1-hour NSR SIPs rather than Appendix S, at least until EPA had
established appropriate 1-hour anti-backsliding provisions and had
taken further action with respect to the 1-hour standard
    Similarly, Earthjustice's argument that the ERC changes weaken the
offset requirements in CAA Sec. Sec.  182(a)(4), (b)(5), (c)(10),
(d)(2), (e)(1) is unconvincing. The ERC changes do not affect the
applicable offset ratios as mandated by those statutory provisions.
They concern the cutoff date for offsets, rather than the degree of
offset required. As previously discussed, the inventory required in
Sec.  172(c)(3) is one component of the nonattainment plan provisions
of Sec.  172(c). The components of Sec.  172(c) are not intended to
stand alone. They complement one another. When we look to Sec.
172(c)(6) we find direction that plans include a range of ``other
measures, means, or techniques,'' including economic incentives, ``as
may be necessary or appropriate to provide for attainment.'' ERCs are
one such incentive. As discussed in more detail above, they are fully
compatible with the provisions of sections 172 and 173. Furthermore,
they do not interfere with the specific offset ratios mandated by
Congress in section 182.
    Having considered the comments received, we have seen no new
rationale presented that would lead us to change the current regulatory
language describing the availability and usage of ERC. Accordingly, we
are electing not to amend relevant rule language currently codified in
the Code of Federal Regulations.

D. Applicability of Appendix S, Section VI

1. Changes to Applicability of Appendix S, Section VI
    Section VI allows new sources locating in an area designated as
nonattainment to be exempt from the requirements of Section IV.A. of
Appendix S under certain circumstances if the date for attainment has
not yet passed. Section VI provides a management tool to provide a
limited degree of flexibility in situations where a new source would
not interfere with an area's ability to meet an attainment deadline.
The final Phase 2 Rule made a procedural change to limit the
applicability of appendix S, section VI to only those instances in
which the Administrator has specifically approved its use. Although we
did not include the regulatory language to accomplish this goal in the
June 2, 2003 proposal, we did clearly state our intention of doing so.
As we noted at 68 FR 32848, section VI as worded without any amendment
could apply in any nonattainment area where the dates for attainment
have not passed as long as the source met all applicable SIP emission
limitations and would not interfere with the area's ability to meet its
attainment date. As codified prior to the amendment in the Final Phase
2 Rule, section VI contained no provision conditioning its
applicability on approval by the Administrator. We noted at proposal,
however, that States generally would not be able to show that a
nonattainment area would continue to meet its attainment date if it did
not apply LAER or offsets to major new sources and major modifications
in the absence of safeguards (68 FR 32848).
    Further, we stated in the preamble to the Phase 2 Rule that we
continued to believe, as we stated in its proposal, that States should
not interpret section VI as allowing a blanket exemption from LAER and
offsets for all major new sources and major modifications in a given
area before attainment dates have passed for that area. Thus, in the
final rule we added a further requirement that the Administrator
independently determine and provide public notice that those
requirements have been met. The purpose of the requirement is to assure
that States do not interpret section VI to provide a broad exemption to
all major new sources and major modifications in any nonattainment area
for which the attainment date has not passed.
2. Legal Basis for Changes to Applicability of Appendix S and the
Transitional NSR Program
    The legal basis for Appendix S, including section VI, was discussed
in detail in section V.B.3.b. of the preamble to the final Phase 2
Rule. We have historically recognized that the SIP development period
provided for in section 172(b) leaves a gap in part D major NSR
permitting and have determined that this gap is to be filled with an
interim major NSR program that is substantially similar to the
requirements of part D, including the LAER and offset requirements from
part D, subject to a limited exemption where the attainment deadline
will be met (57 FR 18070, 18076). This interim NSR program has been
implemented to date through Appendix S.
    The section VI exemption, as limited by the final Phase 2 Rule, is
consistent with the section 110(a)(2)(C) requirement that
preconstruction permitting is implemented ``as necessary to assure that
the [NAAQS] are achieved.'' While the Phase 2 Rule did not adopt the
eligibility criteria that were proposed to ensure satisfaction of the
original section VI conditions, we did add the proposed requirement
that the Administrator determine that sources exempted from LAER and
offsets under section VI will meet those conditions, in particular,
noninterference with the attainment deadline. Section VI also is
consistent with the exercise of our gap filling authority under section
301, as informed by the legislative history. That is, Appendix S
reflects Congressional intent that standards equivalent to part D
govern the issuance of NSR permits, subject to a limited degree of
flexibility under conditions where attainment of the NAAQS by the
attainment deadline is assured.
3. Reconsideration of Appendix S, Section VI Final Rule Amendments
    In its January 30, 2006, petition, NRDC requested that EPA
reconsider provisions in the final Phase 2 Rule that pertain to
Appendix S, section VI. NRDC argued that EPA failed to provide the
public with an opportunity to comment on the language of Appendix S,
Section VI that was included in the final rule. As is the case with
respect to the ERC provisions, EPA believes that our rationale was
fully explained in the November 29, 2005 rulemaking and in earlier
actions leading to that rulemaking. The preamble to the final rule
included a lengthy description of preceding actions in which our
rationale was developed. Further, the preamble to the final rule
detailed our response to comments pertaining to the proposal. As noted
above, what we did in the final rule was add one provision to the
already existing language of Appendix S, section VI to limit use of
Section VI to only those instances publicly approved by the
Administrator. From our perspective, we made the smallest change
possible and achieved closure of a gap in section VI. As well, we
continue to disagree with the petitioner's assertion that section VI,
as amended by the Phase 2 rule constitutes an open-ended scheme to
evade the strictures of Part D. If anything, the prior rule language
could have been construed as open-ended. The sole intention of our
language change was to close what we perceived to be a loophole
allowing just the type of outcome to which the petitioners object.
Congress required just such closure through the provisions of the
original section 129 as included in the August 7, 1977 amendments to
the Act. At that time, Congress made clear its opinion that it would be
the role of the Administrator to determine whether waiver of the
appendix S provisions in question might be appropriate. The change made
to Section VI in the final Phase 2 rule providing that the
Administrator must determine whether the conditions of Section VI have
been satisfied provides a positive safeguard to prevent just the kinds
of unchecked application of its provisions as envisioned by the
petitioners.
    As was the case for ERC, we saw value in presenting for public
comment the changes made to Section VI of Appendix S in the final Phase
2 Rule. Accordingly, on December 19, 2006 we requested comment on
subsection C. of Section VI of Appendix S as added in the final Phase 2
rule as requested by the petitioners. Concerning the new paragraph C.
of section VI, our proposal for reconsideration drew ten public
comments. Of those comments, five supported the rule amendments as now
written and five were opposed. Among those opposed, were the
petitioners and State air pollution control agencies. The petitioners
continued presentation of the concerns leading to this notice and were
echoed, in part, by the States. In short, those opposing the change to
section VI see it as an opening which might be subject to abuse of
discretion. We continue to see our change as a closing of a loophole.
Five commenters agreed with our assessment. Detailed discussion and
analysis of arguments raised by all of the commenters is given below.

4. Comments and Responses for Appendix S, Section VI
    We received ten comments upon the proposed section VI paragraph C
language. A number of comments made it clear that the nature of our
addition of paragraph C for the purposes of closing a loophole and
constraining application of section VI was not completely understood.
Also, we received comments questioning the legality and existence of
Section VI along with requests for its removal from the Code of Federal
Regulations. Such comments are outside the scope of this action.
Section VI significantly predates the Phase 2 Rule. While it originally
applied only to secondary NAAQS, EPA revised it to include primary
standards following the 1977 Amendments (44 FR 3274, Jan. 16, 1979).
EPA made an additional revision to Section VI in 1980 in the course of
clarifying the applicability of Appendix S to sources located outside
of nonattainment areas that cause or contribute to violations (45 FR
31307, May 13, 1980). The version of Section VI established by that
1980 rulemaking remained current up until the effective date of EPA's
final Phase 2 rule. The time for challenging rules issued in 1979 and
1980 is long past. If commenters believe Section VI as a whole is no
longer desirable, then the appropriate vehicle for their concerns is a
petition for rulemaking. The only matter opened for comment by the
proposal for reconsideration was the appropriateness of paragraph C.
Before reviewing those comments which were germane to the proposal, we
will first recap the reasoning for our addition of paragraph C to
section VI.
    Section VI allows new sources locating in an area designated as
nonattainment to be exempt from the requirements of section IV.A. of
appendix S under certain circumstances if the date for attainment has
not yet passed. Section VI provides a management tool to provide a
limited degree of flexibility in situations where a new source would
not interfere with an area's ability to meet an attainment deadline.
The final Phase 2 Rule made a procedural change to limit the
applicability of appendix S, section VI to only those instances in
which the Administrator has specifically approved its use. Contrary to
the suggestions of comments to be discussed below, we had no intention
of expanding usage of Section VI through our addition of paragraph C.
Our purpose in making the change was to close what we saw as a loophole
and constrain the application of Section VI. Although we did not
include the regulatory language to accomplish this goal in the June 2,
2003 proposal, we did clearly state our intention of doing so. As we
noted at 68 FR 32848, section VI as worded prior to our amendment could
have applied in any nonattainment area where the dates for attainment
had not passed, even if the source met all applicable SIP emission
limitations and would not have interfered with the area's ability to
meet its attainment date. As codified prior to the amendment in the
Final Phase 2 Rule, section VI contained no provision conditioning its
applicability on approval by the Administrator. We noted at proposal,
however, that States generally would not be able to show that a
nonattainment area would continue to meet its attainment date if it did
not apply Lowest Achievable Emission Rate (LAER) or offsets to major
new sources and major modifications in the absence of safeguards (68 FR
32848).
    Further, we stated in the preamble to the Phase 2 Rule that we
continued to believe, as we also stated in its proposal, that States
should not have interpreted section VI as allowing a blanket exemption
from LAER and offsets for all major new sources and major modifications
in a given area before attainment dates had passed for that area. In
that proposal, we also offered for comment two broad programmatic
proposals to modify the then-existing section VI for the purpose of
providing greater flexibility. Overall, commenters considered the
programmatic options to be impracticable. However most commenters did
express support for the flexibility provided by section VI. For that
reason, we retained the original eligibility conditions for determining
when section VI might apply, but added the procedural requirement that
the Administrator determine that the two previously existing conditions
of Section VI are satisfied, and that the Administrator provide public
notice of that determination. That requirement achieved the proposal's
purpose of assuring that States could not interpret section VI to
provide a broad exemption to all major new sources and major
modifications in any nonattainment area for which the attainment date
has not passed.
    Earthjustice/NRDC filed the petition for reconsideration leading to
today's action and provided comment upon our proposal. This commenter
referenced a prior comment on the proposed Phase 2 rule claiming EPA
has no authority to waive NSR requirements in areas designated
nonattainment under the Act and that the proposed rule was unlawful.
Earthjustice acknowledged a need for EPA's gap-filling program as
supported by Sec. Sec.  101(b)(1), 110(a)(2)(C), and 301 of the Act.
This commenter disagrees that Sec.  110(a)(2)(C) implies an authority
to waive NSR requirements, but rather expressly requires each SIP to
include ``a permit program as required in parts C and D,'' and part D
does not allow for waiver of NSR permitting requirements in
nonattainment areas. They went on to question allowing section VI
waivers after the statutory deadline for completion of the state's Part
D SIP development process. They voiced their concern that the proposed
rule appears to allow continued issuance of NSR waivers even if the
state has failed to timely submit a part D SIP.
    Two commenters questioned the legal underpinnings of section VI
pursuant to sections 110(a)(2)(C), 173, and 182 of the Act. One was of
the opinion that EPA's revisions do not provide any incentive for the
timely completion of the SIP, and the exemption appears to allow
continued issuance of NSR waivers after a state fails to timely submit
a SIP. Also, the commenter said we did not propose or establish an end
date for the transitional period during which a waiver would apply,
thus allowing NSR requirements to be waived indefinitely without any
restrictions on such waiver.
    In response to these specific comments, we note that section VI
pre-dated the Phase 2 rule and that our reconsideration did not open up
the entirety of section VI for comment. Nevertheless, we will discuss
these issues briefly. We recounted the history of appendix S in the
preamble to the Phase 2 rule (70 FR 71677--71680). There, we noted that
the SIP development period provided for in section 172(b) leaves a gap
in part D major NSR permitting and that section 110(a)(2)(C) does not
define specific requirements States must follow for issuing major
source permits during this time. We further noted that EPA's
regulations at 40 CFR section 52.24(k) require States to follow
Appendix S during the period between nonattainment designation and EPA
approval of a part D nonattainment NSR SIP. We also summarized the
relationship of the construction ban to Appendix S, stating: ``When
Congress removed the construction ban * * * it left in place 40 CFR
section 52.25(k), implementing the interim major NSR program under
appendix S'' (70 FR 71678). In adding paragraph (c) to Section VI, we
did not disturb the existing requirements and incentives for timely SIP
completion. Regarding the concern that waivers might be granted after a
state fails to timely submit a SIP, EPA would be highly disinclined to

grant a waiver where the SIP submission deadline had passed and EPA had
not received the required submission.
    The State also thought the original purpose of this exemption has
long passed. Thus, there would be little or no use of the exemptions in
practice and, consequently, EPA's proposed revision to this section
amounts to encouraging states to reconsider its use. They see the
proposal as EPA's encouragement of an NSR exemption that would create a
new obstacle for them to surmount as we strive to attain the 8-hour
ozone standard. Another State agency saw us as proposing to waive NSR
provisions for LAER and emissions offsets requirements which many
states need as part of their state implementation plans in order to
attain and maintain compliance with the ozone NAAQS. They were of the
opinion that the proposal constituted that kind of ``backsliding''
precluded by the South Coast decision
    We received additional comments echoing concerns that the addition
of paragraph C. would encourage the use of section VI and expand its
impacts. One commenter speaking on behalf of the nation's air pollution
control agencies expressed concern that the new paragraph might create
new difficulties for states attempting to meet attainment deadlines.
Also given was a concern that new and existing modified sources would
not achieve the level of emissions reductions that would be possible
with installation of LAER without the usual NSR benefit of comparable
or greater decreases in emissions. They continued that attainment dates
are, in fact, highly likely to be affected by this exemption from LAER
and offsets for new and modifying sources. In summation, they expressed
concern that increased emissions resulting from the NSR exemption could
jeopardize state and local attainment plans.
    We respond to the commenters by first noting that, as discussed
above, section VI as a whole was not placed on the table for comment.
We do believe that the commenter's concerns over the addition of the
Administrator as a gatekeeper to application of section VI are
misplaced. Their comments upon today's action and the concerns conveyed
by Earthjustice in their petition for reconsideration make clear a
misunderstanding by several parties who have come to believe our
addition of paragraph C. is intended to open the door for widespread
use and abuse of section VI. This is not the case. We added paragraph
C. expressly to limit and minimize usage of Section VI. Further,
paragraph C. brings to the public's attention any usage of section VI
by requiring publication of any approvals for such use in the Federal
Register. So, the concerns that EPA is encouraging States to apply
section VI, making it open-ended, or encouraging backsliding are
unfounded. Quite the contrary, our intention with the addition of
paragraph C. is to decrease the likelihood that section VI might be
applied by first requiring close scrutiny by the EPA and by
communicating any decisions in a public forum. Tightening pre-existing
requirements does not constitute backsliding.
    Several commenters perceived the intent of our addition of
paragraph C. and offered comments in support of re-proposed rule
language. Their comments expressed viewpoints opposite to the just-
described comments of Earthjustice and the air pollution control
agencies. Four commenters expressed their opinions that the revision
adding EPA as the determining authority to application of section VI
would not interfere with achieving attainment in a timely manner. Two
offered their expectations that section VI provides a limited
flexibility that would be seldom used. One commenter does not believe
that the waiver of certain LAER or offset requirements would often be
approved, but may make sense and should be provided when there is a
public need. The commenter opined that, in many instances, there is
little difference between BACT and LAER. With the modeling
demonstrations that require the use of worst-case scenarios to
demonstrate that neither attainment nor progress towards attainment
would be interfered with, there is little opportunity ``to evade the
strictures of Part D.'' Another commenter believes States should be
given the limited flexibility provided in the rule to allow new sources
to locate in nonattainment areas without applying LAER or obtaining
offsets if such action is reviewed by EPA and found not to interfere
with attaining the NAAQS. They agreed that the additional safeguard of
EPA determining that the conditions of the rule have been satisfied
(i.e., non-interference) provides a positive safeguard to ensure areas
meet their attainment deadlines. Another commenter found the EPA
rationale reasonable and saw no merit to the petition for
reconsideration.
    EPA appreciates the comments in support of the addition of
paragraph C. These commenters have correctly identified our purpose of
adding a requirement that EPA oversee application of Section VI in
order to limit its usage while preserving its flexibility for those
limited instances where its application might be justified.
    Three commenters specifically endorsed the requirement for the
Administrator to publish in the Federal Register all approvals of
section VI actions. The commenters said EPA's requirement for
publication in the Federal Register ensures public awareness of the use
of this provision as an added safeguard.
    At proposal we provided two possible outcomes for today's action.
First, we said that should we receive compelling arguments that it was
inappropriate for us to add the section VI.C. requirement for the
Administrator approval, we would remove the language in question so as
to revert the text of section VI to that which existed prior to
November 29, 2005. The second possibility was that we would leave the
rule language unchanged from that currently codified in the Code of
Federal Regulations. None of the comments received made a good case for
removing the language change from November 29, 2005 and we have elected
to make no amendments removing that provision.

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.'' This action is
significant 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.

B. Paperwork Reduction Act

    The information collection requirements in this reconsideration
notice have been submitted for approval to the Office of Management and
Budget (OMB) under the Paperwork Reduction Act, 44 U.S.C. 3501 et seq.
They were addressed along with those covering the Phase 1 Rule (April
30, 2004; 69 FR 23951) and the Phase 2 Rule (November 29, 2005; 70 FR
71612) under EPA ICR 2236.01. The information collection
requirements are not enforceable until OMB approves them other than to
the extent required by statute.
    This action announces EPA's final decision on reconsideration of
several provisions of the Phase 2 Rule, namely the RACT provisions and
selected NSR provisions. This action does not establish any new
information

collection burden on States beyond what was required in the Phase 2
Rule.
    The EPA has projected cost and hour burden for the statutory SIP
development obligation for the Phase 2 Rule, and prepared an
Information Collection Request (ICR). Assessments of some of the
administrative cost categories identified as a part of the SIP for an
8-hour standard are already conducted as a result of other provisions
of the CAA and associated ICRs (e.g. emission inventory preparation,
air quality monitoring program, conformity assessments, NSR, inspection
and maintenance program).
    The burden estimates in the ICR for the Phase 2 rule are
incremental to what is required under other provisions of the CAA and
what would be required under a 1-hour standard. 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. When the ICR for the
Phase 2 rule is approved by OMB, the Agency will publish a technical
amendment to 40 CFR part 9 in the Federal Register to display the OMB
control number for the approved information collection requirements
contained in this final rule. However, the failure to have an approved
ICR for this rule does not affect the statutory obligation for the
States to submit SIPs as required under part D of the CAA.
    The information collection requirements associated with NSR
permitting for ozone are covered by EPA's request to renew the approval
of the ICR for the NSR program, ICR 1230.17, which was approved by OMB
on January 25, 2005. The information collection requirements associated
with NSR permitting were previously covered by ICR 1230.10 and 1230.11.
The OMB previously approved the information collection requirements
contained in the existing NSR regulations at 40 CFR parts 51 and 52
under the provisions of the Paperwork Reduction Act, and assigned OMB
control number 2060-0003. A copy of the approved 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<PHONE_NUMBER>.

C. Regulatory Flexibility Act

    The Regulatory Flexibility Act generally requires an Agency to
prepare a regulatory flexibility analysis of any rule subject to
notice-and-comment rulemaking requirements under the Administrative
Procedures Act or any other statute unless the Agency certifies 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 this reconsideration
action on small entities, small entity is defined as: (1) A small
business as defined by the Small Business Administration's (SBA)
regulations at 13 CFR 121.201; (2) a 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 the Phase 1 and Phase 2
Rules, we concluded that those actions did not have a significant
economic impact on a substantial number of small entities. For those
same reasons, I certify that this action will not have a significant
economic impact on a substantial number of small entities. This action
of reconsideration will not impose any requirements on small entities.
    Concerning the NSR portion of this notice of reconsideration, a
Regulatory Flexibility Act Screening Analysis (RFASA) was developed as
part of a 1994 draft Regulatory Impact Analysis (RIA) and incorporated
into the September 1995 ICR renewal. This analysis showed that the
changes to the NSR program due to the 1990 CAA Amendments would not
have an adverse impact on small entities. This analysis encompassed the
entire universe of applicable major sources that were likely to also be
small businesses (approximately 50 ``small business'' major sources).
Because the administrative burden of the NSR program is the primary
source of the NSR program's regulatory costs, the analysis estimated a
negligible ``cost to sales'' (regulatory cost divided by the business
category mean revenue) ratio for this source group. The incorporation
of the major source thresholds and offset ratios from the 1990 CAA
Amendments in section 51.165 and appendix S for the purpose of
implementing NSR for the 8-hour standard does not change this
conclusion. Under section 110(a)(2)(C), all States must implement a
preconstruction permitting program ``as necessary to assure that the
[NAAQS] are achieved,'' regardless of the changes in the Phase 2 rule.
Thus, small businesses continue to be subject to regulations for
construction and modification of stationary sources, whether under
State and local agency minor NSR programs, SIPs to implement section
51.165, or appendix S, to ensure that the 8-hour standard is achieved.

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 reconsideration action 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 1 year. In promulgating the
Phase 1 and Phase 2 Rules, we concluded that they were not subject to
the requirements of sections 202 and 205 of the UMRA. For those same
reasons, this notice of reconsideration and request for comment is not
subject to the UMRA.
    The EPA has determined that this notice of reconsideration contains
no regulatory requirements that may significantly or uniquely affect
small governments, including Tribal governments.

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 action 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. This reconsideration action
pertains to three aspects of the Phase 2 Rule. For the same reasons
stated in the Phase 1 and Phase 2 Rules, Executive Order 13132 does not
apply to this action.

F. 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 reconsideration action does not
have ``Tribal implications'' as specified in Executive Order 13175.
    The purpose of this reconsideration action is to announce our
decision following reconsideration of specific aspects of the Phase 2
Rule. The CAA provides for States and Tribes to develop plans to
regulate emissions of air pollutants within their jurisdictions. The
Tribal Authority Rule (TAR) gives Tribes the opportunity to develop and
implement CAA programs such as the 8-hour ozone NAAQS, but it leaves to
the discretion of the Tribes whether to develop these programs and
which programs, or appropriate elements of a program, they will adopt.
    For the same reasons stated in the Phase 1 and Phase 2 Rules, this
action does not have Tribal implications as defined by Executive Order
13175. It does not have a substantial direct effect on one or more
Indian Tribes, since no Tribe has implemented a CAA program to attain
the 8-hour ozone NAAQS at this time. If a Tribe does implement such a
plan, it would not impose substantial direct costs upon it.
Furthermore, this action does not affect the relationship or
distribution of power and responsibilities between the Federal
government and Indian Tribes. The CAA and the TAR establish the
relationship of the Federal government and Tribes in developing plans
to attain the NAAQS, and this action does nothing to modify that
relationship. Because this action does not have Tribal implications,
Executive Order 13175 does not apply.

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'' (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 or safety risk that EPA has reason to believe may
have 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.
    This final rule is not subject to the Executive Order because it is
not economically significant as defined in Executive Order 12866, and
because the Agency does not have reason to believe the environmental
health or safety risk addressed by this action present a
disproportionate risk to children.

H. Executive Order 13211: Actions That Significantly Affect Energy
Supply, Distribution, or Use

    This action is not a ``significant energy action'' as defined in
Executive Order 13211, ``Actions 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 reconsideration action announces
our decision following reconsideration of several aspects of the Phase
2 Rule, for which EPA did perform an analysis of the energy impacts
under Executive Order 13211.\18\
---------------------------------------------------------------------------

    \18\ Technical Appendix: Potential Impacts of Implementation of
the 8-Hour Ozone NAAQS; Technical Support Document. July 21, 2005.
Docket Document EPA-HQ-OAR-2003-0079-0860.
---------------------------------------------------------------------------

I. National Technology Transfer Advancement Act

    Section 12(d) of the National Technology Transfer Advancement Act
of 1995 (NTTAA), Public Law No. 104-113, section 12(d) (15 U.S.C. 272
note) directs EPA to use voluntary consensus standards (VCS) 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 VCS bodies. The NTTAA directs EPA to provide Congress,
through OMB, explanations when the Agency decides not to use available
and applicable VCS.
    This action does not involve technical standards. Therefore, EPA
did not consider the use of any VCS.
    The EPA will encourage the States and Tribes to consider the use of
such standards, where appropriate, in the development of the
implementation plans.

J. Executive Order 12898: Federal Actions To Address Environmental
Justice in Minority Populations and Low-Income Populations

    Executive Order 12898 (59 FR 7629 (Feb. 16, 1994)) establishes
federal executive policy on environmental justice. Its main provisions
direct 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.
    The EPA concluded that the Phase 2 Rule does not raise any
environmental justice issues (See 70 FR at 71695, col. 2; (November 29,
2005)); for the same reasons, since this action concerns several
aspects of the Phase 2 rule, this reconsideration action does not raise
any environmental justice issues. This action will not have
disproportionately high and adverse human health or environmental
effects on minority or low-income populations because the 8-hour ozone
national ambient air quality standard is designed to protect public
health and is intended to apply equally to all portions of the
population. In addition, this rule makes only minor changes to the
previous Phase 2 implementation rule and these changes are intended to
strengthen the rule, which should not disproportionately affect
minority or low income populations. The health and environmental risks
associated with ozone were considered in the establishment of the 8-
hour, 0.08 ppm ozone NAAQS [62 FR 38856 (July 18, 1997)]. The level is
designed to be protective with an adequate margin of safety. The Phase
2 Rule provides a framework for improving environmental quality and
reducing health risks for areas that may be designated nonattainment.

K. 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. EPA will submit a report containing this reconsideration
action 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 reconsideration action in the
Federal Register. A Major rule cannot take effect until 60 days after
it is published in the Federal Register. This action is not a ``major
rule'' as defined by 5 U.S.C. 804(2). This action will be effective
July 9, 2007.

L. Judicial Review

    Section 307(b)(1) of the CAA indicates which Federal Courts of
Appeal have venue for petitions of review of final actions by EPA. This
section provides, in part, that petitions for review must be filed in
the Court of Appeals for the District of Columbia Circuit if (i) the
agency action consists of ``nationally applicable regulations
promulgated, or final action taken, by the Administrator,'' or (ii)
such action is locally or regionally applicable, if ``such action is
based on a determination of nationwide scope or effect and if in taking
such action the Administrator finds and publishes that such action is
based on such a determination.''
    Final actions described in this Final Action on Reconsideration are
``nationally applicable'' within the meaning of section 307(b)(1). This
action explains the final actions EPA is taking on the petitions for
reconsideration of several aspects of the Phase 2 rule. EPA has
determined that all of these actions are of nationwide scope and effect
for purposes of section 307(d)(1) because these actions clarify the
obligations of all states with respect to the nationwide implementation
of the 8-hour ozone NAAQS and concern the basic program elements of
nonattainment new source review SIPs. Thus, any petitions for review of
the final action described in this Notice must be filed in the Court of
Appeals for the district of Columbia Circuit within 60 days from the
date this Notice is published in the Federal Register.

List of Subjects in 40 CFR Part 51

    Environmental protection, Air pollution control, Carbon monoxide,
Lead, Nitrogen dioxide, Ozone, Particulate matter, Sulfur oxides.

    Dated: May 31, 2007.
Stephen L. Johnson,
Administrator.

0
For the reasons stated in the preamble, title 40, chapter I of the Code
of Federal Regulations is amended as follows:

PART 51--REQUIREMENTS FOR PREPARATION, ADOPTION, AND SUBMITTAL OF
IMPLEMENTATION PLANS

0
1. The authority citation for part 51 continues to read as follows:

    Authority: 23 U.S.C. 101; 42 U.S.C. 7401-7671q.

Subpart X--[Amended]

0
2. Section 51.912 is amended by revising paragraph (a)(2) to read as
follows:

Sec.  51.912  What requirements apply for reasonably available control
technology (RACT) and reasonably available control measures (RACM)
under the 8-hour NAAQS?

    (a) * * * * *
    (2) The State shall submit the RACT SIP for each area no later than
27 months after designation for the 8-hour ozone NAAQS, except that for
a State subject to the requirements of the Clean Air Interstate Rule,
the State shall submit NOX RACT SIPs for electrical
generating units (EGUs) no later than the date by which the area's
attainment demonstration is due (prior to any reclassification under
section 181(b)(3)) for the 8-hour ozone national ambient air quality
standard, or July 9, 2007, whichever comes later.
* * * * *
[FR Doc. E7-11113 Filed 6-7-07; 8:45 am]

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