Approval and Promulgation of Air Quality Implementation Plans; Richmond, Virginia--NO_x Exemption Petition

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Note: EPA no longer updates this information, but it may be useful as a reference or resource.
[Federal Register: July 21, 1997 (Volume 62, Number 139)]
[Rules and Regulations]
[Page 38922-38932]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr21jy97-14]

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ENVIRONMENTAL PROTECTION AGENCY
40 CFR Part 52
[SIPTRAX No.VA062-5019; FRL-5861-2]

Approval and Promulgation of Air Quality Implementation Plans;
Richmond, Virginia--NO_x Exemption Petition

AGENCY: Environmental Protection Agency (EPA).
ACTION: Final rule.

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SUMMARY: The EPA is issuing final approval of a petition from the
Commonwealth of Virginia requesting that the Richmond moderate ozone
nonattainment area be exempt from applicable nitrogen oxides
(NO_x) reasonably available control technology (RACT) control
requirements of section 182(f) of the Clean Air Act (Act). This
exemption request, submitted by the Virginia Department of
Environmental Quality, is based upon three years of ambient air
monitoring data which demonstrate that the National Ambient Air Quality
Standard (NAAQS) for ozone has been attained in the Richmond area
without additional reductions of NO_x. The effect of this
action is to remove the requirement for NO_x RACT contingent
upon continued monitoring of attainment in the Richmond area. The
action will also stop application of the offset sanction imposed on
January 8, 1996 and defer application of future sanctions as of the
effective date of the exemption approval. This action is being taken
under section 182(f) of the Clean Air Act.

EFFECTIVE DATE: This final rule is effective on August 20, 1997.

ADDRESSES: Copies of the documents relevant to this action are
available for public inspection during normal business hours at the
Air, Radiation, and Toxics Division, U.S. Environmental Protection
Agency, Region III, 841 Chestnut Building, Philadelphia, Pennsylvania
19107; Virginia Department of Environmental Quality, 629 East Main
Street, Richmond, Virginia, 23219.

FOR FURTHER INFORMATION CONTACT: Christopher H. Cripps, (215) 566-2179,
at the EPA Region III address above (or via e-mail at
cripps.christopher@epamail.epa.gov).

SUPPLEMENTARY INFORMATION: On December 18, 1995, the Commonwealth of
Virginia's Department of Environmental Quality submitted a
NO_x exemption petition that would exempt the Richmond ozone
nonattainment area from the NO_x RACT requirement under
section 182(f) of the Act. The exemption request was based upon ambient
air monitoring data for 1993, 1994, and 1995, which demonstrated that
the NAAQS for ozone has been attained in the area without additional
reductions of NO_x. Subsequent to the original request for an
exemption, additional ambient data for 1996 became available. The EPA
has reviewed the ambient air monitoring data for 1994, 1995, and 1996
and concludes that the area is still attaining the ozone standard.
    The current design value for the Richmond nonattainment area,
computed using ozone monitoring data for 1994 through 1996, is 116
parts per billion (ppb). The average annual number of expected
exceedances is 0.7 for that same time period. For the 1993 to 1995 time
period, the average annual number of expected exceedances was 1.0, and
the corresponding design value was 124 ppb. An area is considered in
attainment of the standard if the average annual number of expected
exceedances is less than or equal to 1.0.
    On July 26, 1996, the Commonwealth of Virginia submitted a
redesignation request and complete maintenance plan for the Richmond
ozone nonattainment area based on the 1993 to 1995 air quality
monitoring data. The EPA will be acting on this submittal in a separate
rulemaking document.
    On March 19, 1996, the EPA proposed approval of the NO_x
exemption petition for the Richmond ozone nonattainment area (61 FR
11170). Also, in a March 19, 1996 interim final rule, EPA made a
determination that the Commonwealth, contingent on continued monitored
attainment of the ozone NAAQS, had corrected the deficiency of failing
to submit NO_x RACT rules (61 FR 11162). This interim final
rule did not stop the sanction clock that started under section 179 for
this area on July 8, 1994. However, this interim final rule did stay
the application of the offset sanction and has deferred the application
of the highway sanction. The EPA provided

[[Page 38923]]

the public with an opportunity to comment on the proposed action and on
the interim final rule.

Response to Public Comment

    Adverse comments to the proposed exemption and the interim final
rule were received from six commenters. In addition, three
environmental groups submitted joint adverse comments on the proposed
approvals of NO_x exemptions for the Ohio and Michigan ozone
nonattainment areas in August of 1994. These comments addressed the
EPA's general policy regarding NO_x exemptions. The
commenters requested that these comments be addressed in all EPA
rulemakings dealing with section 182(f) exemptions. Even though some of
these August 1994 comments are not pertinent to the proposed action,
EPA has addressed them for completeness.
    In addition to commenters who fully opposed the exemption, two
letters were received that either conditionally supported the exemption
or that fully supported the exemption but commented adversely on
supplemental information in the preamble of the notice of proposed
rulemaking. One of these two comment letters supported the proposed
exemption only if no further controls on volatile organic compounds
(VOC) would be required in lieu of NO_x RACT. The second of
these two comment letters fully supported the exemption and provided
urban airshed modeling results to show further reduction of
NO_x would not contribute to attainment although EPA's action
to grant the exemption is based upon ambient air quality data
indicating that the Richmond area has attained the ozone NAAQS and not
upon a modeled demonstration. The following discussion summarizes the
comments received regarding the Commonwealth's petition and EPA's
proposed rulemaking and presents the EPA's responses to these comments.
    Comment ^#1 Certain commenters argued that all
NO_x exemption determinations by the EPA, including exemption
actions taken under the petition process established by subsection
182(f)(3), must occur during consideration of a state implementation
plan (SIP) revision. These commenters argued that NO_x
exemptions are provided for in two separate parts of the Act, section
182(b)(1) and section 182(f). Because the NO_x exemption
tests in subsections 182(b)(1) and 182(f)(1) include language
indicating that action on such requests should take place ``when [EPA]
approves a plan or plan revision,'' these commenters conclude that all
NO_x exemption determinations by the EPA, including exemption
actions taken under the petition process established by subsection
182(f)(3), must occur during consideration of an approvable SIP
revision such as attainment demonstrations or maintenance plans, unless
the area has been redesignated as attainment. Several commenters stated
NO_x exemptions should only be considered in conjunction with
attainment or maintenance plans whereas one commenter stated
NO_x exemptions should only be considered in conjunction with
any implementation plans containing control measures.
    Response ^#1 Section 182(f) contains very few details
regarding the administrative procedures for acting on NO_x
exemption requests. The absence of specific guidelines by Congress
leaves the EPA with discretion to establish reasonable procedures
consistent with the requirements of the Administrative Procedures Act
(APA).
    The EPA disagrees with the commenters regarding the process for
considering NO_x exemption requests under section 182(f) and
instead, believes that sections 182(f)(1) and 182(f)(3) provide
independent procedures by which the EPA may act on NO_x
exemption requests. The language in section 182(f)(1), which indicates
that the EPA should act on NO_x exemptions in conjunction
with action on a plan or a plan revision, does not appear in section
182(f)(3). While section 182(f)(3) references section 182(f)(1), the
EPA believes that this reference encompasses only the substantive tests
in paragraph (1) (and by extension, paragraph (2)), not the procedural
requirement that the EPA act on exemptions only when acting on SIP
revisions. Additionally, section 182(f)(3) provides that ``a person''
(which section 302(e) of the Act defines to include a State) may
petition for NO_x exemptions ``at any time,'' and requires
the EPA to make its determination within 6 months of the petition's
submission. These key differences lead the EPA to believe that Congress
intended the exemption petition process of paragraph (3) to be distinct
and more expeditious than the longer plan revision process intended
under paragraph (1).
    With respect to major stationary sources, section 182(f) requires
marginal areas to adopt new source review (NSR) rules, unless exempted.
These rules were generally due to be submitted to the EPA by November
15, 1992. Thus, in order to avoid the Act's sanctions, areas seeking a
NO_x exemption would have needed to submit this exemption
request for EPA review and rulemaking action several months before
November 15, 1992. In contrast, the Act specifies that the attainment
demonstrations were not due until November 1993 or 1994 (and the EPA
may take up to 12 months to approve or disapprove the demonstrations).
For marginal ozone nonattainment areas (subject to NO_x NSR),
no attainment demonstrations are called for in the Act. For areas
seeking redesignation to attainment of the ozone NAAQS, the Act does
not specify a deadline for submittal of maintenance demonstrations (in
reality, the EPA would generally consider redesignation requests
without accompanying maintenance plans to be unacceptable). Clearly,
the Act envisions the submittal of an EPA action on NO_x
exemption requests, in some cases, prior to submittal of attainment or
maintenance demonstrations.
    Comment ^#2 Commenters argued that for various reasons
three years of ``clean'' data fail to demonstrate that NO_x
reductions would not contribute to attainment and that EPA's policy
erroneously equates the absence of a violation for one three-year
period with ``attainment''. Two commenters argued that three years of
violation-free data could be reflecting an economic downturn that
resulted in temporarily lower than normal emissions.
    Several of these commenters argued that three years of data without
a violation might be only the result of favorable weather conditions.
One commenter argued that the weather in 1995 was in fact abnormal in
that the Richmond area experienced high-altitude winds which prevented
stagnation.
    Response ^#2 The EPA does not agree with the comment that
three years of air quality monitoring data is an insufficient basis to
grant an exemption under section 182(f). In cases where a nonattainment
area outside an ozone transport region is demonstrating attainment with
3 consecutive years of air quality monitoring data without having
implemented the section 182(f) NO_x provisions, the EPA
believes that the section 182(f) test is met since ``additional
reductions of [NO_x] would not contribute to attainment'' of
the NAAQS in that area. In all cases, in the absence of approved
maintenance and contingency plans and an approved redesignation
request, EPA's approval of the exemption is granted on a contingent
basis (i.e., the exemption would last for only as long as the area's
monitoring data continue to demonstrate attainment).
    The EPA has separate criteria for determining if an area should be
officially redesignated to attainment under section 107(d)(3)(E) of the
Act. The section 107 criteria are more

[[Page 38924]]

comprehensive than the Act requires with respect to NO_x
exemptions under section 182(f). If all the criteria, other than that
related to air quality data, for redesignation are met, EPA would act
to redesignate an area to attainment of the ozone NAAQS based upon only
(and at least) three years of violation-free data.
    In addition to air quality monitoring data showing attainment,
under section 107, EPA can only redesignate an area to attainment if
EPA has fully approved a maintenance plan. One of EPA's criteria for an
approvable maintenance plan is that the plan demonstrate maintenance
with the standard for a period of twelve years after the submission of
the maintenance plan. One method of demonstrating maintenance is a
showing that future year emissions of each of the ozone precursors
including NO_x will remain stable or decline over the twelve-
year period. In the absence of such redesignation with an approved
maintenance plan, EPA's approval of the exemption is granted on a
contingent basis.
    EPA must, as a legal matter, use the ambient air quality monitoring
data and related evaluation methodologies to determine if an area is
attaining or violating the ozone NAAQS and base its action on the
particular facts of each exemption petition. Therefore, the EPA cannot
require that states seeking exemption from NO_x provisions
based on monitoring data estimate what emissions might have been under
different economic conditions. The EPA cannot require that states
seeking exemptions from NO_x provisions based on monitoring
data estimate what ozone concentrations might have been under different
meteorological conditions. Furthermore, the determination of compliance
with the ozone NAAQS uses air quality monitoring data over a three year
period and therefore accounts for fluctuations in meteorology.
    Comment ^#3 One commenter stated that because the
Virginia petition did not take into account meteorological fluctuations
any perceived trends in ambient ozone monitoring data are a poor basis
for an exemption, and cited the conclusions in the report of the
National Academy of Sciences (NAS) ``Rethinking the Ozone Problem in
Urban and Regional Air Pollution'' [National Academy Press, Wash., DC,
1991] by the National Research Council that year-to-year variability in
ozone concentrations are attributable to meteorological fluctuations.
This commenter also cited the conclusion in this NAS report that the
current use of the second-highest daily maximum 1-hour concentration in
a given year as the principal measure to assess ozone trends is not a
reliable measure of progress in reducing ozone and that more
statistically robust methods should be used. This commenter noted that
there were seven ozone nonattainment areas (Kansas City, San Francisco,
Memphis, Detroit, Cincinnati, Pittsburgh and Muskegon) which violated
the ozone NAAQS in 1995 that had been redesignated to attainment since
1990 or had redesignation requests pending. The commenter also argued
that a conclusion based solely upon three years of ``clean'' data fails
to demonstrate that NO_x reductions would not contribute to
attainment because in the absence of reliable methods for monitoring
reductions in precursor emissions EPA cannot conclude that real
progress in reducing ozone has been made.
    Response ^#3 EPA does not agree with the comment. As
noted in the response to an earlier comment, EPA must, as a legal
matter, use the current ozone standard and related evaluation
methodologies to determine if an area is attaining or violating the
ozone NAAQS and base its action on the particular facts of each
exemption petition. The cited NAS report and EPA's companion report
both support the conclusion that, as a general matter for ozone
nonattainment areas across the country, NO_x reductions in
addition to VOC reductions will be needed to achieve attainment.
However, as stated in the response to an earlier comment, EPA believes
that an area outside an ozone transport region qualifies for an
exemption under section 182(f) when the area is demonstrating
attainment with 3 consecutive years of air quality monitoring data
without having implemented the section 182(f) NO_x
provisions. For the Richmond area the issue is whether the additional
reductions from the requirements of section 182(f) would contribute to
attainment of the ozone NAAQS in the Richmond area. The reductions
required under section 182(f) are ``additional'' in the sense that
these reductions will occur in addition to other requirements of the
Act. For example, the Clean Air Act mandated a number of new control
measures such as those required under Title II concerning national
standards for new motor vehicles which will reduce both NO_x
and VOC emissions as cars built prior to these standards are replaced
by those required to meet these standards. For the reasons stated in
the previous response, EPA believes there is a basis for granting a
NO_x exemption for the Richmond area on a contingent basis
(in the absence of approved maintenance and contingency plans and an
approved redesignation request).
    Comment ^#4 One of these commenters provided newspaper
articles which reported that the Richmond area was slated for
construction of one major new manufacturing facility and was one of a
few areas under consideration for location of another major new
manufacturing facility. This commenter noted that future ozone
precursor emissions growth is likely.
    Response ^#4 The EPA's decisions on whether or not to
grant a NOX waiver are not dependent on estimates of what emissions may
be in future years. As explained in the response to a previous comment,
EPA must, as a legal matter, use the ambient air quality monitoring
data and related evaluation methodologies to determine if an area is
attaining or violating the ozone NAAQS and base its action on the
particular facts of each exemption petition. As also explained in the
response to a previous comment, a determination that an area is in
``attainment'' based on three years of clean data does not result in
official redesignation to attainment until the other requirements of
section 107(d)(3)(E) of the Act are met. These other requirements
include a demonstration of continued maintenance for twelve years after
submittal of the redesignation request and maintenance plan. Such a
demonstration may be based upon a showing that emissions of ozone
precursors will remain stable or decline relative to the emissions in
the attainment year inventory or be based upon photochemical modeling
that a future year mix of ozone precursor emissions will not result in
violation of the ozone NAAQS. Either method for a demonstration of
maintenance sets emission budgets for ozone precursors. In all cases,
in the absence of approved maintenance and contingency plans and an
approved redesignation request, EPA's approval of the exemption is
granted on a contingent basis (i.e., the exemption would last for only
as long as the area's monitoring data continue to demonstrate
attainment).
    Comment ^#5 Many commenters opposed the exemption based
on 3 years of clean data where there is evidence that shows the
exemption interferes with attainment or maintenance in downwind areas.
Several commenters noted that either one or both of EPA's December 1993
guidance and May 27, 1994 policy prohibits granting a section 182(f)
exemption based on 3 years of clean data if evidence exists showing
that the exemption would interfere with attainment or maintenance in

[[Page 38925]]

downwind areas. Such conditions should also apply to exemption requests
based on modeling.
    One commenter provided evidence that shows NO_x
reductions in the Richmond area provide ozone benefits in large areas
of the ozone transport region. Several commenters referenced results of
regional oxidant modeling (ROM) performed by the EPA and mentioned in
the notice of proposed rulemaking for this action that show regional
NO_x control is needed in combination with localized VOC
control in order to attain the ozone NAAQS throughout the Ozone
Transport Region (OTR); thus, control of NO_x emissions
throughout the eastern United States will contribute to significant
reductions in peak ozone levels within the OTR. Several commenters
asked EPA to re-evaluate the February 8, 1995 memorandum from John S.
Seitz, Director, Office of Air Quality and Standards, entitled
``Section 182(f) Nitrogen Oxides (NO_x) Exemptions--Revised
Process and Criteria'' to require that exemptions only be granted to
areas that do not interfere with attainment or maintenance in downwind
areas. Three of these commenters contend that EPA cannot segregate
action under section 182(f) from the requirements of section
110(a)(2)(D).
    One of these commenters also opposed the interim final rule to stay
sanctions because it ignores the detrimental effects on air quality on
areas downwind.
    Response #5 As a result of comments on previous NO_x
exemptions, the EPA reevaluated its position on this issue and has
revised previously-issued guidance. See the Memorandum, ``Section
182(f) Nitrogen Oxides (NO_x) Exemptions--Revised Process and
Criteria,'' dated February 8, 1995, from John Seitz. As described in
this memorandum, the EPA intends to use its authority under section
110(a)(2)(D) to require a State to reduce NO_x emissions from
stationary and/or mobile sources where there is evidence, such as
photochemical grid modeling, showing that the NO_x emissions
would contribute significantly to nonattainment in, or interfere with
maintenance by, any other State or in another nonattainment area within
the same State. This action would be independent of any action taken by
the EPA on a NO_x exemption request under section 182(f).
That is, the EPA's action to grant or deny a NO_x exemption
request under section 182(f) for any area would not shield that State's
need in response to a call by EPA for revisions to state implementation
plans (SIP call), for example, area from the EPA's action to require
additional NO_x emission reductions from sources in that
area, if necessary, under section 110.
    Recent modeling data suggest that certain ozone nonattainment areas
may benefit from reductions in NO_x emissions upwind of the
nonattainment areas. The EPA is working with the States and other
organizations to design and complete studies which consider upwind
sources and quantify their impacts. At the same time, States have
requested exemptions from NO_x requirements under section
182(f) for certain nonattainment areas in the modeling domains. Some of
these nonattainment areas may impact downwind nonattainment areas. The
EPA intends to address the transport issue under section 110(a)(2)(D),
based on a regional modeling analysis.
    Under section 182(f)(1)(A) of the Act, an exemption from
NO_x requirements may be granted for nonattainment areas
outside of an ozone transport region if the EPA determines that
``additional reductions of (NO_x) would not contribute to
attainment of the national ambient air quality standard for ozone in
the area.'' There are three NO_x exemption tests specified in
section 182(f). Of these, two are applicable for areas outside of an
ozone transport region: the ``contribute to attainment'' test described
above, and the ``net air quality benefits'' test. The EPA must
determine, under the latter test, that the net benefits to air quality
in an area ``are greater in the absence of NO_x reductions''
from relevant sources. Based on the plain language of section 182(f),
EPA believes that each test provides an independent basis for receiving
a full or limited NO_x exemption. Consequently, as stated in
section 1.4 of the December 16, 1993, EPA guidance,

    [w]here any one of the tests is met (even if another test is
failed), the section 182(f) NO_x requirements would not
apply or, under the excess reductions provision, a portion of these
requirements would not apply.

    As described in section 4.3 of the December 13, 1993, EPA guidance
document, ``Guideline for Determining the Applicability of Nitrogen
Oxides Requirements Under Section 182(f),'' the EPA encourages, but
does not require, States/petitioners to consider the impacts on the
entire modeling domain since the effects of an attainment strategy may
extend beyond a designated nonattainment area. Specifically, the
guidance encourages States to consider imposition of the NO_x
requirements if needed to avoid adverse impacts in downwind areas,
either intra- or interstate. States need to consider such impacts since
they are ultimately responsible for achieving attainment in all
portions of their State and for ensuring that emissions originating in
their State do not contribute significantly to nonattainment in, or
interfere with maintenance by, any other State. See section
110(a)(2)(D)(i)(I) of the Act.
    In contrast, section 4.4 of the December 16, 1993, guidance states
that the section 182(f) demonstration would not be approved if there is
evidence, such as photochemical grid modeling, showing that the
NO_x exemption would interfere with attainment or maintenance
in downwind areas. The guidance further explains that section
110(a)(2)(D) [not section 182(f)] prohibits such impacts. Consistent
with section 4.3 of the guidance, the EPA believes that the section
110(a)(2)(D) and 182(f) provisions must be considered independently,
and hence, has revised section 4.4 of the December 16, 1993, guidance
document. Thus, if there is evidence that NO_x emissions in
an upwind area would interfere with attainment or maintenance in a
downwind area, that problem should be separately addressed by the
State(s) or, if necessary, by the EPA in a section 110(a)(2)(D) action.
In addition, a section 182(f) exemption request should be independently
considered by the EPA.
    The Commonwealth of Virginia is being included in modeling analyses
being conducted by the EPA, States, and other agencies as part of the
Ozone Transport Assessment Group (OTAG). The OTAG process is a
consultative process among the eastern States and the EPA. The OTAG
assessment process will evaluate regional and national emission control
strategies using improved regional modeling analyses. The goal of the
OTAG process is to reach consensus on additional regional and national
emission reductions that are needed to support efforts to attain the
ozone standard in the eastern United States.
    On January 10, 1997 (62 FR 1420) EPA issued a notice of intent to
issue a SIP call to reduce regional transport of ozone. In this notice,
in accordance with section 110(k)(5) and 110(a)(2)(D) of the Clean Air
Act (Act), the EPA announced its plans to require States to submit SIP
measures to ensure that emission reductions are achieved as needed to
allow current nonattainment areas to prepare attainment demonstrations
for the current NAAQS. This action will reflect the technical work done
by OTAG and other pertinent regional and urban scale analyses of ozone
transport.

[[Page 38926]]

    Furthermore, this exemption in no way insulates or alleviates the
Commonwealth of Virginia from any future obligations to secure
additional NO_x reductions, perhaps even from among sources
in the Richmond area, should technical evidence, including but not
limited to that which may result from the OTAG process, indicate that
such reductions are required because NO_x emissions generated
in Virginia interfere with the ability of another state or legally
responsible jurisdiction to attain and maintain the NAAQS for ozone,
and EPA makes such a finding.
    Comment #6 One commenter asked EPA to require NO_x RACT
immediately under section 110(a)(2)(D) if the Commonwealth's petition
for an exemption from NO_x RACT is approved.
    Response #6 The EPA does not agree with this comment for two
reasons. First, EPA noted in the Technical Support Document for this
action that the level of reductions required under section 110 may be
greater or less than that required by RACT, depending upon the
circumstances. The EPA established general policy for NO_x
RACT in the ``NO_x Supplement to the General Preamble for
Implementation of Title I'' (57 FR 55620, November 25, 1992) and
established NO_x RACT presumptive emission limits for four
categories of utility boilers. These limits require reductions on the
order of 25 to 50 percent from emission rates prior to control. The
ozone transport assessment process described previously has evaluated
regional and national emission control strategies for NO_x
that considered levels of reductions well in excess of 50 percent.
Therefore RACT alone may not be a significant level of control.
Secondly, the geographic scope of the January 10, 1997 notice of intent
to issue SIP calls for areas throughout the OTAG domain that are
contributing significantly to ozone pollution in downwind areas
includes Virginia. The SIP call process will therefore address the
transport of ozone from all areas influencing the various ozone
nonattainment areas in the eastern half of the United States. As noted
in the response to an earlier comment, EPA's position is that an action
to grant or deny a NO_x exemption request under section
182(f) for any area would not shield that area if additional
NO_x emission reductions are determined to be necessary to
meet the requirements of section 110(a)(2)(D).
    Comment #7 One commenter stated it was inappropriate to issue the
NO_x exemption and interim final rule prior to final action
on the request that EPA exercise its authority under section
110(a)(2)(D) made by the State of New York in the November 1994 SIP
revision for an attainment demonstration for the New York City
metropolitan area.
    Response #7 The EPA does not agree with this comment for the
reasons discussed in the previous two responses. The EPA continues to
believe that actions under section 110(a)(2)(D) are independent of any
action taken by the EPA on a NO_x exemption request under
section 182(f). However, the EPA's action to grant or deny a
NO_x exemption request under section 182(f) for any area
would not shield that area if additional NO_x emission
reductions are determined to be necessary to meet the requirements of
section 110(a)(2)(D). In the January 10, 1997 notice of intent, the EPA
announced its plans to require certain States to submit additional SIP
measures to ensure that emission reductions are achieved as needed to
allow current nonattainment areas to prepare attainment demonstrations
for the current NAAQS. This action will reflect the technical work done
by OTAG and other pertinent regional and urban scale analyses of ozone
transport.
    Comment #8 One commenter asserted that exemptions should be granted
considering transport issues under section 110(2)(2)(D) and referenced
a ``limited exemption'' granted for the State of Maine. The limited
exemption was ``based upon a demonstration that NO_x
emissions in the Northern Maine area are not impacting Maine's moderate
ozone nonattainment areas or any other area in the Ozone Transport
Region during the time periods when elevated ozone levels are monitored
in these areas.''
    Response #8 As noted in the response to an earlier comment, EPA
does not agree that exemptions granted under section 182(f) for areas
outside an ozone transport region must consider transport under section
110(a)(2)(D). The EPA believes, as described in the EPA's December 1993
guidance, that section 182(f)(1) of the Act provides that the new
NO_x requirements shall not apply (or may be limited to the
extent necessary to avoid excess reductions) if the Administrator
determines that any one of the following tests is met:
    (1) In any area, the net air quality benefits are greater in the
absence of NO_x reductions from the sources concerned;
    (2) In nonattainment areas not within an ozone transport region,
additional NO_x reductions would not contribute to ozone
attainment in the area; or
    (3) In nonattainment areas within an ozone transport region,
additional NO_x reductions would not produce net ozone air
quality benefits in the transport region.
    Only the first and third tests are applicable for areas inside an
ozone transport region; the ``net air quality benefits test'' and the
``net ozone air quality benefit'' test. The EPA must determine, under
the first test, that the net benefits to air quality in an area ``are
greater in the absence of NO_x reductions'' from relevant
sources. Under the third test, EPA must determine ``that additional
NO_x reductions would not produce net ozone benefits in the
transport region.'' The exemption for Northern Maine was granted under
the third test (60 FR 66749, December 26, 1995). Therefore, the
exemption petition for Northern Maine had to consider net ozone
benefits in areas within the transport region that are downwind of that
State.
    Comment #9 In addition to stating that perceived trends are a poor
basis for a conclusion and three years of data fail to consider
meteorological fluctuations, one commenter said that sections
110(a)(2), 161 and 162 of the Act, obligate EPA to protect the public
health by ensuring that the air quality standards are attained and then
maintained, not simply to respond after a violation has occurred.
(EPA's response to the interplay of section 182(f) and section
110(a)(2) of the Act is also noted in the response to previous
comments.)
    Response #9 The EPA does not agree with this comment since it
ignores the Congressional intent as evidenced by the plain language of
section 182(f), the structure of the Title I ozone subpart as a whole,
and relevant legislative history. By contrast, in developing and
implementing its NO_x exemption policies, the EPA has sought
an approach that reasonably accords with that intent. In addition to
imposing control requirements on major stationary sources of
NO_x similar to those that apply for sources of VOC, section
182(f) also provides for an exemption (or limitation) from application
of these requirements if, under one of several tests, the EPA
determines that, in certain areas, NO_x reductions would
generally not be beneficial towards attainment of the ozone standard.
    Sections 161 and 162 deal with requirements for areas designated
``attainment'' of the ozone (and any other) NAAQS. Section 182(f)
authorizes when a nonattainment area may be exempted from the
NO_x RACT requirement for purposes of attaining the ozone
NAAQS; however, the exemption does not preclude future NO_x
controls needed for maintenance of

[[Page 38927]]

the ozone NAAQS that may be required once the area has been
redesignated to attainment. The EPA has not interpreted the
``contribute to attainment'' language in the section 182(f)(1)(A) test
to mean ``contribute to attainment and maintenance.'' (Refer to the May
27, 1994, John S. Seitz, Director, Office of Air Quality Planning and
Standards, memorandum entitled ``Section 182(f) Nitrogen Oxides
(NO_x) Exemptions--Revised Process and Criteria''.)
    In section 182(f)(1), Congress explicitly conditioned action on
NO_x exemptions on the results of an ozone precursor study
required under section 185B of the Act. Because of the possibility that
reducing NO_x in an area may either not contribute to ozone
attainment or may cause the ozone problem to worsen, Congress included
attenuating language, not just in section 182(f), but throughout Title
I of the Act, to avoid requiring NO_x reductions where such
reductions would not be necessary. In describing these various ozone
provisions, including section 182(f), the House Conference Committee
Report states in the pertinent part:

    [T]he Committee included a separate NO_x/VOC (volatile
organic compound) study provision in section (185B) to serve as the
basis for the various findings contemplated in the NO_x
provisions. The Committee does not intend NO_x reduction
for reduction's sake, but rather as a measure scaled to the value of
NO_x reductions for achieving attainment in the particular
ozone nonattainment area. See H.R. Rep. No. 490, 101st Cong., 2d
Sess. 257-258 (1990).

Therefore, EPA has concluded that the determination of the benefits of
NO_x reductions required under section 182(f)(1)(A) is
limited to a determination of whether such reductions would contribute
only to ``attainment'' of the ozone NAAQS and need not consider the
benefits for maintenance in areas that have been redesignated to
attainment of the ozone NAAQS.
    Comment #10 Several commenters stated that the exemption should not
be granted because the Act does not authorize any exemption of the
NO_x reduction requirements until conclusive evidence exists
that such reductions are counter-productive.
    Response #10 The EPA does not agree with this comment since it
ignores the Congressional intent as evidenced by the plain language of
section 182(f), the structure of the Title I ozone subpart as a whole,
and relevant legislative history. By contrast, in developing and
implementing its NO_x exemption policies, the EPA has sought
an approach that reasonably accords with that intent. In addition to
imposing control requirements on major stationary sources of
NO_x similar to those that apply for sources of VOC, section
182(f) also provides for an exemption (or limitation) from application
of these requirements if, under one of several tests, the EPA
determines that, in certain areas, NO_x reductions would
generally not be beneficial towards attainment of the ozone standard.
In section 182(f)(1), Congress explicitly conditioned action on
NO_x exemptions on the results of an ozone precursor study
required under section 185B of the Act. Because of the possibility that
reducing NO_x in an area may either not contribute to ozone
attainment or may cause the ozone problem to worsen, Congress included
attenuating language, not just in section 182(f), but throughout Title
I of the Act, to avoid requiring NO_x reductions where such
reductions would not be beneficial or would be counterproductive. In
describing these various ozone provisions, including section 182(f),
the House Conference Committee Report states in the pertinent part:

    [T]he Committee included a separate NO_x/VOC [volatile
organic compound] study provision in section (185B) to serve as the
basis for the various findings contemplated in the NO_x
provisions. The Committee does not intend NO_x reduction
for reduction's sake, but rather as a measure scaled to the value of
NO_x reductions for achieving attainment in the particular
ozone nonattainment area. See H.R. Rep. No. 490, 101st Cong., 2d
Sess. 257-258 (1990).

    As noted in the response to an earlier comment, the command in
section 182(f)(1) that the EPA ``shall consider'' the section 185B
report taken together with the time period the Act provides for
completion of the report and for acting on NO_x exemption
petitions clearly demonstrate that Congress believed the information in
the completed section 185B report would provide a sufficient basis for
the EPA to act on NO_x exemption requests, even in the
absence of the additional information that would be included in
affected areas' attainment or maintenance demonstrations. While there
is no specific requirement in the Act that EPA actions granting
NO_x exemption requests must await ``conclusive evidence,''
as the commenters argue, there is also nothing in the Act to prevent
the EPA from revisiting an approved NO_x exemption if
warranted by additional, current information.
    In addition, the EPA believes, as described in the EPA's December
1993 guidance, that section 182(f)(1) of the Act provides that the new
NO_x requirements shall not apply (or may be limited to the
extent necessary to avoid excess reductions) if the Administrator
determines that any one of the following tests is met:
    (1) In any area, the net air quality benefits are greater in the
absence of NO_x reductions from the sources concerned;
    (2) In nonattainment areas not within an ozone transport region,
additional NO_x reductions would not contribute to ozone
attainment in the area; or
    (3) In nonattainment areas within an ozone transport region,
additional NO_x reductions would not produce net ozone air
quality benefits in the transport region.
    Based on the plain language of section 182(f), the EPA believes
that each test provides an independent basis for a full or limited
NO_x exemption.
    Only the first test listed above is based on a showing that
NO_x reductions are ``counterproductive.'' If any one of the
tests is met, the section 182(f) NO_x requirements would not
apply or, under the excess reductions provision, a portion of these
requirements would not apply.
    Comment #11 Many commenters opposed the exemption because it
ignored the other benefits of NO_x reductions. Other benefits
noted were reduction of nitrogen loading to waterways, bays and
estuaries, especially noted was the Chesapeake Bay, reduction of other
(non-ozone) secondary pollution, such as fine particulate matter,
formed from NO_x-VOC mixtures, and reduction of acid
deposition. One of these commenters wondered if EPA can relieve an
ozone nonattainment area of the NO_x RACT requirement where
the Commonwealth is not meeting alternative requirements for nitrogen
controls in water discharges.
    Response #11 The EPA does not agree nor does the Act require that
decisions regarding granting of a NO_x exemption be made
contingent on addressing other environmental benefits such as those
raised by the commenters. As noted in the responses to the two previous
comments, based upon the plain language of section 182(f) and relevant
legislative history, the EPA believes that each of the three tests
discussed in section 182(f) provides an independent basis for a full or
limited NO_x exemption. Only the ``net air quality test'' is
based on a showing that NO_x reductions provide environmental
benefits beyond attainment of the ozone NAAQS. In addition, based upon
the language, not just in section 182(f), but throughout Title I of the
Act regarding NO_x reductions and upon the relevant

[[Page 38928]]

legislative history, EPA has concluded that the determination of the
benefits of NO_x reductions required under the ``contribute
to attainment'' test is limited to a determination of whether such
reductions would contribute only to ``attainment'' of the ozone NAAQS
and need not consider the benefits in relation to other environmental
media. Moreover, some of the pollution problems to which NO_x
emissions contribute are addressed by separate Titles of the Clean Air
Act or other environmental statutes.
    Comment #12 One commenter contended that the air quality monitoring
data alone does not support this exemption proposal. The commenter
stated the actual measured ozone concentrations reflect the Richmond
nonattainment area's failure to consistently attain the federal
standard. The air quality levels are below EPA's definition of an
exceedance of the ozone NAAQS at 0.125 parts per million (ppm), but are
greater than the ozone NAAQS of 0.12 ppm. The commenter protested
rounding of ozone concentration measurements less than or equal to 124
ppb down to 120 ppb. The commenter stated that had the EPA adhered to a
``brightline'' 120 ppb standard the Richmond area would be in violation
of the ozone NAAQS. The commenter stated that more control of
NO_x should be required in the Richmond area because the
ozone concentrations are routinely at or above the current ozone NAAQS.
The commenter contended that the ozone readings for 1995 were more than
``twice'' the current standard.
    Response #12 For the reasons provided below, EPA does not agree
with the commenter's conclusions. As stated in 40 CFR 50.9, the ozone
``standard is attained when the expected number of days per calendar
year with maximum hourly average concentrations above 0.12 parts per
million (235 ug/m\3\) is equal to or less than 1, as determined by
Appendix H. Appendix H references EPA's ``Guideline for Interpretation
of Ozone Air Quality Standards'' (EPA-450/4-79-003, January 1979),
which notes that the stated level of the standard is taken as defining
the number of significant figures to be used in comparison with the
standard. For example, a standard level of 0.12 ppm means that
measurements are to be rounded to two decimal places (0.005 rounds up
to 0.01). Thus, 0.125 ppm is the smallest concentration value in excess
of the level of the ozone standard. Likewise, the calculated expected
exceedances are rounded to zero decimal places. Thus, the smallest sum
of expected exceedances for any one monitor that cause the 3-year
average to exceeds 1 would be 3.2. Before proposing the exemption, EPA
had analyzed the 1993 to 1995 air quality monitoring data in accordance
with Appendix H and had determined that the expected number of days per
calendar year maximum hourly average concentrations above 0.12 parts
per million (235 ug/m\3\) did not exceed 1. Because the largest sum of
expected exceedances for the 1993 to 1995 data at any one monitor was
3.1, the standard was not exceeded. The largest recorded one-hour,
maximum ozone concentration recorded in the 1993 to 1995 period was
0.154 ppm which is well less than twice the standard of 0.12 ppm. It is
true that during 1995 three monitoring locations in the Richmond area
each recorded one valid monitored exceedance of the 0.12 ppm standard
during 1995. However, the form of the ozone NAAQS requires the use of a
3-year period to determine the average number of exceedances per year.
The determination of expected number of exceedances is performed on a
monitor by monitor basis. An area with more than one monitor would
violate the standard if the expected number of days per calendar year
maximum hourly average concentrations above 0.12 parts per million
exceeds 1 at any one monitor. The EPA has determined that the Richmond
area did not violate the ozone NAAQS based upon monitoring data for
1993 to 1995 and has continued without violation through 1996.
    Comment #13 One commenter said that NO_x reductions would
benefit the Richmond area as demonstrated by the Urban Airshed Modeling
performed by the Virginia Department of Environmental Quality for the
May 15, 1995, Virginia Attainment Demonstration SIP submittal for
Richmond.
    Response #13 The EPA does not agree with this comment. The EPA
considered the Attainment Demonstration submittal for Richmond in the
Technical Support Document (TSD) for the notice of proposed rulemaking.
The EPA's evaluation weighed the air quality monitoring more heavily
than the attainment demonstration. The reason for doing so was
discussed in the TSD and is summarized and clarified below.
    In section 4.3 of the December 1993 EPA applicability guidance, the
``contribute to attainment'' test is described for the case where an
exemption request is submitted with a redesignation request with
violation-free monitoring data for the most recent three years. This
policy was amended in the May 27, 1994 Seitz memo to allow a petition
for a section 182(f) exemption to be submitted prior to a redesignation
request. The same section of the guidance (since amended as discussed
above under transport) requires EPA to deny the petition if creditable
modeling shows that NO_x reduction in the area seeking the
section 182(f) is necessary for a downwind area to attain or maintain
the ozone NAAQS. The guidance is silent on the case where modeling and
monitoring results in the area are at odds.
    Under the policy set forth in a May 10, 1995 memorandum from John
S. Seitz, Director, OAQPS, entitled ``Reasonable Further Progress,
Attainment Demonstration, and Related Requirements for Ozone
Nonattainment Areas Meeting the Ozone National Ambient Air Quality
Standard'', EPA concluded that the requirements for reasonable further
progress towards attainment, the attainment demonstration itself, and
certain attainment-related requirements are moot when an area is
monitoring attainment of the NAAQS. The determination that these
requirements are waived would remain effective as long as the area
remains free of violations of the ozone NAAQS. In a recent Federal
Register notice EPA has acted to waive these requirements for the
Richmond area based upon air quality monitoring data for 1993 to 1996.
See 62 FR 32204 (June 13, 1997). The reasonable further progress,
attainment demonstration and related requirements become permanently
moot if and when the area is redesignated to attainment. To redesignate
an area to attainment, EPA must determine that, among other things, the
area is free of violations of the ozone NAAQS, that attainment was the
result of real, permanent, quantifiable reductions in precursor
emissions and that maintenance of the standard is demonstrated. The EPA
does not require the maintenance demonstration to be air quality
modeling based where a demonstration is made that the future year
emission inventories will remain at or below the inventory of the
attainment year.
    The December 1993 guidance is silent on situations where EPA must
consider an exemption petition based upon air quality monitoring data
that is not consistent with air quality modeling. The EPA has
determined nonattainment areas can be exempted from certain other
nonattainment requirements contingent upon continued monitoring of
attainment. The EPA therefore has granted greater weight to the air
quality monitoring data than the air quality modeling data when
considering this exemption petition.

[[Page 38929]]

    Comment #14 Several commenters argued that the monitoring network
in Richmond does not adequately cover this large airshed. All argued
that the four monitors cannot reflect all areas where an exceedance of
the ozone NAAQS may occur. One stated that according to the Virginia
Department of Environmental Quality the four monitors are not placed in
high-activity areas in order to more ``accurately reflect consistent
ambient concentrations,'' that is, the monitors are placed to measure
``background'' or ``diluted'' concentrations. One commenter argued that
to address the inadequacies of the monitoring networks the Act
establishes several prerequisites before an area can be redesignated to
attainment and that three-years of data do not address any potential
increases in NO_x emissions.
    Response #14 The EPA does not agree with these comments because the
current monitoring network meets EPA-specified regulatory requirements
(see 40 CFR part 58), and adequately reflects air quality in the
nonattainment area.
    Comment ^#15 Comments were received regarding the process
by which the reapplication of the NO_x RACT requirement and
sanctions in the event a violation is monitored. One commenter stated
the notice of proposed rulemaking and the interim final rule contained
conflicting statements regarding staying and deferring imposition of
sanctions. The commenter noted that the interim final rule mentions
that the stay and deferment of sanctions will occur while the EPA
completes the rulemaking process on the Commonwealth's petition. In
contrast the commenter noted that the notice of proposed rulemaking
stated the 2:1 offset sanction cannot be lifted until either a
NO_x RACT SIP is deemed complete by the EPA or the exemption
under section 182(f) is granted. Another commenter asked EPA to clarify
what steps will be taken regarding reapplication of NO_x RACT
in the event a violation of the ozone NAAQS occurs in the future.
    Response #15 The purpose of the interim final rule was to stay, for
the duration of EPA's rulemaking process on the exemption petition,
further application of the 2:1 offset sanction which went into effect
in the Richmond ozone nonattainment area as of January 8, 1996 as a
result of the July 8, 1994 finding of failure to submit. On July 8,
1994, EPA sent a letter to the Governor of Virginia stating that, under
section 179 of the Act, EPA made a finding that Virginia failed to
submit a SIP revision for NO_x RACT. This finding commenced
the sanctions process outlined by section 179. The two to one (2:1)
offset sanction went into effect 18 months later.
    The interim final rule also established the procedure by which
sanctions would be reapplied if, based upon comments to the proposed
and/or interim final rules, EPA determined that the petition was not
approvable. The basis for staying and deferring sanctions in the
interim final rule was that EPA had concluded that the Commonwealth was
eligible for an exemption from the NO_x RACT requirement,
under section 182(f) and, therefore, was no longer subject to the
requirement for which the July 8, 1994 finding of failure to submit was
issued. If, based upon comment, EPA determined that the exemption
petition was in fact unapprovable then the basis for the interim final
rule would no longer exist. Therefore, the interim final rule provided
that sanctions would be applied at the time of a final action
disapproving the NO_x exemption petition (or, if action is
re-proposed, at the time of the proposed disapproval).
    The notice of proposed rulemaking also had to address how sanctions
would be affected if EPA approved the exemption. Basically, the notice
of proposed rulemaking proposed, on the effective date of the exemption
approval, to stop application of the 2:1 offset sanction and to defer
application of the highway sanction which was to take effect July 8,
1996. In essence, final approval (contingent upon continued monitoring
of attainment) of the exemption petition would continue the stay and
deferment of sanctions initiated by the interim final rule. However,
the stay would be lifted, should a monitored violation of the ozone
NAAQS be recorded under the conditions set forth in the notice of
proposed rulemaking. These conditions were:

    ``If there is a violation of the ozone NAAQS in any portion of
the Richmond ozone nonattainment area while this area is designated
nonattainment for ozone, the exemption will no longer be applicable
as of the date of any such determination. Should this occur, EPA
will provide notice both of the exemption revocation and of the date
sanctions will re-apply in the Federal Register. A determination
that the NO_x exemption no longer applies would mean that
the NO_x requirements become once more applicable to the
affected area, that the sanctions would be reinstated, and that
deferred sanctions would be imposed on the date originally due or
the effective date of the notice, whichever is later.'' See 61 FR
11172.

    The contingent nature of the exemption lasts only as long as the
Richmond area is designated nonattainment. If prior to redesignation to
attainment, a violation of the ozone NAAQS is monitored in the Richmond
area and recorded in AIRS, then the section 182(f) exemption would no
longer apply. In the rulemaking action which removes the exempt status,
the EPA would provide specific information regarding the reapplication
of the NO_x RACT requirement and sanctions. Because
NO_x RACT is a nonattainment area requirement, once the area
is redesignated to attainment, NO_x RACT is no longer
required for purposes of attainment. Once the Richmond area is
redesignated to attainment, then the response to a violation of the
ozone NAAQS would be addressed in the manner prescribed by the approved
maintenance plan. NO_x RACT would be implemented to the
extent as required under the approved maintenance plan.
    Because the sanctions were applied pursuant to a finding that the
Commonwealth of Virginia failed to submit a state implementation plan
(SIP) revision for NO_x RACT, both the notice of proposed
rulemaking and interim final rules noted that, even if the exemption
were granted, a NO_x RACT SIP for the Richmond ozone
nonattainment area that meets the completeness criteria of section
110(k) would permanently correct the July 8, 1994 finding of failure to
submit and would permanently lift sanctions. If prior to redesignation
to attainment, a violation of the ozone NAAQS is monitored in the
Richmond area and recorded in AIRS, then the section 182(f) exemption
would no longer apply, and the only way to lift sanctions would be
through submittal of a complete NO_x RACT SIP for the
Richmond area.
    EPA acknowledges that the precise terminology regarding
reapplication of sanctions after an approval of the exemption petition
differed slightly in the interim final rule and the proposed rule. The
EPA intended the description of the reapplication of sanctions after an
exemption approval in the interim final rule to summarize the detailed
proposal language contained in the notice of proposed rulemaking. In
response to this comment, the final rule clarifies the process for
reapplication of sanctions after an exemption approval in the event of
a monitored violation as set forth in the notice of proposed rulemaking
and defines the role of a complete NO_x RACT SIP revision
submittal in terminating sanctions.
    Comment ^#16   One commenter supported the exemption but
expressed concerns that the exemption will result in stricter
regulation on emissions of other pollutants, specifically on VOC. The
commenter encouraged EPA not to approve any additional VOC control

[[Page 38930]]

regulations adopted by the Commonwealth that are needed in lieu of an
exemption from NO_x RACT. The commenter asked that any final
approval address further VOC regulation and asked EPA to clarify that
NO_x RACT will be required before any additional VOC control.
    Response ^#16   The EPA does not agree with this comment.
As explained in the response to previous comments (refer to responses
to comments numbers 9 and 10) in section 182(f)(1), Congress included
attenuating language, not just in section 182(f), but throughout Title
I of the Act, to avoid requiring NO_x reductions where such
reductions would not provide net benefits or contribute to attainment.
No such similar language is found concerning VOC reductions in section
182(f) or elsewhere in Title I of the Act. Because today's action is
taken under section 182(f) EPA has no basis for conditioning the
exemption on future VOC regulation.
    Comment ^#17   One commenter fully supported the proposed
action, but commented negatively on the portion of the preamble dealing
with other possible benefits of NO_x reductions in the
Richmond area. One commenter stated that the proposal alleges several
other environmental effects of additional NO_x reductions. If
such benefits exist, they should be addressed in the context of
regulations dealing with those specific environmental effects, not in
context of regulations dealing with attainment of the ozone NAAQS. The
commenter said any conclusion regarding benefits on transport of ozone
from reducing NO_x emissions are premature pending the
outcome of the studies underway by OTAG. The commenter also noted that
the compensation for future growth in NO_x emissions is an
issue to be addressed in a maintenance plan.
    Response ^#17   The EPA included discussion of the
potential other environmental effects of NO_x reductions to
inform the public that the action proposed could affect air quality in
ways not related to attainment of the ozone NAAQS. Nowhere in the
proposal did EPA state that the EPA's proposed action was based upon
other than a determination that the NO_x reductions required
under section 182(f) would not contribute to attainment. As explained
in the response to previous comments, EPA intends to use its authority
under section 110(a)(2)(D) to require a State to reduce NO_x
emissions from stationary and/or mobile sources where there is evidence
showing that the NO_x emissions would contribute
significantly to nonattainment in, or interfere with maintenance by,
any other State, and this action would be independent of any action
taken by the EPA on a NO_x exemption request under section
182(f). As noted in that earlier response, EPA began that process in a
January, 10, 1997 Federal Register notice. Further in an earlier
response, EPA noted it has not interpreted ``contribute to attainment''
in section 182(f)(1)(A) to mean ``contribute to attainment and
maintenance.'' Therefore, the demonstration that an area qualifies for
an exemption under section 182(f)(1)(A) is limited to the effects of
the section 182(f) requirements on attainment.
    Comment ^#18   Some commenters stated that the modeling
required by EPA is insufficient to establish that NO_x
reductions would not contribute to attainment since only one level of
NO_x control, i.e., ``substantial'' reductions, is required
to be analyzed. They further explained that an area must submit an
approvable attainment plan before EPA can know whether NO_x
reductions will aid or undermine attainment.
    Response ^#18   As discussed in the Notice of Proposed
rulemaking and in the responses to previous comments, the basis for
granting this exemption on a contingent basis (i.e., the exemption
would last for only as long as the area's monitoring data continue to
demonstrate attainment) is ambient air monitoring data.
    Therefore this comment is not pertinent to the granting of the
exemption for the Richmond area. But EPA has included this comment
because it was one of the ``standing'' comments as discussed previously
in the introduction to the ``Response to Public Comment'' portion of
this notice.
    Comment #19 Commenters contended that section 182(b)(1) is the
appropriate authority for granting interim period transportation
conformity NO_x exemptions.
    Response #19 The EPA agreed with the commenters and published an
interim final rule that changed the transportation conformity rule to
reference section 182(b)(1) as the correct authority under the Act for
waiving the NO_x ``build/no-build'' and ``less-than-1990
emissions'' tests for certain areas. See 60 FR 44762, (August 29,
1995). A related proposed rule (60 FR 44790), published on the same
day, invited public comment on how the Agency plans to implement
section 182(b)(1) transportation conformity NO_x exemptions.
The final rule for that proposal has since been promulgated. See 60 FR
57179 (November 14, 1995). In that final rule, the EPA noted that
section 182(b)(1), by its terms, only applies to moderate and above
ozone nonattainment areas. Consequently, the EPA believes that the
interim reduction requirements of section 176(c)(3)(A)(iii), and the
authority provided in section 182(b)(1) to grant relief from those
interim reduction requirements, apply only to those areas subject to
section 182(b)(1). The EPA, however, is not granting a NO_x
exemption from the interim period transportation conformity
requirements by today's action because the Commonwealth submitted its
NO_x petition pursuant to section 182(f).
    Comment #20 Comments were received regarding the scope of exemption
of areas from the NO_x requirements of the conformity rules.
The commenters argued that such exemptions waive only the requirements
of section 182(b)(1) to contribute to specific annual reductions during
the period before submission of conformity SIPs, not the requirement
that conformity SIP revisions contain information showing the maximum
amount of motor vehicle NO_x emissions allowed under the
transportation conformity rules, and similarly, the maximum allowable
amounts of any such NO_x emissions under the general
conformity rules. The commenters admitted that, in prior guidance, the
EPA has acknowledged the need to amend a drafting error in the existing
transportation conformity rules to ensure consistency with motor
vehicle emissions budgets for NO_x, but have wanted the EPA,
in actions on NO_x exemptions, to explicitly affirm this
obligation and to also avoid granting exemptions until a budget
controlling future NO_x increases is in place.
    Response #20 The EPA's transportation conformity rule originally
provided a NO_x transportation conformity exemption if an
area received a section 182(f) exemption. See 58 FR 62188 (November 24,
1993). As indicated in a previous response, the EPA has changed the
reference from section 182(f) to section 182(b)(1) in the
transportation conformity rule since that section is specifically
referenced by the transportation conformity provisions of the Act. See
60 FR 44762 (August 29, 1995). The EPA has also consistently held the
view that, in order to conform, nonattainment and maintenance areas
must demonstrate that the transportation plan and the Transportation
Improvement Program are consistent with the motor vehicle emissions
budget for NO_x even where a conformity NO_x
exemption has been granted. Due to a drafting error, that view was not
reflected in the transportation conformity rule. The EPA

[[Page 38931]]

has amended the rule to correct this error. See 60 FR 57179 (November
14, 1995).

Final Action

    EPA approves the 182(f) NO_x exemption petition submitted
by the Commonwealth of Virginia for the Richmond ozone nonattainment
area. Approval of the exemption waives the Federal requirements for
NO_x RACT applicable to the Richmond ozone nonattainment
area. The EPA believes that all section 182(f) exemptions that are
approved should be approved only on a contingent basis. As described in
the EPA's NO_x Supplement to the General Preamble (57 FR
55628, November 25, 1992), the EPA would rescind a NO_x
exemption in cases where NO_x reductions were later found to
be beneficial for attainment of the ozone NAAQS in an area's attainment
plan. That is, if an area that received an exemption based on clean air
quality data which shows that the area is attaining the ozone standard
experiences a violation prior to redesignation of the area to
attainment, the exemption would no longer be applicable.
    If, prior to redesignation of the area to attainment, a violation
of the ozone NAAQS is monitored in Richmond (consistent with the
requirements contained in 40 CFR part 58 and recorded in AIRS), the
section 182(f) exemption would no longer apply, as of the date EPA
makes a determination that a violation has occurred. The EPA would
notify the area that the exemption no longer applies, and would also
provide notice to the public in the Federal Register.
    If the exemption is revoked, the area must comply with any
applicable NO_x requirements set forth in the Act. The
NO_x RACT requirements would also be applicable, with a
reasonable time provided as necessary to allow major stationary sources
subject to the RACT requirements to purchase, install and operate the
required controls. The EPA believes that the Commonwealth may provide
sources a reasonable time period after the EPA determination to
actually meet the RACT emission limits. The EPA expects such time
period to be as expeditious as practicable, but in no case longer than
24 months.
    This action stops application of the offset sanction imposed on
January 8, 1996 and defers application of future sanctions on the
effective date of the exemption approval. Sanctions would then remain
stopped or deferred contingent upon continued monitoring that
demonstrates continued attainment of the ozone NAAQS in the entire
Richmond ozone nonattainment area. If there is a violation of the ozone
NAAQS in any portion of the Richmond ozone nonattainment area while
this area is designated nonattainment for ozone, the exemption will no
longer be applicable as of the date of any such determination. Should
this occur, EPA will provide notice both of the exemption revocation
and of the date sanctions will re-apply in the Federal Register. A
determination that the NO_x exemption no longer applies would
mean that the NO_x requirements become once more applicable
to the affected area, that the sanctions would be reinstated, and that
deferred sanctions would be imposed on the date originally due or the
date specified in the notice, whichever is later.
    The sanctions were applied pursuant to a finding that the
Commonwealth of Virginia failed to submit a state implementation plan
(SIP) revision for NO_x RACT. Therefore, if prior to
redesignation to attainment, the sanctions have been reapplied, they
then can only be permanently lifted by submittal of a NO_x
RACT SIP for the Richmond ozone nonattainment area that meets the
completeness criteria of section 110(k).
    If Richmond is redesignated to attainment of the ozone NAAQS,
NO_x RACT is to be implemented as provided for as contingency
measures in the maintenance plan.
    Nothing in this action should be construed as permitting or
allowing or establishing a precedent for any future request for
revision to any state implementation plan. Each request for revision to
the state implementation plan shall be considered separately in light
of specific technical, economic, and environmental factors and in
relation to relevant statutory and regulatory requirements.

Administrative Requirements

A. Executive Order 12866

    This action is not a SIP revision and is not subject to the
requirements of section 110 of the Act. The authority to approve or
disapprove exemptions from NO_x requirements under section
182 of the Act was delegated to the Regional Administrator from the
Administrator in a memo dated July 6, 1994, from Jonathan Cannon,
Assistant Administrator, to the Administrator, titled, ``Proposed
Delegation of Authority: `Exemptions from Nitrogen Oxide Requirements
Under Clean Air Act section 182(f) and Related Provisions of the
Transportation and General Conformity Rules'--Decision Memorandum.''
The Office of Management and Budget (OMB) has exempted this regulatory
action from E.O. 12866 review.

B. Regulatory Flexibility Act

    Under the Regulatory Flexibility Act, 5 U.S.C. 600 et seq., EPA
must prepare a regulatory flexibility analysis assessing the impact of
any proposed or final rule on small entities. 5 U.S.C. 603 and 604.
Alternatively, EPA may certify that the rule will not have a
significant impact on a substantial number of small entities. Small
entities include small businesses, small not-for-profit enterprises,
and government entities with jurisdiction over populations of less than
50,000. Today's determination does not create any new requirements, but
suspends the indicated requirements. Therefore, because this action
does not impose any new requirements, I certify that it does not have a
significant impact on any small entities affected.

C. Unfunded Mandates

    Under section 202 of the Unfunded Mandates Reform Act of 1995
(``Unfunded Mandates Act''), signed into law on March 22, 1995, EPA
must prepare a budgetary impact statement to accompany any proposed or
final rule that includes a Federal mandate that may result in estimated
costs to State, local, or tribal governments in the aggregate; or to
private sector, of $100 million or more. Under section 205, EPA must
select the most cost-effective and least burdensome alternative that
achieves the objectives of the rule and is consistent with statutory
requirements. Section 203 requires EPA to establish a plan for
informing and advising any small governments that may be significantly
or uniquely impacted by the rule. The EPA has determined that the
action promulgated does not include a Federal mandate that may result
in estimated costs of $100 million or more to either State, local, or
tribal governments in the aggregate, or to the private sector. This
Federal action does not create any new requirements, but suspends the
indicated requirements. Accordingly, no additional costs to State,
local, or tribal governments, or to the private sector, result from
this action.

D. Submission to Congress and the General Accounting Office

    Under section 801(a)(1)(A) as added by the Small Business
Regulatory Enforcement Fairness Act of 1996, EPA submitted a report
containing this rule and other required information to the U.S. Senate,
the U.S. House of Representatives and the Comptroller

[[Page 38932]]

General of the General Accounting Office prior to publication of the
rule in today's Federal Register. This rule is not a ``major rule'' as
defined by section 804(2).

E. Petitions for Judicial Review

    Under section 307(b)(1) of the Clean Air Act, petitions for
judicial review of this action must be filed in the United States Court
of Appeals for the appropriate circuit by September 19, 1997. Filing a
petition for reconsideration by the Administrator of this final rule
does not affect the finality of this rule for the purposes of judicial
review nor does it extend the time within which a petition for judicial
review may be filed, and shall not postpone the effectiveness of such
rule or action. This action may not be challenged later in proceedings
to enforce its requirements. (See section 307(b)(2).)

List of Subjects in 40 CFR Part 52

    Environmental protection, Air pollution control, Carbon monoxide,
Hydrocarbons, Intergovernmental relations, Nitrogen dioxide, Ozone,
Particulate matter, Reporting and recordkeeping requirements, Sulfur
oxides.

    Dated: July 8, 1997.
W. Michael McCabe,
Regional Administrator, Region III.

    40 CFR part 52, subpart VV of chapter I, title 40 is amended as
follows:

PART 52--[AMENDED]

    1. The authority citation for part 52 continues to read as follows:

    Authority: 42 U.S.C. 7401-7671q.

Subpart VV--Virginia

    2. Section 52.2428 is amended by redesignating the existing text as
paragraph (a) and adding paragraph (b) to read as follows:

Sec. 52.2428  Control Strategy: Carbon monoxide and ozone.

    (a) * * *
    (b) EPA is approving an exemption request submitted by the Virginia
Department of Environmental Quality on December 18, 1995 for the
Richmond ozone nonattainment area, which consists of the counties of
Charles City, Chesterfield, Hanover and Henrico, and of the cities of
Richmond, Colonial Heights and Hopewell, from the oxides of nitrogen
(NO_x) requirements for reasonably available control
technology (RACT). This approval exempts the Richmond ozone
nonattainment area from implementing the NO_x RACT
requirements contained in section 182(f) of the Clean Air Act. The
exemption is based on ambient air monitoring data. The exemption is
applicable during the period prior to redesignation of the Richmond
area to attainment of the National Ambient Air Quality Standard for
ozone only as long as ambient air quality monitoring data for the
Richmond ozone nonattainment area continue to demonstrate attainment
without NO_x reductions from major stationary sources of
NO_x.

[FR Doc. 97-19090 Filed 7-18-97; 8:45 am]
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Approval and Promulgation of Air Quality Implementation Plans; Richmond, Virginia--NO_x Exemption Petition
