol would benefit patients. One commenter stated EPA correctly concluded, based on the availability of alternatives, that CFCs for albuterol MDIs are not necessary, as defined by Section 604(d)(2) of the Clean Air Act; and that the proposed allocations would benefit patients by smoothing the transition to alternatives. One commenter supported the proposed allocation because it provided for a timetable that would enable CFC albuterol supplies to be drawn down while ensuring a steady, reliable supply of HFA product. The commenter stated that a smooth transition requires a gradual conversion of the albuterol market to HFAs and that this transition should be completed sufficiently in advance of December 31, 2008. The commenter noted that an abrupt transition would have potential negative health impacts, present an onerous administrative burden on providers and pharmacies, and waste any potential for transition to improve disease management. Both commenters cautioned the Agency about the negative health outcomes potentially associated with patients transitioning several times between CFC and HFA inhalers or using both products at once. One commenter stated that specific benchmarks can minimize confusion in pharmacies and that an efficient phase-out period with consistent downward pressure on the availability of CFC MDIs can prevent these problems. The commenter also suggested that nine months would be an appropriate conversion period for CFC and HFA products to coexist in the market. One commenter noted that the four HFA albuterol MDIs on the market are all different formulations, while the CFC albuterol MDIs were all similar. The commenter asserted that this variety will benefit patients by allowing them to find a formulation that works best for them and to avoid formulations to which they are allergic. The commenter noted that some of the HFA MDIs also have new features that were absent in the CFC models and that the production variety improves security of supply. The commenter also stated that the proposed allocations sent a consistent and appropriate signal to all affected constituencies that the Government is serious about the albuterol transition, which is prompting patient education and outreach. III. Allocation of Essential Use Allowances for Calendar Year 2007 With this action, EPA is allocating essential use allowances for calendar year 2007 to the entities listed in Table 1. These allowances are for the production or import of the specified quantity of Class I controlled substances solely for the specified essential use. Table 1.—Essential Use Allowances for Calendar Year 2007 Company Chemical 2007 Quantity (metric tons)
(i)Metered Dose Inhalers (for oral inhalation) for Treatment of Asthma and Chronic Obstructive Pulmonary Disease Armstrong Pharmaceuticals CFC-114 (production of epinephrine MDIs only) 22.4 Inyx (Aventis) CFC-11 or CFC-12 or CFC-114 39.6 3M Pharmaceuticals CFC-11 or CFC-12 or CFC-114 65.0 Wyeth CFC-11 or CFC-12 or CFC-114 40.0 IV. Statutory and Executive Order Reviews A. Executive Order 12866: Regulatory Planning and Review Under Executive Order
(EO)12866 (58 FR 51735, October 4, 1993), this action is a “significant regulatory action” because it raises novel legal or policy issues. Accordingly, EPA submitted this action to the Office of Management and Budget
(OMB)for review under EO 12866 and any changes made in response to OMB recommendations have been documented in the docket for this action. EPA prepared an analysis of the potential costs and benefits related to this action. This analysis is contained in the Agency's Regulatory Impact Analysis
(RIA)for the entire Title VI phaseout program (U.S. Environmental Protection Agency, “Regulatory Impact Analysis: Compliance with Section 604 of the Clean Air Act for the Phaseout of Ozone Depleting Chemicals,” July 1992). A copy of the analysis is available in the docket for this action and the analysis is briefly summarized here. The RIA examined the projected economic costs of a complete phaseout of consumption of ozone-depleting substances, as well as the projected benefits of phased reductions in total emissions of CFCs and other ozone-depleting substances, including essential use CFCs used for metered-dose inhalers. B. Paperwork Reduction Act This action does not impose any new information collection burden. The recordkeeping and reporting requirements included in this action are already included in an existing information collection burden and this action does not make any changes that would affect the burden. However, the Office of Management and Budget
(OMB)has previously approved the information collection requirements contained in the existing regulations at 40 CFR 82(a) under the provisions of the Paperwork Reduction Act, 44 U.S.C. 3501 *et seq.* and has assigned OMB control number 2060-0170, EPA ICR number 1432.25. A copy of the OMB approved Information Collection Request
(ICR)may be obtained from Susan Auby, Collection Strategies Division; U.S. Environmental Protection Agency (2822T); 1200 Pennsylvania Ave., NW., Washington, DC 20460 or by calling
(202)566-1672. Burden means the total time, effort, or financial resources expended by persons to generate, maintain, retain, or disclose or provide information to or for a Federal agency. This includes the time needed to review instructions; develop, acquire, install, and utilize technology and systems for the purposes of collecting, validating, and verifying information, processing and maintaining information, and disclosing and providing information; adjust the existing ways to comply with any previously applicable instructions and requirements; train personnel to be able to respond to a collection of information; search data sources; complete and review the collection of information; and transmit or otherwise disclose the information. An agency may not conduct or sponsor, and a person is not required to respond to a collection of information unless it displays a currently valid OMB control number. The OMB control numbers for EPA's regulations are listed in 40 CFR part 9. C. Regulatory Flexibility Act The Regulatory Flexibility Act
(RFA)generally requires an agency to prepare a regulatory flexibility analysis of any rule subject to notice and comment rulemaking requirements under the Administrative Procedure Act or any other statute unless the agency certifies that the rule will not have a significant economic impact on a substantial number of small entities. Small entities include small businesses, small organizations, and small governmental jurisdictions. For purposes of assessing the impact of today's rule on small entities, small entities are defined as:
(1)Pharmaceutical preparations manufacturing businesses (NAICS code 325412) that have fewer than 750 employees;
(2)a small governmental jurisdiction that is a government of a city, county, town, school district or special district with a population of less than 50,000; and
(3)a small organization that is any not-for-profit enterprise that is independently owned and operated and is not dominant in its field. After considering the economic impacts of today's final rule on small entities, I certify that this action will not have a significant economic impact on a substantial number of small entities. In determining whether a rule has a significant economic impact on a substantial number of small entities, the impact of concern is any significant adverse economic impact on small entities, since the primary purpose of the regulatory flexibility analyses is to identify and address regulatory alternatives “which minimize any significant economic impact of the proposed rule on small entities.” 5 U.S.C. 603 and 604. Thus, an agency may conclude that a rule will not have a significant economic impact on a substantial number of small entities if the rule relieves regulatory burden, or otherwise has a positive economic effect on all of the small entities subject to the rule. This rule provides an otherwise unavailable benefit to those companies that are receiving essential use allowances. We have therefore concluded that today's final rule will relieve regulatory burden for all small entities. D. Unfunded Mandates Reform Act Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), Public Law 104-4, establishes requirements for Federal agencies to assess the effects of their regulatory actions on State, local, and tribal governments and the private sector. Under section 202 of the UMRA, EPA generally must prepare a written statement, including a cost-benefit analysis, for proposed and final rules with “Federal mandates” that may result in expenditures to State, local, and tribal governments, in the aggregate, or to the private sector, of $100 million or more in any one year. Before promulgating an EPA rule for which a written statement is needed, section 205 of the UMRA generally requires EPA to identify and consider a reasonable number of regulatory alternatives and adopt the least costly, most cost-effective, or least burdensome alternative that achieves the objectives of the rule. The provisions of section 205 do not apply when they are inconsistent with applicable law. Moreover, section 205 allows EPA to adopt an alternative other than the least costly, most cost-effective, or least burdensome alternative, if the Administrator publishes with the final rule an explanation why that alternative was not adopted. Before EPA establishes any regulatory requirements that may significantly or uniquely affect small governments, including tribal governments, it must have developed a small government agency plan under section 203 of the UMRA. The plan must provide for notifying potentially affected small governments, enabling officials of affected small governments to have meaningful and timely input in the development of EPA regulatory proposals with significant Federal intergovernmental mandates, and informing, educating, and advising small governments on compliance with the regulatory requirements. Today's rule contains no Federal mandates (under the regulatory provisions of Title II of the UMRA) for State, local, or tribal governments or the private sector, since it merely provides exemptions from the 1996 phase-out of Class I ODSs. Similarly, EPA has determined that this rule contains no regulatory requirements that might significantly or uniquely affect small governments, because this rule merely allocates essential use exemptions to entities as an exemption to the ban on production and import of Class I ODSs. E. Executive Order 13132: Federalism Executive Order 13132, entitled “Federalism” (64 FR 43255, August 10, 1999), requires EPA to develop an accountable process to ensure “meaningful and timely input by State and local officials in the development of regulatory policies that have federalism implications.” “Policies that have federalism implications” is defined in the Executive Order to include regulations that 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.” This final rule does not have federalism implications. It will not have substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government, as specified in Executive Order 13132. Thus, Executive Order 13132 does not apply to this rule. F. Executive Order 13175: Consultation and Coordination With Indian Tribal Governments Executive Order 13175, entitled “Consultation and Coordination with Indian Tribal Governments” (65 FR 67249, November 9, 2000), requires EPA to develop an accountable process to ensure “meaningful and timely input by tribal officials in the development of regulatory policies that have tribal implications.” This final rule does not have tribal implications, as specified in Executive Order 13175. Today's rule affects only the companies that requested essential use allowances. Thus, Executive Order 13175 does not apply to this rule. G. Executive Order 13045: Protection of Children From Environmental Health Risks and Safety Risks Executive Order 13045, “Protection of Children from Environmental Health Risks and Safety Risks” (62 FR 19885, April 23, 1997), applies to any rule that
(1)is determined to be “economically significant” as defined under Executive Order 12866, and
(2)concerns an environmental health and safety risk that EPA has reason to believe may have a disproportionate effect on children. If the regulatory action meets both criteria, the Agency must evaluate the environmental health or safety effects of the planned rule on children, and explain why the planned regulation is preferable to other potentially effective and reasonably feasible alternatives considered by the Agency. EPA interprets E.O. 13045 as applying only to those regulatory actions that are based on health or safety risks, such that the analysis required under section 5-501 of the Order has the potential to influence the regulation. This final rule is not subject to Executive Order 13045 because it implements the phaseout schedule and exemptions established by Congress in Title VI of the Clean Air Act. H. Executive Order 13211: Actions That Significantly Affect Energy Supply, Distribution, or Use This rule is a not “significant energy action” as defined in Executive Order 13211, “Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use” (66 FR 28355 (May 22, 2001)) because it is not likely to have a significant adverse effect on the supply, distribution, or use of energy. The rule affects only the pharmaceutical companies that requested essential use allowances. I. National Technology Transfer and Advancement Act Section 12(d) of the National Technology Transfer and Advancement Act of 1995 (“NTTAA”), Public Law 104-113, section 12(d) (15 U.S.C. 272 note) directs EPA to use voluntary consensus standards in regulatory activities unless to do so would be inconsistent with applicable law or otherwise impractical. Voluntary consensus standards are technical standards (e.g., materials specifications, test methods, sampling procedures, and business practices) that are developed or adopted by voluntary consensus standards bodies. The NTTAA directs EPA to provide Congress, through OMB, explanations when the Agency decides not to use available and applicable voluntary consensus standards. This final rule does not involve technical standards. Therefore, EPA did not consider the use of any voluntary consensus standards. J. Congressional Review Act The Congressional Review Act, 5 U.S.C. 801 *et seq.* , as added by the Small Business Regulatory Enforcement Fairness Act of 1996, generally provides that before a rule may take effect, the agency promulgating the rule must submit a rule report, which includes a copy of the rule, to each House of the Congress and to the Comptroller General of the United States. Therefore, 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** . This rule is not a “major rule” as defined by 5 U.S.C. 804(2). This rule will be effective June 12, 2007. V. Judicial Review Under section 307(b)(1) of the Act, EPA finds that these regulations are of national applicability. Accordingly, judicial review of the action is available only by the filing of a petition for review in the United States Court of Appeals for the District of Columbia Circuit within sixty days of publication of the action in the **Federal Register** . Under section 307(b)(2), the requirements of this rule may not be challenged later in judicial proceedings brought to enforce those requirements. VI. Effective Date of This Final Rule Section 553(d) of the Administrative Procedures Act
(APA)generally provides that rules may not take effect earlier than 30 days after they are published in the **Federal Register** . Today's final rule is issued under section 307(d) of the CAA, which states, “The provisions of section 553 through 557 * * * of Title 5 shall not, except as expressly provided in this subsection, apply to actions to which this subsection applies.” Thus, section 553(d) of the APA does not apply to this rule. EPA nevertheless is acting consistently with the policies underlying APA section 553(d) in making this rule effective June 12, 2007. APA section 553(d) provides an exception for any action that grants or recognizes an exemption or relieves a restriction. Because today's action grants an exemption to the phaseout of production and consumption of CFCs, EPA is making this action effective immediately to ensure continued availability of CFCs for medical devices. List of Subjects in 40 CFR Part 82 Environmental protection, Administrative practice and procedure, Air pollution control, Chemicals, Exports, Imports, Ozone, Reporting and recordkeeping requirements. Dated: June 6, 2007. Stephen L. Johnson, Administrator. 40 CFR Part 82 is amended as follows: PART 82—PROTECTION OF STRATOSPHERIC OZONE 1. The authority citation for part 82 continues to read as follows: Authority: 42 U.S.C. 7414, 7601, 7671-7671q. Subpart A—Production and Consumption Controls 2. Section 82.8 is amended by revising the table in paragraph
(a)to read as follows: § 82.8 Grants of essential use allowances and critical use allowances.
(a)* * * Table I.—Essential Use Allowances for Calendar Year 2007 Company Chemical 2007 Quantity (metric tons)
(i)Metered Dose Inhalers (for oral inhalation) for Treatment of Asthma and Chronic Obstructive Pulmonary Disease Armstrong Pharmaceuticals CFC-114 (production of epinephrine MDIs only) 22.4 Inyx (Aventis) CFC-11 or CFC-12 or CFC-114 39.6 3M Pharmaceuticals CFC-11 or CFC-12 or CFC-114 65.0 Wyeth CFC-11 or CFC-12 or CFC-114 40.0 [FR Doc. E7-11319 Filed 6-11-07; 8:45 am] BILLING CODE 6560-50-P 72 112 Tuesday, June 12, 2007 Proposed Rules DEPARTMENT OF AGRICULTURE Animal and Plant Health Inspection Service 7 CFR Part 354 [Docket No. APHIS-2006-0137] RIN 0579-AC22 User Fees; Export Certification for Plants and Plant Products AGENCY: Animal and Plant Health Inspection Service, USDA. ACTION: Proposed rule. SUMMARY: We are proposing to amend the user fee regulations by adjusting the fees charged for export certification of plants and plant products. We are proposing to increase these user fees for fiscal years 2007 through 2012 to reflect the anticipated costs associated with providing these services during each year. We are also proposing to add a new user fee for Federal export certificates for plants and plant products that an exporter obtains from a State or county cooperator in order to recover our administrative costs associated with that service. Finally, we are proposing to make several nonsubstantive changes to the regulations for clarity. These proposed changes would enable us to properly recover the costs of providing export certification services for plants and plant products. DATES: We will consider all comments that we receive on or before August 13, 2007. ADDRESSES: You may submit comments by either of the following methods: • Federal eRulemaking Portal: Go to *http://www.regulations.gov* , select “Animal and Plant Health Inspection Service” from the agency drop-down menu, then click “Submit.” In the Docket ID column, select APHIS-2006-0137 to submit or view public comments and to view supporting and related materials available electronically. Information on using Regulations.gov, including instructions for accessing documents, submitting comments, and viewing the docket after the close of the comment period, is available through the site's “User Tips” link. Postal Mail/Commercial Delivery: Please send four copies of your comment (an original and three copies) to Docket No. APHIS-2006-0137, Regulatory Analysis and Development, PPD, APHIS, Station 3A-03.8, 4700 River Road Unit 118, Riverdale, MD 20737-1238. Please state that your comment refers to Docket No. APHIS-2006-0137. *Reading Room:* You may read any comments that we receive on this docket in our reading room. The reading room is located in room 1141 of the USDA South Building, 14th Street and Independence Avenue SW., Washington, DC. Normal reading room hours are 8 a.m. to 4:30 p.m., Monday through Friday, except holidays. To be sure someone is there to help you, please call
(202)690-2817 before coming. *Other Information:* Additional information about APHIS and its programs is available on the Internet at *http://www.aphis.usda.gov.* FOR FURTHER INFORMATION CONTACT: For information concerning program operations, contact Ms. Karen Bedigian, Senior Export Specialist, Phytosanitary Issues Management, PPQ, APHIS, 4700 River Road Unit 140, Riverdale, MD 20737-1236;
(301)734-5712. For information concerning rate development, contact Mrs. Kris Caraher, User Fee Section, Financial Services Branch, Financial Management Division, MRPBS, APHIS, 4700 River Road Unit 54, Riverdale, MD 20737-1232,
(301)734-5901. SUPPLEMENTARY INFORMATION: Background User fees for the issuance of export certificates for plants and plant products are contained in 7 CFR 354.3 (referred to below as the regulations). Export certificates are issued in accordance with the regulations in 7 CFR part 353, and they certify agricultural products as being considered free from plant pests, according to the phytosanitary requirements of the foreign countries to which the plants and plant products may be exported. Export certificates are also issued to certify that reexported plants or plant products conform to the most current phytosanitary requirements of the importing country and that, during storage in the United States, the consignment has not been subjected to risk of infestation or infection. These export certificates must be issued in accordance with 7 CFR part 353 to be accepted in international commerce. 1 1 These export certificates are not commercial documents; they can be issued for noncommercial consignments. Regulations Proposed in This Document We are proposing to amend the regulations in § 354.3 to adjust the user fees charged for export certification of plants and plant products. The Animal and Plant Health Inspection Service (APHIS) has not adjusted these particular user fees since the publication of a final rule in the **Federal Register** on January 29, 1996 (61 FR 2660-2665, Docket No. 94-074-2). That rule increased the user fees for certification of plants and plant products to reflect the actual cost of providing those services. Given the routine increases in operating costs, the current user fees for the certification of plants and plant products must be adjusted in order for APHIS to recover the full cost of providing these services. Therefore, we are proposing to adjust these fees. Specifically, we are proposing to set the fees for fiscal years
(FYs)2007 through 2012 and beyond for each of the following categories of service:
(1)Certification for export or reexport of a commercial shipment;
(2)certification for export or reexport of a low-value commercial or noncommercial shipment; and
(3)replacement of any certificate for export or reexport. In addition, we are also proposing to add a new user fee for exporters who will be obtaining Federal export certificates for plants and plant products from State or county cooperators. State and county cooperators can issue Federal export certificates and APHIS will print, distribute, and track these State/county issued export certificates, incurring administrative as well as associated overhead costs. In order to cover the administrative costs APHIS incurs in connection with these State and county operations, we are proposing to establish a new user fee which would become effective in FY 2007. We are proposing to set fees for FYs 2007 through 2012. This administrative fee for a Federal export certificate issued by State and county cooperators would be remitted by the exporter directly to APHIS through the Phytosanitary Certificate Issuance and Tracking System (PCIT), 2 provided that the exporter has a PCIT account and submits the application for the export certificate through the PCIT. If the exporter does not have a PCIT account or if the State or county creates export certificates independently using the PCIT or cannot or will not use the system, then the burden of collecting the administrative fee from the exporter and remitting it to APHIS would fall directly on the State or county issuing the Federal export certificate. 2 While we are not currently accepting payments through the PCIT, we anticipate that the payment collection system will become fully operational in FY 2007, at which time, payment for applications for, and issuance of, the other certificates referred to above would also become possible through the PCIT. Under this proposal, the FY 2007 fees would become effective on the date specified in the final rule, the FY 2008 through FY 2012 rates would become effective on the first day of each of those fiscal years, and the FY 2012 rates would remain in effect until new rates were established. The user fee tables in this document, therefore, do not specify an end date for fees that would become effective on October 1, 2011 (the beginning of FY 2012). Establishing the user fee changes 6 years in advance would allow users of APHIS' services to incorporate the fees into their budget planning. APHIS would review the fees annually and, if necessary, publish a proposal to amend them if the published fees do not properly recover our costs. Finally, this proposed rule would make several nonsubstantive changes to the regulations for clarity. These changes are described below under the section heading “Miscellaneous.” User Fee Accounting In FY 1992, APHIS established accounting procedures to, among other things, segregate export certification costs for plants and plant products from all other costs. We maintain all export certification user fees we collect in a distinct account, carefully monitor the balance of this account, and only use these funds to pay for our actual costs for providing export certification services. Types of Program Costs As part of our accounting procedures, we maintain separate accounting codes to record costs that can be directly related to an inspection activity. These are referred to as “direct-charge costs.” At the APHIS field level and below, we direct-charge the following costs to the user fee account: Salaries and benefits, direct labor of supervisors, such as officers-in-charge, and clerical staff; equipment used only in connection with services subject to user fees; contracts; large supply items such as uniforms; and systems costs, which include supporting the PCIT, paper, paper distribution, etc. Other program-delivery-related costs, at the APHIS field level and below, that cannot be directly charged to individual accounts are charged to “distributable” accounts established at the APHIS field level and are referred to as “distributable costs.” The following types of costs are charged to distributable accounts: Utilities, rent, telephone, vehicles, office supplies, etc. The costs in these distributable accounts are prorated (or distributed) among all the activities, including export certification services, that benefit from the expense, based on the ratio of the costs that are directly charged to each activity divided by the total costs directly charged to each account at the field level. Export Program costs also include program direction and support costs we incur at the regional and headquarters level. These are costs related to the overall management of APHIS' Plant Protection and Quarantine
(PPQ)program. The PPQ program incurs these costs for functions carried out by PPQ management support staff at headquarters in Riverdale, MD, and by various staffs at APHIS' two regional hubs located in Raleigh, NC, and Fort Collins, CO. The headquarters and regional staffs perform program support activities such as budget planning, formulation, justification, and execution specific to the PPQ program; specialized agreement management; staff-year management; program spending monitoring and projections; and liaison with higher-level internal and external entities. We also incur Agency-level support costs through activities that support the Export Program, such as recruitment and development; legislative and public affairs; regulation development; regulatory enforcement; and budget, accounting, payroll, purchasing, billing, and collection services. Departmental charges are assessed for various program costs, including Agency support staffs at the U.S. Department of Agriculture
(USDA)Department level, Federal telephone service, mail, processing of payroll and money management, unemployment compensation, Office of Workers Compensation Programs, and central supply depots for storing and issuing commonly used supplies and forms. Prior Year Cost Identification As we have noted, the user fees supporting the Export Program have not been adjusted since 1996. In order to properly identify actual total program costs, we employed contractors from Kadix Systems in FY 2004 to develop and document an accurate cost-based analysis of the nationwide Export Program. We also established an Export User Fee Work Group to assist with technical and program expertise; provide financial and budgetary advice; and perform data collection, regulatory analysis, and management review for this project. The contracting project team provided an export user fee report on their review of export certificate issuance trends, direct labor costs, support costs for 5 fiscal years, and fluctuations in activity volumes. Based on the analysis of the Kadix Systems study, we were able to better identify our true export certification user fee costs. We then added the pro-rata share of the distributable accounts at the APHIS field level and appropriate amounts to recover regional, headquarters, Agency, and departmental level costs, and other costs to identify our full costs for providing export certification services. Cost Projections for FY 2007 Through FY 2012 We used prior year costs and added inflationary factors and planned new costs, such as new staffing and automation/information technology initiatives, to project our costs for FY 2007 through FY 2012. We then added a reasonable amount to contribute to a reserve in the Export Program user fee accounts to identify our total anticipated costs for those years. Those reserve funds provide us with a means to ensure that we have sufficient operating funds in cases of fluctuations in activity volumes or unanticipated events that could impact the program. We split our total costs for each fiscal year into the certification categories. Development of Estimated Spending Amounts The estimated spending amounts for FY 2007 through FY 2012 are based on data from FYs 2004 through 2006. The FY 2007 base costs include the direct-charge and program-delivery costs described above. We added our estimated pay cost increases during FY 2007 and our estimated new costs, including new hires, training, and automation initiatives. We next added overhead expenses, including the program direction and support and Agency-level support costs and Departmental charges as described above. We then included rent and a reserve amount. FY 2007 base cost $9,423,440 Estimated Pay Costs @ 2.3% 216,739 New Costs 4,718,753 Subtotal 14,358,932 Overhead @ 16.15% 2,318,967 Departmental Charges @ 3.38% 563,985 Rent Costs 299,064 Subtotal 3,182,016 Reserve Component 932,301 FY 2007 Total $18,473,249 We evaluated our historic cost-distribution percentages and applied them to the costs we identified and estimated for FYs 2007 through 2012 to split our projected costs among the export certificate categories described earlier. The following table indicates the estimated spending amounts for FY 2007 through FY 2012: Table 1.—Total Projected Cost for Administering the Export Program, FY 2007-2012 Certificate categories FY 2007 FY 2008 FY 2009 FY 2010 FY 2011 FY 2012 Commercial shipment $15,408,495 $15,763,411 $16,126,748 $16,498,975 $16,880,308 $17,261,762 Noncommercial and low-value shipments 477,026 488,014 499,262 510,786 522,591 534,401 Replacement 97,615 99,864 102,166 104,524 106,940 109,356 State or county issued 2,490,113 2,547,470 2,606,187 2,666,342 2,727,968 2,789,613 Total 18,473,249 18,898,759 19,334,363 19,780,627 20,237,807 20,695,132 Volumes Once we identified our estimated costs for each of the export certificate categories and estimated our costs in out years using economic factors, we then divided our annual costs by the estimated volumes for each export certification category to obtain our cost per export certification category. We performed extensive volume analyses to project volumes for each fee category in the out years. We reviewed actual data for each service category for FYs 2004 through 2006 and estimated our annual export certification volumes for FYs 2007 through 2012 by reviewing the Kadix Systems volume analysis and conducting surveys of several work units with high volumes of export certifications. The following table identifies volumes for export certificates by service category for FY 2007 through FY 2012. Table 2.—Projected Volumes by Service Category, FY 2007-2012 Service categories FY 2007 FY 2008 FY 2009 FY 2010 FY 2011 FY 2012 Commercial shipment 155,565 157,121 158,692 160,279 161,882 163,501 Noncommercial and low-value shipments 8,348 8,432 8,517 8,601 8,687 8,774 Replacement 6,845 6,913 6,982 7,052 7,123 7,194 APHIS subtotal 170,759 172,467 174,191 175,933 177,692 179,469 State or county issued 155,206 156,758 158,326 159,909 161,508 163,123 Grand total 325,965 329,225 332,517 335,482 339,200 342,592 User Fees for Export Certification of Plants and Plant Products Once we established the total annual costs to administer the Export Program, including the amount necessary to maintain the account reserve at a reasonable level for each of the service categories, we began the calculation of our fees. In calculating the user fees, we divided the sum of the costs of providing each service by the projected volumes (i.e., numbers of export certificates issued), thereby arriving at “raw” fees. We then rounded up or down to the nearest whole dollar to obtain the final fees and ensure adequate reserve funds. Also, unlike the fees for international air passengers, where the service volumes are so high, in the case of the export certification program, there would be no impact from rounding these user fees to the nearest whole dollar. Our current user fees for export certification of plants and plant products and the user fees we are proposing to charge for these services for each fiscal year from 2007 through 2012 are shown in table 3 below. The proposed user fees would be listed in § 354.3, in a new paragraph (g)(3). The proposed user fees provide for the maintenance of a reasonable reserve of up to 5 months' operating expenses in each of the export certification accounts. We intend to monitor the reserve balances closely and propose adjustments in our fees as necessary. If we determine that any fees are too high and are contributing to unreasonably high reserve levels, we will undertake rulemaking to lower the fees as quickly as possible. Conversely, if it becomes necessary to increase any fees because reserve levels are being drawn too low, we will undertake rulemaking to increase the fees. Table 3.—User Fees for Export or Reexport Certification of Plants and Plant Products Certificate categories FY 2006 FY 2007 FY 2008 FY 2009 FY 2010 FY 2011 FY 2012 Commercial shipment $50 $99 $100 $102 $103 $104 $106 Noncommercial shipment 23 57 58 59 59 60 61 Low value shipment 23 57 58 59 59 60 61 Replacement 7 14 14 15 15 15 15 State or county issued 16 16 17 17 17 17 Miscellaneous We are also proposing to make several changes to the regulations in addition to those described above. These changes are needed for clarity and to ensure that APHIS is fully compensated for all the export-certification services it performs. We have been allowing, and would continue to allow, exporters to purchase prepaid “blocks” of certificates (we do not specify the number of certificates in a block) for commercial shipments only. The current regulations do not indicate clearly that only commercial shipment certificates may be purchased this way. We would amend the regulations in § 354.3(g) to remove any ambiguity on this point. We are also proposing to amend the regulations in § 354.3(g) to make clear that work necessary to issue an export certificate that must be conducted outside of normal business hours is subject to our reimbursable overtime rates (7 CFR 354.1), in addition to the applicable user fee. This change is necessary to ensure that APHIS is properly compensated for services provided outside of normal business hours. The current regulations in § 354.3(g) do not clearly reflect that we charge user fees for issuing reexport certificates for noncommercial shipments in connection with the export of plants and plant products. To eliminate confusion, we are proposing to add a specific reference to this existing fee in § 354.3(g). We would make several changes to § 354.3(h)(1), which currently provides that a shipper who pays for a block of export certificates to cover commercial shipments may obtain a refund or a credit against future AQI user fees under the following circumstances: • If a certificate from the block is voided; • If a certificate from the block is returned unused; • If the shipper pays for inspection outside of normal business hours (8 a.m. to 4:30 p.m.) under § 354.1; • If a certificate from the block is used for a noncommercial shipment; or • If a certificate from the block is used to reissue another certificate. We would amend § 354.3(h)(1)(i) to indicate that the shipper would be eligible for a refund only if an export certificate is voided prior to its being signed by a certifying official. If APHIS issues a certificate and the exporter then decides to void it, there should be no refund because APHIS will have already performed the work of processing and issuing the certificate and will have incurred the associated costs. We would also amend the paragraph to eliminate the reference to obtaining credit against future AQI user fees. We do not offer such credits. We would amend § 354.3(h)(1)(ii) to indicate that the shipper would be eligible for a refund only if an unused export certificate is returned in its original unused condition. This clarification is needed because if a certificate is not in its original condition, *i.e.* , if anything has been written on it, it may no longer be used. We would remove current paragraph (h)(1)(iii), pertaining to inspection outside normal business hours, because a shipper would no longer be eligible for a refund under the circumstances described in the paragraph. Under proposed paragraph (g)(2), described above, work necessary to issue an export certificate that is conducted outside of normal business hours would be subject to both overtime rates and the applicable user fee. Current paragraph (h)(1)(iv), concerning refunds for export certificates for noncommercial shipments, would be redesignated as (h)(1)(iii) but would not undergo any substantive changes. Current paragraph (h)(1)(v) provides that a shipper is eligible for a refund if a certificate from the block is used to “reissue” another certificate. Because the term “reissue” may be subject to different interpretations, we are proposing to revise this provision to state that a refund may be issued if a certificate from a block is used to replace another certificate that has been lost or destroyed, provided that the certificate is issued as a duplicate certificate, without changes. This paragraph would be redesignated as (h)(1)(iv). Current paragraph (h)(2) states that the amount of any refund or credit will be the amount overcharged, less $7 to cover APHIS administrative expenses. In order to make the paragraph consistent with the changes to the fees that we are proposing elsewhere in this proposed rule and to enable us to cover our costs, we would amend the paragraph to indicate that the amount of any refund (we would also remove the existing reference to a credit from this paragraph) for a certificate issued by APHIS would be determined by APHIS based on the difference between the cost of purchasing the certificate and the cost that would be applicable to its actual use or disposition. For example, if a commercial certificate were purchased as part of a block of certificates for $99 and then applied to a noncommercial shipment, the certificate for which could be purchased for $57, then the amount of the refund would total $42. We would further state that, in the case of a certificate issued on behalf of APHIS by a designated State or county inspector, the amount of the proposed new administrative fee would be withheld from any refund. Section 354.3 lists definitions for terms, including the terms *export certificate for processed plant products, phytosanitary certificates,* and *phytosanitary certificate for reexport.* These existing definitions add no useful information to the regulations and are unnecessary, provided that we include a definition of *certificate* in the regulations. Therefore, we are proposing to amend the regulations by removing the definitions for the three types of certificates and adding a definition of *certificate* to the regulations to read as follows: “Any certificate issued by or on behalf of APHIS describing the phytosanitary condition of a shipment of plants or plant products for export, including but not limited to, Phytosanitary Certificate (PPQ Form 577), Export Certificate for Processed Plant Products (PPQ Form 578), and Phytosanitary Certificate for Reexport (PPQ Form 579).” Executive Order 12866 and Regulatory Flexibility Act This proposed rule has been reviewed under Executive Order 12866. The rule has been determined to be significant for the purposes of Executive Order 12866 and, therefore, has been reviewed by the Office of Management and Budget. For this proposed rule, we have prepared an economic analysis. The economic analysis provides a cost-benefit analysis as required by Executive Order 12866 and an initial regulatory flexibility analysis that examines the potential economic effects on small entities as required by section 603 of the Regulatory Flexibility Act. The economic analysis is summarized below. Copies of the full analysis are available by contacting the persons listed under FOR FURTHER INFORMATION CONTACT and may be viewed on the Regulations.gov Web site (see ADDRESSES above for instructions for accessing Regulations.gov). This proposed rule would amend the user fees for certifying plants and plant products for export (7 CFR 354.3(g)). This proposed rule would also make several other changes to clarify the regulations. In addition to updating and clarifying the current user fees, this proposal would add an administrative user fee for each export certificate issued on behalf of APHIS by a U.S. State or county in order to recover administrative costs associated with providing that service. 3 3 In California, county inspectors are authorized to issue Federal export certificates under a memorandum of understanding
(MOU)between the California Department of Agriculture
(CDFA)and 55 participating counties. This MOU mirrors the requirements set forth between USDA and States. The adjusted and new fees proposed in this rule are designed to recover our full costs for providing plant and plant product export certification services and to allow for a reasonable reserve to ensure that we have sufficient operating funds in cases of fluctuations in activity volumes or unanticipated events that could impact the program. The proposed fees are based on an analysis of our costs for providing these services in FYs 2004 through 2006, as well as our best projections of what it would cost us to provide these services in FYs 2007 through 2012. APHIS is updating these fees to take into account the routine increases in the cost of doing business, such as inflation, replacing equipment, maintaining databases, etc., as well as to properly cover our costs for new hires, training, automation initiatives, and rent, and to build a reserve balance in this account. A wide variety of commodities are potentially eligible for certification under the APHIS export certification program. Eligibility requirements vary by commodity and in some cases by the degree of processing or treatment that has occurred. The demand for certification by exporters is driven by the phytosanitary requirements of importing countries. Eligible commodities generally include live plants, fresh and some dried fruits, vegetables and nuts, unroasted coffee, cereals, milling products, oil seeds, raw sugar, tobacco, wood, and cotton. We cannot place a specific value on the commodities that have been certified for export. However, in 2004, exports of the covered commodity categories were valued at nearly $41 billion. 4 In addition, products in these commodity categories valued at more than $1.5 billion were reexported in 2004. 4 These values may overstate the value of commodities certified by APHIS, PPQ in these years. In order to have been certified, a given commodity must have met the eligibility requirements, and have been presented for certification. However, these are the categories covering potentially eligible commodities, and commodities within these general categories that are categorically not eligible for certification, such as refined sugar and frozen fruit and vegetables, are not included here. The export certification services covered in this proposal are provided to U.S. exporters of plants and plant products. These exporters include those entities shipping plant and plant products to foreign destinations for commercial as well as noncommercial purposes. These exporters would be the main affected entities of this proposal. In addition, State and county governments would be affected by this proposal. Under this proposed rule, the user fee for the certification of a commercial or reexport shipment would increase from $50 to $99 in FY 2007. Additional yearly increases would raise the fee to $106 by FY 2012. This proposed rule would also increase the user fee for low-value commercial or reexport shipments and noncommercial shipments from $23 to $57 in FY 2007 and to $61 by FY 2012, with yearly increases. The user fee for replacing any export certificate would rise from $7 to $14 in FY 2007 and to $15 by FY 2012. The proposed new administrative user fee for each certificate issued on behalf of APHIS by a U.S. State or county would be set at $16 in FY 2007 and ultimately rise to $17 by FY 2012. Table 4 shows the projected collections under the user fees covered in this proposal for FY 2007 through FY 2012. The increased revenues would go to cover the projected costs of administering the program and building a reserve to ensure that we have sufficient operating funds in cases of fluctuations in activity volumes or unanticipated events that could impact the program. The largest increase in collections would occur in FY 2007. Table 4.—Projected Revenue Collections From Proposed User Fees [In millions of dollars] Service Collections from proposed user fees FY 2007 FY 2008 FY 2009 FY 2010 FY 2011 FY 2012 Commercial shipment $15.4 $15.7 $16.2 $16.5 $16.8 $17.3 Noncommercial and low-value shipments 0.5 0.5 0.5 0.5 0.5 0.5 Replacement 0.1 0.1 0.1 0.1 0.1 0.1 State or county issued 2.5 2.5 2.5 2.7 2.7 2.8 Total 18.5 18.8 19.3 19.8 20.2 20.7 To the extent that the proposed changes in user fees would impact exporters' operational costs, any entity that utilizes APHIS' export certification services that are subject to user fees could be affected by this proposed change. The degree to which any entity may be affected would depend on its market power (the ability to which costs can be either absorbed or passed on to its buyers). While the lack of information on profit margins and operational expenses of the affected entities, or the supply responsiveness of the affected industry, 5 prevents the precise prediction of the scale of impacts, some conclusions on overall potential impacts on domestic and international commerce can be drawn. 5 The measurement of supply responsiveness would provide information on the likely impact on an entity's production due to changes in operating costs. The proposed percentage increases in user fees would be significant primarily in the first year. In all cases, the increase over current fees would be at least 98 percent in FY 2007. If the user fees cannot be passed on, the profit margins of some entities may decline as user fees are increased. If a user fee does not cover all associated costs, those costs are shifted away from those receiving and benefitting from the service and onto APHIS, and thus ultimately to the taxpayer. As noted above, this proposed rule would increase the user fee for commercial export and reexport certification from $50 to $99 in FY 2007 and to $106 by FY 2012. In comparison with the current fees, these adjusted fees could generate additional annual collections of $7.6 million in the first year of the proposal period and about $8.7 million in FY 2012. This fee would increase by a total of 108 percent over its current level during the period covered by the proposed rule. However, the total impact of these changes should be small. The total dollar value of the fee increases covered in this proposal, $56, would represent a tiny fraction of the value of those shipments. To put these fees in perspective, at the proposed level, this fee category is projected to generate total collections of $15.4 million in FY 2007, while exports and reexports of eligible commodities were valued at more than $42 billion in 2004. The total collections would represent less than 0.04 percent of the value of those shipments. The Regulatory Flexibility Act requires that agencies specifically consider the economic impact of their rules on small entities. As noted earlier, exporters of plants and plant products would be the domestic entities most affected by this proposed rule. The overwhelming majority of these entities (at least 96 percent of each of the categories described below) fall under the Small Business Administration's (SBA's) definition of small entities. Exporters of plants and plant products are part of the wholesale trade sector of the U.S. economy. These entities either sell goods on their own account (export merchants) or arrange for the sale of goods owned by others (export agents and brokers). Exporters of wood fall under the North American Industry Classification System (NAICS) code 423310, “Lumber, plywood, millwork, and wood panel merchant wholesalers.” The average firm in this category had sales of $11.6 million in 2002. Exporters of Fruit and Vegetables fall under NAICS code 424480, “Fresh fruit and vegetable merchant wholesalers.” The average firm in this category had sales of $10 million in 2002. Exporters of grains, such as corn, wheat, oats, barley, and unpolished rice, as well as dry beans and soybeans, are under NAICS code 424510, “Grain and field bean merchant wholesalers.” The average firm in this category had sales of $28 million in 2002. Exporters of leaf tobacco are covered under NAICS code 4245902, “Leaf tobacco merchant wholesalers.” The average firm in this category had sales of $8.1 million in 2002. Exporters of cotton are under NAICS code 4245904, “Cotton merchant wholesalers.” The average firm in this category had sales of $35.3 million in 2002. Exporters of plant seeds and plant bulbs are under NAICS code 424910, “Farm supplies merchant wholesalers.” The average firm in this category had sales of $11 million. Exporters of flowers and nursery stock are under NAICS code 434930 “Flower, nursery stock, and florists’ supplies merchant wholesalers.” The average firm in this category had sales of $2.4 million in 2002. Exporters of various other farm product raw materials, such as Christmas trees, fall under NAICS code 4249904, “Other nondurable goods merchant wholesalers.” The average firm in this category had sales of $2.2 million in 2002. Based on the above, it can be seen that our proposed fee increases would be very small relative to the revenues generated by exporters of plants and plant products, the overwhelming majority of which are small, according to SBA criteria. Thus, we expect that the impact of the fee increases on small entities should be limited. We welcome any additional information or comments from the public regarding the impact of this proposed rule on small entities. If a commercial export or reexport shipment is valued at less than $1,250, the fee for certification in this proposal for FY 2007 would be $57, an increase from $23. The new fee would represent at least 4.6 percent of the value of the shipment. This is not an insignificant percentage. However, the impact of the fee increase may be mitigated to the degree that individual low-value shipments can be consolidated into single shipments for certification. This proposed rule would increase the user fee for noncommercial export and reexport certification from $23 to $57 in FY 2007, and to $61 by FY 2012. Combined with the changes for low-value commercial shipments, these changes could generate additional annual collections of $284,000 in the first year of the proposal period, increasing to about $333,000 in FY 2012. These fees would increase by a total of 161 percent over current levels during the period covered by the proposed rule. However, it is estimated that only about 8,500 of these certificates are issued annually. This proposed rule would increase the user fee for replacing any export certificate from $7 to $14 in FY 2007, and to $15 by FY 2012. Compared with the current fees, these adjusted fees could generate additional annual collections of $48,000 in the first year of the proposal period and about $58,000 in FY 2012. While this increase is a doubling of the fee, its impact should still be small. There are administrative costs to APHIS associated with the running of the export certification program nationwide, regardless of whether APHIS or a State or county cooperator issues the certificate. The proposed user fees for APHIS-issued certificates would recover these administrative costs. This proposed rule would initiate an administrative user fee for each export certificate issued on behalf of APHIS by a State or county in order to recover the costs APHIS incurs in supporting these State and county operations. The user fee for State-or county-issued Federal export certificates would be set at $16 in FY 2007 and increase to $17 by FY 2012. These changes could generate additional annual collections of $2.5 million in the first year of the proposal period and about $2.8 million by FY 2012. As noted earlier, the administrative fee for Federal export certificates issued by State and county cooperators could be collected directly from the exporter by APHIS through the PCIT; however, in certain circumstances, such as when the exporter cannot or will not use the PCIT, the burden of collecting this administrative fee and remitting it to APHIS would fall directly on the State or county issuing the Federal export certificate. As a result, States and counties that do not utilize the PCIT would be likely to incur some administrative and recordkeeping costs. However, additional costs should be low because in most cases, alternative mechanisms are already in place for collecting export certification fees. To the extent that a State or county were to increase the fees it charges in order to incorporate the new administrative fee and pass the increased administrative and recordkeeping costs onto exporters, it would shift the burden of the fee to the user. Any fee charged for export services performed by a State or county is determined by the individual State or county performing the service. Currently, States/counties charge from $0 to $212 6 for a commercial export certificate, with an average of about $28; and from $0 to $50 for a noncommercial certificate, with an average of about $19. States/counties currently charge from $0 to $75, with an average of about $16 to replace a commercial certificate, and from $0 to $50, with an average of about $15 to replace a noncommercial certificate. Thirty-five States have charges for issuing certificates. Twelve States have fee structures that duplicate APHIS' fee structure. 7 These fees could well change following the implementation of this rule to incorporate the Federal administrative fee, thereby shifting the burden of the fee to the users. 6 One county has a sliding scale based upon the commodity being shipped that ranges from $22 to $212. 7 Kadix systems. United States Department of Agriculture, Animal & Plant Heath Inspection Service, Plant Protection and Quarantine; Analysis of the Export User Fee Program; Final Report. December 2004. About 70 percent of export certificates issued in California in 2003 were written in eight counties, six of which have rate structures currently higher than those of the USDA. Only 10 States and 2 California counties do not have current legislative authority to charge for these certificates. These 10 States and 2 counties account for approximately one-tenth of the certificates issued by States/counties in a given year. In assessing the need for this proposed rule, we considered alternatives to the chosen course of action. These alternatives are discussed below. One alternative to this proposed rule would be to leave the regulations unchanged. In this case, the fees would remain unchanged. However, these fees were last updated in 1996 and will no longer recover the full cost of providing certification services. The existing fees will not cover the routine increases in the cost of doing business, such as inflation, replacing equipment, maintaining databases, etc. If APHIS were to continue to collect user fees at the current rates in FYs 2007 through 2012, total collections would be about $63 million short of projected program costs over that period. Therefore, this alternative was rejected. Another alternative we considered was not adding the proposed administrative user fee for each certificate issued on behalf of APHIS by a U.S. State or county. However, APHIS' activities support these State and county operations, as well as our nationwide export certification functions. APHIS' costs for printing, distributing, and tracking these State/county issued certificates, as well as associated overhead costs, would not be recovered under the current user fees. The users who obtain export certification issued by a State or county on APHIS' behalf would only pay the costs that the State or county incurs in issuing the certificate. Therefore, this alternative was rejected. Executive Order 12372 This program/activity is listed in the Catalog of Federal Domestic Assistance under No. 10.025 and is subject to Executive Order 12372, which requires intergovernmental consultation with State and local officials. (See 7 CFR part 3015, subpart V.) Executive Order 12988 This proposed rule has been reviewed under Executive Order 12988, Civil Justice Reform. If this proposed rule is adopted:
(1)All State and local laws and regulations that are inconsistent with this rule will be preempted;
(2)no retroactive effect will be given to this rule; and
(3)administrative proceedings will not be required before parties may file suit in court challenging this rule. Paperwork Reduction Act This proposed rule contains no information collection or recordkeeping requirements under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 *et seq.* ). List of Subjects in 7 CFR Part 354 Animal diseases, Exports, Government employees, Imports, Plant diseases and pests, Quarantine, Reporting and recordkeeping requirements, Travel and transportation expenses. Accordingly, we propose to amend 7 CFR part 354 as follows: PART 354—OVERTIME SERVICES RELATING TO IMPORTS AND EXPORTS; AND USER FEES 1. The authority citation for part 354 would continue to read as follows: Authority: 7 U.S.C. 7701-7772, 7781-7786, and 8301-8317; 21 U.S.C. 136 and 136a; 49 U.S.C. 80503; 7 CFR 2.22, 2.80, and 371.3. 2. Section 354.3 would be amended as follows: a. In paragraph (a), by removing the definitions of *export certificate for processed products, phytosanitary certificate,* and *phytosanitary certificate for reexport,* and adding a new definition of *certificate,* in alphabetical order, to read as set forth below. b. In paragraph (g), by removing paragraphs (g)(2) and (g)(5); by redesignating paragraphs (g)(3) and (g)(4) as (g)(4) and (g)(5), respectively; and by revising paragraph (g)(1) and adding new paragraphs (g)(2) and (g)(3) to read as set forth below. c. By revising paragraph
(h)to read as set forth below. § 354.3 User fees for certain international services.
(a)* * * *Certificate.* Any certificate issued by or on behalf of APHIS describing the condition of a shipment of plants or plant products for export, including but not limited to Phytosanitary Certificate (PPQ Form 577), Export Certificate for Processed Plant Products (PPQ Form 578), and Phytosanitary Certificate for Reexport (PPQ Form 579).
(g)* * *
(1)For each certificate issued by APHIS personnel, the recipient must pay the applicable AQI user fee at the time and place the certificate is issued, or, in the case of a prepaid block of certificates (only certificates for commercial shipments may be purchased in this way), at the time the certificates are given to the shipper.
(2)When the work necessary for the issuance of a certificate is performed by APHIS personnel on a Sunday or holiday, or at any other time outside the regular tour of duty of the APHIS personnel issuing the certificate, in addition to the applicable user fee, the recipient must pay the applicable overtime rate in accordance with 7 CFR part 354. (3)(i) Each exporter who receives an export or reexport certificate issued on behalf of APHIS by a designated State or county inspector must pay an AQI user fee, as shown in the following table. The AQI user fee will be remitted by the exporter directly to APHIS through the Phytosanitary Certificate Issuance and Tracking System (PCIT), provided that the exporter has a PCIT account and submits the application for the export certificate through the PCIT. If the PCIT is not used, the State or county issuing the certificate is responsible for collecting the fee and remitting it monthly to the U.S. Bank, United States Department of Agriculture, APHIS, AQI, P.O. Box 979043, St. Louis, MO 63197-9000. Effective dates Amount per certificate [ *Effective date of final rule* ] through September 30, 2007 $16 October 1, 2007, through September 30, 2008 16 October 1, 2008, through September 30, 2009 17 October 1, 2009, through September 30, 2010 17 October 1, 2010, through September 30, 2011 17 Beginning October 1, 2011 17
(ii)The AQI user fees for an export or reexport certificate for a commercial shipment are shown in the following table. Effective dates Amount per shipment [ *Effective date of final rule* ] through September 30, 2007 $99 October 1, 2007, through September 30, 2008 100 October 1, 2008, through September 30, 2009 102 October 1, 2009, through September 30, 2010 103 October 1, 2010, through September 30, 2011 104 Beginning October 1, 2011 106
(iii)The AQI user fees for an export or reexport certificate for a low-value commercial shipment are shown in the following table. A commercial shipment is a low-value commercial shipment if the items being shipped are identical to those identified on the certificate; the shipment is accompanied by an invoice which states that the items being shipped are worth less than $1,250; and the shipper requests that the user fee charged be based on the low value of the shipment. Effective dates Amount per shipment [ *Effective date of final rule* ] through September 30, 2007 $57 October 1, 2007, through September 30, 2008 58 October 1, 2008, through September 30, 2009 59 October 1, 2009, through September 30, 2010 59 October 1, 2010, through September 30, 2011 60 Beginning October 1, 2011 61
(iv)The AQI user fees for an export or reexport certificate for a noncommercial shipment are shown in the following table. Effective dates Amount per shipment [ *Effective date of final rule* ] through September 30, 2007 $57 October 1, 2007, through September 30, 2008 58 October 1, 2008, through September 30, 2009 59 October 1, 2009, through September 30, 2010 59 October 1, 2010, through September 30, 2011 60 Beginning October 1, 2011 61
(v)The AQI user fees for replacing any certificate are shown in the following table. Effective dates Amount per certificate [ *Effective date of final rule* ] through September 30, 2007 $14 October 1, 2007, through September 30, 2008 14 October 1, 2008, through September 30, 2009 15 October 1, 2009, through September 30, 2010 15 October 1, 2010, through September 30, 2011 15 Beginning October 1, 2011 15
(h)*Refunds of AQI user fees.*
(1)A shipper who pays for a block of certificates to cover commercial shipments may obtain a refund under the following circumstances:
(i)If a certificate from the block is voided prior to its being signed by a certifying official;
(ii)If a certificate from the block is returned in its original, unused condition;
(iii)If a certificate from the block is used for a noncommercial shipment; or
(iv)If a certificate from a block is used to replace another certificate that has been lost or destroyed, provided that the certificate is issued as a duplicate certificate, without changes.
(2)The amount of any refund for a certificate issued by APHIS will be determined by APHIS based on the difference between the cost of purchasing the certificate and the cost that applies to its actual use or disposition. In the case of a certificate issued on behalf of APHIS by a designated State or county inspector, the amount listed in paragraph (g)(3)(i) of this section will not be refunded. Done in Washington, DC, this 6th day of June 2007. Bruce Knight, Under Secretary for Marketing and Regulatory Programs. [FR Doc. E7-11278 Filed 6-11-07; 8:45 am] BILLING CODE 3410-34-P DEPARTMENT OF TRANSPORTATION Federal Aviation Administration 14 CFR Part 39 [Docket No. FAA-2007-28068; Directorate Identifier 2007-CE-043-AD] RIN 2120-AA64 Airworthiness Directives; Hawker Beechcraft Corporation (Type Certificate No. A00010WI previously held by Raytheon Aircraft Company) Model 390 Airplanes AGENCY: Federal Aviation Administration (FAA), Department of Transportation (DOT). ACTION: Notice of proposed rulemaking (NPRM). SUMMARY: We propose to adopt a new airworthiness directive
(AD)for certain Hawker Beechcraft Corporation Model 390 Airplanes. This proposed AD would require you to inspect the starter-generator to determine the serial number (S/N) and suffix letter, which indicates if the part is defective, and replace any defective starter-generator with one of new design. This proposed AD results from reports of a manufacturing error where certain starter-generators may have been improperly shimmed. We are proposing this AD to detect and replace defective starter-generators, which could result in premature starter-generator failure. This failure could lead to increased chances of dual starter-generator failure on the same flight. DATES: We must receive comments on this proposed AD by August 13, 2007. ADDRESSES: Use one of the following addresses to comment on this proposed AD: • *DOT Docket Web site:* Go to *http://dms.dot.gov* and follow the instructions for sending your comments electronically. • *Mail:* Docket Management Facility; U.S. Department of Transportation, 400 Seventh Street, SW., Nassif Building, Room PL-401, Washington, DC 20590-0001. • *Fax:*
(202)493-2251. • *Hand Delivery:* Room PL-401 on the plaza level of the Nassif Building, 400 Seventh Street, SW., Washington, DC, between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. • *Federal eRulemaking Portal:* Go to *http://www.regulations.gov.* Follow the instructions for submitting comments. For service information identified in this proposed AD, contact Hawker Beechcraft Company, P.O. Box 85, Wichita, Kansas 67201-0085; telephone:
(800)429-5372 or
(316)676-3140. FOR FURTHER INFORMATION CONTACT: Philip Petty, Aerospace Engineer, Wichita Aircraft Certification Office, FAA, 1801 Airport Road, Room 100, Wichita, Kansas 67209; telephone:
(316)946-4139; fax:
(316)946-4107; e-mail: *philip.petty@faa.gov.* SUPPLEMENTARY INFORMATION: Comments Invited We invite you to send any written relevant data, views, or arguments regarding this proposed AD. Send your comments to an address listed under the ADDRESSES section. Include the docket number, “FAA-2007-28068; Directorate Identifier 2007-CE-043-AD” at the beginning of your comments. We specifically invite comments on the overall regulatory, economic, environmental, and energy aspects of the proposed AD. We will consider all comments received by the closing date and may amend the proposed AD in light of those comments. We will post all comments we receive, without change, to *http://dms.dot.gov* , including any personal information you provide. We will also post a report summarizing each substantive verbal contact we receive concerning this proposed AD. Discussion We received reports of premature starter-generator failure on several Hawker Beechcraft Corporation Model 390 airplanes. We determined the cause of the premature failure to be a result of a manufacturing error in which certain starter-generators, Raytheon Aircraft Company
(RAC)part number (P/N) 390-389001-0001 and Advance Industries, Inc.
(AI)P/N MG94A-1 without an “A” suffix letter, may have been improperly shimmed. This condition, if not corrected, could result in premature starter-generator failure. This failure could lead to increased chances of dual starter-generator failure on the same flight. Relevant Service Information We have reviewed RAC Mandatory Service Bulletin SB 24-3790, Issued: August, 2006. The service information describes procedures for: • Inspecting the left-hand and right-hand starter-generators to determine the serial number and suffix letter, which indicates whether the part is defective; and • Replacing any defective starter-generator found with one of new design. FAA's Determination and Requirements of the Proposed AD We are proposing this AD because we evaluated all information and determined the unsafe condition described previously is likely to exist or develop on other products of the same type design. This proposed AD would require you to inspect the starter-generator to determine the serial number (S/N) and suffix letter, which indicates whether the part is defective, and replace any defective starter-generator with one of new design. Costs of Compliance We estimate that this proposed AD would affect 105 airplanes in the U.S. registry. We estimate the following costs to do the proposed inspection: Labor cost Parts cost Total cost per airplane Total cost on U.S. operators 1 work-hour × $80 per hour = $80 Not applicable $80 $8,400 We estimate the following costs to do any necessary replacements that would be required based on the results of the proposed inspection. We have no way of determining the number of airplanes that may need this replacement: Labor cost Parts cost Total cost per generator 5 work-hours × $80 per hour = $400 $9,648 for new part $10,048 for new part. $6,593 for overhauled part $6,993 for overhauled part. Authority for This Rulemaking Title 49 of the United States Code specifies the FAA's authority to issue rules on aviation safety. Subtitle I, Section 106, describes the authority of the FAA Administrator. Subtitle VII, Aviation Programs, describes in more detail the scope of the Agency's authority. We are issuing this rulemaking under the authority described in Subtitle VII, Part A, Subpart III, Section 44701, “General requirements.” Under that section, Congress charges the FAA with promoting safe flight of civil aircraft in air commerce by prescribing regulations for practices, methods, and procedures the Administrator finds necessary for safety in air commerce. This regulation is within the scope of that authority because it addresses an unsafe condition that is likely to exist or develop on products identified in this rulemaking action. Regulatory Findings We have determined that this proposed AD would not have federalism implications under Executive Order 13132. This proposed AD would not have a substantial direct effect 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. For the reasons discussed above, I certify that the proposed regulation: 1. Is not a “significant regulatory action” under Executive Order 12866; 2. Is not a “significant rule” under the DOT Regulatory Policies and Procedures (44 FR 11034, February 26, 1979); and 3. Will not have a significant economic impact, positive or negative, on a substantial number of small entities under the criteria of the Regulatory Flexibility Act. We prepared a regulatory evaluation of the estimated costs to comply with this proposed AD and placed it in the AD docket. Examining the AD Docket You may examine the AD docket that contains the proposed AD, the regulatory evaluation, any comments received, and other information on the Internet at *http://dms.dot.gov* ; or in person at the Docket Management Facility between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The Docket Office (telephone
(800)647-5227) is located at the street address stated in the ADDRESSES section. Comments will be available in the AD docket shortly after receipt. List of Subjects in 14 CFR Part 39 Air transportation, Aircraft, Aviation safety, Safety. The Proposed Amendment Accordingly, under the authority delegated to me by the Administrator, the FAA proposes to amend 14 CFR part 39 as follows: PART 39—AIRWORTHINESS DIRECTIVES 1. The authority citation for part 39 continues to read as follows: Authority: 49 U.S.C. 106(g), 40113, 44701. § 39.13 [Amended] 2. The FAA amends § 39.13 by adding the following new AD: **Hawker Beechcraft Corporation (Type Certificate No. A00010WI previously held by Raytheon Aircraft Company):** Docket No. FAA-2007-28068; Directorate Identifier 2007-CE-043-AD. Comments Due Date
(a)We must receive comments on this airworthiness directive
(AD)action by August 13, 2007. Affected ADs
(b)None. Applicability
(c)This AD applies to Model 390 airplanes, serial numbers RB-1 and RB-4 through RB-149, that are certificated in any category. Unsafe Condition
(d)This AD results from reports of a manufacturing error where certain starter-generators may have been improperly shimmed. We are issuing this AD to detect and replace defective starter-generators, which could result in premature starter-generator failure. This failure could lead to increased chances of dual starter-generator failure on the same flight. Compliance
(e)To address this problem, you must do the following, unless already done: Actions Compliance Procedures
(1)Do a one-time inspection of the left-hand and right-hand starter-generators, Raytheon Aircraft Company
(RAC)part number (P/N) 390-389001-0001 or Advance Industries, Inc.
(AI)P/N MG94A-1, to determine the serial number and suffix letter, which indicates whether the part is defective Within the next 50 hours time-in-service
(TIS)after the effective date of this AD or within the next 3 months after the effective date of this AD, whichever occurs first Follow RAC Mandatory Service Bulletin SB 24-3790, Issued: August, 2006.
(2)If any defective starter-generator(s) is/are found during the inspection required in paragraph (e)(1) of this AD, replace any defective starter-generator with one of new design As follows:
(i)If both starter-generators are found defective, replace at least one within 10 hours after the inspection required in paragraph (e)(1) of this AD. Replace the other within the next 200 hours TIS after the effective date of this AD or within the next 12 months after the effective date of this AD, whichever occurs first.
(ii)If one starter-generator is found defective, replace within the next 200 hours TIS after the effective date of this AD or within the next 12 months after the effective date of this AD, whichever occurs first. Follow RAC Mandatory Service Bulletin SB 24-3790, Issued: August, 2006.
(3)If a defective starter-generator is not found during the inspection required in paragraph (e)(1) of this AD, no further action is required Not applicable Follow RAC Mandatory Service Bulletin SB 24-3790, Issued: August, 2006.
(4)Do not install on any airplane any RAC P/N 390-389001-0001 or AI P/N MG94A-1, unless it is inspected following paragraph (e)(1) of this AD and found not to be defective Before further flight after the inspection required in paragraph (e)(1) of this AD Follow RAC Mandatory Service Bulletin SB 24-3790, Issued: August, 2006. Alternative Methods of Compliance (AMOCs)
(f)The Manager, Wichita Aircraft Certification Office (ACO), FAA, has the authority to approve AMOCs for this AD, if requested using the procedures found in 14 CFR 39.19. Send information to ATTN: Philip Petty, Aerospace Engineer, Wichita ACO, FAA, 1801 Airport Road, Room 100, Wichita, Kansas 67209; telephone:
(316)946-4139; fax:
(316)946-4107; e-mail: *philip.petty@faa.gov.* Before using any approved AMOC on any airplane to which the AMOC applies, notify your appropriate principal inspector
(PI)in the FAA Flight Standards District Office (FSDO), or lacking a PI, your local FSDO. Related Information
(g)To get copies of the service information referenced in this AD, contact Hawker Beechcraft Company, P.O. Box 85, Wichita, Kansas 67201-0085; telephone:
(800)429-5372 or
(316)676-3140. To view the AD docket, go to the Docket Management Facility; U.S. Department of Transportation, 400 Seventh Street, SW., Nassif Building, Room PL-401, Washington, DC, or on the Internet at *http://dms.dot.gov.* The docket number is Docket No. FAA-2007-28068; Directorate Identifier 2007-CE-043-AD. Issued in Kansas City, Missouri, on June 5, 2007. David R. Showers, Acting Manager, Small Airplane Directorate, Aircraft Certification Service. [FR Doc. E7-11244 Filed 6-11-07; 8:45 am] BILLING CODE 4910-13-P DEPARTMENT OF HOMELAND SECURITY Coast Guard 33 CFR Part 137 [USCG-2006-25708] RIN 1625-AB09 Landowner Defenses to Liability Under the Oil Pollution Act of 1990: Standards and Practices for Conducting All Appropriate Inquiries AGENCY: Coast Guard, DHS. ACTION: Notice of proposed rulemaking. SUMMARY: The Coast Guard proposes to establish standards and practices concerning the “all appropriate inquiries” element of a defense to liability of an owner or operator of a facility that is the source of a discharge or substantial threat of discharge of oil into the navigable waters or adjoining shorelines or the exclusive economic zone. To be entitled to the defense, those persons must show, among other elements not addressed in this rulemaking, that, before acquiring the real property on which the facility is located, they had made all appropriate inquiries into its previous ownership and uses to determine the presence or likely presence of oil. This proposed rule is consistent with a final rule on this subject published by the Environmental Protection Agency. DATES: Comments and related material must reach the Docket Management Facility on or before September 10, 2007. Comments sent to the Office of Management and Budget
(OMB)on collection of information must reach OMB on or before September 10, 2007. ADDRESSES: You may submit comments identified by Coast Guard docket number USCG-2006-25708 to the Docket Management Facility at the U.S. Department of Transportation. Two different locations are listed under the mail and delivery options below because the Document Management Facility is moving May 30, 2007. To avoid duplication, please use only one of the following methods:
(1)*Web Site: http://dms.dot.gov.*
(2)*Mail:* • Address mail to be delivered before May 30, 2007, as follows: Docket Management Facility, U.S. Department of Transportation, 400 Seventh Street, SW., Washington, DC 20590-0001. • Address mail to be delivered on or after May 30, 2007, as follows: Docket Management Facility, U.S. Department of Transportation, 1200 New Jersey Avenue, SE., West Building Ground Floor, Room W12-140, Washington, DC 2059.
(3)*Fax:* 202-493-2251.
(4)*Delivery:* • Before May 30, 2007, deliver comments to: Room PL-401 on the Plaza level of the Nassif Building, 400 Seventh Street, SW., Washington, DC 20590. • On or after May 30, 2007, deliver comments to: Room W12-140 on the Ground Floor of the West Building, 1200 New Jersey Avenue SE., Washington, DC 20590. At either location, deliveries may be made between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The telephone number is 202-366-9329.
(5)*Federal eRulemaking Portal: http://www.regulations.gov.* You must also send comments on collection of information to the Office of Information and Regulatory Affairs, Office of Management and Budget. To ensure that the comments are received on time, the preferred method is by e-mail at *nlesser@omb.eop.gov* or fax at 202-395-6566. An alternate, though slower, method is by U.S. mail to the Office of Information and Regulatory Affairs, Office of Management and Budget, 725 17th Street, NW., Washington, DC 20503, ATTN: Desk Officer, U.S. Coast Guard. You may inspect the material referenced in this part at room 1013, National Pollution Funds Center, Coast Guard, 4200 Wilson Boulevard, Arlington, VA 22203-1804, between 9 a.m. and 3 p.m., Monday through Friday, except Federal holidays. The telephone number is 202-493-6863. Copies of the material are available as indicated in the “References” section of this preamble. FOR FURTHER INFORMATION CONTACT: If you have questions on this proposed rule, call Benjamin White, National Pollution Funds Center, Coast Guard, telephone 202-493-6863. If you have questions on viewing or submitting material to the docket, call Renee V. Wright, Program Manager, Docket Operations, telephone 202-493-0402. Public Participation and Request for Comments We encourage you to participate in this rulemaking by submitting comments and related materials. All comments received will be posted, without change, to *http://dms.dot.gov* and will include any personal information you have provided. We have an agreement with the Department of Transportation
(DOT)to use the Docket Management Facility. Please see DOT's “Privacy Act” paragraph below. *Submitting comments:* If you submit a comment, please include your name and address, identify the docket number for this rulemaking (USCG-2006-25708), indicate the specific section of this document to which each comment applies, and give the reason for each comment. You may submit your comments and material by electronic means, mail, fax, or delivery to the Docket Management Facility at the address under ADDRESSES ; but please submit your comments and material by only one means. If you submit them by mail or delivery, submit them in an unbound format, no larger than 8 1/2 by 11 inches, suitable for copying and electronic filing. If you submit them by mail and would like to know that they reached the Facility, please enclose a stamped, self-addressed postcard or envelope. We will consider all comments and material received during the comment period. We may change this proposed rule in view of them. *Viewing comments and documents:* To view comments, as well as documents mentioned in this preamble as being available in the docket, go to *http://dms.dot.gov* at any time, click on “Simple Search,” enter the last five digits of the docket number for this rulemaking, and click on “Search.” You may also visit the Docket Management Facility in room PL-401 on the Plaza level of the Nassif Building, 400 Seventh Street SW., Washington, DC, between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. *Privacy Act:* Anyone can search the electronic form of all comments received into any of our dockets by the name of the individual submitting the comment (or signing the comment, if submitted on behalf of an association, business, labor union, etc.). You may review the Department of Transportation's Privacy Act Statement in the **Federal Register** published on April 11, 2000 (65 FR 19477), or you may visit *http://dms.dot.gov.* Public Meeting We do not now plan to hold a public meeting. But you may submit a request for one to the Docket Management Facility at the address under ADDRESSES explaining why one would be beneficial. If we determine that one would aid this rulemaking, we will hold one at a time and place announced by a later notice in the **Federal Register** . Need for This Rulemaking This rulemaking will codify the requirement of 33 U.S.C. 2703(d)(4)(B). It applies to persons planning to acquire real property on which a facility, as defined under 33 U.S.C. 2701(9), is located who choose to take steps necessary to protect themselves from liability should unknown oil that is the subject of a discharge or substantial threat of discharge be found at the facility after they acquire it. We call these persons “landowners” or “owners” in this preamble. Should prospective landowners opt for this protection, they may find that they have already complied with this proposed rule if they have complied with ASTM International
(ASTM)E 1527-05, “Standard Practice for Environmental Site Assessments: Phase I Environmental Site Assessment Process.” The industry standard ASTM E 1527-05, is consistent with this proposed rule and is compliant with the statutory criteria for all appropriate inquiries. Persons conducting all appropriate inquiries may use the procedures included in the ASTM E 1527-05 standard to comply with this proposed rule. For more information on the ASTM standard, see the “ASTM Standard E 1527-05” section in this preamble. Note that this proposed rule addresses only one of several elements that must be complied with in order to avail oneself of this protection. The element addressed in this proposed rule is called the “all-appropriate-inquiries” element found in 33 U.S.C. 2703(d)(4). Background and Purpose In general, under the Oil Pollution Act of 1990 (33 U.S.C. 2701, *et seq.* ) (OPA 90), an owner or operator of a facility that is the source of a discharge, or a substantial threat of discharge, of oil into the navigable waters or adjoining shorelines or the exclusive economic zone is liable for damages and removal costs resulting from the discharge or threat. See 33 U.S.C. 2702(a). Under OPA 90, that person is known as a “responsible party.” See 33 U.S.C. 2701(32). The Coast Guard and Maritime Transportation Act of 2004 (Pub. L. 108-293) (the 2004 Act) amended OPA 90, at 33 U.S.C. 2703(d)(4), by creating an “innocent landowner” defense to liability for those persons who could demonstrate, among other requirements, that before acquiring the real property on which the facility is located, they did not know, and had no reason to know that oil that is the subject of the discharge or substantial threat of discharge was located on, in, or at the facility. See 33 U.S.C. 2703(d)(2)(A). This is done by establishing that, before it acquired the real property on which the facility is located, it carried out “all appropriate inquiries” into its previous ownership and uses according to “generally accepted good commercial and customary standards and practices.” See 33 U.S.C. 2703(d)(4)(A)(i). The Coast Guard is required to establish, by regulation, the standards and practices for carrying out all appropriate inquiries (33 U.S.C. 2703(d)(4)(B)), which is the subject of this rulemaking. Scope of the Proposed Rule Congress included in the 2004 Act a list of criteria that the Coast Guard must address in their regulations for establishing standards and practices for conducting all appropriate inquiries. The criteria may be found in 33 U.S.C. 2703(d)(4)(C). This rulemaking is limited only to providing those standards and practices relative to the “all appropriate inquiries” element. This rulemaking does not address the other requirements in 33 U.S.C. 2703 which also must be met to qualify for the innocent-landowner defense. The proposed rule would not apply to real property purchased by a non-governmental entity or non-commercial entity for residential use or other similar uses where an inspection and a title search of the facility and the real property on which the facility is located reveal no basis for further investigation. In those cases, 33 U.S.C. 2703(d)(4)(E) states that the inspection and title search satisfy the requirements for all appropriate inquiries. Also, the proposed rule would not affect the existing OPA 90 liability protections for State and local governments that acquire a facility involuntarily in their functions as sovereigns under 33 U.S.C. 2701(26)(B)(i) and 33 U.S.C. 2703(d)(2)(B). Involuntary acquisition of facilities by State and local governments do not fall under the all-appropriate-inquiries provision of 33 U.S.C. 2703(d)(4). Consultation With Other Agencies Under 33 U.S.C. 2703(d)(4)(B), we are required to consult with the Environmental Protection Agency
(EPA)to develop regulations establishing standards and practices for conducting “all appropriate inquiries.” On November 1, 2005, EPA published a final rule in the **Federal Register** (70 FR 66070) establishing standards and practices for conducting all appropriate inquiries as required by sections 101(35)(B)(ii) and
(iii)of the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA)(42 U.S.C. 9601, *et seq.* ) found at 42 U.S.C. 9601(35)(B)(ii) and (iii). CERCLA applies to “hazardous substances”, which is defined to exclude most forms of oil. These regulations are located in 40 CFR part 312. EPA used a negotiated rulemaking process to develop their standards and practices for conducting all appropriate inquiries under CERCLA. EPA's Negotiated Rulemaking Committee included interested parties from— • Environmental interest groups; • The Environmental Justice Community; • Federal, State, tribal, and local Governments; • Real estate developers, bankers and lenders; and • Environmental professionals. The all-appropriate-inquiries provisions of OPA 90 and CERCLA are similar in many respects, but not identical. The CERCLA provision has a broader scope than the OPA provision. It addresses certain liability defense provisions that are unique to CERCLA, involving persons who may not be affected by this proposed rule, such as contiguous property owners and individuals receiving Federal Brownfield grant monies under 40 U.S.C. 9604(k)(2)(B). While differences between OPA 90 and CERCLA have required certain differences between the Coast Guard's proposed rule and EPA's final rule, the two rules have been rendered as consistent as possible within statutory constraints. Maintaining consistency between the two rules helps standardize practices within the Federal Government. ASTM Standard E 1527-05 ASTM International
(ASTM)E 1527-05, “Standard Practice for Environmental Site Assessments: Phase I Environmental Site Assessment Process,” is the current voluntary industry standard that defines good commercial and customary practice in the United States for conducting an environmental site assessment of a parcel of commercial real estate with respect to oil under OPA 90 and hazardous substances under CERCLA. The 2004 Act, at 33 U.S.C. 2703(d)(4)(D)(ii), refers to ASTM E 1527-97, which is no longer available from ASTM and has been replaced by ASTM E 1527-05. Both the EPA and the Coast Guard agree that the new ASTM E 1527-05 is the active industry standard and is consistent with Congressional intent. Persons conducting all appropriate inquiries may use the procedures included in the ASTM E 1527-05 standard to comply with this proposed rule. Discussion of the Proposed Rule The proposed provisions addressed here warrant further discussion. The following discussion is intended to help prospective landowners understand and comply with the proposed rule. *Sections 137.15 and 137.20.* These sections concern the reference of an industry standard. See the discussion in the “ASTM Standard E 1527-05” section in this preamble. *Section 137.25.* The qualifications for an environmental professional in proposed § 137.25 are the same as those published in EPA's final rule. See 40 CFR part 312.10(b). *Section 137.30(a) and (b).* We believe that basing the regulations on a set of specific objectives and overall performance factors lends clarity and flexibility to the standards. Such an approach also allows for the application of professional judgment and expertise to account for site-specific circumstances. In many cases, one piece of documentation may provide information satisfying more than one of the statutory criteria. For example, a chain of title document is historic documentation that may also include information on environmental cleanup liens and past oil use at the facility and the real property on which the facility is located. To avoid duplication of effort, the parties undertaking all appropriate inquiries must keep in mind the primary objectives of the proposed rule, as described in proposed § 137.30(a), and the performance factors for achieving those objectives, as described in proposed § 137.30(b). It is important to note that the determination of whether or not the all-appropriate-inquiries standard is met remains within the discretion of an adjudicator, whether a court or, in the context of a claim to the Oil Spill Liability Trust Fund, the NPFC. *Section 137.30(a)(6).* This provision would require the identification of institutional controls placed on the facility and the real property on which the facility is located. Institutional controls ( *e.g.* , zoning restrictions, building permits, and easements) are typically used whenever the presence of environmental contaminants including oil precludes unlimited use of the facility and the real property on which the facility is located. Thus, institutional controls may have been needed both before and after completion of a past removal action or may have been employed in place of a removal action. Because institutional controls often must remain in place for an indefinite duration and, therefore, generally need to survive ownership changes ( *i.e.* , run with the land) to be legally and practically effective, they can indicate past presence of oil at the facility and the real property on which it is located. *Section 137.33.* The proposed rule includes provisions addressing each of the 10 statutory criteria for the conduct of all appropriate inquiries under 33 U.S.C. 2703(d)(4)(C). The proposed rule and 33 U.S.C. 2703(d)(4)(C) require that all appropriate inquiries include an inquiry by an environmental professional. The statute, however, does not require that all of the inquiries be conducted by, or under the supervision or responsible charge of, an environmental professional. The inquiries in §§ 137.55, 137.70, 137.75, and 137.80 must be conducted by either the prospective landowner or by, or under the supervision or responsible charge of, an environmental professional. All other required inquiries ( *i.e.* , those in proposed §§ 137.35(c), 137.45, 137.50, 137.60, 137.65, and 137.85) must be conducted by, or under the supervision or responsible charge of, an environmental professional. Under 33 U.S.C. 2703(d)(4)(A), the landowner must conduct all appropriate inquiries on or before the date on which the landowner acquired the real property on which the facility is located. To most closely reflect the intent of Congress, the date on which a person received documentation transferring title or possession should be the date that the landowner acquired the real property on which the facility is located. *Section 137.33(e).* The proposed rule requires prospective landowners and environmental professionals to identify data gaps that affect their ability to identify conditions indicative of the presence or likely presence of oil. While the proposed rule does not require sampling and analysis as part of the all-appropriate-inquiries investigation, sampling and analysis may be valuable in determining the presence or likely presence of oil at a facility and on the real property on which the facility is located. In addition, the fact that the all-appropriate-inquiry standards do not require sampling and analysis does not prevent a court, or in the context of a claim to the Oil Spill Liability Trust Fund the NPFC, from concluding that, under the circumstances of a particular case, sampling and analysis should have been conducted to meet “the degree of obviousness of the presence or likely presence of oil at the facility and on the real property on which the facility is located, and the ability to detect the oil by appropriate investigation” criterion and obtain protection from OPA 90 liability. In addition, sampling and analysis may help explain existing data gaps. Prospective landowners should be mindful of all the statutory requirements for obtaining the OPA 90 liability protections when considering whether or not to conduct sampling and analysis prior to or after acquiring the real property on which the facility is located. *Sections 137.35(c).* We propose no requirements regarding the format of the written report under proposed § 137.35(c). The report may use the same format as required under ASTM E 1527-05. In addition, there are no requirements that the report be submitted to the Coast Guard or other government agency or that the written report be maintained on-site for any length of time. The written report may allow any person claiming the innocent-landowner liability protection under OPA 90 to offer documentation in support of his or her claim that all appropriate inquiries were conducted in compliance with Federal regulations. While the proposed rule does not require parties conducting all appropriate inquiries to retain the written report or any other documentation discovered, consulted, or created in the course of conducting the inquiries, the retention of the documentation may be helpful should the owner need to assert protection from OPA 90 liability after acquiring the real property on which the facility is located. Nothing in this regulation or preamble is intended to suggest that any particular documentation prepared in conducting all appropriate inquiries will be admissible in court in any litigation where a party raises the innocent-landowner liability protection or will in any way alter the judicial rules of evidence. *Section 137.35(c)(2).* This paragraph would require that the report identify data gaps in the information collected that affect the ability of the environmental professional to render the opinion. Given that the burden of potential OPA 90 liability ultimately falls upon the person specified in § 137.1(a), a prospective landowner does not have to provide the results of an inquiry or related information to the environmental professional hired to undertake other aspects of the all-appropriate-inquiries investigation. However, if the lack of this information affects the ability of the environmental professional to identify conditions that indicate the presence or likely presence of oil at the facility and the real property on which the facility is located, he or she must note the data gap in their report under § 137.35(c). *Section 137.35(d).* This provision would require the environmental professional, who conducts or oversees all appropriate inquiries, to sign the written report. There are two reasons for requiring that the report be signed. First, the individual signing the report must declare, on the signature page, that he or she meets the requirements for an environmental professional in proposed § 137.25. Second, the environmental professionals must declare that all appropriate inquiries have been developed and performed according to the standards and practices in proposed part 137. *Section 137.45.* The primary purpose for the interviews portion of all appropriate inquiries is to obtain information regarding the current and past ownership, current and past uses, and the potential environmental conditions at the facility and real property on which the facility is located. All interviews must be conducted by the environmental professional or by someone under their supervision or responsible charge. The intent is that an individual meeting the requirements of an environmental professional under proposed § 137.35 must oversee the conduct of, or review and approve the results of, the interviews to ensure that the interviews are conducted in compliance with the objectives and performance factors in proposed § 137.30(a) and (b). This is to ensure that the information obtained from the interviews provides sufficient information, in conjunction with the results of all other inquiries, to allow the environmental professional to render an opinion with regard to conditions at the facility and the real property on which the facility is located that may be indicative of the presence or likely presence of oil. The proposed rule does not prescribe particular questions that must be asked during the interview. The type and content of any questions asked during interviews would depend upon the site-specific conditions and circumstances and the extent of the knowledge of the environmental professional (or other individual under the supervision or responsible charge of the environmental professional) of the facility and the real property on which the facility is located before conducting the interviews. Interviews with current and past owners and occupants may provide opportunities to collect information that was not previously recorded nor well documented and may provide valuable perspectives on how to find or interpret information required to complete other aspects of all the appropriate inquiries. In the case of facilities and the real properties on which they are located where there may be more than one owner or occupant, the proposed rule does not specify the number of owners and occupants to be interviewed. Instead, proposed § 137.45 requires that interviews be conducted with major occupants, as well as those occupants likely to use, store, treat, handle or dispose of oil or those who likely have done so in the past. The environmental professional may use their professional judgment to determine the specific occupants to be interviewed and the total number of occupants to be interviewed in seeking to comply with the objectives and performance factors for the inquiries. In the case of abandoned properties, it most likely will be difficult to identify or interview current or past owners and occupants of the property. Therefore, the proposed rule requires that at least one owner or occupant of a neighboring property be interviewed to obtain information regarding past owners or uses of the abandoned property. *Section 137.50.* The proposed rule requires that historical records on the real property on which the facility is located be searched by the environmental professional, or by a person under their supervision or responsible charge, for information dating as far back in time as there is documentation that the real property contained structures or was placed into use of some form. The proposed rule does allow the environmental professional to exercise his or her professional judgment in context of the facts available at the time of the inquiry as to how far back in time it is necessary to search historical records. We believe that this provides sufficient flexibility to allow for any circumstances where, due to the availability of other information about a real property, an environmental professional may conclude that a comprehensive search of historical records is not necessary to meet the objectives and performance factors in proposed § 137.30(a) and (b). The proposed rule also does not require that any specific type of historic information be collected. The proposed rule allows for the environmental professional to use professional judgment when determining what types of historical documentation may provide the most useful information about a real property's ownership, uses, and potential environmental conditions when seeking to comply with the objectives and performance factors for the inquiries. In addition, nothing in the proposed rule prohibits the use of secondary sources (e.g., a previously conducted title search) when gathering information about historical ownership and usage of a real property. Information from secondary sources would also be required to be updated if it was last collected more than 180 days prior to the date of acquisition under proposed § 137.33(b)(3). *Section 137.55.* Searching for recorded environmental cleanup liens is required to be conducted by either the environmental professional (or a person under their supervision or responsible charge) or by a person specified in § 137.1(a). Recorded environmental cleanup liens often provide an indication that environmental conditions either currently exist or previously existed at a facility and the real property on which the facility is located that may include the presence or likely presence of oil. Environmental cleanup liens that are not recorded by government entities or agencies are not addressed by the language of the statute. The statute speaks only of “recorded liens.” Therefore, the proposed rule requires that only a search for recorded environmental liens be included in the all-appropriate-inquiries investigation. *Section 137.60.* The proposed rule describes, in § 137.60(b), the types of Federal, State, tribal, and local government records or data bases of governmental records to be reviewed to obtain information on the subject facility, the real property on which the facility is located, and nearby properties necessary to meet the proposed rule's objectives and performance factors in § 137.30(a) and (b). The review of actual records is not necessary, provided that the same information contained in the government records is attainable by searching available data bases. The proposed rule allows the environmental professional to adjust the search distances for reviewing government records of nearby properties based upon his or her professional judgment. Environmental professionals may consider one or more of the factors in § 137.60(d)(1) through (d)(7), when determining an alternative appropriate search distance. The proposed § 137.60 requires environmental professionals to document the rationale for making any modifications to the required minimum search distances. *Section 137.65.* The visual on-site inspection of a facility, the real property on which the facility is located, and adjoining properties during the conduct of all appropriate inquiries may be the most important aspect of the inquiries and the primary source of information regarding environmental conditions. In all cases, every effort must be made to conduct an on-site visual inspection of a facility and the real property on which the facility is located when conducting all appropriate inquiries. The proposed rule requires that the on-site visual inspection be conducted by an environmental professional (or by someone under their supervision or responsible charge) to achieve the objectives and performance factors in § 137.30(a) and (b). The proposed rule requires that a visual on-site inspection be conducted in all but a few very limited cases. In those cases where physical limitations restrict the portions of the facility and the real property on which the property is located that may be visually inspected, physical limitations encountered during the visual on-site inspection ( *e.g.* , weather conditions, physical obstructions) must be documented. We understand that, in some limited circumstances, it may not be possible to obtain on-site access to a facility and the real property on which the property is located due to extreme and prolonged weather conditions, remote locations, or refusal by the owner of the facility and the real property on which the facility is located to allow access, even after the party exercises all good faith efforts to gain access ( *e.g.* , by seeking the assistance of government officials). However, the mere refusal of an owner to allow access to the facility and the real property on which the facility is located does not justify the failure to conduct an on-site inspection, where a party has failed to exercise all good faith efforts to gain access. If on-site access is not possible despite the exercise of good faith efforts, the proposed rule requires that the facility and the real property on which the facility is located be visually inspected, or observed by another method such as through the use of aerial photography, or be inspected or observed from the nearest accessible vantage point, such as the property line or a public road that runs through or along the real property. In addition, the proposed rule requires that the all-appropriate-inquiries report include documentation of efforts undertaken to obtain on-site access to the facility and the real property on which the facility is located and include an explanation of why good faith efforts to gain access were unsuccessful. The proposed rule also requires that the all-appropriate-inquiries investigation include visual inspections of properties that adjoin the subject real property. Visual inspections of adjoining properties may provide excellent information on the potential for the facility and the real property on which the facility is located to be affected by oil migrating from adjoining properties. Visual inspections of adjoining properties may be conducted from the real property's property line, one or more public rights-of-way, or other vantage point (e.g., by aerial photography). Where practicable, a visual on-site inspection is recommended and may provide greater specificity of information. The visual inspections of adjoining properties must include observing areas where oil currently may be, or previously may have been, stored, treated, handled, or disposed and must also be conducted to achieve the objectives and performance factors in proposed § 137.30(a) and
(b)for all the appropriate inquiries. Physical limitations to the visual inspections of adjoining properties must be noted in the report. *Section 137.70.* The proposed rule requires that the specialized knowledge of prospective landowners and the persons responsible for undertaking the all appropriate inquiries be taken into account when conducting the all appropriate inquiries for the purposes of identifying conditions indicative of the presence or likely presence of oil at a facility and the real property on which the facility is located to achieve the objectives and performance factors in § 137.30(a) and (b). Including the specialized knowledge of the environmental professional or a person under their supervision or responsible charge is not required. *Section 137.75.* Addressing the relationship of the purchase price to the value of the facility and the real property on which the facility is located if oil was not present is required to be conducted by either the environmental professional (or a person under their supervision or responsible charge) or by a person specified in § 137.1(a). There may be many reasons that the price paid for a particular facility and the real property on which the facility is located is not an accurate reflection of the fair market value. The all-appropriate-inquiries investigation need only include a consideration of whether a significant difference between the price paid and the fair market value is an indication that oil may be at the facility and the real property on which the facility is located. The proposed rule does not require that a real estate appraisal be conducted to achieve compliance with this requirement. The objective is not to ascertain the exact value of the facility and the real property on which the facility is located, but to determine whether or not the purchase price paid generally is reflective of its fair market value. In the case of many real estate transactions, a formal appraisal may be conducted for other purposes ( *e.g.* , to establish the value of the facility and the real property on which the facility is located for the purposes of establishing the conditions of a mortgage or to provide information of relevance where a windfall lien may be filed). In cases where the results of a formal appraisal are available, the appraisal results may serve as an excellent source of information on the fair market value of the facility and the real property on which the facility is located. In cases where the results of a formal appraisal are not available, the determination of fair market value may be made by comparing the price paid for a particular facility and the real property on which the facility is located to prices paid for similar facilities and real properties on which they are located in the same vicinity, or by consulting a real estate expert familiar with properties in the general locality and who may be able to provide a comparability analysis. *Section 137.80.* The inclusion of commonly known or reasonably ascertainable information into the inquiry is required by either the environmental professional (or a person under their supervision or responsible charge) or by a person specified in § 137.1(a) to satisfy objectives and performance factor in proposed § 137.30(a) and (b). Information about a facility and the real property on which the facility is located, including its ownership and uses, that is commonly known or reasonably ascertainable within the community or neighborhood may be valuable to identifying conditions indicative of the presence or likely presence of oil. Commonly known or reasonably ascertainable information includes information about a facility and the real property on which the facility is located that generally is known to the public within the community and can be easily sought and found from individuals familiar with the facility and the real property on which the facility is located or from easily attainable public sources of information. This information may be ascertained from the owner or occupant of a facility and the real property on which the facility is located, members of the local community, including owners or occupants of neighboring properties, local or state government officials, local media sources, and local libraries and historical societies. In many cases, this information may be incidental to other information collected during the inquiries, and separate or distinct efforts to collect the information may not be necessary. *Section 137.85.* The proposed rule requires that persons conducting all appropriate inquiries consider all the information collected during the conduct of the inquiries in totality to assess whether or not an obvious conclusion may be drawn that there are conditions indicative of the presence or likely presence of oil at the facility and the real property on which the facility is located. We interpret the statutory criterion to require the environmental professional or a person under their supervision or responsible charge to consider information already obtained during the conduct of all-appropriate-inquiries investigation which achieves the objectives and performance factors in § 137.30(a) and
(b)and not as a requirement to collect additional information. References Material referenced appears in § 137.15. You may inspect this material at the National Pollution Funds Center where indicated under ADDRESSES . Copies of the material are available from the sources listed in § 137.15. Regulatory Analysis and Review This proposed rule is not a “significant regulatory action” under section 3(f) of Executive Order 12866, Regulatory Planning and Review, and does not require an assessment of potential costs and benefits under section 6(a)(3) of that Order. The Office of Management and Budget has not reviewed it under that Order. Draft Regulatory Evaluation Compliance with this proposed rule is required only for those persons engaging in a commercial real estate transaction who choose to take steps necessary to protect themselves from liability should unknown oil that is the subject of a discharge or substantial threat of discharge be found at the facility after they acquire it. The following analysis of the economic impacts associated with this proposed rule relies heavily upon the data collected and the assumptions made in the Environmental Impact Analysis of EPA's final rule, “Economic Impact Analysis for the Final All Appropriate Inquiries Regulation,” Docket ID No. SFUND-2004-0001 found at *http://www.regulations.gov/fdmspublic/component/main* or at EPA Docket Center, EPA West Building, room B102, 1301 Constitution Avenue, NW., Washington, DC. EPA surveyed all publicly available literature on environmental assessments of sites to determine what standard industry was customarily using. These assessments correspond to the all appropriate inquiries provision being addressed in this rulemaking and are commonly known as Phase I environmental site assessments (Phase I ESAs). EPA determined that the 2000 edition of ASTM E 1527 ( *i.e.* , ASTM E 1527-00) would be their regulatory baseline. This baseline represented the “no action” scenario to which all regulatory alternatives were compared and their economic impacts were measured. ASTM E 1527-00 would have been applied by industry absent EPA's regulation, because this voluntary industry standard represented “generally accepted good commercial and customary practices.” This assumption was confirmed by the members of EPA's Negotiated Rulemaking Committee (See the “Consultation with Other Agencies” section of this preamble.). To further validate their assumption, EPA received no public comments on this aspect of its Economic Impact Analysis. In addition, ASTM International states that ASTM E 1527-97 (the edition referred to in the 2004 Act) is no longer available because, when a new version of a standard is released, previous versions of the standard are no longer the active industry standard. The Coast Guard, after independently contacting ASTM International, concurs that the ASTM E 1527-00 standard more accurately reflects the current market conditions than the E 1527-97 standard referenced in OPA 90 as the acceptable interim standard (33 U.S.C. 2703(d)(4)(D)(ii)). The Coast Guard therefore uses the ASTM E 1527-00 standard as its regulatory baseline for its analysis of the economic impacts associated with this proposed rule. Historically, Phase I ESAs have been used towards providing liability protection to individuals under CERCLA. A recent survey conducted by Environmental Data Resources, Inc.
(EDR)indicates that approximately 55 percent of all Phase I ESAs are driven exclusively by a need for the landowner to qualify for protection from CERCLA liability. The remaining 45 percent are driven by a desire to assess other business environmental risk concerns ( *i.e.* , asbestos, lead-based paint, oil, etc.). As previously discussed in the “Consultation with Other Agencies” section of this preamble, this proposed rule is consistent with EPA's final rule. The scope of EPA's rulemaking however is much larger than this proposed rule. As such, the economic impacts of this proposed rule are a subset of the impacts estimated by EPA's rulemaking. This reduction in economic impact results primarily from the lower number of Phase I ESAs expected to be conducted annually under this proposed rule compared to EPA's final rule. As was the case with EPA's rulemaking, this proposed rule is expected to result in the following economic impacts:
(1)A reduced burden for the conduct of interviews in those cases where the facility and the real property on which the facility is located is abandoned. The new requirement requires only that neighboring property owners and occupants be interviewed and not the current owners and occupants of the abandoned property. This burden would range from no change to a decrease of 0.5 hour per Phase I ESA depending on the type and size of the facility and the real property on which the facility is located.
(2)An increased burden in those cases where past owners or occupants of the facility and the real property on which the facility is located need to be interviewed. This would involve the additional effort required to locate and interview past owners and occupants. This increased burden would range from 1 hour to 2 hours per Phase I ESA depending on the type and size of the facility and the real property on which the facility is located.
(3)An increased burden associated with documenting recorded environmental cleanup liens. This increased burden would involve additional time spent in preparing the Phase I ESA report. This increased burden would range from an additional 0.5 hour to 1 hour per Phase I ESA depending on the size and type of the facility and the real property on which the facility is located.
(4)An increased burden for documenting the reasons for the price and fair market value of a facility and the real property on which the facility is located in those cases where the purchase price paid is significantly below its fair market value. This increased burden would involve interviews with local government officials and increased time spent in preparing the Phase I ESA report. This increased burden would reflect an additional 0.5 hour per Phase I ESA for all sizes and types of facilities and the real properties on which the facilities are located.
(5)An increased burden for recording information about the degree of obviousness of the presence or likely presence of oil at a facility and the real property on which the facility is located. This increased burden would involve additional time spent in preparing the Phase I Environmental report. This increased burden would range from 0.5 hour to 1 hour per Phase I ESA depending on the type and size of the facility and the real property on which the facility is located. Using a weighted labor rate of $51.20/hour applied to the activities (as outlined above) required as a result of their regulation (as they vary from those required in their regulatory baseline), EPA determined that there would be an incremental cost ranging from $52 to $58 per Phase I ESA (the low end estimate assumes that 15 percent of properties are abandoned, while the high end estimate assumes that 28 percent of properties are abandoned). Our analysis simplifies this range as an average incremental cost of $55 per Phase I ESA. A. Analysis Calculations and Results Using data from EPA's final rule and extrapolated for the period from 2007 to 2016, there would be an average of 332,038 Phase I ESAs conducted annually. As previously mentioned, the incremental cost of conducting a Phase I ESA to comply with EPA's rulemaking above and beyond what was required under ASTM E 1527-00 as calculated by EPA's rulemaking would be approximately $55 per ESA. B. Estimated Annual Number of OPA 90-Related Phase I ESAs This analysis is severely limited by the lack of data available which would allow the number of Phase I ESAs conducted applicable to this proposed rule to be segregated from the total population of Phase I ESAs conducted. In order to put an upward bound on the costs associated with this proposed rule, this analysis first describes the absolute upper bound scenario ( *i.e.* , that all commercial real estate transactions not exclusively conducted for CERCLA liability protection requiring a Phase I ESA would be impacted by this proposed rule). Next the Coast Guard attempts to develop a more likely scenario that takes into account that Phase I ESAs for certain commercial real estate transactions are outside the scope of this proposed rule. We acknowledge that, of all of the commercial real estate transactions that occur annually, a likely small percentage would involve— 1. A facility and the real property on which the facility is located where a discharge or substantial threat of discharge of oil may impact the navigable waters or exclusive economic zone of the United States; and 2. A Phase I ESA that was conducted for establishment of the innocent landowner liability protection provision under OPA 90 and not to assess environmental risk concerns not related to oil ( *e.g.* , lead-based paint contamination, asbestos, CERCLA hazardous substances, etc.). C. Upper Bound Cost Scenario The estimated incremental cost of this scenario, where all future Phase I ESAs not conducted specifically for CERCLA liability protection ( *i.e.* , 45 percent as per the results of EDR's survey mentioned above) are impacted by this proposed rule, would be approximately $8.2 Million per year. Cost Calculation 1—Estimated Annual Number of Coast Guard related Phase I ESAs 332,038 Phase I ESAs × 0.45 = 149,417 Phase I ESAs Estimated Annual Cost of Coast Guard related Phase I ESAs 149,417 Phase I ESAs × $55/ESA = $8,217,935 per year. D. Most Likely Cost Scenario To more accurately reflect the scope of this proposed rule, certain commercial real estate transactions involving a Phase I ESA from EPA's analysis would have to be removed from this analysis. Those include transactions where a discharge or substantial threat of discharge of oil from a facility and the real property on which the facility is located would not have the possibility of impacting the navigable waters or exclusive economic zone of the United States and transactions which are conducted for substances other than oil. Absent the data to make more than an approximation, we assumed that five percent of the total number of Phase I ESAs may realistically reflect the number of Phase I ESAs within the scope of this proposed rule. Under this assumption, the estimated cost associated with this proposed rule would be significantly reduced. The estimated incremental cost under this scenario is approximately $913,110 per year. Cost Calculation 2—Estimated Annual Number of Coast Guard related Phase I ESAs 332,038 Phase I ESAs × 0.05 = 16,602 Phase I ESAs Estimated Annual Cost of Coast Guard related Phase I ESAs 16,602 Phase I ESAs × $55/ESA = $913,110 per year. ASTM International has since updated their ASTM E 1527 standard. Their new standard is ASTM E 1527-05. Both EPA and Coast Guard recognize that this new standard is consistent with their rulemakings on the subject. See **Federal Register** (70 FR 66081). Because the new standard is consistent with the EPA final rule, which went into effect on November 1, 2006, and provides documentation for both hazardous substances and oil, it is likely that all prudent prospective commercial landowners will be using the more rigorous ASTM standard for their real estate transactions well before our rule becomes effective. Thus, the possible economic impact attributed to this proposed rule might be reduced to a negligible value. The Coast Guard further notes that there have been no instances to date where a responsible party has attempted to use the interim innocent-landowner defense to liability provision under OPA 90. EPA qualitatively assessed the benefits for their final rule. Of these benefits, only one is applicable to our proposed rule due to our much smaller regulatory scope, namely the increased level of certainty with regard to OPA 90 liability provided to prospective owners of facilities and the real properties on which they are located with potential oil discharges. The Coast Guard, as was the case with EPA's analysis, is not able to quantify, with any significant level of confidence, the exact proportion of benefits associated with the proposed rule. For these reasons, the costs and benefits can not be directly compared. However, because complying with this proposed rule is required only for those persons who choose to take steps necessary to protect themselves from liability should unknown oil that is the subject of a discharge or substantial threat of discharge be found at the facility after they acquire it, it can be assumed that persons would only do so if the potential benefits to them associated with this protection from liability outweigh their costs of compliance. Small Entities Under the Regulatory Flexibility Act (5 U.S.C. 601-612), we have considered whether this proposed rule would have a significant economic impact on a substantial number of small entities. The term “small entities” comprises small businesses, not-for-profit organizations that are independently owned and operated and are not dominant in their fields, and governmental jurisdictions with populations of less than 50,000. As previously stated in the above regulatory evaluation section, compliance with this proposed rule is only required for those entities, regardless of their operations, involved in a real estate transaction who choose to take steps necessary to protect themselves from liability should unknown oil that is the subject of a discharge or substantial threat of discharge be found at the facility after they acquire it. Therefore, it assumed that entities across all industries, as defined by the North American Industry Classification System (NAICS), could potentially be affected. The Regulatory Flexibility Act and the Small Business Regulatory Enforcement Fairness Act of 1996 require Federal agencies to measure the regulatory impacts of the rule to determine whether there will be a significant economic impact on a substantial number of small entities. Entities, however, may operate at multiple physical locations. For example, most family-owned restaurants operate at a single location, while chain restaurants have multiple locations. Thus, the annual number of transactions per entity, and therefore the demand for Phase I ESAs, is a function of the number of establishments an entity owns. According to 2001 U.S. Census data, the distribution of establishments by entity size of the regulated community is as follows: Less than 100 employees: 81%. 100 to 499 employees: 5%. 500 to 1,499 employees: 2%. 1,500 employees or more: 12%. According to EPA's Office of Policy, Economics, and Innovations and EPA's National Center for Environmental Economics, it is a common practice when a proposed regulation has the potential of affecting all industries to consider all entities with less than 500 employees as small. According to 2001 U.S. Census data, when small entities are defined as entities with less than 500 employees, small entities own 86 percent of all establishments. Using EPA's assumption that small entities are equally likely to engage in commercial real estate transactions as large ones, we estimate that 86 percent of all commercial real estate transactions completed annually involve small entities. Applying this 86 percent to the “Most Likely Cost Scenario” and the “Upper Bound Cost Scenario” (See “Regulatory Evaluation” in this preamble.) provides a range in the number of potential transactions occurring annually of between 14,278 and 128,499. Based on 2001 Census Bureau data, the average annual revenue per employee for an entity is approximately $24,000. Therefore, even for a small entity receiving the minimum average annual revenue of $24,000 that makes one transaction a year (a very conservative assumption), the annual cost impact of $55 would represent only 0.23 percent of annual revenues. Therefore, the Coast Guard certifies under 5 U.S.C. 605(b) that this proposed rule would not have a significant economic impact on a substantial number of small entities. If you think that your business, organization, or governmental jurisdiction qualifies as a small entity and that this rule would have a significant economic impact on it, please submit a comment to the Docket Management Facility at the address under ADDRESSES . In your comment, explain why you think it qualifies and how and to what degree this rule would economically affect it. Assistance for Small Entities Under section 213(a) of the Small Business Regulatory Enforcement Fairness Act of 1996 (Pub. L. 104-121), we want to assist small entities in understanding this proposed rule so that they can better evaluate its effects on them and participate in the rulemaking. If the rule would affect your small business, organization, or governmental jurisdiction and you have questions concerning its provisions or options for compliance, please consult Benjamin White, National Pollution Funds Center, Coast Guard, telephone 202-493-6863. The Coast Guard will not retaliate against small entities that question or complain about this rule or any policy or action of the Coast Guard. Small businesses may send comments on the actions of Federal employees who enforce, or otherwise determine compliance with, Federal regulations to the Small Business and Agriculture Regulatory Enforcement Ombudsman and the Regional Small Business Regulatory Fairness Boards. The Ombudsman evaluates these actions annually and rates each agency's responsiveness to small business. If you wish to comment on actions by employees of the Coast Guard, call 1-888-REG-FAIR (1-888-734-3247). Collection of Information This proposed rule would call for a collection of information under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520). As defined in 5 CFR 1320.3(c), “collection of information” comprises reporting, recordkeeping, monitoring, posting, labeling, and other, similar actions. The title and description of the information collections, a description of those who must collect the information, and an estimate of the total annual burden follow. The estimate covers the time for reviewing instructions, searching existing sources of data, gathering and maintaining the data needed, and completing and reviewing the collection. *Title:* Landowner Defenses to Liability under the Oil Pollution Act of 1990: Standards and Practices for Conducting All Appropriate Inquiries. *Summary of the Collection of Information:* For landowners choosing to avail themselves of the innocent-landowner defense, they or their environmental professionals must conduct the all appropriate inquiries specified in the proposed rule. Depending upon the particular case, this may involve interviews, research, and reports. *Need for Information:* This proposed rule is needed to assist prospective landowners in establishing the innocent-landowner defense. *Proposed Use of Information:* The information could be used by persons if their liability under OPA 90 for the discharge or substantial threat of discharge of oil were challenged in a court. *Description of the Respondents:* The respondents include anyone engaging in a commercial real estate transaction that may desire to assert an innocent landowner defense to liability under OPA 90. *Number of Respondents:* We estimate that there would be 16,602 respondents. This is based on an estimate made in the “Draft Regulatory Evaluation” section of this preamble. *Frequency of Response:* 1 hour per response. *Burden of Response:* $67 per response. *Estimate of Total Annual Burden:* 16,602 respondents × 1 hour per response × $67 per response = $1,112,334. As required by the Paperwork Reduction Act of 1995 (44 U.S.C. 3507(d)), we have submitted a copy of this proposed rule to the Office of Management and Budget
(OMB)for its review of the collection of information. We ask for public comment on the proposed collection of information to help us determine how useful the information is; whether it is readily available elsewhere; how accurate our estimate of the burden of collection is; how valid our methods for determining burden are; how we can improve the quality, usefulness, and clarity of the information; and how we can minimize the burden of collection. If you submit comments on the collection of information, submit them both to OMB and to the Docket Management Facility where indicated under ADDRESSES , by the date under DATES . You need not respond to a collection of information unless it displays a currently valid control number from OMB. Before the requirements for this collection of information become effective, we will publish notice in the **Federal Register** of OMB's decision to approve, modify, or disapprove the collection. Federalism A rule has implications for federalism under Executive Order 13132, Federalism, if it has a substantial direct effect on State or local governments and would either preempt State law or impose a substantial direct cost of compliance on them. We have analyzed this proposed rule under that Order and have determined that it does not have implications for federalism. Unfunded Mandates Reform Act The Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1531-1538) requires Federal agencies to assess the effects of their discretionary regulatory actions. In particular, the Act addresses actions that may result in the expenditure by a State, local, or tribal government, in the aggregate, or by the private sector of $100,000,000 or more in any one year. Though this proposed rule would not result in such an expenditure, we do discuss the effects of this rule elsewhere in this preamble. Taking of Private Property This proposed rule would not effect a taking of private property or otherwise have taking implications under Executive Order 12630, Governmental Actions and Interference with Constitutionally Protected Property Rights. Civil Justice Reform This proposed rule meets applicable standards in sections 3(a) and 3(b)(2) of Executive Order 12988, Civil Justice Reform, to minimize litigation, eliminate ambiguity, and reduce burden. Protection of Children We have analyzed this proposed rule under Executive Order 13045, Protection of Children from Environmental Health Risks and Safety Risks. This rule is not an economically significant rule and would not create an environmental risk to health or risk to safety that might disproportionately affect children. Indian Tribal Governments This proposed rule does not have tribal implications under Executive Order 13175, Consultation and Coordination with Indian Tribal Governments, because it would 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. Energy Effects We have analyzed this proposed rule under Executive Order 13211, Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use. We have determined that it is not a “significant energy action” under that order because it is not a “significant regulatory action” under Executive Order 12866 and is not likely to have a significant adverse effect on the supply, distribution, or use of energy. The Administrator of the Office of Information and Regulatory Affairs has not designated it as a significant energy action. Therefore, it does not require a Statement of Energy Effects under Executive Order 13211. Technical Standards The National Technology Transfer and Advancement Act (NTTAA) (15 U.S.C. 272 note) directs agencies to use voluntary consensus standards in their regulatory activities unless the agency provides Congress, through the Office of Management and Budget, with an explanation of why using these standards would be inconsistent with applicable law or otherwise impractical. Voluntary consensus standards are technical standards ( *e.g.* , specifications of materials, performance, design, or operation; test methods; sampling procedures; and related management systems practices) that are developed or adopted by voluntary consensus standards bodies. This proposed rule references the following voluntary consensus standard: ASTM E 1527-05, “Standard Practice for Environmental Site Assessments: Phase I Environmental Site Assessment Process.” The proposed section that references this standard and the location where this standard is available is listed in proposed § 137.15. Persons conducting all appropriate inquiries may use the procedures included in the ASTM E 1527-05 standard to comply with this proposed rule. Environment We have analyzed this proposed rule under Commandant Instruction M16475.lD and Department of Homeland Security Management Directive 5100.1, which guide the Coast Guard in complying with the National Environmental Policy Act of 1969
(NEPA)(42 U.S.C. 4321-4370f), and have made a preliminary determination that there are no factors in this case that would limit the use of a categorical exclusion under section 2.B.2 of the Instruction. Therefore, we believe that this rule should be categorically excluded, under figure 2-1, paragraph (34)(a), of the Instruction, from further environmental documentation. This proposed rule concerns the making of inquiries into the previous ownership and uses of facilities and the real property on which they are located, before they are acquired, to determine the presence or likely presence of oil. It has no effect on the environment. A preliminary “Environmental Analysis Check List” is available in the docket where indicated under the “Public Participation and Request for Comments” section of this preamble. Comments on this section will be considered before we make the final decision on whether this rule should be categorically excluded from further environmental review. List of Subjects in 33 CFR Part 137 Environmental protection, Administrative practice and procedure, Petroleum, Intergovernmental relations, Reporting and recordkeeping requirements. For the reasons set out in the preamble, the Coast Guard proposes to add 33 CFR part 137 as follows: 1. Add part 137 to read as follows: PART 137—OIL SPILL LIABILITY: STANDARDS FOR CONDUCTING ALL APPROPRIATE INQUIRIES UNDER THE INNOCENT LAND-OWNER DEFENSE Subpart A—Introduction Sec. 137.1 Purpose and applicability. 137.5 Disclosure obligations. 137.10 How are terms used in this part defined? 137.15 References: Where can I get a copy of the publications mentioned in this part? Subpart B—Standards and Practices 137.18 Duties of persons specified in § 137.1(a). 137.20 May voluntary industry standards be used to comply with this regulation? 137.25 Qualifications of the Environmental Professional. 137.30 Objectives and performance factors. 137.33 General All Appropriate Inquiries requirements. 137.35 Inquiries by an environmental professional. 137.40 Additional inquiries. 137.45 Interviews with past and present owners, operators, and occupants. 137.50 Reviews of historical sources of information. 137.55 Searches for recorded environmental cleanup liens. 137.60 Reviews of Federal, State, tribal and local government records. 137.65 Visual inspections of the facility, the real property on which the facility is located, and adjoining properties. 137.70 Specialized knowledge or experience on the part of persons specified in § 137.1(a). 137.75 The relationship of the purchase price to the value of the facility and the real property on which the facility is located, if oil was not at the facility or on the real property. 137.80 Commonly known or reasonably ascertainable information about the facility and the real property on which the facility is located. 137.85 The degree of obviousness of the presence or likely presence of oil at the facility and the real property on which the facility is located and the ability to detect the oil by appropriate investigation. Authority: 33 U.S.C. 2703(d)(4); Department of Homeland Security Delegation No. 14000. Subpart A—Introduction § 137.1 Purpose and applicability.
(a)In general under the Oil Pollution Act of 1990 (33 U.S.C. 2701, *et seq.* ), an owner or operator of a facility (as defined in § 137.10) that is the source of a discharge, or a substantial threat of discharge, of oil into the navigable waters or adjoining shorelines or the exclusive economic zone is liable for damages and removal costs resulting from the discharge or threat. However, if that person can demonstrate, among other criteria not addressed in this part, that they did not know and had no reason to know at the time of their acquisition of the real property on which the facility is located that oil was located on, in, or at the facility, the person may be eligible for the innocent landowner defense to liability under 33 U.S.C. 2703(d)(4). One element of the defense is that the person made all appropriate inquiries into the nature of the real property on which the facility is located before acquiring it. The purpose of this part is to prescribe standards and practices for making those inquiries.
(b)Under 33 U.S.C. 2703(d)(4)(E), this part does not apply to real property purchased by a non-governmental entity or non-commercial entity for residential use or other similar uses where a property inspection and a title search reveal no basis for further investigation. In those cases, the property inspection and title search satisfy the requirements of this part.
(c)This part does not affect the existing OPA 90 liability protections for State and local governments that acquire a property involuntarily in their functions as sovereigns under 33 U.S.C. 2703(d)(2)(B). Involuntary acquisition of properties by State and local governments fall under the provisions of 33 U.S.C. 2703(d)(2)(B), not under the all-appropriate-inquiries provision of 33 U.S.C. 2703(d)(4) and this part. § 137.5 Disclosure obligations.
(a)Under 33 U.S.C. 2703(c)(1), persons specified in § 137.1(a), including environmental professionals, must report the incident as required by law if they know or have reason to know of the incident.
(b)This part does not limit or expand disclosure obligations under any Federal, State, tribal, or local law. It is the obligation of each person, including environmental professionals, conducting inquiries to determine his or her respective disclosure obligations under Federal, State, tribal, and local law and to comply with them. § 137.10 How are terms used in this part defined?
(a)The following terms have the same definitions as in 33 U.S.C. 2701: “damages;” “discharge;” “incident;” “liable” or “liability;” “oil;” “owner or operator;” and “removal costs.”
(b)As used in this part— *Abandoned property* means a property that, because of its general disrepair or lack of activity, a reasonable person could believe that there is an intent on the part of the current owners to surrender their rights to the property. *Adjoining property* means real property the border of which is shared in part or in whole with that of the subject property or that would be shared in part or in whole with that of the property but for a street, road, or other public thoroughfare separating the properties. *Data gap* means a lack of, or inability to, obtain information required by subpart B of this part despite good faith efforts by the environmental professional or persons specified in § 137.1(a), as appropriate, to gather the information under § 137.33. *Environmental professional* means an individual who meets the requirements of § 137.25. *Facility* means any structure, group of structures, equipment, or device (other than a vessel) which is used for one or more of the following purposes: Exploring for, drilling for, producing, storing, handling, transferring, processing, or transporting oil. This term includes any motor vehicle, rolling stock, or pipeline used for one or more of these purposes. *Good faith* means the absence of any intention to seek an unfair advantage or to defraud another party; an honest and sincere intention to fulfill one's obligations in the conduct or transaction concerned. *Institutional controls* means non-engineered instruments, such as administrative and/or legal controls, that help to minimize the potential for human exposure to oil discharge and/or protect the integrity of a removal action. *Relevant experience* means participation in the performance of all-appropriate-inquiries investigations, environmental site assessments, or other site investigations that may include environmental analyses, investigations, and remediation which involve the understanding of surface and subsurface environmental conditions and the processes used to evaluate these conditions and for which professional judgment was used to develop opinions regarding conditions indicative of the presence or likely presence of oil at the facility and the real property on which the facility is located. § 137.15 References: Where can I get a copy of the publications mentioned in this part? Section 137.20 of this part refers to ASTM E 1527-05, Standard Practice for Environmental Site Assessments: Phase I Environmental Site Assessment Process. That document is available from ASTM International, 100 Barr Harbor Drive, P.O. Box C700, West Conshohocken, PA 19428-2959. It is also available for inspection at the Coast Guard National Pollution Funds Center, 4200 Wilson Boulevard, Suite 1013, Arlington, VA 22203-1804. Subpart B—Standards and Practices § 137.18 Duties of persons specified in § 137.1(a). In order to make all appropriate inquiries, persons seeking to establish the liability protection under § 137.1(a) must conduct the inquiries and investigations as required in this part and ensure that the inquiries and investigations required to be made by environmental professionals are made. § 137.20 May voluntary industry standards be used to comply with this regulation? The industry standards in ASTM E 1527-05, (Referenced in § 137.15) may be used to comply with the requirements set forth in §§ 137.45 through 137.85 of this part. § 137.25 Qualifications of the environmental professional.
(a)An environmental professional is an individual who possesses sufficient specific education, training, and experience necessary to exercise professional judgment to develop opinions and conclusions regarding conditions indicative of the presence or likely presence of oil at a facility and the real property on which the facility is located sufficient to meet the objectives and performance factors in § 137.30(a) and (b).
(1)Such a person must—
(i)Hold a current Professional Engineer's or Professional Geologist's license or registration from a State, tribe, or U.S. territory (or the Commonwealth of Puerto Rico) and have the equivalent of 3 years of full-time relevant experience;
(ii)Be licensed or certified by the Federal government, a State, tribe, or U.S. territory (or the Commonwealth of Puerto Rico) to perform environmental inquiries under § 137.35 and have the equivalent of 3 years of full-time relevant experience;
(iii)Have a Baccalaureate or higher degree from an accredited institution of higher education in a discipline of engineering or science and the equivalent of 5 years of full-time relevant experience; or
(iv)Have the equivalent of 10 years of full-time relevant experience.
(2)An environmental professional should remain current in his or her field through participation in continuing education or other activities.
(3)The requirements for an environmental professional in this section do not preempt State professional licensing or registration requirements, such as those for a professional geologist, engineer, or site-remediation professional. Before commencing work, a person should determine the applicability of State professional licensing or registration laws to the activities to be undertaken as part of an inquiry under § 137.35(b).
(4)A person who does not qualify as an environmental professional under this section may assist in the conduct of all appropriate inquiries according to this part if the person is under the supervision or responsible charge of an environmental professional meeting the requirements of this section when conducting the inquiries. § 137.30 Objectives and performance factors.
(a)*Objectives.* This part is intended to result in the identification of conditions indicative of the presence or likely presence of oil at the facility and the real property on which the facility is located. In order to meet the objectives of this regulation, persons specified in § 137.1(a) and the environmental professional must seek to identify, through the conduct of the standards and practices in this subpart, the following types of information about the facility and the real property on which the facility is located:
(1)Current and past uses and occupancies of the facility and the real property on which the facility is located.
(2)Current and past uses of oil.
(3)Waste management and disposal activities that indicate presence or likely presence of oil.
(4)Current and past corrective actions and response activities that indicate presence or likely presence of oil.
(5)Engineering controls.
(6)Institutional controls, such as zoning restrictions, building permits, and easements.
(7)Properties adjoining or located nearby the facility and the real property on which the facility is located that have environmental conditions that could have resulted in conditions indicative of the presence or likely presence of oil at the facility and the real property on which the facility is located.
(b)*Performance factors.* In order to meet this part and to meet the objectives stated in paragraph
(a)of this section, the persons specified in § 137.1(a) or the environmental professional (as appropriate to the particular standard and practice) must—
(1)Gather the information that is required for each standard and practice listed in this subpart that is publicly available, is obtainable from its source within a reasonable time and cost, and can be reviewed practicably; and
(2)Review and evaluate the thoroughness and reliability of the information gathered in complying with each standard and practice listed in this subpart taking into account information gathered in the course of complying with the other standards and practices of this part. § 137.33 General all appropriate inquiries requirements.
(a)All appropriate inquiries must be conducted within 1 year before the date of acquisition of the real property on which the facility is located, as evidenced by the date of receipt of the documentation transferring title to, or possession of, the real property and must include:
(1)An inquiry by an environmental professional, as provided in § 137.35.
(2)The collection of information under § 137.40 by persons specified in § 137.1(a).
(b)The following components of the all appropriate inquiries must be conducted or updated within 180 days before the date of acquisition of the real property on which the facility is located:
(1)Interviews with past and present owners, operators, and occupants. See § 137.45.
(2)Searches for recorded environmental cleanup liens. See § 137.55.
(3)Reviews of Federal, State, tribal, and local government records. See § 137.60.
(4)Visual inspections of the facility, the real property on which the facility is located, and adjoining properties. See § 137.65.
(5)The declaration by the environmental professional. See § 137.35(d).
(c)All appropriate inquiries may include the results of and information contained in an inquiry previously conducted by, or on behalf of, persons specified in § 137.1(a) who are responsible for the inquiries for the facility and the real property on which the facility is located if—
(1)The information was collected during the conduct of an all-appropriate-inquiries investigation under this part.
(2)The information was collected or updated within 1 year before the date of acquisition of the real property on which the facility is located.
(3)The following components of the inquiries were conducted or updated within 180 days before the date of acquisition of the real property on which the facility is located:
(i)Interviews with past and present owners, operators, and occupants. See § 137.45.
(ii)Searches for recorded environmental cleanup liens. See § 137.55.
(iii)Reviews of Federal, State, tribal, and local government records. See § 137.60.
(iv)Visual inspections of the facility, the real property on which the facility is located, and the adjoining properties. See § 137.65.
(v)The declaration by the environmental professional. See § 137.35(d).
(4)Previously collected information is updated by including relevant changes in the conditions of the facility and the real property on which the facility is located and specialized knowledge, as outlined in § 137.70, of the persons conducting the all appropriate inquiries for the facility and the real property on which the facility is located, including persons specified in § 137.1(a) and the environmental professional.
(d)All appropriate inquiries may include the results of an environmental professional's report under § 137.35(c) that have been prepared by or for other persons if—
(1)The reports meet the objectives and performance factors in § 137.30(a) and (b); and
(2)The person specified in § 137.1(a) reviews the information and conducts the additional inquiries under §§ 137.70, 137.75, and 137.80 and updates the inquiries requiring an update under paragraph
(b)of this section.
(e)To the extent there are data gaps that affect the ability of persons specified in § 137.1(a) and environmental professionals to identify conditions indicative of the presence or likely presence of oil, the gaps must be identified in the report under § 137.35(c)(2). In addition, the sources of information consulted to address data gaps should be identified and the significance of the gaps noted. Sampling and analysis may be conducted to develop information to address data gaps.
(f)Any conditions indicative of the presence or likely presence of oil identified as part of the all-appropriate-inquiries investigation should be noted in the report. § 137.35 Inquiries by an environmental professional.
(a)Inquiries by an environmental professional must be conducted either by the environmental professional or by a person under the supervision or responsible charge of an environmental professional.
(b)The inquiry of the environmental professional must include the requirements in §§ 137.45 (interviews with past and present owners), 137.50 (reviews of historical sources), 137.60 (reviews of government records), 137.65 (visual inspections), 137.80 (commonly known or reasonably ascertainable information) and 137.85 (degree of obviousness of the presence or likely presence of oil). In addition, the inquiry should take into account information provided to the environmental professional by the person specified in § 137.1(a) conducting the additional inquiries under § 137.40.
(c)The results of the inquiry by an environmental professional must be documented in a written report that, at a minimum, includes the following:
(1)An opinion as to whether the inquiry has identified conditions indicative of the presence or likely presence of oil at the facility and the real property on which the facility is located.
(2)An identification of data gaps in the information developed as part of the inquiry that affect the ability of the environmental professional to identify conditions indicative of the presence or likely presence of oil at the facility and the real property on which the facility is located. The report must also indicate whether the gaps prevented the environmental professional from reaching an opinion regarding the identification of conditions indicative of the presence or likely presence of oil.
(3)The qualifications of the environmental professional.
(4)An opinion regarding whether additional appropriate investigation is necessary.
(d)The environmental professional must place the following statements in the written document identified in paragraph
(c)of this section and sign the document: “[I, We] declare that, to the best of [my, our] professional knowledge, [I, we] meet the requirements under 33 CFR 137.25 for an environmental professional.” and “[I, We] have the specific qualifications based on education, training, and experience to assess the nature, history, and setting of a facility and the real property on which it is located. [I, We] have developed and conducted all appropriate inquiries according to the standards and practices in 33 CFR part 137.” § 137.40 Additional inquiries.
(a)Persons specified in § 137.1(a) must conduct inquiries in addition to those conducted by the environmental professional under § 137.35 and may provide the information associated with these additional inquiries to the environmental professional responsible for conducting the activities listed in § 137.35—
(1)As required by § 137.55 and if not otherwise obtained by the environmental professional, environmental cleanup liens against the facility and the real property on which it is located that are filed or recorded under Federal, State, tribal, or local law.
(2)As required by § 137.70, specialized knowledge or experience of the person specified in § 137.1(a).
(3)As required by § 137.75, the relationship of the purchase price to the fair market value of the facility and the real property on which the facility is located if the oil was not at the facility and the real property on which it is located.
(4)As required by § 137.80 and if not otherwise obtained by the environmental professional, commonly known or reasonably ascertainable information about the facility and the real property on which it is located. § 137.45 Interviews with past and present owners, operators, and occupants.
(a)Interviews with owners, operators, and occupants of the facility and the real property on which the facility is located must be conducted for the purposes of achieving the objectives and performance factors of § 137.30(a) and (b).
(b)The inquiry of the environmental professional must include interviewing the current owner and occupant of the facility and the real property on which the facility is located. If the facility and the real property on which the facility is located has multiple occupants, the inquiry of the environmental professional must include interviewing major occupants, as well as those occupants likely to use, store, treat, handle or dispose of oil or those who have likely done so in the past.
(c)The inquiry of the environmental professional also must include, to the extent necessary to achieve the objectives and performance factors in § 137.30(a) and (b), interviewing one or more of the following persons:
(1)Current and past facility and real property managers with relevant knowledge of uses and physical characteristics of the facility and the real property on which the facility is located.
(2)Past owners, occupants, or operators of the facility and the real property on which the facility is located.
(3)Employees of current and past occupants of the facility and the real property on which the facility is located.
(d)In the case of inquiries conducted at abandoned properties where there is evidence of potential unauthorized uses or evidence of uncontrolled access, the environmental professional's inquiry must include an interview of at least one owner or occupant of a neighboring property from which it appears possible that the owner or occupant of the neighboring property could have observed use or other presence or likely presence of oil. § 137.50 Reviews of historical sources of information.
(a)Historical documents and records must be reviewed for the purposes of achieving the objectives and performance factors of § 137.30(a) and (b). Historical documents and records may include, but are not limited to, aerial photographs, fire insurance maps, building department records, chain of title documents, and land use records.
(b)Historical documents and records reviewed must cover a period of time as far back in the history of the real property to when the first structure was built or when it was first used for residential, agricultural, commercial, industrial, or governmental purposes. The environmental professional may exercise professional judgment in context of the facts available at the time of the inquiry as to how far back in time it is necessary to search historical records. § 137.55 Searches for recorded environmental cleanup liens.
(a)All appropriate inquiries must include a search for the existence of environmental cleanup liens against the facility and the real property on which the facility is located that are filed or recorded under Federal, State, tribal, or local law.
(b)All information collected by persons specified in § 137.1(a) rather than an environmental professional regarding the existence of environmental cleanup liens associated with the facility and the real property on which the facility is located may be provided to the environmental professional or retained by the applicable party. § 137.60 Reviews of Federal, State, tribal, and local government records.
(a)Federal, State, tribal, and local government records or data bases of government records of the facility, the real property on which the facility is located, and adjoining properties must be reviewed for the purposes of achieving the objectives and performance factors of § 137.30(a) and (b).
(b)With regard to the facility and the property on which the facility is located, the review of Federal, State, and tribal government records or data bases of the government records and local government records and data bases of the records should include—
(1)Records of reported oil discharges present, including site investigation reports for the facility and the real property on which the facility is located;
(2)Records of activities, conditions, or incidents likely to cause or contribute to discharges or substantial threat of discharges of oil, including landfill and other disposal unit location records and permits, storage tank records and permits, hazardous waste handler and generator records and permits, federal, tribal and state government listings of sites identified as priority cleanup sites, and spill reporting records;
(3)Comprehensive Environmental Response, Compensation, and Liability Information System (CERCLIS) records;
(4)Public health records;
(5)Emergency Response Notification System records;
(6)Registries or publicly available lists of engineering controls; and
(7)Registries or publicly available lists of institutional controls, including environmental land use restrictions, applicable to the facility and the real property on which the facility is located.
(c)With regard to nearby or adjoining properties, the review of Federal, State, tribal, and local government records or databases of government records should include the identification of the following:
(1)Properties for which there are government records of reported discharges or substantial threat of discharges of oil. Such records or databases containing such records and the associated distances from the facility and the real property on which the facility is located for which such information should be searched include the following:
(i)Records of National Priorities List
(NPL)sites or tribal- and state-equivalent sites (one mile).
(ii)Resource Conservation and Recovery Act
(RCRA)properties subject to corrective action (one mile).
(iii)Records of Federally-registered, or State-permitted or registered, hazardous waste sites identified for investigation or remediation, such as sites enrolled in State and tribal voluntary cleanup programs and tribal- and State-listed brownfield sites (one-half mile).
(iv)Records of leaking underground storage tanks (one-half mile).
(2)Properties that previously were identified or regulated by a government entity due to environmental concerns at the facility and the real property on which the facility is located. The records or databases containing the records and the associated distances from the facility and the real property on which the facility is located for which the information should be searched include the following:
(i)Records of delisted NPL sites (one-half mile).
(ii)Registries or publicly available lists of engineering controls (one-half mile).
(iii)Records of former CERCLIS sites with no further remedial action notices (one-half mile).
(3)Properties for which there are records of Federally-permitted, State-permitted or -registered, or tribal-permitted or -registered waste management activities. The records or data bases that may contain the records include the following:
(i)Records of RCRA small quantity and large quantity generators (adjoining properties).
(ii)Records of Federally-permitted, State-permitted or -registered, or tribal-permitted landfills and solid waste management facilities (one-half mile).
(iii)Records of registered storage tanks (adjoining property).
(4)A review of additional government records with regard to sites identified under paragraphs (c)(1) through (c)(3) of this section may be necessary in the judgment of the environmental professional for the purpose of achieving the objectives and performance factors of §§ 137.30
(a)and (b).
(d)The search distance from the real property boundary for reviewing government records or databases of government records listed in paragraph
(c)of this section may be modified based upon the professional judgment of the environmental professional. The rationale for the modifications must be documented by the environmental professional. The environmental professional may consider one or more of the following factors in determining an alternate appropriate search distance—
(1)The nature and extent of a discharge.
(2)Geologic, hydrogeologic, or topographic conditions of the property and surrounding environment.
(3)Land use or development densities.
(4)The property type.
(5)Existing or past uses of surrounding properties.
(6)Potential migration pathways ( *e.g.* , groundwater flow direction, prevalent wind direction).
(7)Other relevant factors. § 137.65 Visual inspections of the facility, real property on which the facility is located, and adjoining properties.
(a)For the purpose of achieving the objectives and performance factors of § 137.30(a) and (b), the inquiry of the environmental professional must include the following:
(1)A visual on-site inspection of the facility and the real property on which the facility is located, and the improvements at the facility and real property, including a visual inspection of the areas where oil may be or may have been used, stored, treated, handled, or disposed. Physical limitations to the visual inspection must be noted.
(2)A visual inspection of adjoining properties, from the subject real property line, public rights-of-way, or other vantage point ( *e.g.* , aerial photography), including a visual inspection of areas where oil may be or may have been stored, treated, handled or disposed. A visual on-site inspection is recommended, though not required. Physical limitations to the inspection of adjacent properties must be noted.
(b)Except as in paragraph
(c)of this section, a visual on-site inspection of the facility and the real property on which the facility is located must be conducted.
(c)An on-site inspection is not required if an on-site visual inspection of the facility and the real property on which the facility is located cannot be performed because of physical limitations, remote and inaccessible location, or other inability to obtain access to the facility and the real property on which the facility is located after good faith efforts have been taken to obtain access. The mere refusal of a voluntary seller to provide access to the facility and the real property on which the facility is located is not justification for not conducting an on-site inspection. The inquiry of the environmental professional must include—
(1)Visually inspecting the facility and the real property on which the facility is located using another method, such as aerial imagery for large properties, or visually inspecting the facility and the real property on which the facility is located from the nearest accessible vantage point, such as the property line or public road for small properties;
(2)Documenting the efforts undertaken to obtain access and an explanation of why such efforts were unsuccessful; and
(3)Documenting other sources of information regarding the presence or likely presence of oil at the facility and the real property on which the facility is located that were consulted according to § 137.30(a). The documentation should include comments, if any, by the environmental professional on the significance of the failure to conduct a visual on-site inspection of the facility and the real property on which the facility is located with regard to the ability to identify conditions indicative of the presence or likely presence of oil at the facility and the real property. § 137.70 Specialized knowledge or experience on the part of persons specified in § 137.1(a).
(a)For the purpose of identifying conditions indicative of the presence or likely presence of oil at the facility and the real property on which the facility is located, persons specified in § 137.1(a) must take into account their own specialized knowledge of the facility and the real property on which the facility is located, the area surrounding the facility and the real property on which the facility is located, and the conditions of adjoining properties and their experience relevant to the inquiry.
(b)The results of all appropriate inquiries under § 137.33 must take into account the relevant and applicable specialized knowledge and experience of the persons specified in § 137.1(a) responsible for undertaking the inquiry. § 137.75 The relationship of the purchase price to the value of the facility and the real property on which the facility is located, if oil was not at the facility or on the real property.
(a)Persons specified in § 137.1(a) must consider whether the purchase price of the facility and the real property on which the facility is located reasonably reflects the fair market value of the facility and real property if oil was not present or likely present.
(b)If the persons conclude that the purchase price does not reasonably reflect the fair market value of that facility and real property if oil was not at the facility and the real property, they must consider whether or not the differential in purchase price and fair market value is due to the presence or likely presence of oil. § 137.80 Commonly known or reasonably ascertainable information about the facility and the real property on which the facility is located.
(a)Throughout the inquiries, persons specified in § 137.1(a) and environmental professionals conducting the inquiry must take into account commonly known or reasonably ascertainable information within the local community about the facility and the real property on which the facility is located and consider that information when seeking to identify conditions indicative of the presence or likely presence of oil at the facility and the real property.
(b)Commonly known information may include information obtained by the person specified in § 137.1(a) or by the environmental professional about the presence or likely presence of oil at the facility and the real property on which the facility is located that is incidental to the information obtained during the inquiry of the environmental professional.
(c)To the extent necessary to achieve the objectives and performance factors of § 137.30(a) and (b), the person specified in § 137.1(a) and the environmental professional must gather information from varied sources whose input either individually or taken together may provide commonly known or reasonably ascertainable information about the facility and the real property on which the facility is located; the environmental professional may refer to one or more of the following sources of information:
(1)Current owners or occupants of neighboring properties or properties adjacent to the facility and the real property on which the facility is located.
(2)Local and state government officials who may have knowledge of, or information related to, the facility and the real property on which the facility is located.
(3)Others with knowledge of the facility and the real property on which the facility is located.
(4)Other sources of information, such as newspapers, Web sites, community organizations, local libraries, and historical societies. § 137.85 The degree of obviousness of the presence or likely presence of oil at the facility and the real property on which the facility is located and the ability to detect the oil by appropriate investigation.
(a)Persons specified in § 137.1(a) and environmental professionals conducting an inquiry of a facility and the real property on which it is located on their behalf must take into account the information collected under §§ 137.45 through 137.80 in considering the degree of obviousness of the presence or likely presence of oil at the facility and the real property on which the facility is located.
(b)Persons specified in § 137.1(a) and environmental professionals conducting an inquiry of a facility and the property on which the facility is located on their behalf must take into account the information collected under §§ 137.45 through 137.80 in considering the ability to detect the presence or likely presence of oil by appropriate investigation. The report of the environmental professional should include an opinion under § 137.35(c)(4) regarding whether additional appropriate investigation is necessary. Dated: May 29, 2007. Thad W. Allen, Admiral, Commandant, United States Coast Guard. [FR Doc. E7-11110 Filed 6-11-07; 8:45 am] BILLING CODE 4910-15-P ENVIRONMENTAL PROTECTION AGENCY 40 CFR Parts 52 and 81 [EPA-R05-OAR-2007-0001; FRL-8326-4] Redesignation of the Toledo, Ohio Area to Attainment for the 8-Hour Ozone Standard AGENCY: Environmental Protection Agency (EPA). ACTION: Proposed rule. SUMMARY: The Ohio Environmental Protection Agency (Ohio EPA) submitted a request on December 22, 2006, and supplemented it on March 9, 2007, for redesignation of the Toledo, Ohio area which includes Lucas and Wood Counties to attainment for the 8-hour ozone standard. EPA is proposing to approve several elements associated with of this request. First, EPA is making a determination that complete, quality-assured ambient air quality data indicate that the Toledo area has attained the 8-hour ozone standard. Second, EPA is proposing to approve, as revisions to the Ohio State Implementation Plan (SIP), the State's plans for maintaining the 8-hour ozone NAAQS through 2018. Third, EPA is proposing to redesignate the Toledo area to attainment for the 8-hour ozone standard, based on a finding that the requirements for this redesignation have been satisfied. Fourth, EPA finds adequate and is proposing to approve the State's 2009 and 2018 Motor Vehicle Emission Budgets (MVEBs) for the Toledo area. DATES: Comments must be received on or before July 12, 2007. ADDRESSES: Submit your comments, identified by Docket ID No. EPA-R05-OAR-2007-0001, by one of the following methods: • *http://www.regulations.gov/* . Follow the on-line instructions for submitting comments. • *E-mail: mooney.john@epa.gov.* • *Fax:*
(312)886-5824. • *Mail:* John M. Mooney, Chief, Criteria Pollutant Section, Air Programs Branch, (AR-18J), U.S. Environmental Protection Agency, 77 West Jackson Boulevard, Chicago, Illinois 60604. • *Hand delivery:* John M. Mooney, Chief, Criteria Pollutant Section, Air Programs Branch, (AR-18J), U.S. Environmental Protection Agency, 77 West Jackson Boulevard, 18th floor, Chicago, Illinois 60604. Such deliveries are only accepted during the Regional Office normal hours of operation, and special arrangements should be made for deliveries of boxed information. The Regional Office official hours of business are Monday through Friday, 8:30 a.m. to 4:30 p.m. excluding Federal holidays. *Instructions:* Direct your comments to Docket ID No. EPA-R05-OAR-2007-0001. EPA's policy is that all comments received 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 information claimed to be Confidential Business Information
(CBI)or other information whose disclosure is restricted by statute. Do not submit information that you consider to be CBI or otherwise protected through *www.regulations.gov* or e-mail. The *www.regulations.gov* Web site is an “anonymous access” system, which means EPA will not know your identity or contact information unless you provide it in the body of your comment. If you send an e-mail comment directly to EPA without going through *www.regulations.gov* , your e-mail address will be automatically captured and included as part of the comment that is placed in the public docket and made available on the Internet. If you submit an electronic comment, EPA recommends that you include your name and other contact information in the body of your comment and with any disk or CD-ROM you submit. If EPA cannot read your comment due to technical difficulties and cannot contact you for clarification, EPA may not be able to consider your comment. Electronic files should avoid the use of special characters, any form of encryption, and be free of any defects or viruses. For additional instructions on submitting comments, go to Section I of the SUPPLEMENTARY INFORMATION section of this document. *Docket:* All documents in the docket are listed in the *www.regulations.gov* index. Although listed in the index, some information is not publicly available, *e.g.* , CBI or other information whose disclosure is restricted by statute. Certain other material, such as copyrighted material, will be publicly available only in hard copy. Publicly available docket materials are available either electronically in *www.regulations.gov* or in hard copy at the Environmental Protection Agency, Region 5, Air and Radiation Division, 77 West Jackson Boulevard, Chicago, Illinois 60604. This facility is open from 8:30 a.m. to 4:30 p.m., Monday through Friday, excluding legal holidays. We recommend that you telephone Michael Leslie, Environmental Engineer, at
(312)353-6680 before visiting the Region 5 office. FOR FURTHER INFORMATION CONTACT: Michael Leslie, Environmental Engineer, Criteria Pollutant Section, Air Programs Branch (AR-18J), Environmental Protection Agency, Region 5, 77 West Jackson Boulevard, Chicago, Illinois 60604,
(312)353-6680, *leslie.michael@epa.gov* . SUPPLEMENTARY INFORMATION: Throughout this document whenever “we,” “us,” or “our” is used, we mean EPA. This supplementary information section is arranged as follows: Table of Contents I. What Should I Consider as I Prepare My Comments for EPA? II. What Actions Is EPA Proposing To Take? III. What Is the Background for These Actions? IV. What Are the Criteria for Redesignation? V. Why Is EPA Proposing To Take These Actions? VI. What Is the Effect of These Actions? VII. What Is EPA's Analysis of the Request? A. Attainment Determination and Redesignation B. Adequacy of Ohio's Motor Vehicle Emissions Budgets VIII. What Actions Is EPA Taking Today? IX. Statutory and Executive Order Reviews. I. What Should I Consider as I Prepare My Comments for EPA? When submitting comments, remember to: 1. Identify the rulemaking by docket number and other identifying information (subject heading, **Federal Register** date and page number). 2. Follow directions—The EPA may ask you to respond to specific questions or organize comments by referencing a Code of Federal Regulations
(CFR)part or section number. 3. Explain why you agree or disagree; suggest alternatives and substitute language for your requested changes. 4. Describe any assumptions and provide any technical information and/or data that you used. 5. If you estimate potential costs or burdens, explain how you arrived at your estimate in sufficient detail to allow for it to be reproduced. 6. Provide specific examples to illustrate your concerns, and suggest alternatives. 7. Explain your views as clearly as possible, avoiding the use of profanity or personal threats. 8. Make sure to submit your comments by the comment period deadline identified. II. What Actions Is EPA Proposing To Take? EPA is proposing to take several related actions. EPA is proposing to determine that the Toledo nonattainment area has attained the 8-hour ozone standard. EPA is also proposing to approve Ohio's maintenance plan SIP revision for the Toledo area. The maintenance plan is designed to keep the Toledo nonattainment area in attainment of the ozone NAAQS through 2018. EPA is proposing that the Toledo area has met the requirements for redesignation under Section 107(d)(3)(E) of the Clean Air Act (CAA). EPA is thus proposing to approve Ohio's request to change the legal determination of Toledo area from nonattainment to attainment for the 8-hour ozone National Ambient Air Quality Standard (NAAQS). Finally, EPA is announcing its action on the Adequacy Process for the newly established 2009 and 2018 MVEBs for the area. The adequacy comment period for the 2009 and 2018 MVEBs began on March 6, 2007, with EPA's posting of the availability of these submittals on EPA's Adequacy Web site ( *http://www.epa.gov/otaq/stateresources/transconf/adequacy.htm* ). The adequacy comment period for these MVEBs ended on April 5, 2007. EPA did not receive any requests for these submittals or adverse comments on these submittals during the adequacy comment period. Therefore, we find adequate and are proposing to approve the State's 2009 and 2018 MVEBs for transportation conformity purposes. III. What Is the Background for These Actions? On December 22, 2006, Ohio requested that EPA redesignate the Toledo area to attainment for the 8-hour ozone standard. The request was supplemented on March 9, 2007. The redesignation request included three years of complete, quality-assured data for the periods of 2004 through 2006, indicating that the 8-hour NAAQS for ozone has been attained for the Toledo area. Under the CAA, nonattainment areas may be redesignated to attainment if sufficient complete, quality-assured data are available for the Administrator to determine that the area has attained the standard, and the area meets the other CAA redesignation requirements in section 107(d)(3)(E). A. General Background Information EPA has determined that ground-level ozone is detrimental to human health. On July 18, 1997, EPA promulgated an 8-hour ozone NAAQS of 0.08 parts per million parts of air (0.08 ppm) (80 parts per billion (ppb)) (62 FR 38856). This 8-hour ozone standard replaced a prior 1-hour ozone NAAQS, which had been promulgated on February 8, 1979 (44 FR 8202), and which was revoked on June 15, 2005 (69 FR 23858). Ground-level ozone is not emitted directly by sources. Rather, emitted NO <sup>X</sup> and VOC react in the presence of sunlight to form ground-level ozone along with other secondary compounds. NO <sup>X</sup> and VOC are referred to as “ozone precursors.” Control of ground-level ozone concentrations is achieved through controlling VOC and NO <sup>X</sup> emissions. The CAA required EPA to designate as nonattainment any area that violated the 8-hour ozone NAAQS. The **Federal Register** notice promulgating these designations and classifications was published on April 30, 2004 (69 FR 23857). The CAA contains two sets of provisions—subpart 1 and subpart 2—that address planning and emission control requirements for nonattainment areas. Both are found in title I, part D of the CAA. Subpart 1 contains general, less prescriptive requirements for all nonattainment areas for any pollutant governed by a NAAQS. Subpart 2 contains more specific requirements for certain ozone nonattainment areas, and applies to ozone nonattainment areas classified under section 181 of the CAA. In the April 30, 2004, designation rulemaking, EPA divided 8-hour ozone nonattainment areas into the categories of subpart 1 nonattainment (“basic” nonattainment) and subpart 2 nonattainment (“classified” nonattainment). EPA based this division on the area's 8-hour ozone design values (i.e., on the three-year averages of the annual fourth-highest daily maximum 8-hour ozone concentrations at the worst-case monitoring sites in the areas) and on their 1-hour ozone design values (i.e., on the fourth-highest daily maximum 1-hour ozone concentrations over the three-year period at the worst-case monitoring sites in the areas). EPA classified 8-hour ozone nonattainment areas with 1-hour ozone design values equaling or exceeding 121 ppb as subpart 2, classified nonattainment areas. EPA classified all other 8-hour nonattainment areas as subpart 1, basic nonattainment areas. The basis for area classification was explained in a separate April 30, 2004, final rule (the Phase 1 implementation rule) (69 FR 23951). Emission control requirements for classified nonattainment areas are linked to area classifications. Areas with more serious ozone pollution problems are subject to more prescribed requirements and later attainment dates. The prescribed emission control requirements are designed to bring areas into attainment by their specified attainment dates. In the April 30, 2004, ozone designation/classification rulemaking, EPA designated the Toledo area as a subpart 1 basic nonattainment area for the 8-hour ozone NAAQS. EPA based the designation on ozone data collected during the 2001-2003 period. On December 22, 2006, the State of Ohio requested redesignation of Toledo area to attainment of the 8-hour ozone NAAQS based on ozone data collected in this area counties from 2004-2006. B. What Is the Impact of the December 22, 2006, United States Court of Appeals Decision Regarding EPA's Phase 1 Implementation Rule? 1. Summary of Court Decision On December 22, 2006, the U.S. Court of Appeals for the District of Columbia Circuit vacated EPA's Phase 1 Implementation Rule for the 8-hour Ozone Standard. (69 FR 23951, April 30, 2004). South Coast Air Quality Management Dist. v. EPA, 472 F.3d 882 (D.C.Cir. 2006). The Court held that certain provisions of EPA's Phase 1 Rule were inconsistent with the requirements of the CAA. The Court rejected EPA's reasons for implementing the 8-hour standard in nonattainment areas under Subpart 1 in lieu of subpart 2 of Title I, part D of the Act. The Court also held that EPA improperly failed to retain four measures required for 1-hour nonattainment areas under the anti-backsliding provisions of the regulations:
(1)Nonattainment area New Source Review
(NSR)requirements based on an area's 1-hour nonattainment classification;
(2)Section 185 penalty fees for 1-hour severe or extreme nonattainment areas;
(3)measures to be implemented pursuant to section 172(c)(9) or 182(c)(9)of the Act, on the contingency of an area not making reasonable further progress toward attainment of the 1-hour NAAQS, or for failure to attain that NAAQS; and
(4)certain conformity requirements for certain types of Federal actions. The Court upheld EPA's authority to revoke the 1-hour standard provided there were adequate anti-backsliding provisions. This section sets forth EPA's views on the potential effect of the Court's ruling on this redesignation action. For the reasons set forth below, EPA does not believe that the Court's ruling alters any requirements relevant to this redesignation action so as to preclude redesignation, and does not prevent EPA from finalizing this redesignation. EPA believes that the Court's decision, as it currently stands, or as it may be modified based upon any petition for rehearing that has been filed, imposes no impediment to moving forward with redesignation of this area to attainment, because in either circumstance redesignation is appropriate under the relevant redesignation provisions of the Act and longstanding policies regarding redesignation requests. 2. Requirements Under the 8-Hour Standard With respect to the 8-hour standard, the Court's ruling rejected EPA's reasons for classifying areas under Subpart 1 for the 8-hour standard, and remanded that matter to the Agency. Consequently, it is possible that this area could, during a remand to EPA, be reclassified under Subpart 2. Although any future decision by EPA to classify this area under Subpart 2 might trigger additional future requirements for the area, EPA believes that this does not mean that redesignation cannot now go forward. This belief is based upon
(1)EPA's longstanding policy of evaluating State submissions in accordance with the requirements due at the time the request is submitted; and,
(2)consideration of the inequity of applying retroactively any future requirements. First, at the time the redesignation request was submitted, the Toledo area was classified under Subpart 1 and was obligated to meet Subpart 1 requirements. Under EPA's longstanding interpretation of section 107(d)(3)(E) of the CAA, to qualify for redesignation, states requesting redesignation to attainment must meet only the relevant SIP requirements that came due prior to the submittal of a complete redesignation request. September 4, 1992, Calcagni memorandum (“Procedures for Processing Requests to Redesignate Areas to Attainment,” Memorandum from John Calcagni, Director, Air Quality Management Division) See also Michael Shapiro Memorandum, September 17, 1993, and 60 FR 12459, 12465-66 (March 7, 1995) (Redesignation of Detroit-Ann Arbor). See *Sierra Club* v. *EPA* , 375 F.3d 537 (7th Cir. 2004), which upheld this interpretation. See, *e.g.* also 68 FR 25418, 25424, 25427 (May 12, 2003) (redesignation of St. Louis). Moreover, it would be inequitable to retroactively apply any new SIP requirements that were not applicable at the time the request was submitted. The D.C. Circuit has recognized the inequity in such retroactive rulemaking, See *Sierra Club* v. *Whitman* , 285 F. 3d 63 (D.C. Cir. 2002), in which the D.C. Circuit upheld a District Court's ruling refusing to make retroactive an EPA determination of nonattainment that was past the statutory due date. Such a determination would have resulted in the imposition of additional requirements on the area. The Court stated: “Although EPA failed to make the nonattainment determination within the statutory time frame, Sierra Club's proposed solution only makes the situation worse. Retroactive relief would likely impose large costs on the States, which would face fines and suits for not implementing air pollution prevention plans in 1997, even though they were not on notice at the time.” Id. at 68. Similarly here it would be unfair to penalize the area by applying to it for purposes of redesignation additional SIP requirements under Subpart 2 that were not in effect at the time it submitted its redesignation request. 3. Requirements Under the 1-Hour Standard With respect to the requirements under the 1-hour standard, the Toledo area was an attainment area subject to a CAA section 175A maintenance plan under the 1-hour standard. The Court's ruling does not impact redesignation requests for these types of areas. First, there are no conformity requirements that are relevant for redesignation requests for any standard, including the requirement to submit a transportation conformity SIP. Under longstanding EPA policy, EPA believes that it is reasonable to interpret the conformity SIP requirement as not applying for purposes of evaluating a redesignation request under section 107(d) because State conformity rules are still required after redesignation and Federal conformity rules apply where State rules have not been approved. 40 CFR 51.390. See *Wall* v. *EPA* , 265 F.3d 426 (6th Cir. 2001), upholding this interpretation. See also 60 FR 62748 (Dec. 7, 1995) (Tampa, FL redesignation). Federal transportation conformity regulations apply in all States prior to approval of transportation conformity SIPs. The Toledo, Ohio 1-hour ozone area was redesignated to attainment without approved State transportation conformity regulations because the Federal regulations were in effect in Ohio. When challenged, these 1-hour ozone redesignations, which were approved without State regulations, were upheld by the courts. See *Wall* v. *EPA* , 265 F.3d 426 (6th Cir. 2001). See also 60 FR 62748 (December 7, 1995) (Tampa, Florida). Although Ohio does not have approved State transportation conformity regulations, it has developed memoranda of understanding, signed by all parties involved in conformity, to address conformity consultation procedures. The Federal transportation conformity regulations, which apply in Ohio, require the approved 1-hour ozone budgets to be used for transportation conformity purposes prior to 8-hour ozone budgets being approved. Second, with respect to the three other anti-backsliding provisions for the 1-hour standard that the Court found were not properly retained, the Toledo area is an attainment area subject to a maintenance plan for the 1-hour standard, and the NSR, contingency measure (pursuant to section 172(c)(9) or 182(c)(9)) and fee provision requirements no longer apply to an area that has been redesignated to attainment of the 1-hour standard. Thus, the decision in South Coast should not alter requirements that would preclude EPA from finalizing the redesignation of this area. IV. What Are the Criteria for Redesignation? Section 107(d)(3)(E) of the CAA allows for redesignation from nonattainment to attainment provided that:
(1)The Administrator determines that the area has attained the applicable NAAQS;
(2)the Administrator has fully approved the applicable implementation plan for the area under section 110(k);
(3)the Administrator determines that the improvement in air quality is due to permanent and enforceable reductions in emissions resulting from implementation of the applicable SIP and applicable Federal air pollutant control regulations and other permanent and enforceable reductions;
(4)the Administrator has fully approved a maintenance plan for the area as meeting the requirements of section 175A; and,
(5)the State containing such area has met all requirements applicable to the area under section 110 and part D. EPA provided guidance on redesignation in the General Preamble for the Implementation of Title I of the CAA Amendments of 1990, on April 16, 1992 (57 FR 13498), and supplemented this guidance on April 28, 1992 (57 FR 18070). EPA has provided further guidance on processing redesignation requests in several guidance documents. A listing of pertinent documents is provided in other redesignation actions including a September 9, 2005 notice; 70 FR 53606. V. Why Is EPA Proposing To Take These Actions? On December 22, 2006, Ohio requested redesignation of the Toledo area to attainment for the 8-hour ozone standard. EPA believes that the area has attained the standard and has met the requirements for redesignation set forth in section 107(d)(3)(E) of the CAA. VI. What Is the Effect of These Actions? Approval of the redesignation request would change the official designation of the Toledo area for the 8-hour ozone NAAQS found at 40 CFR part 81. It would also incorporate into the Ohio SIP a plan for maintaining the 8-hour ozone NAAQS through 2018. The maintenance plans include contingency measures to remedy future violations of the 8-hour NAAQS. The maintenance plan also established MVEBs for the years 2009 and 2018. Motor Vehicle Emissions Budgets for the Toledo, Ohio Area Year VOC (tons/day) NO <sup>X</sup> (tons/day) 2009 18.99 33.75 2018 11.20 14.11 These proposed actions pertain to the designation of the Toledo area for the 8-hour ozone NAAQS and to the emission controls in the area related to the attainment and maintenance of the 8-hour ozone NAAQS. If you own or operate a VOC or NO <sup>X</sup> emissions source in this area or live in this area, this proposed rule may impact or apply to you. It may also impact you if you are involved in transportation planning or implementation of emission controls in this area. Finally, it may also impact you if you breathe the air in the Toledo area or the air which has passed through this Toledo area, or if you are concerned with clean air, human health or the environment. VII. What Is EPA's Analysis of the Request? A. Attainment Determination and Redesignation EPA is proposing to make a determination that the Toledo area has attained the 8-hour ozone standard and that the Toledo area has met all other applicable section 107(d)(3)(E) redesignation criteria. The basis for EPA's determinations is as follows: 1. The Area Has Attained the 8-Hour Ozone NAAQS, (Section 107(d)(3)(E)(i)) EPA is proposing to make the determination that the Toledo area has attained the 8-hour ozone NAAQS. For ozone, an area may be considered to be attaining the 8-hour ozone NAAQS if there are no violations, as determined in accordance with 40 CFR 50.10 and Part 50, Appendix I, based on three complete, consecutive calendar years of quality-assured air quality monitoring data. For each monitor in the area, EPA computes the average of the fourth-highest daily maximum 8-hour average ozone concentrations from each of the three most recent years. The area is attaining the standard if all monitors have average concentrations at or below 0.08 ppm. Based on the rounding convention described in 40 CFR Part 50, Appendix I, the standard is attained if the design value is 0.084 ppm or below. The data must be collected and quality-assured in accordance with 40 CFR part 58, and recorded in the Aerometric Information Retrieval System (AIRS). The monitors generally should have remained at the same location for the duration of the monitoring period required for demonstrating attainment. Ohio submitted 2004-2006 ozone monitoring data for the Toledo area. The Ohio EPA quality assured the ambient monitoring data in accordance with 40 CFR 58.10, and recorded it in the AIRS database, thus making the data publicly available. The data meet the completeness criteria in 40 CFR 50, Appendix I, which requires a minimum completeness of 75 percent annually and 90 percent over each three year period. A summary of the monitoring data is presented in Table 1 below. Table 1.—Annual 4th High Daily Maximum 8-Hour Ozone Concentration and 3-Year Averages of 4th High Daily Maximum 8-Hour Ozone Concentrations Site ID County 2003 4th high
(ppm)2005 4th high
(ppm)2006 4th high
(ppm)2004-2006 average
(ppm)39-095-0024 Lucas 67 80 75 74 39-095-0027 Lucas 74 84 69 75 39-095-0034 Lucas 78 87 74 79 39-095-0081 Lucas 78 87 74 79 39-73-0003 Wood 76 84 73 77 In addition, as discussed below with respect to the maintenance plans, Ohio has committed to continue operating an EPA-approved monitoring network in accordance with 40 CFR part 58. In summary, EPA finds that the data submitted by Ohio provide an adequate demonstration that the Toledo area has attained the 8-hour ozone NAAQS. 2. The Area Has Met All Applicable Requirements Under Section 110 and Part D; and the Area Has a Fully Approved SIP Under Section 110(k) (Sections 107(d)(3)(E)(v) and 107(d)(3)(E)(ii)) We have determined that Ohio has met all currently applicable SIP requirements for purposes of redesignation for the Toledo area under Section 110 of the CAA (general SIP requirements). We have also determined that the Ohio SIP meets all SIP requirements currently applicable for purposes of redesignation under Part D of Title I of the CAA (requirements specific to Subpart 1 nonattainment areas), in accordance with section 107(d)(3)(E)(v). In addition, we have determined that the SIP is fully approved with respect to all applicable requirements for purposes of redesignation, in accordance with section 107(d)(3)(E)(ii). In making these determinations, we have ascertained what SIP requirements are applicable to the area for purposes of redesignation, and have determined that the portions of the SIP meeting these requirements are fully approved under section 110(k) of the CAA. As discussed more fully below, SIPs must be fully approved only with respect to currently applicable requirements of the CAA. a. Toledo, Ohio Has Met All Applicable Requirements Under Section 110 and Part D of the CAA The September 4, 1992, Calcagni memorandum (see “Procedures for Processing Requests to Redesignate Areas to Attainment,” Memorandum from John Calcagni, Director, Air Quality Management Division, September 4, 1992) describes EPA's interpretation of section 107(d)(3)(E) of the CAA. Under this interpretation, a State, and the area it wishes to redesignate, must meet the relevant CAA requirements that are due prior to the State's submittal of a complete redesignation request for the area. See also the September 17, 1993 Michael Shapiro memorandum and 60 FR 12459, 12465-66 (March 7, 1995) (redesignation of Detroit-Ann Arbor, Michigan to attainment of the 1-hour ozone NAAQS). Applicable requirements of the CAA that come due subsequent to the State's submittal of a complete request remain applicable until a redesignation to attainment is approved, but are not required as a prerequisite to redesignation. See section 175A(c) of the CAA. *Sierra Club* v. *EPA* , 375 F.3d 537 (7th Cir. 2004). See also 68 FR 25424, 25427 (May 12, 2003) (redesignation of the St. Louis/East St. Louis area to attainment of the 1-hour ozone NAAQS). *General SIP requirements.* Section 110(a) of title I of the CAA contains the general requirements for a SIP. Section 110(a)(2) provides that the implementation plan submitted by a State must have been adopted by the State after reasonable public notice and hearing, and that, among other things, it includes enforceable emission limitations and other control measures, means or techniques necessary to meet the requirements of the CAA; provides for establishment and operation of appropriate devices, methods, systems and procedures necessary to monitor ambient air quality; provides for implementation of a source permit program to regulate the modification and construction of any stationary source within the areas covered by the plan; includes provisions for the implementation of part C, Prevention of Significant Deterioration
(PSD)and part D, New Source Review
(NSR)permit programs; includes criteria for stationary source emission control measures, monitoring, and reporting; includes provisions for air quality modeling; and provides for public and local agency participation in planning and emission control rule development. Section 110(a)(2)(D) of the CAA requires that SIPs contain measures to prevent sources in a State from significantly contributing to air quality problems in another State. To implement this provision, EPA has required certain States to establish programs to address transport of air pollutants (NO <sup>X</sup> SIP Call (63 FR 57356), Clean Air Interstate Rule
(CAIR)(70 FR 25162)). However, the section 110(a)(2)(D) requirements for a State are not linked with a particular nonattainment area's designation and classification. EPA believes that the requirements linked with a particular nonattainment area's designation and classifications are the relevant measures to evaluate in reviewing a redesignation request. When the transport SIP submittal requirements are applicable to a State, they will continue to apply to the State regardless of the attainment designation of any one particular area in the State. Therefore, we believe that these requirements should not be construed to be applicable requirements for purposes of redesignation. Further, we believe that the other section 110 elements described above that are not connected with nonattainment plan submissions and not linked with an area's attainment status are also not applicable requirements for purposes of redesignation. A State remains subject to these requirements after an area is redesignated to attainment. We conclude that only the section 110 and part D requirements which are linked with a particular area's designation and classification are the relevant measures which we may consider in evaluating a redesignation request. This approach is consistent with EPA's existing policy on applicability of conformity and oxygenated fuels requirements for redesignation purposes, as well as with section 184 ozone transport requirements. See Reading, Pennsylvania, proposed and final rulemakings (61 FR 53174-53176, October 10, 1996), (62 FR 24826, May 7, 1997); Cleveland-Akron-Lorain, Ohio, final rulemaking (61 FR 20458, May 7, 1996); and Tampa, Florida, final rulemaking (60 FR 62748, December 7, 1995). See also the discussion on this issue in the Cincinnati ozone redesignation (65 FR 37890, June 19, 2000), and in the Pittsburgh ozone redesignation (66 FR 50399, October 19, 2001). As discussed above, we believe that section 110 elements which are not linked to the area's nonattainment status are not applicable for purposes of redesignation. Because there are no section 110 requirements linked to the part D requirements for 8-hour ozone nonattainment areas that have become due, as explained below, there are no Part D requirements applicable for purposes of redesignation under the 8-hour standard. *Part D Requirements.* EPA has determined that the Ohio SIP meets applicable SIP requirements under part D of the CAA, since no requirements applicable for purposes of redesignation became due for the 8-hour ozone standard prior to Ohio's submission of the redesignation request for The Toledo area. Under part D, an area's classification determines the requirements to which it will be subject. Subpart 1 of part D, found in sections 172-176 of the CAA, sets forth the basic nonattainment requirements applicable to all nonattainment areas. Section 182 of the CAA, found in subpart 2 of part D, establishes additional specific requirements depending on the area's nonattainment classification. Toledo, Ohio, was classified as a subpart 1 nonattainment area, and, therefore, subpart 2 requirements do not apply. *Part D, Subpart 1 applicable SIP requirements.* For purposes of evaluating these redesignation requests, the applicable part D, subpart 1 SIP requirements for the Toledo area are contained in sections 172(c)(1)-(9). No 8-hour ozone planning requirements applicable for purposes of redesignation under part D became due prior to submission of the redesignation request, and, therefore, none are applicable to the area for purposes of redesignation. Since Ohio has submitted a complete ozone redesignation request for the Toledo area prior to the deadline for any submissions required for purposes of redesignation, we have determined that these requirements do not apply to the Toledo area for purposes of redesignation. *Section 176 conformity requirements.* Section 176(c) of the CAA requires States to establish criteria and procedures to ensure that Federally-supported or funded activities, including highway projects, conform to the air quality planning goals in the applicable SIPs. The requirement to determine conformity applies to transportation plans, programs and projects developed, funded or approved under Title 23 of the U.S. Code and the Federal Transit Act (transportation conformity) as well as to all other Federally-supported or funded projects (general conformity). State conformity revisions must be consistent with Federal conformity regulations relating to consultation, enforcement and enforceability, which EPA promulgated pursuant to CAA requirements. EPA approved Ohio's general and transportation conformity SIPs on March 11, 1996 (61 FR 9646) and May 30, 2000 (65 FR 34395), respectively. In summary, the Toledo area has satisfied all applicable requirements under section 110 and part D of the CAA. b. Toledo Has a Fully Approved Applicable SIP Under Section 110(k) of the CAA. EPA has fully approved the Ohio SIP for the Toledo area under section 110(k) of the CAA for all requirements applicable for purposes of redesignation. In approving a redesignation request, EPA may rely on prior SIP approvals plus any additional measures it may approve in conjunction with a redesignation action (See the September 4, 1992 John Calcagni memorandum, page 3, *Southwestern Pennsylvania Growth Alliance* v. *Browner,* 144 F.3d 984, 989-990 (6th Cir. 1998), *Wall* v. *EPA,* 265 F.3d 426 (6th Cir. 2001)). Since the passage of the CAA of 1970, Ohio has adopted and submitted, and EPA has fully approved, provisions addressing the various required SIP elements applicable to the Toledo area under the 1-hour ozone standard. No Toledo area SIP provisions are currently disapproved, conditionally approved, or partially approved. 3. The Improvement in Air Quality Is Due to Permanent and Enforceable Reductions in Emissions (Section 107(d)(3)(E)(iii)) EPA finds that Ohio has demonstrated that the observed air quality improvement in the Toledo area is due to permanent and enforceable reductions in emissions resulting from implementation of the SIP, Federal measures, and other State-adopted measures. In making this demonstration, the State has calculated the change in emissions between 2002 and 2004, one of the years on which the Toledo area monitored attainment. The reduction in emissions and the corresponding improvement in air quality over this time period can be attributed to a number of regulatory control measures that Ohio has implemented. a. Permanent and Enforceable Controls Implemented. The following is a discussion of permanent and enforceable measures that have been implemented in the area: *NO* X *rules.* In compliance with EPA's NO <sup>X</sup> SIP call, Ohio developed rules to control NO <sup>X</sup> emissions from Electric Generating Units (EGUs), major non-EGU industrial boilers, and major cement kilns. These rules required sources to begin reducing NO <sup>X</sup> emissions in 2004. However, statewide NO <sup>X</sup> emissions actually had begun to decline before 2004, as sources phased in emission controls needed to comply with the State's NO <sup>X</sup> emission control regulations. From 2004 on, NO <sup>X</sup> emissions from EGUs in the Eastern United States have been capped at a level well below pre-2002 levels, such that EGU emissions in the Toledo area, and elsewhere in Ohio, can be expected to remain well below 2002 levels. Ohio expects that NO <sup>X</sup> emissions will further decline as the State meets the requirements of EPA's Phase II NO <sup>X</sup> SIP call (69 FR 21604 (April 21, 2004)). *Federal Emission Control Measures.* Reductions in VOC and NO <sup>X</sup> emissions have occurred statewide as a result of Federal emission control measures, with additional emission reductions expected to occur in the future as the State implements additional emission controls. Federal emission control measures include: Tier 2 emission standards for vehicles, gasoline sulfur limits, low sulfur diesel fuel standards, and heavy-duty diesel engine standards. In addition, in 2004, EPA issued the Clean Air Non-road Diesel Rule (69 FR 38958 (July 29, 2004)). EPA expects this rule to reduce off-road diesel emissions through 2010, with emission reductions starting in 2008. b. Emission Reductions Ohio is using 2002 for the nonattainment inventory and included area, mobile and point source emissions. Area sources were taken from the Ohio 2002 periodic inventory submitted to EPA. These projections were made from the United States Department of Commerce Bureau of Economic Analysis growth factors, with some updated local information. Mobile source emissions were calculated from MOBILE6.2 produced emission factors. Non-road emissions were generated using the EPA's National Mobile Inventory Model
(NMIM)2002 application. Point source information was compiled from Ohio's 2002 annual emission inventory database and the 2002 EPA Clean Air Markets Acid Rain database. Based on the inventories described above, Ohio's submittal documents changes in VOC and NO <sup>X</sup> emissions from 2002 to 2004. Summaries of emissions data are shown in Tables 2 through 4. Table 2.—The Toledo, Ohio Area: Total VOC and NO <sup>X</sup> Emissions for Nonattainment Year 2002 (Tons/Day) Sector Lucas county Wood county Total VOC NO <sup>X</sup> VOC NO <sup>X</sup> VOC NO <sup>X</sup> Point 7.65 38.88 0.95 3.23 8.60 42.11 Area 22.71 0.97 7.91 0.64 30.62 1.61 Non-Road Mobile 8.49 16.80 2.86 10.06 11.35 26.86 On-Road Mobile 19.77 31.51 9.93 18.73 29.70 50.24 Toledo Area Total 80.27 120.82 Table 3.—The Toledo, Ohio Area Total VOC and NO <sup>X</sup> Emissions for Attainment Year 2004 (Tons/Day) Lucas VOC NO <sup>X</sup> Wood VOC NO <sup>X</sup> Total VOC NO <sup>X</sup> Point 7.44 35.54 0.91 3.23 8.35 38.77 Area 22.71 1.03 7.43 0.67 30.55 1.7 Nonroad 7.66 15.68 2.65 9.14 10.31 24.82 Onroad 16.57 27.05 8.41 16.26 24.98 43.31 Total 74.19 108.6 Table 4.—The Toledo Area, Ohio: Comparison of 2002 and 2004 VOC and NO <sup>X</sup> Emissions (Tons/Day) VOC Sector 2002 2004 Net change (2002-2004) NO <sup>X</sup> 2002 2004 Net change (2002-2004) Point 8.6 8.35 −0.25 42.11 38.77 −3.34 Area 30.62 30.55 −0.07 1.61 1.7 0.09 Nonroad 11.35 10.31 −1.04 26.86 24.82 −2.04 Onroad 29.7 24.98 −4.72 50.24 43.31 −6.93 Total 80.27 74.19 −6.08 120.82 108.6 −12.22 Table 4 shows that the area reduced VOC emissions by 6.08 tons/day, and NO <sup>X</sup> emissions by 12.22 tons/day, between 2002 and 2004. Based on the information summarized above, Ohio has adequately demonstrated that the improvement in air quality is due to permanent and enforceable emissions reductions. 4. The Area Has a Fully Approved Maintenance Plan Pursuant to Section 175a of the CAA (Section 107(d)(3)(E)(iv)) In conjunction with its request to redesignate the Toledo area to attainment status, Ohio submitted SIP revisions to provide for the maintenance of the 8-hour ozone NAAQS in this area through 2018. a. What is required in a maintenance plan? Section 175A of the CAA sets forth the required elements of a maintenance plan for areas seeking redesignation from nonattainment to attainment. Under section 175A, the plan must demonstrate continued attainment of the applicable NAAQS for at least ten years after the Administrator approves a redesignation to attainment. Eight years after the redesignation, the State must submit a revised maintenance plan which demonstrates that attainment will continue to be maintained for ten years following the initial ten-year maintenance period. To address the possibility of future NAAQS violations, the maintenance plan must contain contingency measures with a schedule for implementation as EPA deems necessary to assure prompt correction of any future 8-hour ozone violations. The September 4, 1992, John Calcagni memorandum provides additional guidance on the content of a maintenance plan. The memorandum clarifies that an ozone maintenance plan should address the following items: The attainment VOC and NO <sup>X</sup> emissions inventories, a maintenance demonstration showing maintenance for the ten years of the maintenance period, a commitment to maintain the existing monitoring network, factors and procedures to be used for verification of continued attainment of the NAAQS, and a contingency plan to prevent or correct future violations of the NAAQS. b. Attainment Inventory Ohio developed a baseline emissions inventory for 2004, one of the years used to demonstrate monitored attainment of the 8-hour NAAQS. The attainment level of emissions is summarized in Table 5, below. Table 5.—The Toledo, Ohio Area, Total VOC and NO <sup>X</sup> Emissions for Attainment Year 2004 (Tons/Day) Lucas VOC NO <sup>X</sup> Wood VOC NO <sup>X</sup> Total VOC NO <sup>X</sup> Point 7.44 35.54 0.91 3.23 8.35 38.77 Area 22.78 1.03 7.77 0.67 30.55 1.70 Nonroad 7.66 15.68 2.65 9.14 10.31 24.82 Onroad 16.57 27.05 8.41 16.26 24.98 43.31 Total 74.19 108.60 c. Demonstration of Maintenance Ohio submitted revisions to the 8-hour ozone SIP to include 11-year maintenance plans for the Toledo area, in compliance with section 175A of the CAA. This demonstration shows maintenance of the 8-hour ozone standard by assuring that current and future emissions of VOC and NO <sup>X</sup> area remain at or below attainment year emission levels. A maintenance demonstration need not be based on modeling. See *Wall* v. *EPA,* 265 F.3d 426 (6th Cir. 2001), *Sierra Club* v. *EPA,* 375 F. 3d 537 (7th Cir. 2004). See also 66 FR 53094, 53099-53100 (October 19, 2001), 68 FR 25413, 25430-25432 (May 12, 2003). Ohio is using projected inventories for the years 2009 and 2018. These emission estimates are presented in Table 6. Table 6.—The Toledo, Ohio Area: Comparison of 2004-2018 VOC and NO <sup>X</sup> Emissions (Tons/Day) Sector VOC 2004 2009 2018 Net change 2004-2018 NO <sup>X</sup> 2004 2009 2018 Net change 2004-2018 Point 8.35 7.81 8.64 0.29 38.77 30.35 16.03 −22.74 Area 30.55 30.4 32.6 2.05 1.7 1.91 1.97 0.27 Nonroad 10.31 7.78 6.55 −3.76 24.82 19.76 14.91 −9.91 Onroad 24.98 16.51 9.74 −15.24 43.31 29.35 12.27 −31.04 Total 74.19 62.50 57.53 −16.66 108.6 81.37 45.18 −63.42 The emission projections show that Ohio does not expect emissions in the area to exceed the level of the 2004 attainment year inventory during the maintenance period. In the area, Ohio projects that VOC and NO <sup>X</sup> emissions will decrease by 16.66 tons/day and 63.42 tons/day, respectively. As part of its maintenance plan, the State elected to include a “safety margin” for the area. A “safety margin” is the difference between the attainment level of emissions (from all sources) and the projected level of emissions (from all sources) in the maintenance plan which continues to demonstrate attainment of the standard. The attainment level of emissions is the level of emissions during one of the years in which the area met the NAAQS. Ohio used 2004 as the attainment level of emissions for the area. In the maintenance plan, Ohio projected emission levels for 2018. The emissions from point, area, non-road, and mobile sources in 2004 equaled 74.19 tons/day of VOC and 108.6 tons/day of NO <sup>X</sup> . Ohio projected VOC emissions for the year 2018 to be 57.63 tons/day of VOC and 45.18 tons/day of NO <sup>X</sup> . The safety margin is calculated to be the difference between these amounts or, in this case, 16.66 tons/day of VOC and 63.42 tons/day of NO <sup>X</sup> for 2018. The safety margin, or a portion thereof, can be allocated to any of the source categories, as long as the total attainment level of emissions is maintained. Ohio EPA allocated 1.46 tons/day of VOC and 1.84 tons/day of NO <sup>X</sup> to the MVEB. The SIP submission demonstrates that the area will continue to maintain the standard because emission will continue to be below the attainment level. d. Monitoring Network Ohio currently operates five ozone monitors in The Toledo area. Ohio has committed to continue operating and maintaining their approved ozone monitor network in accordance with 40 CFR part 58. e. Verification of Continued Attainment Continued attainment of the ozone NAAQS in the area depends, in part, on the State's efforts toward tracking indicators of continued attainment during the maintenance period. The State's plan for verifying continued attainment of the 8-hour standard in the area consists of plans to continue ambient ozone monitoring in accordance with the requirements of 40 CFR part 58. In addition, Ohio will periodically review and revise the VOC and NO <sup>X</sup> emissions inventories for the area, as required by the Consolidated Emissions Reporting Rule (40 CFR part 51), to track levels of emissions in the future. f. Contingency Plan The contingency plan provisions of the CAA are designed to result in prompt correction or prevention of violations of the NAAQS that might occur after redesignation of an area to attainment of the NAAQS. Section 175A of the CAA requires that a maintenance plan include such contingency measures as EPA deems necessary to assure that the State will promptly correct a violation of the NAAQS that might occur after redesignation. The maintenance plan must identify the contingency measures to be considered for possible adoption, a schedule and procedure for adoption and implementation of the selected contingency measures, and a time limit for action by the State. The State should also identify specific indicators to be used to determine when the contingency measures need to be adopted and implemented. The maintenance plan must include a requirement that the State will implement all measures with respect to control of the pollutant(s) that were included in the SIP before the redesignation of the area to attainment. See section 175A(d) of the CAA. As required by section 175A of the CAA, Ohio has adopted a contingency plan to address possible future ozone air quality issues. The contingency plan has two levels of actions/responses depending on whether a violation of the 8-hour ozone standard is only threatened (Warning Level Response) or has actually occurred or appears to be very imminent (Action Level Response). A Warning Level Response will be triggered whenever an annual (1-year) fourth-high monitored 8-hour ozone concentration of 88 ppb occurs within the ozone maintenance area (Toledo area). A Warning Level Response will consist of a study to determine whether the ozone value indicates a trend toward higher ozone concentrations or whether emissions appear to be increasing. The study will evaluate whether the trend, if any, is likely to continue and, if so, the control measures necessary to reverse the trend, taking into consideration ease and timing for implementation, as well as economic and social consideration. Implementation of necessary controls in response to a Warning Level Response triggering will take place as expeditiously as possible, but in no event later than 12 months from the conclusion of the most recent ozone season. An Action Level Response will be triggered whenever a two-year average annual fourth-high monitored 8-hour ozone concentration of 85 ppb or greater occurs within the maintenance area (Toledo area). A violation of the 8-hour ozone standard (three-year average fourth-high value of 85 ppb or greater) will also prompt an Action Level Response. In the event that an Action Level Response is triggered and is not due to an exceptional event, malfunction, or noncompliance with a source permit condition or rule requirement, Ohio will determine the additional emission control measures needed to assure future attainment of the ozone NAAQS. Emission control measures that can be implemented in a short time will be selected in order to be in place within 18 months from the close of the ozone season that prompted the Action Level Response. Any new emission control measure that is selected for implementation will be given a public review. If a new emission control measure is already promulgated and scheduled to be implemented at the Federal or State level and that emission control measure is determined to be sufficient to address the increase in peak ozone concentrations, additional local measures may be unnecessary. Ohio will submit to the EPA an analysis to assess whether the proposed emission control measures are adequate to reverse the increase in peak ozone concentrations and to maintain the 8-hour ozone standard in the area. The selection of emission control measures will be based on cost-effectiveness, emission reduction potential, economic and social considerations, or other factors that Ohio deems to be appropriate. Selected emission control measures will be subject to public review and the State will seek public input prior to selecting new emission control measures. The State's ozone redesignation request lists the following possible emission control measures as contingency measures in the ozone maintenance portion of the State's submittal: i. Lower Reid vapor pressure gasoline requirements; ii. Tighten RACT on existing source covered by USEPA Control Techniques Guidelines issued in response to the 1990 CAA; iii. Apply RACT to smaller existing sources; iv. One or more transportation control measures sufficient to achieve at least half a percent reduction in actual area wide VOC emissions. Transportation measures will be selected from the following, based upon the factors listed above after consultation with affected local governments: a. Trip reduction programs, including, but not limited to, employer-based transportation management plans, area wide rideshare programs, work schedule changes, and telecommuting; b. Traffic flow and transit improvements; and c. Other new or innovative transportation measures not yet in widespread use that affects State and local governments deemed appropriate. v. Alternative fuel and diesel retrofit programs for fleet vehicle operations. vi. Controls on consumer products consistent with those adopted elsewhere in the United States. vii. Require VOC and NO <sup>X</sup> emissions offsets for new and modified major sources. viii. Require VOC or NO <sup>X</sup> emission offsets for new or modified minor sources. ix. Increase the ratio of emission offsets required for new sources. x. Require VOC or NO <sup>X</sup> controls on new minor sources (less than 100 tons). g. Provisions for Future Updates of the Ozone Maintenance Plan. As required by section 175A(b) of the CAA, Ohio commits to submit to the EPA updated ozone maintenance plans eight years after redesignation to cover an additional 10-year period beyond the initial 10-year maintenance period. Ohio has committed to retain the control measures for VOC and NO <sup>X</sup> emissions that were contained in the SIP before redesignation of the area to attainment, as required by section 175(A) of the CAA. EPA proposes that the maintenance plan adequately addresses the five basic components of a maintenance plan: Attainment inventory, maintenance demonstration, monitoring network, verification of continued attainment, and a contingency plan. B. Adequacy of Ohio's Motor Vehicle Emissions Budgets (MVEBs) 1. How Are MVEBs Developed and What Are the MVEBs for the Area? Under the CAA, States are required to submit, at various times, control strategy SIP revisions and ozone maintenance plans for ozone nonattainment areas and for areas seeking redesignation to attainment of the ozone standard. These emission control strategy SIP revisions ( *e.g.* , reasonable further progress SIP and attainment demonstration SIP revisions) and ozone maintenance plans create MVEBs based on onroad mobile source emissions for criteria pollutants and/or their precursors to address pollution from cars and trucks. The MVEBs are the portions of the total allowable emissions that are allocated to highway and transit vehicle use that, together with emissions from other sources in the area, will provide for attainment or maintenance. Under 40 CFR part 93, a MVEB for an area seeking a redesignation to attainment is established for the last year of the maintenance plan. The MVEB serves as a ceiling on emissions from an area's planned transportation system. The MVEB concept is further explained in the preamble to the November 24, 1993, transportation conformity rule (58 FR 62188). The preamble also describes how to establish the MVEB in the SIP and how to revise the MVEB if needed. Under section 176(c) of the CAA, new transportation projects, such as the construction of new highways, must “conform” to ( *i.e.* , be consistent with) the part of the SIP that addresses emissions from cars and trucks. Conformity to the SIP means that transportation activities will not cause new air quality violations, worsen existing air quality violations, or delay timely attainment of the NAAQS. If a transportation plan does not conform, most new transportation projects that would expand the capacity of roadways cannot go forward. Regulations at 40 CFR part 93 set forth EPA policy, criteria, and procedures for demonstrating and assuring conformity of such transportation activities to a SIP. When reviewing SIP revisions containing MVEBs, including attainment strategies, rate-of-progress plans, and maintenance plans, EPA must affirmatively find that the MVEBs are “adequate” for use in determining transportation conformity. Once EPA affirmatively finds the submitted MVEBs to be adequate for transportation conformity purposes, the MVEBs are used by State and Federal agencies in determining whether proposed transportation projects conform to the SIP as required by section 176(c) of the CAA. EPA's substantive criteria for determining the adequacy of MVEBs are set out in 40 CFR 93.118(e)(4). EPA's process for determining adequacy of a MVEB consists of three basic steps:
(1)Providing public notification of a SIP submission;
(2)providing the public the opportunity to comment on the MVEB during a public comment period; and,
(3)EPA's finding of adequacy. The process of determining the adequacy of submitted SIP MVEBs was initially outlined in EPA's May 14, 1999, guidance, “Conformity Guidance on Implementation of March 2, 1999, Conformity Court Decision.” This guidance was codified in the Transportation Conformity Rule Amendments for the “New 8-Hour Ozone and PM <sup>2.5</sup> National Ambient Air Quality Standards and Miscellaneous Revisions for Existing Areas; Transportation Conformity Rule Amendments—Response to Court Decision and Additional Rule Change,” published on July 1, 2004 (69 FR 40004). EPA follows this guidance and rulemaking in making its adequacy determinations. The Toledo area's maintenance plan contains new VOC and NO <sup>X</sup> MVEBs for the years 2009 and 2018. The availability of the SIP submission with these 2009 and 2018 MVEBs was announced for public comment on EPA's Adequacy web page on March 5, 2007, at: *http://www.epa.gov/otaq/stateresources/transconf/currsips.htm.* The EPA public comment period on adequacy of the MVEBs closed on April 6, 2007. No requests for the submittal or adverse comments on the submittal were received during the adequacy comment period. In a letter dated, April 6, 2007 EPA informed Ohio that we had found the MVEBs to be adequate for use in transportation conformity analyses. EPA, through this rulemaking, is proposing to approve the MVEBs for use in determining transportation conformity in the Toledo area because the EPA has determined that the area can maintain attainment of the 8-hour ozone NAAQS for the relevant maintenance period with mobile source emissions at the levels of the MVEBs. Motor Vehicle Emissions Budgets for the Toledo, Ohio Area Year VOC (tons/day) NO <sup>X</sup> (tons/day) 2009 18.99 33.75 2018 11.20 14.11 2. What Is a Safety Margin? A “safety margin” is the difference between the attainment level of emissions (from all sources) and the projected level of emissions (from all sources) in the maintenance plan. As part of its maintenance plan, the State elected to include a “safety margin” for the area. The attainment level of emissions is the level of emissions during one of the years in which the area met the NAAQS. Ohio used 2004 as the attainment level of emissions for the area. In the maintenance plan, Ohio projected emission levels for 2018. The emissions from point, area, non-road, and mobile sources in 2004 equaled 74.19 tons/day of VOC and 108.6 tons/day of NO <sup>X</sup> . Ohio projected VOC emissions for the year 2018 to be 57.63 tons/day of VOC and 45.18 tons/day of NO <sup>X</sup> . The safety margin is calculated to be the difference between these amounts or, in this case, 16.66 tons/day of VOC and 63.42 tons/day of NO <sup>X</sup> for 2018. The safety margin, or a portion thereof, can be allocated to any of the source categories, as long as the total attainment level of emissions is maintained. Ohio EPA allocated 1.46 tons/day of VOC and 1.84 tons/day of NO <sup>X</sup> to the MVEB. The SIP submission demonstrates that the area will continue to maintain the standard. VIII. What Actions Is EPA Taking Today? EPA is proposing to make determinations that the Toledo area has attained the 8-hour ozone NAAQS and EPA is proposing to approve Ohio's maintenance plan for assuring that the area will continue to attain this standard. EPA is also proposing to find that the Toledo area meets the redesignation criteria set forth in section 107(d)(3)(E) of the CAA, and on this basis, EPA is proposing to approve the redesignation of the Toledo area from nonattainment to attainment for the 8-hour ozone standard. Finally, EPA is finding adequate and proposing to approve the 2009 and 2018 VOC and NO <sup>X</sup> MVEBs submitted by Ohio in conjunction with the redesignation request. IX. Statutory and Executive Order Reviews Executive Order 12866: Regulatory Planning and Review 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. Paperwork Reduction Act This proposed 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.* ). Regulatory Flexibility Act This proposed action merely proposes to approve State law as meeting Federal requirements and imposes no additional requirements beyond those imposed by State law. Redesignation of an area to attainment under section 107(d)(3)(E) of the CAA does not impose any new requirements on small entities. Redesignation is an action that affects the status of a geographical area and does not impose any new regulatory requirements on sources. 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.* ). Unfunded Mandates Reform Act Because this rule proposes to approve 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). Executive Order 13132: Federalism 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). Redesignation is an action that merely affects the status of a geographical area, does not impose any new requirements on sources, or allows a State to avoid adopting or implementing other requirements, and does not alter the relationship or the distribution of power and responsibilities established in the CAA. Executive Order 13175: Consultation and Coordination With Indian Tribal Governments Executive Order 13175 (65 FR 67249, November 9, 2000) requires EPA to develop an accountable process to ensure “meaningful and timely input by tribal officials in the development of regulatory policies that have tribal implications.” This proposed rule also does not have tribal implications, as specified in Executive Order 13175, because redesignation is an action that affects the status of a geographical area and does not impose any new regulatory requirements on tribes, impact any existing sources of air pollution on tribal lands, nor impair the maintenance of ozone national ambient air quality standards in tribal lands. Thus, Executive Order 13175 does not apply to this rule. Executive Order 13045: Protection of Children From Environmental Health and Safety Risks This proposed 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. Executive Order 13211: Actions That Significantly Affect Energy Supply, Distribution, or Use Because it is not a “significant regulatory action” under Executive Order 12866 or a “significant energy action,” this action is also not subject to Executive Order 13211, “Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use” (66 FR 28355, May 22, 2001). National Technology Transfer Advancement Act Section 12(d) of the National Technology Transfer and Advancement Act of 1995 (NTTA), 15 U.S.C. 272, requires Federal agencies to use technical standards that are developed or adopted by voluntary consensus to carry out policy objectives, so long as such standards are not inconsistent with applicable law or otherwise impracticable. In reviewing program submissions, EPA's role is to approve State choices, provided that they meet the criteria of the CAA. Absent a prior existing requirement for the State to use voluntary consensus standards, EPA has no authority to disapprove a program submission for failure to use such standards, and it would thus be inconsistent with applicable law for EPA to use voluntary consensus standards in place of a program submission that otherwise satisfies the provisions of the Act. Redesignation is an action that affects the status of a geographical area but does not impose any new requirements on sources. 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. List of Subjects 40 CFR Part 52 Environmental protection, Air pollution control, Intergovernmental relations, Nitrogen dioxide, Ozone, Volatile organic compounds. 40 CFR Part 81 Environmental protection, Air Pollution Control, National parks, Wilderness areas. Dated: June 1, 2007. Walter Kovalick, Acting Regional Administrator, Region 5. [FR Doc. E7-11305 Filed 6-11-07; 8:45 am] BILLING CODE 6560-50-P ENVIRONMENTAL PROTECTION AGENCY 40 CFR Parts 52 and 81 [EPA-R05-OAR-2007-0025; FRL-8326-3] Redesignation of the Columbus, OH Area to Attainment for the 8-Hour Ozone Standard AGENCY: Environmental Protection Agency (EPA). ACTION: Proposed rule. SUMMARY: The Ohio Environmental Protection Agency (Ohio EPA) submitted a request on December 28, 2006, and supplemented it on January 12, 2007 and March 9, 2007, for redesignation of the Columbus, Ohio area which includes Delaware, Fairfield, Franklin, Knox, Licking, and Madison Counties to attainment for the 8-hour ozone standard. EPA is proposing to approve several elements associated with this request. First, EPA is making a determination that complete, quality-assured ambient air quality data indicate that the Columbus area has attained the 8-hour ozone standard. Second, EPA is proposing to approve, as revisions to the Ohio State Implementation Plan (SIP), the State's plans for maintaining the 8-hour ozone NAAQS through 2018. Third, EPA is proposing to redesignate the Columbus area to attainment for the 8-hour ozone standard, based on a finding that the requirements for this redesignation have been satisfied. Fourth, EPA finds adequate and is proposing to approve the State's 2009 and 2018 Motor Vehicle Emission Budgets (MVEBs) for the Columbus area. DATES: Comments must be received on or before July 12, 2007. ADDRESSES: Submit your comments, identified by Docket ID No. EPA-R05-OAR-2007-0001, by one of the following methods: • *http://www.regulations.gov/* . Follow the on-line instructions for submitting comments. • *E-mail:* *mooney.john@epa.gov* . • *Fax:* (312)886-5824. • *Mail:* John M. Mooney, Chief, Criteria Pollutant Section, Air Programs Branch, (AR-18J), U.S. Environmental Protection Agency, 77 West Jackson Boulevard, Chicago, Illinois 60604. • *Hand delivery:* John M. Mooney, Chief, Criteria Pollutant Section, Air Programs Branch, (AR-18J), U.S. Environmental Protection Agency, 77 West Jackson Boulevard, 18th floor, Chicago, Illinois 60604. Such deliveries are only accepted during the Regional Office normal hours of operation, and special arrangements should be made for deliveries of boxed information. The Regional Office official hours of business are Monday through Friday, 8:30 a.m. to 4:30 p.m. excluding Federal holidays. *Instructions:* Direct your comments to Docket ID No. EPA-R05-OAR-2007-0001. EPA's policy is that all comments received 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 information claimed to be Confidential Business Information
(CBI)or other information whose disclosure is restricted by statute. Do not submit information that you consider to be CBI or otherwise protected through *www.regulations.gov* or e-mail. The *www.regulations.gov* Web site is an “anonymous access” system, which means EPA will not know your identity or contact information unless you provide it in the body of your comment. If you send an e-mail comment directly to EPA without going through www.regulations.gov, your e-mail address will be automatically captured and included as part of the comment that is placed in the public docket and made available on the Internet. If you submit an electronic comment, EPA recommends that you include your name and other contact information in the body of your comment and with any disk or CD-ROM you submit. If EPA cannot read your comment due to technical difficulties and cannot contact you for clarification, EPA may not be able to consider your comment. Electronic files should avoid the use of special characters, any form of encryption, and be free of any defects or viruses. For additional instructions on submitting comments, go to Section I of the SUPPLEMENTARY INFORMATION section of this document. *Docket:* All documents in the docket are listed in the *www.regulations.gov* index. Although listed in the index, some information is not publicly available, *e.g.* , CBI or other information whose disclosure is restricted by statute. Certain other material, such as copyrighted material, will be publicly available only in hard copy. Publicly available docket materials are available either electronically in *www.regulations.gov* or in hard copy at the Environmental Protection Agency, Region 5, Air and Radiation Division, 77 West Jackson Boulevard, Chicago, Illinois 60604. This facility is open from 8:30 a.m. to 4:30 p.m., Monday through Friday, excluding legal holidays. We recommend that you telephone Michael Leslie, Environmental Engineer, at
(312)353-6680 before visiting the Region 5 office. FOR FURTHER INFORMATION CONTACT: Michael Leslie, Environmental Engineer, Criteria Pollutant Section, Air Programs Branch (AR-18J), Environmental Protection Agency, Region 5, 77 West Jackson Boulevard, Chicago, Illinois 60604,
(312)353-6680, *leslie.michael@epa.gov* . SUPPLEMENTARY INFORMATION: Throughout this document whenever “we,” “us,” or “our” is used, we mean EPA. This supplementary information section is arranged as follows: Table of Contents I. What Should I Consider as I Prepare My Comments for EPA? II. What Actions Is EPA Proposing To Take? III. What Is the Background for These Actions? IV. What Are the Criteria for Redesignation? V. Why Is EPA Proposing To Take These Actions? VI. What Is the Effect of These Actions? VII. What Is EPA's Analysis of the Request? A. Attainment Determination and Redesignation B. Adequacy of Ohio's Motor Vehicle Emissions Budgets VIII. What Actions Is EPA Taking Today? IX. Statutory and Executive Order Reviews. I. What Should I Consider as I Prepare My Comments for EPA? When submitting comments, remember to: 1. Identify the rulemaking by docket number and other identifying information (subject heading, **Federal Register** date and page number). 2. Follow directions—The EPA may ask you to respond to specific questions or organize comments by referencing a Code of Federal Regulations
(CFR)part or section number. 3. Explain why you agree or disagree; suggest alternatives and substitute language for your requested changes. 4. Describe any assumptions and provide any technical information and/or data that you used. 5. If you estimate potential costs or burdens, explain how you arrived at your estimate in sufficient detail to allow for it to be reproduced. 6. Provide specific examples to illustrate your concerns, and suggest alternatives. 7. Explain your views as clearly as possible, avoiding the use of profanity or personal threats. 8. Make sure to submit your comments by the comment period deadline identified. II. What Actions Is EPA Proposing To Take? EPA is proposing to take several related actions. EPA is proposing to determine that the Columbus nonattainment area has attained the 8-hour ozone standard. EPA is also proposing to approve Ohio's maintenance plan SIP revision for the Columbus area. The maintenance plan is designed to keep the Columbus nonattainment area in attainment of the ozone NAAQS through 2018. EPA is proposing the that Columbus area has met the requirements for redesignation under Section 107(d)(3)(E) of the Clean Air Act (CAA). EPA is thus proposing to approve Ohio's request to change the legal determination of Columbus area from nonattainment to attainment for the 8-hour ozone National Ambient Air Quality Standard (NAAQS). Finally, EPA is announcing its action on the Adequacy Process for the newly established 2009 and 2018 MVEBs for the area. The adequacy comment period for the 2009 and 2018 MVEBs began on March 6, 2007, with EPA's posting of the availability of these submittals on EPA's Adequacy Web site ( *http://www.epa.gov/otaq/stateresources/transconf/adequacy.htm* ). The adequacy comment period for these MVEBs ended on April 5, 2007. EPA did not receive any requests for these submittals or adverse comments on these submittals during the adequacy comment period. Therefore, we find adequate and are proposing to approve the State's 2009 and 2018 MVEBs for transportation conformity purposes. III. What Is the Background for These Actions? On December 22, 2006, Ohio requested that EPA redesignate the Columbus area to attainment for the 8-hour ozone standard. The request was supplemented on January 12, 2007, and March 9, 2007. The redesignation request included three years of complete, quality-assured data for the periods of 2004 through 2006, indicating that the 8-hour NAAQS for ozone has been attained for the Columbus area. Under the CAA, nonattainment areas may be redesignated to attainment if sufficient complete, quality-assured data are available for the Administrator to determine that the area has attained the standard, and the area meets the other CAA redesignation requirements in section 107(d)(3)(E). A. General Background Information EPA has determined that ground-level ozone is detrimental to human health. On July 18, 1997, EPA promulgated an 8-hour ozone NAAQS of 0.08 parts per million parts of air (0.08 ppm) (80 parts per billion (ppb)) (62 FR 38856). This 8-hour ozone standard replaced a prior 1-hour ozone NAAQS, which had been promulgated on February 8, 1979 (44 FR 8202), and which was revoked on June 15, 2005 (69 FR 23858). Ground-level ozone is not emitted directly by sources. Rather, emitted NO <sup>X</sup> and VOC react in the presence of sunlight to form ground-level ozone along with other secondary compounds. NO <sup>X</sup> and VOC are referred to as “ozone precursors.” Control of ground-level ozone concentrations is achieved through controlling VOC and NO <sup>X</sup> emissions. The CAA required EPA to designate as nonattainment any area that violated the 8-hour ozone NAAQS. The **Federal Register** notice promulgating these designations and classifications was published on April 30, 2004 (69 FR 23857). The CAA contains two sets of provisions—subpart 1 and subpart 2—that address planning and emission control requirements for nonattainment areas. Both are found in title I, part D of the CAA. Subpart 1 contains general, less prescriptive requirements for all nonattainment areas for any pollutant governed by a NAAQS. Subpart 2 contains more specific requirements for certain ozone nonattainment areas, and applies to ozone nonattainment areas classified under section 181 of the CAA. In the April 30, 2004, designation rulemaking, EPA divided 8-hour ozone nonattainment areas into the categories of subpart 1 nonattainment (“basic” nonattainment) and subpart 2 nonattainment (“classified” nonattainment). EPA based this division on the area's 8-hour ozone design values ( *i.e.* , on the three-year averages of the annual fourth-highest daily maximum 8-hour ozone concentrations at the worst-case monitoring sites in the areas) and on their 1-hour ozone design values ( *i.e.* , on the fourth-highest daily maximum 1-hour ozone concentrations over the three-year period at the worst-case monitoring sites in the areas). EPA classified 8-hour ozone nonattainment areas with 1-hour ozone design values equaling or exceeding 121 ppb as subpart 2, classified nonattainment areas. EPA classified all other 8-hour nonattainment areas as subpart 1, basic nonattainment areas. The basis for area classification was explained in a separate April 30, 2004, final rule (the Phase 1 implementation rule) (69 FR 23951). Emission control requirements for classified nonattainment areas are linked to area classifications. Areas with more serious ozone pollution problems are subject to more prescribed requirements and later attainment dates. The prescribed emission control requirements are designed to bring areas into attainment by their specified attainment dates. In the April 30, 2004, ozone designation/classification rulemaking, EPA designated the Columbus area as a subpart 1 basic nonattainment area for the 8-hour ozone NAAQS. EPA based the designation on ozone data collected during the 2001-2003 period. On December 22, 2006, the State of Ohio requested redesignation of Columbus area to attainment of the 8-hour ozone NAAQS based on ozone data collected in this area from 2004-2006. B. What Is the Impact of the December 22, 2006, United States Court of Appeals Decision Regarding EPA's Phase 1 Implementation Rule? 1. Summary of Court Decision On December 22, 2006, the U.S. Court of Appeals for the District of Columbia Circuit vacated EPA's Phase 1 Implementation Rule for the 8-hour Ozone Standard. (69 FR 23951, April 30, 2004). *South Coast Air Quality Management Dist.* v. *EPA* , 472 F.3d 882 (D.C. Cir. 2006). The Court held that certain provisions of EPA's Phase 1 Rule were inconsistent with the requirements of the CAA. The Court rejected EPA's reasons for implementing the 8-hour standard in nonattainment areas under Subpart 1 in lieu of subpart 2 of Title I, part D of the Act. The Court also held that EPA improperly failed to retain four measures required for 1-hour nonattainment areas under the anti-backsliding provisions of the regulations:
(1)Nonattainment area New Source Review
(NSR)requirements based on an area's 1-hour nonattainment classification;
(2)Section 185 penalty fees for 1-hour severe or extreme nonattainment areas;
(3)measures to be implemented pursuant to section 172(c)(9) or 182(c)(9) of the Act, on the contingency of an area not making reasonable further progress toward attainment of the 1-hour NAAQS, or for failure to attain that NAAQS; and
(4)certain conformity requirements for certain types of Federal actions. The Court upheld EPA's authority to revoke the 1-hour standard provided there were adequate anti-backsliding provisions. This section sets forth EPA's views on the potential effect of the Court's ruling on this redesignation action. For the reasons set forth below, EPA does not believe that the Court's ruling alters any requirements relevant to this redesignation action so as to preclude redesignation, and does not prevent EPA from finalizing this redesignation. EPA believes that the Court's decision, as it currently stands, or as it may be modified based upon any petition for rehearing that has been filed, imposes no impediment to moving forward with redesignation of this area to attainment, because in either circumstance redesignation is appropriate under the relevant redesignation provisions of the Act and longstanding policies regarding redesignation requests. 2. Requirements Under the 8-Hour Standard With respect to the 8-hour standard, the Court's ruling rejected EPA's reasons for classifying areas under Subpart 1 for the 8-hour standard, and remanded that matter to the Agency. Consequently, it is possible that this area could, during a remand to EPA, be reclassified under Subpart 2. Although any future decision by EPA to classify this area under Subpart 2 might trigger additional future requirements for the area, EPA believes that this does not mean that redesignation cannot now go forward. This belief is based upon
(1)EPA's longstanding policy of evaluating State submissions in accordance with the requirements due at the time the request is submitted; and,
(2)consideration of the inequity of applying retroactively any future requirements. First, at the time the redesignation request was submitted, the Columbus area was classified under Subpart 1 and was obligated to meet Subpart 1 requirements. Under EPA's longstanding interpretation of section 107(d)(3)(E) of the CAA, to qualify for redesignation, States requesting redesignation to attainment must meet only the relevant SIP requirements that came due prior to the submittal of a complete redesignation request. September 4, 1992, Calcagni memorandum (“Procedures for Processing Requests to Redesignate Areas to Attainment,” Memorandum from John Calcagni, Director, Air Quality Management Division) See also Michael Shapiro Memorandum, September 17, 1993, and 60 FR 12459, 12465-66 (March 7, 1995) (Redesignation of Detroit—Ann Arbor). See *Sierra Club* v. *EPA* , 375 F.3d 537 (7th Cir. 2004), which upheld this interpretation. See, *e.g.* also 68 FR 25418, 25424, 25427 (May 12, 2003) (redesignation of St. Louis). Moreover, it would be inequitable to retroactively apply any new SIP requirements that were not applicable at the time the request was submitted. The D.C. Circuit has recognized the inequity in such retroactive rulemaking, See *Sierra Club* v. *Whitman* , 285 F. 3d 63 (D.C. Cir. 2002), in which the D.C. Circuit upheld a District Court's ruling refusing to make retroactive an EPA determination of nonattainment that was past the statutory due date. Such a determination would have resulted in the imposition of additional requirements on the area. The Court stated: “Although EPA failed to make the nonattainment determination within the statutory time frame, Sierra Club's proposed solution only makes the situation worse. Retroactive relief would likely impose large costs on the States, which would face fines and suits for not implementing air pollution prevention plans in 1997, even though they were not on notice at the time.” Id. at 68. Similarly here it would be unfair to penalize the area by applying to it for purposes of redesignation additional SIP requirements under Subpart 2 that were not in effect at the time it submitted its redesignation request. 3. Requirements Under the 1-Hour Standard With respect to the requirements under the 1-hour standard, the Columbus area was an attainment area subject to a CAA section 175A maintenance plan under the 1-hour standard. The Court's ruling does not impact redesignation requests for these types of areas. First, there are no conformity requirements that are relevant for redesignation requests for any standard, including the requirement to submit a transportation conformity SIP. Under longstanding EPA policy, EPA believes that it is reasonable to interpret the conformity SIP requirement as not applying for purposes of evaluating a redesignation request under section 107(d) because State conformity rules are still required after redesignation and Federal conformity rules apply where State rules have not been approved. 40 CFR 51.390. See *Wall* v. *EPA* , 265 F.3d 426 (6th Cir. 2001), upholding this interpretation. See also 60 FR 62748 (Dec. 7, 1995) (Tampa, FL redesignation). Federal transportation conformity regulations apply in all States prior to approval of transportation conformity SIPs. The Columbus, Ohio 1-hour ozone area was redesignated to attainment without approved State transportation conformity regulations because the Federal regulations were in effect in Ohio. When challenged, these 1-hour ozone redesignations, which were approved without State regulations, were upheld by the courts. See *Wall* v. *EPA* , 265 F.3d 426 (6th Cir. 2001). See also 60 FR 62748 (December 7, 1995) (Tampa, Florida). Although Ohio does not have approved State transportation conformity regulations, it has developed memoranda of understanding, signed by all parties involved in conformity, to address conformity consultation procedures. The Federal transportation conformity regulations, which apply in Ohio, require the approved 1-hour ozone budgets to be used for transportation conformity purposes prior to 8-hour ozone budgets being approved. Second, with respect to the three other anti-backsliding provisions for the 1-hour standard that the Court found were not properly retained, Columbus area is an attainment area subject to a maintenance plan for the 1-hour standard, and the NSR, contingency measure (pursuant to section 172(c)(9) or 182(c)(9)) and fee provision requirements no longer apply to an area that has been redesignated to attainment of the 1-hour standard. Thus, the decision in South Coast should not alter requirements that would preclude EPA from finalizing the redesignation of this area. IV. What Are the Criteria for Redesignation? Section 107(d)(3)(E) of the CAA allows for redesignation from nonattainment to attainment provided that:
(1)The Administrator determines that the area has attained the applicable NAAQS;
(2)the Administrator has fully approved the applicable implementation plan for the area under section 110(k);
(3)the Administrator determines that the improvement in air quality is due to permanent and enforceable reductions in emissions resulting from implementation of the applicable SIP and applicable Federal air pollutant control regulations and other permanent and enforceable reductions;
(4)the Administrator has fully approved a maintenance plan for the area as meeting the requirements of section 175A; and
(5)the State containing such area has met all requirements applicable to the area under section 110 and part D. EPA provided guidance on redesignation in the General Preamble for the Implementation of Title I of the CAA Amendments of 1990, on April 16, 1992 (57 FR 13498), and supplemented this guidance on April 28, 1992 (57 FR 18070). EPA has provided further guidance on processing redesignation requests in several guidance documents. A listing of pertinent documents is provided in other redesignation actions including a September 9, 2005 notice; 70 FR 53606. V. Why Is EPA Proposing To Take These Actions? On December 22, 2006, Ohio requested redesignation of the Columbus area to attainment for the 8-hour ozone standard. EPA believes that the area has attained the standard and has met the requirements for redesignation set forth in section 107(d)(3)(E) of the CAA. VI. What Is the Effect of These Actions? Approval of the redesignation request would change the official designation of the Columbus area for the 8-hour ozone NAAQS found at 40 CFR part 81. It would also incorporate into the Ohio SIP a plan for maintaining the 8-hour ozone NAAQS through 2018. The maintenance plans include contingency measures to remedy future violations of the 8-hour NAAQS. The maintenance plan also established MVEBs for the years 2009 and 2018. Motor Vehicle Emissions Budgets for the Columbus, OH Area Year VOC (tons/day) NO <sup>X</sup> (tons/day) 2009 72.16 125.43 2018 41.50 56.30 These proposed actions pertain to the designation of the Columbus area for the 8-hour ozone NAAQS and to the emission controls in the area related to the attainment and maintenance of the 8-hour ozone NAAQS. If you own or operate a VOC or NO <sup>X</sup> emissions source in this area or live in this area, this proposed rule may impact or apply to you. It may also impact you if you are involved in transportation planning or implementation of emission controls in this area. Finally, it may also impact you if you breathe the air in the Columbus area or the air which has passed through this area, or if you are concerned with clean air, human health or the environment. VII. What Is EPA's Analysis of the Request? A. Attainment Determination and Redesignation EPA is proposing to make a determination that the Columbus area has attained the 8-hour ozone standard and that the Columbus area has met all other applicable section 107(d)(3)(E) redesignation criteria. The basis for EPA's determinations is as follows: 1. The Area Has Attained the 8-Hour Ozone NAAQS (Section 107(d)(3)(E)(i)) EPA is proposing to make the determination that the Columbus area has attained the 8-hour ozone NAAQS. For ozone, an area may be considered to be attaining the 8-hour ozone NAAQS if there are no violations, as determined in accordance with 40 CFR 50.10 and Part 50, Appendix I, based on three complete, consecutive calendar years of quality-assured air quality monitoring data. For each monitor in the area, EPA computes the average of the fourth-highest daily maximum 8-hour average ozone concentrations from each of the three most recent years. The area is attaining the standard if all monitors have average concentrations at or below 0.08 ppm. Based on the rounding convention described in 40 CFR Part 50, Appendix I, the standard is attained if the design value is 0.084 ppm or below. The data must be collected and quality-assured in accordance with 40 CFR part 58, and recorded in the Aerometric Information Retrieval System (AIRS). The monitors generally should have remained at the same location for the duration of the monitoring period required for demonstrating attainment. Ohio submitted 2004-2006 ozone monitoring data for the Columbus area. The Ohio EPA quality assured the ambient monitoring data in accordance with 40 CFR 58.10, and recorded it in the AIRS database, thus making the data publicly available. The data meet the completeness criteria in 40 CFR 50, Appendix I, which requires a minimum completeness of 75 percent annually and 90 percent over each three year period. A summary of the monitoring data is presented in Table 1 below. Table 1.—Annual 4th High Daily Maximum 8-Hour Ozone Concentration and 3-Year Averages of 4th High Daily Maximum 8-Hour Ozone Concentrations Site ID County 2003 4th high
(ppm)2005 4th high
(ppm)2006 4th high
(ppm)2004-2006 average
(ppm)39-041-0002 Delaware 75 80 75 76 39-049-0028 Franklin 75 86 76 79 39-049-0029 Franklin 78 92 82 84 39-049-0037 Franklin 73 86 79 79 39-049-0081 Franklin 74 86 77 79 39-083-0002 Knox 73 81 75 76 39-089-0005 Licking 74 82 72 76 39-097-0007 Madison 65 81 76 74 In addition, as discussed below with respect to the maintenance plans, Ohio has committed to continue operating an EPA-approved monitoring network in accordance with 40 CFR part 58. In summary, EPA finds that the data submitted by Ohio provide an adequate demonstration that the Columbus area has attained the 8-hour ozone NAAQS. 2. The Area Has Met All Applicable Requirements Under Section 110 and Part D; and the Area Has a Fully Approved SIP Under Section 110(k) (Sections 107(d)(3)(E)(v) and 107(d)(3)(E)(ii)) We have determined that Ohio has met all currently applicable SIP requirements for purposes of redesignation for the Columbus area under Section 110 of the CAA (general SIP requirements). We have also determined that the Ohio SIP meets all SIP requirements currently applicable for purposes of redesignation under Part D of Title I of the CAA (requirements specific to Subpart 1 nonattainment areas), in accordance with section 107(d)(3)(E)(v). In addition, we have determined that the SIP is fully approved with respect to all applicable requirements for purposes of redesignation, in accordance with section 107(d)(3)(E)(ii). In making these determinations, we have ascertained what SIP requirements are applicable to the area for purposes of redesignation, and have determined that the portions of the SIP meeting these requirements are fully approved under section 110(k) of the CAA. As discussed more fully below, SIPs must be fully approved only with respect to currently applicable requirements of the CAA. a. Columbus, Ohio Has Met All Applicable Requirements Under Section 110 and Part D of the CAA The September 4, 1992, Calcagni memorandum (see “Procedures for Processing Requests To Redesignate Areas to Attainment,” Memorandum from John Calcagni, Director, Air Quality Management Division, September 4, 1992) describes EPA's interpretation of section 107(d)(3)(E) of the CAA. Under this interpretation, a State, and the area it wishes to redesignate, must meet the relevant CAA requirements that are due prior to the State's submittal of a complete redesignation request for the area. See also the September 17, 1993 Michael Shapiro memorandum and 60 FR 12459, 12465-66 (March 7, 1995) (redesignation of Detroit-Ann Arbor, Michigan to attainment of the 1-hour ozone NAAQS). Applicable requirements of the CAA that come due subsequent to the State's submittal of a complete request remain applicable until a redesignation to attainment is approved, but are not required as a prerequisite to redesignation. See section 175A(c) of the CAA. *Sierra Club* v. *EPA,* 375 F.3d 537 (7th Cir. 2004). See also 68 FR 25424, 25427 (May 12, 2003) (redesignation of the St. Louis/East St. Louis area to attainment of the 1-hour ozone NAAQS). *General SIP requirements.* Section 110(a) of title I of the CAA contains the general requirements for a SIP. Section 110(a)(2) provides that the implementation plan submitted by a State must have been adopted by the State after reasonable public notice and hearing, and that, among other things, it includes enforceable emission limitations and other control measures, means or techniques necessary to meet the requirements of the CAA; provides for establishment and operation of appropriate devices, methods, systems and procedures necessary to monitor ambient air quality; provides for implementation of a source permit program to regulate the modification and construction of any stationary source within the areas covered by the plan; includes provisions for the implementation of part C, Prevention of Significant Deterioration
(PSD)and part D, New Source Review
(NSR)permit programs; includes criteria for stationary source emission control measures, monitoring, and reporting; includes provisions for air quality modeling; and provides for public and local agency participation in planning and emission control rule development. Section 110(a)(2)(D) of the CAA requires that SIPs contain measures to prevent sources in a State from significantly contributing to air quality problems in another State. To implement this provision, EPA has required certain States to establish programs to address transport of air pollutants (NO <sup>X</sup> SIP Call (63 FR 57356), Clean Air Interstate Rule (CAIR)(70 FR 25162)). However, the section 110(a)(2)(D) requirements for a State are not linked with a particular nonattainment area's designation and classification. EPA believes that the requirements linked with a particular nonattainment area's designation and classifications are the relevant measures to evaluate in reviewing a redesignation request. When the transport SIP submittal requirements are applicable to a State, they will continue to apply to the State regardless of the attainment designation of any one particular area in the State. Therefore, we believe that these requirements should not be construed to be applicable requirements for purposes of redesignation. Further, we believe that the other section 110 elements described above that are not connected with nonattainment plan submissions and not linked with an area's attainment status are also not applicable requirements for purposes of redesignation. A State remains subject to these requirements after an area is redesignated to attainment. We conclude that only the section 110 and part D requirements which are linked with a particular area's designation and classification are the relevant measures which we may consider in evaluating a redesignation request. This approach is consistent with EPA's existing policy on applicability of conformity and oxygenated fuels requirements for redesignation purposes, as well as with section 184 ozone transport requirements. See Reading, Pennsylvania, proposed and final rulemakings (61 FR 53174-53176, October 10, 1996), (62 FR 24826, May 7, 1997); Cleveland-Akron-Lorain, Ohio, final rulemaking (61 FR 20458, May 7, 1996); and Tampa, Florida, final rulemaking (60 FR 62748, December 7, 1995). See also the discussion on this issue in the Cincinnati ozone redesignation (65 FR 37890, June 19, 2000), and in the Pittsburgh ozone redesignation (66 FR 50399, October 19, 2001). As discussed above, we believe that section 110 elements which are not linked to the area's nonattainment status are not applicable for purposes of redesignation. Because there are no section 110 requirements linked to the part D requirements for 8-hour ozone nonattainment areas that have become due, as explained below, there are no Part D requirements applicable for purposes of redesignation under the 8-hour standard. *Part D Requirements.* EPA has determined that the Ohio SIP meets applicable SIP requirements under part D of the CAA, since no requirements applicable for purposes of redesignation became due for the 8-hour ozone standard prior to Ohio's submission of the redesignation request for The Columbus area. Under part D, an area's classification determines the requirements to which it will be subject. Subpart 1 of part D, found in sections 172-176 of the CAA, sets forth the basic nonattainment requirements applicable to all nonattainment areas. Section 182 of the CAA, found in subpart 2 of part D, establishes additional specific requirements depending on the area's nonattainment classification. Columbus, Ohio, was classified as a subpart 1 nonattainment area, and, therefore, subpart 2 requirements do not apply. *Part D, Subpart 1 applicable SIP requirements.* For purposes of evaluating these redesignation requests, the applicable part D, subpart 1 SIP requirements for the Columbus area are contained in sections 172(c)(1)-(9). No 8-hour ozone planning requirements applicable for purposes of redesignation under part D became due prior to submission of the redesignation request, and, therefore, none are applicable to the area for purposes of redesignation. Since Ohio has submitted a complete ozone redesignation request for the Columbus area prior to the deadline for any submissions required for purposes of redesignation, we have determined that these requirements do not apply to the Columbus area for purposes of redesignation. *Section 176 conformity requirements.* Section 176(c) of the CAA requires States to establish criteria and procedures to ensure that Federally-supported or funded activities, including highway projects, conform to the air quality planning goals in the applicable SIPs. The requirement to determine conformity applies to transportation plans, programs and projects developed, funded or approved under Title 23 of the U.S. Code and the Federal Transit Act (transportation conformity) as well as to all other Federally-supported or funded projects (general conformity). State conformity revisions must be consistent with Federal conformity regulations relating to consultation, enforcement and enforceability, which EPA promulgated pursuant to CAA requirements. EPA approved Ohio's general and transportation conformity SIPs on March 11, 1996 (61 FR 9646) and May 30, 2000 (65 FR 34395), respectively. In summary, the Columbus area has satisfied all applicable requirements under section 110 and part D of the CAA. b. Columbus Has a Fully Approved Applicable SIP Under Section 110(k) of the CAA EPA has fully approved the Ohio SIP for the Columbus area under section 110(k) of the CAA for all requirements applicable for purposes of redesignation. In approving a redesignation request, EPA may rely on prior SIP approvals plus any additional measures it may approve in conjunction with a redesignation action (See the September 4, 1992 John Calcagni memorandum, page 3, *Southwestern Pennsylvania Growth Alliance* v. *Browner,* 144 F.3d 984, 989-990 (6th Cir. 1998), *Wall* v. *EPA,* 265 F.3d 426 (6th Cir. 2001)). Since the passage of the CAA of 1970, Ohio has adopted and submitted, and EPA has fully approved, provisions addressing the various required SIP elements applicable to the Columbus area under the 1-hour ozone standard. No Columbus area SIP provisions are currently disapproved, conditionally approved, or partially approved. 3. The Improvement in Air Quality Is Due to Permanent and Enforceable Reductions in Emissions (Section 107(d)(3)(E)(iii)) EPA finds that Ohio has demonstrated that the observed air quality improvement in the Columbus area is due to permanent and enforceable reductions in emissions resulting from implementation of the SIP, Federal measures, and other State-adopted measures. In making this demonstration, the State has calculated the change in emissions between 2002 and 2004, one of the years in which the Columbus area monitored attainment. The reduction in emissions and the corresponding improvement in air quality over this time period can be attributed to a number of regulatory control measures that Ohio has implemented. a. Permanent and Enforceable Controls Implemented The following is a discussion of permanent and enforceable measures that have been implemented in the area: NO <sup>X</sup> rules. In compliance with EPA's NO <sup>X</sup> SIP call, Ohio developed rules to control NO <sup>X</sup> emissions from Electric Generating Units (EGUs), major non-EGU industrial boilers, and major cement kilns. These rules required sources to begin reducing NO <sup>X</sup> emissions in 2004. However, statewide NO <sup>X</sup> emissions actually had begun to decline before 2004, as sources phased in emission controls needed to comply with the State's NO <sup>X</sup> emission control regulations. From 2004 on, NO <sup>X</sup> emissions from EGUs in the Eastern United States have been capped at a level well below pre-2002 levels, such that EGU emissions in the Columbus area, and elsewhere in Ohio, can be expected to remain well below 2002 levels. Ohio expects that NO <sup>X</sup> emissions will further decline as the State meets the requirements of EPA's Phase II NO <sup>X</sup> SIP call (69 FR 21604 (April 21, 2004)). *Federal Emission Control Measures.* Reductions in VOC and NO <sup>X</sup> emissions have occurred statewide as a result of Federal emission control measures, with additional emission reductions expected to occur in the future as the State implements additional emission controls. Federal emission control measures include: Tier 2 emission standards for vehicles, gasoline sulfur limits, low sulfur diesel fuel standards, and heavy-duty diesel engine standards. In addition, in 2004, EPA issued the Clean Air Non-road Diesel Rule (69 FR 38958 (July 29, 2004)). EPA expects this rule to reduce off-road diesel emissions through 2010, with emission reductions starting in 2008. b. Emission Reductions. Ohio is using 2002 for the nonattainment inventory and included area, mobile and point source emissions. Area sources were taken from the Ohio 2002 periodic inventory submitted to EPA. These projections were made from the United States Department of Commerce Bureau of Economic Analysis growth factors, with some updated local information. Mobile source emissions were calculated from MOBILE6.2 produced emission factors. Non-road emissions were generated using the EPA's National Mobile Inventory Model
(NMIM)2002 application. Point source information was compiled from Ohio's 2002 annual emission inventory database and the 2002 EPA Clean Air Markets Acid Rain database. Based on the inventories described above, Ohio's submittal documents changes in VOC and NO <sup>X</sup> emissions from 2002 to 2004. Summaries of emissions data are shown in Tables 2 through 4. Table 2.—The Columbus Area Total VOC and NO <sup>X</sup> Emissions for Nonattainment Year 2002 (Tons/Day) Sector VOC NO <sup>X</sup> Point 5.39 10.71 Area 65.15 6.84 Non-Road Mobile 28.55 41.90 On-Road Mobile 97.84 163.94 Columbus Area Total 196.93 223.39 Table 3.—The Columbus Area Total VOC and NO <sup>X</sup> Emissions for Attainment Year 2004 (Tons/Day) Sector VOC NO <sup>X</sup> Point 5.05 10.30 Area 64.75 7.18 Non-Road Mobile 26.20 38.73 On-Road Mobile 87.84 150.89 Columbus Area Total 183.84 207.10 Table 4.—The Columbus, Ohio Area: Comparison of 2002 and 2004 VOC and NO <sup>X</sup> Emissions (Tons/Day) Sector VOC 2002 2004 Net change (2002-2004) NO <sup>X</sup> 2002 2004 Net change (2002-2004) Point 5.39 5.05 −0.24 10.71 10.30 −0.41 Area 65.15 64.75 −0.40 6.84 7.18 0.34 Nonroad 28.55 26.20 −2.35 41.90 38.73 −3.17 Onroad 97.84 87.84 −10.00 163.94 150.89 −13.05 Total 196.93 183.84 −13.09 223.39 207.10 −16.29 Table 4 shows that the area reduced VOC emissions by 13.09 tons/day, and NO <sup>X</sup> emissions by 16.29 tons/day, between 2002 and 2004. Based on the information summarized above, Ohio has adequately demonstrated that the improvement in air quality is due to permanent and enforceable emissions reductions. 4. The Area Has a Fully Approved Maintenance Plan Pursuant to Section 175a of the CAA (Section 107(d)(3)(E)(iv)) In conjunction with its request to redesignate the Columbus area to attainment status, Ohio submitted SIP revisions to provide for the maintenance of the 8-hour ozone NAAQS in this area through 2018. a. What is required in a maintenance plan? Section 175A of the CAA sets forth the required elements of a maintenance plan for areas seeking redesignation from nonattainment to attainment. Under section 175A, the plan must demonstrate continued attainment of the applicable NAAQS for at least ten years after the Administrator approves a redesignation to attainment. Eight years after the redesignation, the State must submit a revised maintenance plan which demonstrates that attainment will continue to be maintained for ten years following the initial ten-year maintenance period. To address the possibility of future NAAQS violations, the maintenance plan must contain contingency measures with a schedule for implementation as EPA deems necessary to assure prompt correction of any future 8-hour ozone violations. The September 4, 1992, John Calcagni memorandum provides additional guidance on the content of a maintenance plan. The memorandum clarifies that an ozone maintenance plan should address the following items: The attainment VOC and NO <sup>X</sup> emissions inventories, a maintenance demonstration showing maintenance for the ten years of the maintenance period, a commitment to maintain the existing monitoring network, factors and procedures to be used for verification of continued attainment of the NAAQS, and a contingency plan to prevent or correct future violations of the NAAQS. b. Attainment Inventory Ohio developed a baseline emissions inventory for 2004, one of the years used to demonstrate monitored attainment of the 8-hour NAAQS. The attainment level of emissions is summarized in Table 3, above. c. Demonstration of Maintenance Ohio submitted revisions to the 8-hour ozone SIP to include 11-year maintenance plans for the Columbus area, in compliance with section 175A of the CAA. This demonstration shows maintenance of the 8-hour ozone standard by assuring that current and future emissions of VOC and NO <sup>X</sup> area remain at or below attainment year emission levels. A maintenance demonstration need not be based on modeling. See *Wall* v. *EPA* , 265 F.3d 426 (6th Cir. 2001), *Sierra Club* v. *EPA* , 375 F. 3d 537 (7th Cir. 2004). See also 66 FR 53094, 53099-53100 (October 19, 2001), 68 FR 25413, 25430-25432 (May 12, 2003). Ohio is using projected inventories for the years 2009 and 2018. These emission estimates are presented in Table 5. Table 5.—The Columbus, Ohio Area: Comparison of 2004-2018 VOC and NO <sup>X</sup> Emissions (Tons/Day) Sector VOC 2004 2009 2018 Net change 2004-2018 NO <sup>X</sup> 2004 2009 2018 Net change 2004-2018 Point 5.05 4.43 5.20 0.15 10.30 9.38 10.00 −0.30 Area 64.75 63.75 67.24 2.49 7.18 8.06 8.60 1.42 Nonroad 26.20 20.28 18.85 −7.35 38.73 30.72 20.14 −18.59 Onroad 87.84 62.76 36.09 −51.75 150.89 109.07 49.01 −101.88 Total 183.84 151.22 127.38 −56.46 207.10 157.23 87.75 −119.35 The emission projections show that Ohio does not expect emissions in the area to exceed the level of the 2004 attainment year inventory during the maintenance period. In the area, Ohio projects that VOC and NO <sup>X</sup> emissions will decrease by 56.46 tons/day and 119.35 tons/day, respectively. As part of its maintenance plan, the State elected to include a “safety margin” for the area. A “safety margin” is the difference between the attainment level of emissions (from all sources) and the projected level of emissions (from all sources) in the maintenance plan which continues to demonstrate attainment of the standard. The attainment level of emissions is the level of emissions during one of the years in which the area met the NAAQS. Ohio used 2004 as the attainment level of emissions for the area. In the maintenance plan, Ohio projected emission levels for 2018. The emissions from point, area, non-road, and mobile sources in 2004 equaled 183.84 tons/day of VOC and 207.10 tons/day of NO <sup>X</sup> . Ohio projected VOC emissions for the year 2018 to be 127.38 tons/day of VOC and 87.75 tons/day of NO <sup>X</sup> . The safety margin is calculated to be the difference between these amounts or, in this case, 56.46 tons/day of VOC and 119.35 tons/day of NO <sup>X</sup> for 2018. The safety margin, or a portion thereof, can be allocated to any of the source categories, as long as the total attainment level of emissions is maintained. Ohio EPA allocated 5.41 tons/day of VOC and 7.35 tons/day of NO <sup>X</sup> to the MVEB. The SIP submission demonstrates that the area will continue to maintain the standard because emission will continue to be below the attainment level. d. Monitoring Network Ohio currently operates eight ozone monitors in the Columbus area. Ohio has committed to continue operating and maintaining their approved ozone monitor network in accordance with 40 CFR part 58. e. Verification of Continued Attainment Continued attainment of the ozone NAAQS in the area depends, in part, on the State's efforts toward tracking indicators of continued attainment during the maintenance period. The State's plan for verifying continued attainment of the 8-hour standard in the area consists of plans to continue ambient ozone monitoring in accordance with the requirements of 40 CFR part 58. In addition, Ohio will periodically review and revise the VOC and NO <sup>X</sup> emissions inventories for the area, as required by the Consolidated Emissions Reporting Rule (40 CFR part 51), to track levels of emissions in the future. f. Contingency Plan The contingency plan provisions of the CAA are designed to result in prompt correction or prevention of violations of the NAAQS that might occur after redesignation of an area to attainment of the NAAQS. Section 175A of the CAA requires that a maintenance plan include such contingency measures as EPA deems necessary to assure that the State will promptly correct a violation of the NAAQS that might occur after redesignation. The maintenance plan must identify the contingency measures to be considered for possible adoption, a schedule and procedure for adoption and implementation of the selected contingency measures, and a time limit for action by the State. The State should also identify specific indicators to be used to determine when the contingency measures need to be adopted and implemented. The maintenance plan must include a requirement that the State will implement all measures with respect to control of the pollutant(s) that were included in the SIP before the redesignation of the area to attainment. See section 175A(d) of the CAA. As required by section 175A of the CAA, Ohio has adopted a contingency plan to address possible future ozone air quality issues. The contingency plan has two levels of actions/responses depending on whether a violation of the 8-hour ozone standard is only threatened (Warning Level Response) or has actually occurred or appears to be very imminent (Action Level Response). A Warning Level Response will be triggered whenever an annual (1-year) fourth-high monitored 8-hour ozone concentration of 88 ppb occurs within the ozone maintenance area (Columbus area). A Warning Level Response will consist of a study to determine whether the ozone value indicates a trend toward higher ozone concentrations or whether emissions appear to be increasing. The study will evaluate whether the trend, if any, is likely to continue and, if so, the control measures necessary to reverse the trend, taking into consideration ease and timing for implementation, as well as economic and social consideration. Implementation of necessary controls in response to a Warning Level Response triggering will take place as expeditiously as possible, but in no event later than 12 months from the conclusion of the most recent ozone season. An Action Level Response will be triggered whenever a two-year average annual fourth-high monitored 8-hour ozone concentration of 85 ppb or greater occurs within the maintenance area (Columbus area). A violation of the 8-hour ozone standard (three-year average fourth-high value of 85 ppb or greater) will also prompt an Action Level Response. In the event that an Action Level Response is triggered and is not due to an exceptional event, malfunction, or noncompliance with a source permit condition or rule requirement, Ohio will determine the additional emission control measures needed to assure future attainment of the ozone NAAQS. Emission control measures that can be implemented in a short time will be selected in order to be in place within 18 months from the close of the ozone season that prompted the Action Level Response. Any new emission control measure that is selected for implementation will be given a public review. If a new emission control measure is already promulgated and scheduled to be implemented at the Federal or State level and that emission control measure is determined to be sufficient to address the increase in peak ozone concentrations, additional local measures may be unnecessary. Ohio will submit to the EPA an analysis to assess whether the proposed emission control measures are adequate to reverse the increase in peak ozone concentrations and to maintain the 8-hour ozone standard in the area. The selection of emission control measures will be based on cost-effectiveness, emission reduction potential, economic and social considerations, or other factors that Ohio deems to be appropriate. Selected emission control measures will be subject to public review and the State will seek public input prior to selecting new emission control measures. The State's ozone redesignation request lists the following possible emission control measures as contingency measures in the ozone maintenance portion of the State's submittal: i. Lower Reid vapor pressure gasoline requirements; ii. Tighten RACT on existing source covered by USEPA Control Techniques Guidelines issued in response to the 1990 CAA; iii. Apply RACT to smaller existing sources; iv. One or more transportation control measures sufficient to achieve at least half a percent reduction in actual area wide VOC emissions. Transportation-measures will be selected from the following, based upon the factors listed above after consultation with affected local governments: a. Trip reduction programs, including, but not limited to, employer-based transportation management plans, area-wide rideshare programs, work schedule changes, and telecommuting; b. Traffic flow and transit improvements; and c. Other new or innovative transportation measures not yet in widespread use that affects State and local governments deemed appropriate. v. Alternative fuel and diesel retrofit programs for fleet vehicle operations. vi. Controls on consumer products consistent with those adopted elsewhere in the United States. vii. Require VOC and NO <sup>X</sup> emissions offsets for new and modified major sources. viii. Require VOC or NO <sup>X</sup> emission offsets for new or modified minor sources. ix. Increase the ratio of emission offsets required for new sources. x. Require VOC or NO <sup>X</sup> controls on new minor sources (less than 100 tons). g. Provisions for Future Updates of the Ozone Maintenance Plan. As required by section 175A(b) of the CAA, Ohio commits to submit to the EPA updated ozone maintenance plans eight years after redesignation to cover an additional 10-year period beyond the initial 10-year maintenance period. Ohio has committed to retain the control measures for VOC and NO <sup>X</sup> emissions that were contained in the SIP before redesignation of the area to attainment, as required by section 175(A) of the CAA. EPA proposes that the maintenance plan adequately addresses the five basic components of a maintenance plan: attainment inventory, maintenance demonstration, monitoring network, verification of continued attainment, and a contingency plan. B. Adequacy of Ohio's Motor Vehicle Emissions Budgets (MVEBs) 1. How Are MVEBs Developed and What Are the MVEBs for the Area? Under the CAA, States are required to submit, at various times, control strategy SIP revisions and ozone maintenance plans for ozone nonattainment areas and for areas seeking redesignation to attainment of the ozone standard. These emission control strategy SIP revisions ( *e.g.* , reasonable further progress SIP and attainment demonstration SIP revisions) and ozone maintenance plans create MVEBs based on onroad mobile source emissions for criteria pollutants and/or their precursors to address pollution from cars and trucks. The MVEBs are the portions of the total allowable emissions that are allocated to highway and transit vehicle use that, together with emissions from other sources in the area, will provide for attainment or maintenance. Under 40 CFR Part 93, a MVEB for an area seeking a redesignation to attainment is established for the last year of the maintenance plan. The MVEB serves as a ceiling on emissions from an area's planned transportation system. The MVEB concept is further explained in the preamble to the November 24, 1993, transportation conformity rule (58 FR 62188). The preamble also describes how to establish the MVEB in the SIP and how to revise the MVEB if needed. Under section 176(c) of the CAA, new transportation projects, such as the construction of new highways, must “conform” to ( *i.e.* , be consistent with) the part of the SIP that addresses emissions from cars and trucks. Conformity to the SIP means that transportation activities will not cause new air quality violations, worsen existing air quality violations, or delay timely attainment of the NAAQS. If a transportation plan does not conform, most new transportation projects that would expand the capacity of roadways cannot go forward. Regulations at 40 CFR part 93 set forth EPA policy, criteria, and procedures for demonstrating and assuring conformity of such transportation activities to a SIP. When reviewing SIP revisions containing MVEBs, including attainment strategies, rate-of-progress plans, and maintenance plans, EPA must affirmatively find that the MVEBs are “adequate” for use in determining transportation conformity. Once EPA affirmatively finds the submitted MVEBs to be adequate for transportation conformity purposes, the MVEBs are used by State and Federal agencies in determining whether proposed transportation projects conform to the SIP as required by section 176(c) of the CAA. EPA's substantive criteria for determining the adequacy of MVEBs are set out in 40 CFR 93.118(e)(4). EPA's process for determining adequacy of a MVEB consists of three basic steps:
(1)Providing public notification of a SIP submission;
(2)providing the public the opportunity to comment on the MVEB during a public comment period; and,
(3)EPA's finding of adequacy. The process of determining the adequacy of submitted SIP MVEBs was initially outlined in EPA's May 14, 1999, guidance, “Conformity Guidance on Implementation of March 2, 1999, Conformity Court Decision.” This guidance was codified in the Transportation Conformity Rule Amendments for the “New 8-Hour Ozone and PM2.5 National Ambient Air Quality Standards and Miscellaneous Revisions for Existing Areas; Transportation Conformity Rule Amendments—Response to Court Decision and Additional Rule Change,” published on July 1, 2004 (69 FR 40004). EPA follows this guidance and rulemaking in making its adequacy determinations. The Columbus area's maintenance plan contains new VOC and NO <sup>X</sup> MVEBs for the years 2009 and 2018. The availability of the SIP submission with these 2009 and 2018 MVEBs was announced for public comment on EPA's Adequacy Web page on March 5, 2007, at: *http://www.epa.gov/otaq/stateresources/transconf/currsips.htm* . The EPA public comment period on adequacy of the MVEBs closed on April 6, 2007. No requests for the submittal or adverse comments on the submittal were received during the adequacy comment period. In a letter dated April 6, 2007 EPA informed Ohio that we had found the MVEBs to be adequate for use in transportation conformity analyses. EPA, through this rulemaking, is proposing to approve the MVEBs for use in determining transportation conformity in the Columbus area because the EPA has determined that the area can maintain attainment of the 8-hour ozone NAAQS for the relevant maintenance period with mobile source emissions at the levels of the MVEBs. Motor Vehicle Emissions Budgets for the Columbus, OH Area Year VOC (tons/day) NO <sup>X</sup> (tons/day) 2009 72.16 125.43 2018 41.50 56.30 2. What Is a Safety Margin? A “safety margin” is the difference between the attainment level of emissions (from all sources) and the projected level of emissions (from all sources) in the maintenance plan. As part of its maintenance plan, the State elected to include a “safety margin” for the area. The attainment level of emissions is the level of emissions during one of the years in which the area met the NAAQS. Ohio used 2004 as the attainment level of emissions for the area. In the maintenance plan, Ohio projected emission levels for 2018. The emissions from point, area, non-road, and mobile sources in 2004 equaled 183.84 tons/day of VOC and 207.10 tons/day of NO <sup>X</sup> . Ohio projected VOC emissions for the year 2018 to be 127.38 tons/day of VOC and 87.75 tons/day of NO <sup>X</sup> . The safety margin is calculated to be the difference between these amounts or, in this case, 56.46 tons/day of VOC and 119.35 tons/day of NO <sup>X</sup> for 2018. The safety margin, or a portion thereof, can be allocated to any of the source categories, as long as the total attainment level of emissions is maintained. Ohio EPA allocated 5.41 tons/day of VOC and 7.35 tons/day of NO <sup>X</sup> to the MVEB. The SIP submission demonstrates that the area will continue to maintain the standard. VIII. What Actions Is EPA Taking Today? EPA is proposing to make determinations that the Columbus area has attained the 8-hour ozone NAAQS, and EPA is proposing to approve Ohio's maintenance plan for assuring that the area will continue to attain this standard. EPA is also proposing to find that the Columbus area meets the redesignation criteria set forth in section 107(d)(3)(E) of the CAA, and on this basis, EPA is proposing to approve the redesignation of the Columbus area from nonattainment to attainment for the 8-hour ozone standard. Finally, EPA is finding adequate and proposing to approve the 2009 and 2018 VOC and NO <sup>X</sup> MVEBs submitted by Ohio in conjunction with the redesignation request. IX. Statutory and Executive Order Reviews Executive Order 12866: Regulatory Planning and Review 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. Paperwork Reduction Act This proposed 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.* ). Regulatory Flexibility Act This proposed action merely proposes to approve State law as meeting Federal requirements and imposes no additional requirements beyond those imposed by State law. Redesignation of an area to attainment under section 107(d)(3)(E) of the CAA does not impose any new requirements on small entities. Redesignation is an action that affects the status of a geographical area and does not impose any new regulatory requirements on sources. 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.* ). Unfunded Mandates Reform Act Because this rule proposes to approve 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). Executive Order 13132: Federalism 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). Redesignation is an action that merely affects the status of a geographical area, does not impose any new requirements on sources, or allows a State to avoid adopting or implementing other requirements, and does not alter the relationship or the distribution of power and responsibilities established in the CAA. Executive Order 13175: Consultation and Coordination With Indian Tribal Governments Executive Order 13175 (65 FR 67249, November 9, 2000) requires EPA to develop an accountable process to ensure “meaningful and timely input by tribal officials in the development of regulatory policies that have tribal implications.” This proposed rule also does not have tribal implications, as specified in Executive Order 13175, because redesignation is an action that affects the status of a geographical area and does not impose any new regulatory requirements on tribes, impact any existing sources of air pollution on tribal lands, nor impair the maintenance of ozone national ambient air quality standards in tribal lands. Thus, Executive Order 13175 does not apply to this rule. Executive Order 13045: Protection of Children From Environmental Health and Safety Risks This proposed 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. Executive Order 13211: Actions That Significantly Affect Energy Supply, Distribution, or Use Because it is not a “significant regulatory action” under Executive Order 12866 or a “significant energy action,” this action is also not subject to Executive Order 13211, “Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use” (66 FR 28355, May 22, 2001). National Technology Transfer Advancement Act Section 12(d) of the National Technology Transfer and Advancement Act of 1995 (NTTA), 15 U.S.C. 272, requires Federal agencies to use technical standards that are developed or adopted by voluntary consensus to carry out policy objectives, so long as such standards are not inconsistent with applicable law or otherwise impracticable. In reviewing program submissions, EPA's role is to approve State choices, provided that they meet the criteria of the CAA. Absent a prior existing requirement for the State to use voluntary consensus standards, EPA has no authority to disapprove a program submission for failure to use such standards, and it would thus be inconsistent with applicable law for EPA to use voluntary consensus standards in place of a program submission that otherwise satisfies the provisions of the Act. Redesignation is an action that affects the status of a geographical area but does not impose any new requirements on sources. 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. List of Subjects 40 CFR Part 52 Environmental protection, Air pollution control, Intergovernmental relations, Nitrogen dioxide, Ozone, Volatile organic compounds. 40 CFR Part 81 Environmental protection, Air Pollution Control, National parks, Wilderness areas. Dated: June 1, 2007. Walter Kovalick, Acting Regional Administrator, Region 5. [FR Doc. E7-11294 Filed 6-11-07; 8:45 am] BILLING CODE 6560-50-P ENVIRONMENTAL PROTECTION AGENCY 40 CFR Parts 53 and 58 [EPA-HQ-OAR-2004-0018; FRL-8308-8] RIN 2060-AO06 Ambient Air Monitoring Regulations: Correcting and Other Amendments AGENCY: Environmental Protection Agency (EPA). ACTION: Proposed rule. SUMMARY: The EPA is proposing to correct and clarify parts of a recent final rule published on October 17, 2006, that amended the ambient air monitoring requirements for criteria pollutants. The proposed changes include several instances where the wording in the preamble and regulatory text were not completely consistent, several regulatory text passages that contained some imprecise language, two instances of regulatory text omission, an outdated address reference, and numerous publication errors in tables and equations. EPA is also proposing to allow EPA Regional Administrators to approve departures from the minimum number of PM <sup>10</sup> monitors otherwise specified in the rule. In the “Rules and Regulations” section of this **Federal Register** , we are taking direct final action on the amendments because we view the amendments as non-controversial and anticipate no adverse comments. If we receive no adverse comments, we will take no further action on this proposed rule. DATES: Written comments must be received by July 12, 2007. ADDRESSES: Please see the related direct final rule, which is located in the “Rules and Regulations” section of this **Federal Register** , for detailed instructions on how to submit comments. FOR FURTHER INFORMATION CONTACT: Mr. Lewis Weinstock, Air Quality Assessment Division (C304-06), Office of Air Quality Planning and Standards, U.S. Environmental Protection Agency, Research Triangle Park, North Carolina 27711; telephone number:
(919)541-3661; fax number:
(919)541-1903; e-mail address: *weinstock.lewis@epa.gov.* SUPPLEMENTARY INFORMATION: I. Why Is EPA Issuing This Proposed Rule? This document proposes to take action on Ambient Air Monitoring Regulations: Correcting and Other Amendments. We have published a direct final rule identical to this proposal to correct and clarify parts of a recent final rule published on October 17, 2006, that amended the ambient air monitoring requirements for criteria pollutants. We view this as a non-controversial action and anticipate no adverse comment. We have explained our reasons for this action in the preamble to the direct final rule. If we receive no adverse comment, we will not take further action on this proposed rule. If EPA receives relevant adverse comment on one or more of the amendments included in this proposal, we will publish a timely withdrawal in the **Federal Register** informing the public which amendment or amendments we are withdrawing. The provisions that are not withdrawn will become effective as set out in the DATES section of the direct final rule. We will address these public comments in a subsequent final rule based on this proposal. We will not institute a second comment period on this action. Any persons interested in commenting must do so at this time. The regulatory text for the proposal is identical to that for the direct final rule published in the “Rules and Regulations” section of this **Federal Register** . For further supplementary information, the detailed rationale for the proposal and the regulatory revisions, see the direct final rule published in a separate part of this **Federal Register** . II. Does This Action Apply to Me? Categories and entities potentially regulated by this action include: Category NAICS code 1 Examples of regulated entities Industry 334513 541380 Manufacturer, supplier, distributor, or vendor of ambient air monitoring instruments; analytical laboratories or other monitoring organizations that elect to submit an application for a reference or equivalent method determination under 40 CFR part 53. Federal Government 924110 Federal agencies (that conduct ambient air monitoring similar to that conducted by States under 40 CFR part 58 and that wish EPA to use their monitoring data in the same manner as State data) or that elect to submit an application for a reference or equivalent method determination under 40 CFR part 53. State/territorial/local/tribal government 924110 State, territorial, and local air quality management programs that are responsible for ambient air monitoring under 40 CFR part 58 or that elect to submit an application for a reference or equivalent method determination under 40 CFR part 53 or for an approved regional method approved under 40 CFR part 58 appendix C. The proposal also may affect Tribes that conduct ambient air monitoring similar to that conducted by States and that wish EPA to use their monitoring data in the same manner as State monitoring data. 1 North American Industry Classification System. This table is not intended to be exhaustive, but rather provides a guide for readers regarding entities likely to be regulated by this action. This table lists the types of entities that EPA is now aware could potentially be regulated by this action. Other types of entities not listed in the table could also be regulated. To determine whether your facility or Federal, State, local, tribal, or territorial agency is regulated by this action, you should carefully examine the requirements for reference or equivalent method determinations in 40 CFR part 53, subpart A (General Provisions) and the applicability criteria in 40 CFR 51.1 of EPA's requirements for State implementation plans. If you have questions regarding the applicability of this action to a particular entity, consult the person listed in the preceding FOR FURTHER INFORMATION CONTACT section. III. Statutory and Executive Order Reviews A. Executive Order 12866: Regulatory Planning and Review Under Executive Order 12866 (58 FR 51735, October 4, 1993), this action is a “significant regulatory action” because it may raise novel legal policy issues arising out of legal mandates, the President's priorities, or the principles set forth in the Executive Order. Accordingly, EPA submitted this action to the Office of Management and Budget
(OMB)for review under Executive Order 12866 and any changes made in response to OMB recommendations have been documented in the docket for this action. B. Paperwork Reduction Act This action does not impose any new information collection, as it only corrects printing errors, provides clarifications, and provides new flexibility for PM <sup>10</sup> monitoring on a case-by-case basis. However, the OMB has previously approved the information collection requirements contained in the existing regulations for 40 CFR part 53 and 40 CFR part 58 under the provisions of the Paperwork Reduction Act, 44 U.S.C. 3501 *et seq.* , and has assigned OMB control number 2060-0084, EPA ICR number 0940.20. A copy of the OMB approved Information Collection Request
(ICR)may be obtained from Susan Auby, Collection Strategies Division, U.S. Environmental Protection Agency (2822T), 1200 Pennsylvania Ave., NW., Washington, DC 20460 or by calling
(202)566-1672. This action does not impose any new information collection burden beyond the already-approved ICR. Burden means the total time, effort, or financial resources expended by persons to generate, maintain, retain, or disclose or provide information to or for a Federal agency. This includes the time needed to review instructions; develop, acquire, install, and utilize technology and systems for the purposes of collecting, validating, and verifying information, processing and maintaining information, and disclosing and providing information; adjust the existing ways to comply with any previously applicable instructions and requirements; train personnel to be able to respond to a collection of information; search data sources; complete and review the collection of information; and transmit or otherwise disclose the information. An agency may not conduct or sponsor, and a person is not required to respond to a collection of information unless it displays a currently valid OMB control number. The OMB control numbers for EPA's regulations in 40 CFR are listed in 40 CFR part 9. C. Regulatory Flexibility Act The Regulatory Flexibility Act
(RFA)generally requires an agency to prepare a regulatory flexibility analysis of any rule subject to notice and comment rulemaking requirements under the Administrative Procedure Act or any other statute unless the agency certifies that the rule will not have a significant economic impact on a substantial number of small entities. Small entities include small businesses, small organizations, and small governmental jurisdictions. For purposes of assessing the impacts of today's rule on small entities, small entity is defined as:
(1)A small business defined by the Small Business Administration's
(SBA)regulations at 13 CFR 121.201;
(2)a small governmental jurisdiction that is a government of a city, county, town, school district or special district with a population of less than 50,000; and
(3)a small organization that is any not-for-profit enterprise which is independently owned and operated and is not dominant in its field. After considering the economic impacts of today's proposed rule on small entities, I certify that this action will not have a significant economic impact on a substantial number of small entities. This proposed rule will not impose any requirements on small entities. None of the corrections and clarifications creates additional regulatory requirements on affected entities compared to those that were promulgated in the final rule that was published in the **Federal Register** on October 17, 2006. The proposed rule changes only correct printing errors, provide clarifications, and provide new flexibility for PM <sup>10</sup> monitoring on a case-by-case basis. D. Unfunded Mandates Reform Act Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), Public Law 104-4, establishes requirements for Federal agencies to assess the effects of their regulatory actions on State, local, and tribal governments and the private sector. Under section 202 of the UMRA, EPA generally must prepare a written statement, including a cost-benefit analysis, for proposed and final rules with “Federal mandates” that may result in expenditures to State, local, and Tribal governments, in the aggregate, or to the private sector, of $100 million or more in any one year. Before promulgating an EPA rule for which a written statement is needed, section 205 of the UMRA generally requires EPA to identify and consider a reasonable number of regulatory alternatives and adopt the least costly, most cost-effective or least burdensome alternative that achieves the objectives of the rule. The provisions of section 205 do not apply when they are inconsistent with applicable law. Moreover, section 205 allows EPA to adopt an alternative other than the least costly, most cost-effective or least burdensome alternative if the Administrator publishes with the final rule an explanation why that alternative was not adopted. Before EPA establishes any regulatory requirements that may significantly or uniquely affect small governments, including tribal governments, it must have developed under section 203 of the UMRA a small government agency plan. The plan must provide for notifying potentially affected small governments, enabling officials of affected small governments to have meaningful and timely input in the development of EPA regulatory proposals with significant Federal intergovernmental mandates, and informing, educating, and advising small governments on compliance with the regulatory requirements. The EPA has determined that this proposed rule does not contain a Federal mandate that may result in expenditures of $100 million or more for State, local, and tribal governments, in the aggregate, or the private sector in any one year, because the changes being made are merely clarifications and corrections. Thus, today's rule is not subject to the requirements of sections 202 and 205 of the UMRA. The EPA has determined that this proposed rule contains no regulatory requirements that might significantly or uniquely affect small governments. None of the proposed changes creates additional regulatory requirements on affected entities compared to those that were promulgated in the final rule that was published in the **Federal Register** on October 17, 2006. The proposed changes only correct printing errors, provide clarifications, and provide some new flexibility for PM <sup>10</sup> monitoring on a case-by-case basis. Therefore, this proposed rule is not subject to the requirements of section 203 of the UMRA. E. Executive Order 13132: Federalism Executive Order 13132 (64 FR 43255, August 10, 1999) requires EPA to develop an accountable process to ensure “meaningful and timely input by State and local officials in the development of regulatory policies that have federalism implications.” “Policies that have federalism implications” is defined in the Executive Order to include regulations that 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.” This proposed rule does not have federalism implications because it will not have substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government, as specified in Executive Order 13132. This is because the proposed changes being made only correct printing errors, provide clarifications, and provide some new flexibility for PM <sup>10</sup> monitoring on a case-by-case basis. Thus, Executive Order 13132 does not apply to this proposed rule. F. Executive Order 13175: Consultation and Coordination With Indian Tribal Governments Executive Order 13175, entitled “Consultation and Coordination with Indian Tribal Governments” (65 FR 67249, November 9, 2000), requires EPA to develop an accountable process to ensure “meaningful and timely input by tribal officials in the development of regulatory policies that have tribal implications.” This proposed rule does not have tribal implications, as specified in Executive Order 13175. The EPA consulted with tribal officials early in the process of developing the October 17, 2006, rule to permit them to have meaningful and timely input into its development. Although tribal governments may elect to conduct ambient air monitoring, none of the proposed changes in today's rule apply directly to tribal governments. Thus, Executive Order 13175 does not apply to this rule. G. Executive Order 13045: Protection of Children From Environmental Health and Safety Risks Executive Order 13045 “Protection of Children from Environmental Health Risks and Safety Risks” (62FR19885, April 23, 1997) applies to any rule that:
(1)Is determined to be “economically significant” as defined under EO 12866, and
(2)concerns an environmental health or safety risk that EPA has reason to believe may have a disproportionate effect on children. If the regulatory action meets both criteria, the Agency must evaluate the environmental health or safety effects of the planned rule on children, and explain why the planned regulation is preferable to other potentially effective and reasonably feasible alternatives considered by the Agency. EPA interprets EO 13045 as applying only to those regulatory actions that concern health or safety risks, such that the analysis required under section 5-501 of the EO has the potential to influence the regulation. This proposed rule is not subject to EO 13045 because it does not establish an environmental standard intended to mitigate health or safety risks. H. Executive Order 12898: Federal Actions To Address Environmental Justice in Minority Populations and Low-Income Populations Executive Order 12898 (59 FR 7629, February 16, 1994) establishes Federal executive policy on environmental justice. Its main provision directs Federal agencies, to the greatest extent practicable and permitted by law, to make environmental justice part of their mission by identifying and addressing, as appropriate, disproportionately high and adverse human health or environmental effects of their programs, policies, and activities on minority populations and low-income populations in the United States. EPA has determined that this proposed rule will not have disproportionately high and adverse human health or environmental effects on minority or low-income populations because it does not affect the level of protection provided to human health or the environment. The rule merely proposed to amend the October 17, 2006, final monitoring rule (71 FR 61236) by correcting printing errors, providing clarifications, and providing some new flexibility for PM <sup>10</sup> monitoring on a case-by-case basis. I. Executive Order 13211: Actions That Significantly Affect Energy Supply, Distribution, or Use This proposed rule is not a “significant energy action” as defined in Executive Order 13211, “Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution or Use” (66 FR 28355, May 22, 2001) because it is not likely to have a significant adverse effect on the supply, distribution, or use of energy. No significant change in the use of energy is expected because the total number of monitors for ambient air quality measurements will not increase above present levels. Further, we have concluded that this rule is not likely to have any adverse energy effects. J. National Technology Transfer Advancement Act Section 12(d) of the National Technology Transfer and Advancement Act of 1995 (“NTTAA”), Public Law No. 104-113, 12(d) (15 U.S.C. 272 note) directs EPA to use voluntary consensus standards in its regulatory activities unless to do so would be inconsistent with applicable law or otherwise impractical. Voluntary consensus standards are technical standards (e.g., materials specifications, test methods, sampling procedures, and business practices) that are developed or adopted by voluntary consensus standards bodies. The NTTAA directs EPA to provide Congress, through OMB, explanations when the Agency decides not to use available and applicable voluntary consensus standards. This action does not involve technical standards, other than to make corrections and clarifications. Therefore, EPA did not consider the use of any voluntary consensus standards. List of Subjects in 40 CFR Parts 53 and 58 Environmental protection, Administrative practice and procedure, Air pollution control, Intergovernmental relations, Reporting and recordkeeping requirements. Dated: April 30, 2007. Stephen L. Johnson, Administrator. [FR Doc. 07-2237 Filed 6-11-07; 8:45 am]
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  • 40 CFR 82
  • 40 CFR 82(a)
  • 40 CFR 9
  • Pub. L. 104-4
  • Pub. L. 104-113
  • 7 CFR 354
  • 7 CFR 354.3
  • 7 CFR 353
  • 7 CFR 354.1
  • 7 CFR 354.3(g)
  • 7 CFR 3015
  • 7 USC 7701-7772
  • 7 CFR 2.22
  • 14 CFR 39
  • 33 CFR 137
  • Pub. L. 108-293
  • 40 CFR 312
  • 40 USC 9604(k)(2)(B)
  • 40 CFR 312.10(b)
  • 5 USC 601-612
  • Pub. L. 104-121
  • 44 USC 3501-3520
  • 5 CFR 1320.3(c)
  • 2 USC 1531-1538
  • 42 USC 4321-4370f
  • 472 F.3d 882
  • 375 F.3d 537
  • 285 F.3d 63
  • 265 F.3d 426
  • 40 CFR 81
  • 40 CFR 50
  • 40 CFR 58
  • 144 F.3d 984
  • 40 CFR 51
  • 40 CFR 93
  • 40 CFR 93.118(e)(4)
  • 40 CFR 52
  • 40 CFR 53
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F. App'x472 F.3d 882
F. App'x375 F.3d 537
F. App'x285 F.3d 63
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