Response: EPA envisions that the final 8 hour ozone modeling guidance will be available for use by the majority of subpart 1 areas and subpart 2 areas classified as moderate and above. However, due to the unique nature of the ozone problem in many areas, EPA will accept various applications of the guidance. Although EPA anticipates all areas will follow the guidance closely there will be variation based on availability of new and improved data methods and field study data. EPA is always striving to make best use of available data and improvements in methodologies as the science and our understanding of ozone formation and transport in different parts of the country increases. Unique to many areas is the source receptor configuration, level of precursor data collected and the PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 103 model's ability to simulate unique factors influencing the formation and transport of ozone. As more information becomes available in particular areas, EPA expects more rigorous demonstrations will be provided. Areas close to attaining the standard for which there is a better understanding of the meteorology and the relationships between precursor emissions and ozone may not require as much rigor. These decisions will be made on a case by case basis and the public will be able to express their views during the State SIP development and EPA review process.

Comment: EPA cannot adopt or change the 1999 Draft Guidance, use it for regulatory purposes, or require States to use it for regulatory purposes, without subjecting it to separate notice and comment rulemaking.

Response: EPA is not adopting the Guidance as a rule. EPA plans to use the current ( 2005) guidance and future updates as a benchmark for reviewing the technical analysis submitted in support of 8 hour ozone attainment demonstrations. The guidance document is not a regulation.

Therefore, it does not impose binding, enforceable requirements on any party, and may not apply to a particular situation based upon the circumstances. The EPA and State decision makers have the discretion to adopt approaches on a PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 104 case by case basis that differ from this guidance where appropriate. Any decisions by the EPA regarding adequacy of a particular SIP to meet the 8 hour ozone NAAQS will be based on the CAA and our regulations. Therefore, interested parties are free to raise questions and objections about the appropriateness of the application of this guidance to a particular situation during the State SIP development and EPA review process.

Comment: One commenter requested an opportunity to review and comment on the revised guidance prior to the " final"

release.

Response: States, Tribes and others were given an opportunity to comment on the proposed changes in the draft guidance. Also, EPA received additional comments on the draft guidance during the comment period on the implementation rule. EPA has reviewed and considered the comments and will be releasing the final guidance. For more information and updates to the modeling guidance for ozone visit EPA's Technology Transfer Network Support Center for Regulatory Air Models ( TTN/ SCRAM) on the internet,

http:// www. epa. gov/ ttn/ scram/). Even though the guidance will be issued in final form shortly, EPA is always open to suggestions for future improvements to the guidance, PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 105 including the incorporation of methodologies and procedures that increase accuracy and credibility of results. Such suggestions may be made to EPA regional or headquarters modeling contacts listed at the above TTN/ SCRAM web site.

Comment: EPA should carefully consider the resources that will be needed to perform the requisite modeling for multiple areas in many States.

Response: States/ Tribes are encouraged to share and leverage resources currently being used in regional model applications that affect multiple areas. There is much opportunity for common use of data and methodologies among the modeling requirements for the regional haze program, the PM2.5 attainment demonstrations and the ozone attainment demonstrations that should make the overall exercise less onerous. States and Tribes are encouraged to model multiple precursor strategies for multiple areas and review their efficacy for all three programs.

Comment: Any photochemical grid model utilized must either be in the public domain or licensed for unlimited use by any person for purposes of modeling within the area.

Response: EPA modeling guidance supports this comment which is addressed in section 11 of the modeling guidance.

" Applicable models" may be used, if they are non PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 106 proprietary. A " non proprietary" model is one whose source code is available for free or for a reasonable cost.

Further, the user must be free to revise the code to perform diagnostic analyses and/ or to improve the model's ability to describe observations in a credible manner.

Comment: One commenter recommended that EPA update its guidance in 40 CFR 51 Appendix W to include a discussion of the role of weight of evidence as part of a modeling demonstration, and to make any updates in Appendix W subject to public review.

Response: In regard to the role of weight of evidence, EPA does not plan to revise Appendix W. Use of weight of evidence is dependent on local information only available when the technical analysis for a specific model application is under development. Therefore use of weight of evidence is reviewed on a case by case basis as the appropriate Regional Office works with the State as it develops its SIP and, once submitted, during the SIP approval process.

5. Mid course review ( MCR)

a. Background The proposal noted that a MCR provides an opportunity to assess whether a nonattainment area is or is not making sufficient progress toward attainment of the 8 hour ozone PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 15Memorandum of March 28, 2002, from Lydia N. Wegman and J. David Mobley, re: " Mid Course Review Guidance for the 1 Hour Ozone Nonattainment Areas that Rely on Weight of Evidence for Attainment Demonstration." Located at URL: http:// www. epa. gov/ scram001/ guidance/ guide/ policymem33d. pdf .

107 standard, as predicted in its attainment demonstration. We noted that a commitment to perform a MCR is a critical element of an attainment demonstration that employs a longterm projection period and relies on weight of evidence.

Because of the uncertainty in long term projections, we said we believed such attainment demonstrations need to contain provisions for periodic review of monitoring, emissions, and modeling data to assess the extent to which refinements to emission control measures are needed.

A number of States participated in a consultative process with EPA, which resulted in the development of the 1 hour MCR guidance. 15 We noted that we would update the 1

hour MCR policy and technical guidance to include 8 hour metrics and that we were soliciting comment on appropriate revisions. We proposed that the final MCR guidance incorporating 8 hour metrics would be available at the time we issue our final implementation rule.

The proposal briefly described the procedure for performing a MCR. The proposal noted that States would not PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 108 have to commit in advance to adopt new control measures as a result of the MCR process. Based on the MCR, if we determine sufficient progress has not been made, we would determine whether additional emissions reductions are necessary from the State( s) in which the nonattainment area is located or upwind States or both. We would then require the appropriate State( s) to adopt and submit new measures to bring about the necessary emission reductions within a specified period. We anticipated that these findings would be made as calls for SIP revisions under section 110( k)( 5)

and, therefore, the period for submission of the measures would be no longer than 18 months after the EPA finding.

Thus, we proposed that States complete the MCR three or more years before the applicable attainment date to ensure that any additional controls that may be needed can be adopted in sufficient time to reduce emissions by the start of the ozone season in the attainment year.

b. Summary of Final Rule Areas with an attainment date beyond 6 years after the effective date of the area's designation are also required to commit to perform a MCR midway between the due date for its attainment demonstration SIP and the area's attainment date. ( Thus, moderate areas are not required to commit to PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 16Memorandum of March 28, 2002, from Lydia N. Wegman and J. David Mobley, re: " Mid Course Review Guidance for the 1 Hour Ozone Nonattainment Areas that Rely on Weight of Evidence for Attainment Demonstration." Located at URL: http:// www. epa. gov/ scram001/ guidance/ guide/ policymem33d. pdf 109 perform a MCR.) The 8 hour ozone modeling guidance ( EPA,

2004) is expected to identify measurements and activities to support subsequent reviews of an attainment demonstration SIP ( i. e., MCR), such as improvements in air quality monitoring, meteorology and emission measurements. Even though the proposal noted that we expected to revise the existing 1 hour mid course review guidance, EPA now believes the 1 hour mid course review guidance coupled with the 8 hour modeling guidance provides sufficient guidance.

States should consult with EPA prior to using a methodology other than the one developed through the public consultative process.

Guidance for performing a MCR for the 1 hour ozone NAAQS identifies several methods for reviewing whether the existing SIP is sufficient for the area to attain by its attainment date. 16 These guidance documents should provide adequate information for developing protocols for performing MCRs for the 8 hour ozone NAAQS. States/ Tribes should prepare protocols which identify analyses and data bases to PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 110 be used to support a MCR and discuss these with the appropriate EPA Regional Office prior to performing a MCR.

If we determine that additional guidance is needed, we will issue updated guidance in a time frame suitable to support the timely completion of MCRs.

c. Comments and Responses Comment: Requiring the MCR 3 or more years prior to the attainment date is not reasonable or feasible for some areas. EPA needs to recognize that for moderate and lower classifications the MCR would be due at the time of the SIP submittal. MCR's should be required only for areas with nonattainment classifications of serious or greater, as at least 3 years of monitored data are required for a MCR,

after the implementation of controls.

Response: EPA is requiring each nonattainment area with an attainment date greater than 6 years after the effective date of the area's designation to complete and submit to EPA a MCR midway between the due date for its attainment demonstration SIP and the area's attainment date. This requirement is applicable to areas classified under subpart 1 and subpart 2. Thus, areas classified as marginal or moderate under subpart 2 would not be required to commit to a MCR. Areas classified under subpart 2 as serious or above PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 111 would be required to perform a MCR.

Comment: One commenter recommended that EPA make the MCR process part of the requirements for RFP and ROP.

Response: EPA believes the State may develop a coordinated RFP/ MCR analysis to assess progress in both emission reductions and reductions in ambient ozone concentrations.

However, the RFP requirement and milestone reductions and milestone compliance demonstrations under section 182 paragraphs ( b)( 1), ( c)( 2) and ( g) set forth specific timing that may or may not match the timing of the required MCR submission.

Comment: EPA should develop proper analysis techniques so that meteorological conditions do not affect a nonattainment area's perceived progress towards attainment. A MCR should also include an evaluation of ozone transport into the nonattainment area and control implementation in upwind areas.

Response: Assessments of transport are covered in the MCR guidance. EPA is improving methods for determining the ozone trends and how they are affected by meteorology. The latest information will be made available.

Comment: EPA needs to release the revised MCR guidance before the final rule is issued in order for it to be PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 17Memorandum of March 28, 2002, from Lydia N. Wegman and J. David Mobley, re: " Mid Course Review Guidance for the 1 Hour Ozone Nonattainment Areas that Rely on Weight of Evidence for Attainment Demonstration." Located at URL: http:// www. epa. gov/ scram001/ guidance/ guide/ policymem33d. pdf 112 reviewed and commented on during the public comment period.

Response: The final rule does not incorporate any MCR guidance by reference. The 8 hour ozone modeling guidance ( U. S. EPA, 2004) is expected to identify measurements and activities to support subsequent reviews of an attainment demonstration SIP ( i. e., MCR), such as improvements in air quality monitoring, meteorology and emission measurements.

Guidance for performing a MCR for the 1 hour ozone NAAQS identifies several methods for reviewing whether a SIP is on track to attain within prescribed time limits. 17 These guidance documents should provide adequate information for developing protocols for performing MCRs for the 8 hour ozone NAAQS. States/ Tribes should prepare protocols which identify analyses and data bases to be used to support a MCR and discuss these with the appropriate EPA Regional Office prior to performing a MCR. If we determine that additional guidance is needed, we will issue updated guidance in a time frame suitable to support completion of MCR's within established deadlines. PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 18Use of models that are capable of simulating transport and formation of multiple pollutants simultaneously. For example, for ozone and fine particles, it is critical that the model simulate photochemistry, which includes interactions among the pollutants and their precursors.

113 6. Multi pollutant assessments ( one atmosphere modeling18)

a. Background The proposal noted that many factors affecting formation and transport of secondary fine particles ( i. e.,

PM2.5 components) are the same as those affecting formation and transport of ozone.

The proposal therefore noted that models and data analysis intended to address visibility impairment need to be capable of simulating transport and formation of both secondary fine particles and ozone. At a minimum, modeling should include previously implemented or planned measures to reduce ozone, secondary fine particles, and visibility impairment. An integrated assessment of the impact controls have on ozone, secondary fine particles, and regional haze provides safeguards to ensure ozone controls will not preclude optimal controls for secondary fine particles and visibility impairment.

The concept of modeling control impacts on all three programs is further strengthened by the alignment of the PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 114 implementation process for ozone and secondary fine particles. As the dates for attainment demonstration and planning SIPs for the three programs are fairly close, the practicality of using common data bases and analysis tools for all three programs is viable and encourages use of shared resources.

The proposal noted that States that undertake multipollutant assessments as part of their attainment demonstration would assess the impact of their ozone attainment strategies on secondary fine particles and visibility or perform a consistent analysis for ozone,

secondary fine particles, and visibility. To facilitate such an effort, we encouraged States to work closely with established regional haze Regional Planning Organizations ( RPOs) and the jurisdictions responsible for developing PM2.5 implementation plans. We encourage States to perform similar multi pollutant assessments as part of their ozone attainment demonstrations, considering the control programs that are in place at the time of the assessment.

Multipollutant assessments are discussed elsewhere in this proposed rulemaking.

b. Summary of final rule There is no regulatory text on the issue of multi PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 115 pollutant assessments, but we recommend the following:

Attainment demonstration modeling should include previously implemented or planned measures to reduce ozone, secondary fine particles, and visibility impairment.

An integrated assessment of the impact controls have on ozone, secondary fine particles, and regional haze is encouraged to promote efficiencies in strategies for achieving all three goals.

States are also encouraged to use common data bases and analysis tools for all three programs and work closely with established regional haze RPOs and the jurisdictions responsible for developing PM2.5 implementation plans.

States are encouraged to follow EPA's lead and perform similar multi pollutant assessments as part of their ozone attainment demonstrations, considering the control programs that are in place at the time of the assessment.

c. Comments and Responses Comments: EPA received several comments on the recommendation that States perform multi pollutant assessments as part of their ozone attainment PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 116 demonstrations. Almost all of the comments agreed with the basic rationale behind encouraging an analysis of the expected ozone, PM2.5, and visibility impacts of a given set of air quality control measures associated with an 8 hour ozone attainment demonstration. The comments differed on whether multi pollutant assessments should be required or only encouraged. The commenters who urged EPA to encourage rather than require a multi pollutant assessment provided reasons for why they believe a multi pollutant assessment is not possible at this time. One commenter indicated that the proposal was unclear as to whether the multi pollutant assessments were required.

One commenter recommended that EPA require, in certain unspecified cases, nonattainment areas to perform an integrated control strategy assessment to ensure that ozone controls will not preclude optimal controls for secondary fine particles and visibility impairment. Conversely,

several other commenters expressed the opinion that the multi pollutant assessment should not be a requirement of an ozone attainment demonstration. Several reasons were offered for why the assessment should remain optional: 1)

that the state of the science for assessing PM2.5 and visibility is not yet sufficient for providing meaningful PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 117 input to the regulatory process, 2) that the additional resources necessary to model the atmosphere as a single system resulted in an undue burden on the States, and 3)

that requiring a PM2.5 and visibility assessment would result in delayed attainment due to the additional time necessary to complete such an analysis.

Response: EPA continues to believe that encouraging, but not requiring, multi pollutant assessments is the most sound approach for total air quality management given the schedule by which ozone attainment demonstrations are legally required. Much progress has been made on improving the available PM2.5 models and inputs to these models over the past three years. As a result, EPA believes that the available tools are able to support air quality planning.

Further improvements are likely over the next 1 3 years;

much of which will be driven by the RPO's. By working closely with the appropriate RPO's, States can reduce the burden associated with one atmosphere modeling analyses.

EPA recognizes however, that many States have already invested resources in an ozone only modeling platform analysis which is typically conducted over a finite number of episode days and for geographic regions that are typically less than ( in time) and smaller than ( in space) PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 118 what might be required in a multi pollutant assessment. By encouraging States to consider such assessments EPA hopes to speed the process of the transition to more integrated air quality planning tools while yielding sound multi pollutant control strategies. It is prudent for areas to perform these multi pollutant assessments earlier as it will lessen the planning burden in the long term since later planning activities for PM2.5 and regional haze will need to consider the effects of emission control measures adopted for the ozone attainment plan.

7. What baseline emission inventory should be used for the attainment demonstration? [ Not addressed in the June 2, 2003 proposal; section 51.909 of the draft regulatory text.]

The June 2, 2003 proposal did not discuss baselines for purposes of the attainment demonstration. Section 51.909 of the draft regulatory text, however, would have established 2002 as the baseline emission inventory for purposes of both RFP and the attainment demonstration for areas with an effective date of designation of June 15, 2004. We recognize, however, that some areas have already begun to perform modeling for their attainment demonstrations using baseline year inventories earlier than the 2002 inventory,

and because the 2002 inventory may not be in a format to PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 19EPA guidance on baseline years is found in the memorandum of November 18, 2002, from Lydia Wegman and Peter Tsirigotis, " 2002 Base Year Emission Inventory SIP Planning: 8 hr Ozone, PM2.5 and Regional Haze Programs." This document is available at the following web site: http:// www. epa. gov/ ttn/ oarpg/ meta. 442.1.2002baseinv. pdf. That document noted, " The EPA is aware that some areas have already begun on a voluntary basis to model for purposes of the 8 hour ozone standard. These areas may continue to use modeling from previous base years for each set of meteorological episode conditions for use in their SIP submittals if these studies are still applicable for an attainment demonstration."

119 readily be used for photochemical grid modeling. 19 Therefore, the final rule does not specify a baseline for purposes of the attainment demonstration and modeling. The specification of 2002 as a baseline year for RFP purposes ( for for areas with an effective date of designation of June 15, 2004) appears in the RFP provisions of 40 CFR 51.910.

Section 51.909 remains reserved.

E. What requirements for RFP should apply under the 8 hour ozone standard? [ Section VI. I. of June 2, 2003 proposed rule ( 68 FR 32832); sections 51.909 and 51.910 in draft;

section 51.910( d) in final regulatory text.]

1. General Discussion a. Background As noted in the June 2, 2003 proposal, section 172( c)( 2), which is located in subpart 1, requires State PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 20Note that section 51.900 provides the following definitions: ( p) Reasonable further progress ( RFP) means for the purposes of the 8 hour NAAQS, the progress reductions required under section 172( c)( 2) and section 182( b)( 1) and ( c)( 2)( B) and ( c)( 2)( C) of the CAA. ( q) Rate of progress ( ROP) means for purposes of the 1 hour NAAQS, the progress reductions required under section 172( c)( 2) and section 182( b)( 1) and ( c)( 2)( B) and ( c)( 2)( C) of the CAA.

120 plans for nonattainment areas to require RFP. Section 171( 1) of the CAA defines RFP to mean " such annual incremental reductions in emissions of the relevant air pollutant as are required by this part [ part D of title I]

or may reasonably be required by the Administrator for the purpose of ensuring attainment of the applicable [ NAAQS] by the applicable date."

Subpart 2 provides more specific RFP requirements for ozone areas classified under Section 181.20 In particular,

subpart 2 specifies the base year emissions inventory upon which RFP is to be planned for and implemented, the increments of emission reductions required over specified time periods, and the process for determining whether the RFP milestones were achieved.

Subpart 2 does not specify RFP requirements for marginal areas. Section 182( b)( 1)( A) mandates a 15 percent VOC emission reduction, accounting for growth, between 1990 PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 121 and 1996 for moderate and above ozone nonattainment areas.

Furthermore, section 182( c)( 2)( B) of the CAA requires each serious and above ozone nonattainment area to submit a SIP revision providing for an actual VOC emission reduction of at least 3 percent per year averaged over each consecutive 3 year period beginning in 1996 until the area's attainment date ( the post 1996 ROP plan). Section 182( c)( 2)( C) of the CAA allows for substitution of NOx for VOC emissions reductions in the post 1996 ROP plan. The EPA's policy, NOx Substitution Guidance ( December 15, 1993; available at http:// www. epa. gov/ ttn/ oarpg/ t1pgm. html), addresses the substitution of NOx emissions reductions for VOC emission reductions. The baseline emissions inventory for determining the required ROP reductions is specified as 1990.

The requirements for RFP under subparts 1 and 2, as described above, are the minimum required for an area. More reductions may be necessary for attainment within the nonattainment area or where the area contributes to a nonattainment problem in a downwind area in the State.

Moreover, an upwind area that contributes to nonattainment in a downwind area in the same State may need more reductions in a shorter time in order for the downwind area PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 122 to reach attainment by its required attainment date.

b. Summary of Final RFP and ROP Features.

We are adopting nearly all the approaches set forth in our proposed rule for the various 8 hour RFP issues. We are making exceptions to those issues for which convincing arguments were presented by commenters for a suitable alternative or where, through reassessment of the issue, EPA was able to develop a better option that still maintains the integrity of the original proposal. The issues for which we have adopted new approaches are: a) the timing of the submission of the RFP plan; b) the structuring of RFP requirements in subpart 1 areas; c) the implementation of RFP in areas designated for the 8 hour ozone standard that entirely or in part encompass an area that was designated nonattainment for the 1 hour ozone standard; and d) the allowing of substitution of controls from outside the nonattainment area within 100 kilometers ( km) for VOC and 200 km for NOx. These changes are discussed in the sections below.

In developing an approach for addressing the RFP requirements for the 8 hour ozone standard, we are adopting the following:

° The same baseline year would be used both to address PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 21Memorandum of December 29, 1997 from Richard D. Wilson to Regional Administrators, Regions I X re " Guidance for Implementing the 1 Hour Ozone and Pre Existing PM10 NAAQS." Located at URL: http:// www. epa. gov/ ttn/ oarpg/ t1/ memoranda/ iig. pdf . This policy recognized that VOC emissions up to 100 km and NOx emissions up to 200 km from the nonattainment area could be relied on for RFP. Those distances used resulted from FACA discussions cited earlier and generally represent transport of 1 to 2 days. We still believe it is appropriate to allow this credit. However, as noted below, because we received concerns about this policy outside the rulemaking process, we are in the process of subjecting this policy to a technical review and may revise it in light of that review.

123 growth ( in emissions, vehicle miles traveled ( VMT) or otherwise) and to calculate the RFP target level. The baseline year of 2002 applies for areas with an 8 hour ozone nonattainment designation effective in June 2004.

° Emissions reductions from outside the nonattainment area up to 100 km for VOC and 200 km for NOx ( and Statewide for areas that are part of a regional strategy) would be allowed consistent with the concepts in EPA's existing December 1997 interim implementation policy for 1 hour ozone NAAQS. 21 ° For areas classified under subpart 2, the RFP requirements specified in subpart 2 would apply, namely a 15 percent VOC emission reduction, accounting for growth, in the first 6 years after the baseline year for moderate and above ozone nonattainment areas. In PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 124 addition, for areas classified as serious and above,

the RFP provisions in subpart 2 require a VOC or NOx emission reduction of at least three percent per year averaged over each consecutive 3 year period beginning 6 years after the baseline year. ( See section 182( c)( 2)( B)). Areas classified under subpart 2 as marginal, which are required to attain 3 years following classification, are subject only to such RFP as necessary to attain. We believe the periods for RFP under subpart 2 for the 8 hour ozone NAAQS should run from the date of the baseline year, and would be equivalent to the periods Congress established in subpart 2, which applied for the 1 hour NAAQS. Thus,

the first 15 percent reduction would be required for the 6 year period starting after the end of the last day of the baseline year ( i. e., January 1, 2003

December 31, 2008). The first 3 year period for the subsequent ( average of) three percent per year emission reduction requirement in serious and higher areas would begin 6 years after the end of the last day of the baseline year ( January 1, 2009  December 31, 2011).

However, the last period for any area would end on the attainment date for the area. PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 22With today's rulemaking, this provision is now codified as 40 CFR 51.908( d).

125 ° Many areas subject to subpart 1 are subject only to such RFP as necessary to attain. For areas with attainment dates 5 years or less after designation,

emission reductions needed for attainment must be implemented by the beginning of the full ozone season prior to the attainment date ( or about 4 years after designation) to enable a SIP to demonstrate attainment as expeditiously as practicable within 5 years after designation ( See 40 CFR 51.90822). Under the final rule, RFP would be met by emission reductions needed for attainment by the attainment date. This approach is similar to the approach of subpart 2 RFP for areas classified as marginal. For subpart 1 areas with attainment dates beyond 5 years after designation, the RFP SIP would first have to provide for a 15 percent emission reduction ( either NOx and/ or VOC) from the baseline year within 6 years after the baseline year.

For each subsequent 3 year period out to the attainment date, the RFP SIP would have to provide for an additional increment of progress equal to at least the amount of emission reductions that would be PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 23E. g., if the area's attainment date is 2014, and a total of 30 percent reduction is needed between the end of 2008 and the attainment date ( a 6 year period) to reach attainment, roughly 15 percent must be achieved during the first 3 years ( 2009, 2010, 2011), and the remaining 15 percent over the next 3 years ( 2012, 2013, 2014). The actual percentage would have to be calculated based on the number of days.

126 proportional to the time between the end of the first RFP increment and the attainment date. 23 ° New moderate areas would have to submit RFP plans within 3 years after designation and obtain the emission reductions within 4 years after designation ( 6 years after the baseline year 2002).

° Allow credit after the 2002 base year for future reductions from any Federal and regional measures promulgated after 1990 ( except those measures that were not creditable under the CAA's creditablility provisions).

° Allow use of the " Clean Data Policy".

c. Comments and responses This set of comments and responses on our proposal on RFP are of a general nature. Comments and responses on specific topics appear with the sections below on those topics.

Comment: One commenter stated that EPA's proposed 8 hour PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 127 ozone rule would sharply slow momentum to implement health protective emission reduction strategies in areas with unhealthful air quality. It would curtail the effectiveness of transportation conformity in areas with inadequate air quality, including both old and new ozone nonattainment areas. It would do this by proposing to eliminate any further RFP requirements for pollution reduction in existing 1 hour ozone areas.

Response: The EPA has developed anti backsliding provisions to ensure continuing progress toward attainment of the ozone NAAQS. Under these provisions, areas that are nonattainment for the 8 hour standard must continue to meet most obligations for the 1 hour standard, including RFP requirements. Those provisions ( adopted as part of the Phase 1 rule published April 30, 2004) will ensure areas maintain progress in achieving emission reductions in areas with unhealthful air quality.

Comment: Another commenter recommends that EPA not strictly interpret the CAA requirement of a 15 percent reduction in VOC in the first 6 years. If reductions in VOC would not assist the area in progress toward attainment and if an area can provide an analysis that it is at least as sensitive to NOx controls, then the area should be able to reduce NOx PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 128 emissions for RFP requirements.

Response: We addressed in general those comments that recommended alternatives to the mandatory measures of subpart 2 ( which includes the RFP requirement) in the response to comments above under the topic, " Should prescribed requirements of subpart 2 apply in all 8 hour nonattainment areas classified under subpart 2, or is there flexibility in application in certain narrowly defined circumstances?" We conclude in that section that EPA has no discretion to broadly waive mandatory requirements.

However, we noted that case law may provide support for case by case waivers where implementation of a measure would produce an absurd result.

Comment: One commenter stated that EPA should consider highly reactive VOC reductions that achieve ozone reductions equivalent to an average of 3 percent per year reduction of VOC and/ or NOx as meeting RFP requirements.

Response: The Clean Air Act's RFP provisions do not appear to provide for variations in the required percent reduction in VOC based on differences of reactivity of the various VOC compounds. However, EPA is participating with a group called the Reactivity Research Working Group, along with representatives from States, industry and universities, to PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 129 study the scientific aspects of reactivity and to try to determine if more cost effective and greater ozone reductions can be achieved through use of the concept. The requirement to obtain the required percent reduction of total VOCs remains, and if EPA decides to propose a change,

it would be undertaken in a separate rulemaking action.

2. For subpart 2 areas, should the initial 15 percent RFP requirement be limited to VOC emissions? [ Section VI. I. 3 of June 2, 2003 proposed rule ( 68 FR 32833); section 51.910( a)( 1)( ii) of the draft and final regulatory text.]

a. Background. Currently, for many areas of the country,

particularly in the Eastern U. S. outside major metropolitan areas, there is a greater need for NOx reductions rather than VOC reductions to bring about reduced ozone concentrations. However, under the prescribed requirements of subpart 2 of the CAA, NOx substitution is only allowed for the post 1996 RFP requirement ( three percent per year averaged over 3 years), not for the initial 15 percent RFP requirement. We proposed 2 options to address this issue.

( i) Option 1. Continue to require 15 percent VOC reductions within 6 years after the baseline year for all areas designated moderate and above for the 8 hour ozone NAAQS. After 6 years, all serious and above areas would be PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 130 required to achieve a nine percent reduction in VOC and/ or NOx emissions every 3 years, i. e., an average of three percent per year, until attainment.

( ii) Option 2. For those areas that have approved 15 percent plans for their 1 hour ozone SIPs, an additional 15 percent VOC reduction is not necessary. Areas that are classified as moderate under the 8 hour standard that have already implemented their 15 percent plans under their 1

hour ozone SIPs would be considered to have met the statutory 15 percent requirement and RFP for the first 6 years from the baseline year would be covered under the more generic RFP requirements of subpart 1. Subpart 1 RFP requirements are discussed below. Areas that are classified as serious and above under the 8 hour standard that have already implemented their 15 percent plans under the 1 hour ozone standard would have to include in their SIPs an RFP plan that would achieve an average of three percent per year of VOC and/ or NOx over each 3 year period starting at the end of the baseline year out to their attainment year. We recognized in the proposal that it would be difficult to adopt and implement emission controls that would provide for the first nine percent emission reduction within 3 years after nonattainment designation. Therefore, consistent with PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 131 what Congress did under section 182( b)( 1), we proposed to allow the first RFP increment to be averaged over 6 years.

We proposed that an area classified serious or above submit its RFP plan within 2 years after designation such that it provides for 18 percent emissions reductions ( VOC and/ or NOx) over the first 6 years from the baseline year ( January 1, 2003 to December 31, 2008) and then within 3 years after designation submit a plan that provides nine percent emission reductions ( VOC and/ or NOx) over each of the next 3 year periods until the area's attainment date ( i. e., from January 1, 2009 to the attainment date). The proposal noted that this option recognizes previous efforts by areas that submitted 15 percent plans as required under the 1 hour ozone NAAQS and provides flexibility to States to use a mix of NOx and VOC reductions as appropriate to meet the additional ROP/ RFP requirements. We noted that we believe that the statute can be interpreted to require the mandatory 15 percent VOC reduction only once for a given area. Once 15 percent VOC reduction requirements have been met, an area could actually have to achieve greater emission reductions,

i. e., an average of three percent per year, but could choose either VOC or NOx reductions as appropriate. We indicated in the proposal that we preferred this second option because PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 24As discussed below in section 5 ( the discussion of the timing of submission of the RFP plan) the RFP plan would have to be submitted within 3 years after designation ( not 2 years as proposed).

132 it provides more flexibility for the RFP plan to be consistent with the area's needs in attaining the standard and the draft regulatory text incorporated this option.

b. Summary of Final Rule.

The final rule incorporates the second option noted in the Background above, as adjusted in response to comment,

namely, that for those areas that are composed entirely of areas and that have approved 15 percent plans for their 1

hour ozone SIPs, an additional 15 percent VOC reduction is not necessary. Areas that are classified as moderate under the 8 hour standard and that are composed entirely of areas that have already implemented their 15 percent plans under their 1 hour ozone SIPs would be considered to have met the statutory 15 percent requirement. RFP for the first 6 years from the baseline year would be covered under the more generic RFP requirements of subpart 1 ( discussed below).

Areas that are serious would have to meet 3 percent reductions per year averaged over 6 years for the first increment and then averaged over each three year period out to the attainment year. 24 PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 133 c. Comments and responses Comment: One commenter expressed concern that for a number of Subpart 2 areas that are also existing 1 hour nonattainment areas, especially those dominated by mobile source emissions and/ or those with existing stringent stationary source controls, it may be difficult to achieve another 18 percent precursor emission reduction within 6 years from the baseline year and then an additional 3 percent per year precursor reduction after that until the area's attainment date. Specific areas were mentioned such as the South Coast District of California and the Houston

Galveston Area, which the commenter indicated will be well beyond best available control technology ( BACT) controls and in some cases at or near lowest achievable emission rate ( LAER) NOx controls on stationary sources making them dependent on mobile source fleet turnover for SIP RFP emission reductions. The commenter further suggested that EPA should have available approved policy options that allow areas in such predicaments to maintain approved SIPs if emission reductions are not available to meet RFP requirements and/ or if available emission reduction techniques might be counterproductive to other local and regional air quality goals. PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 134 Response: We addressed in general those comments that recommended alternatives to the mandatory measures of subpart 2 ( which includes the RFP requirement) in the response to comments above under the topic, " Should prescribed requirements of subpart 2 apply in all 8 hour nonattainment areas classified under subpart 2, or is there flexibility in application in certain narrowly defined circumstances?" We conclude in that section that EPA has no discretion to broadly waive mandatory requirements.

However, we noted that case law may provide support for case by case waivers where implementation of a measure would produce an absurd result.

Comment: Another commenter supported EPA's efforts to recognize the previous efforts of areas to meet ROP requirements under the 1 hour standard. The commenter concurs with EPA's preferred option, which allows States the flexibility to chose a combination of NOx and VOC strategies to meet ROP/ RFP requirements consistent with an area's need to meet the standard.

Response: We agree with the commenter that if an area has already met the 15 percent VOC emission reduction requirement for the 1 hour standard, the area should not be required to meet that requirement a second time for the 8 PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 135 hour standard but instead will be subject to the other applicable RFP provisions of the Act.

Comment: One commenter prefered Option 1 as more protective of air quality and more consistent with the requirements of the CAA. Option 1 would require States to develop RFP plans based on severity and local situation. Option 2 has some attractive features by recognizing progress that States have already made. Option 2 is problematic, however, because it relies on plans developed based on 1990 to 1996 emissions.

This time period has passed.

One commenter believed EPA to be completely without authority to waive the 15 percent RFP plan requirement,

which is an explicit mandate of subpart 2. A 15 percent ROP plan under the 1 hour standard cannot possibly satisfy the 15 percent RFP plan obligation for the 8 hour standard,

because the new RFP requirement is designed to implement a revised NAAQS and is measured from a different baseline year. They further believe that EPA offers no plausible legal rationale for waiving the 15 percent ROP requirement,

and, indeed, none exists. Moreover, although the agency proposed to require RFP demonstrations for the first 6 years for serious and severe areas, there is no lawful or rational basis for exempting moderate areas from this statutory PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 136 requirement. Allowing States to rely on their 1 hour 15 percent ROP demonstrations is further unsupportable because those demonstrations are almost certainly no longer valid.

Response: The EPA acknowledges that under subpart 2 we must require 15 percent VOC reductions for all moderate and above areas, but we maintain that if an area has met this requirement while subject to section 182( b)( 1)( A) under the 1 hour standard, they will not have to meet it again for the 8 hour standard. EPA believes that the CAA is quite clear that the SIP must provide for a 15 percent reduction in baseline VOC emissions for some period after 1990 in an area subject to section 182( b)( 1)( A), and , consequently, the SIP for any area newly subject to section 182( b)( 1)( A) must provide for a 15 percent reduction in VOC baseline emissions. But, EPA disagrees that the CAA plainly requires that the SIP for an area must require a second 15 percent reduction in VOC baseline emissions under a revised ozone standard. EPA believes that section 182( b)( 2)( A) plainly limits our discretion only to the extent that we cannot let the SIP for any area classified as moderate or worse for the 8 hour standard avoid a demonstration that the SIP contains sufficient measures to achieve a 15 percent reduction in VOC baseline emissions or to allow NOx substitution for the PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 137 initial RFP demonstration requirement of section 182( b)( 1)( A). If serious and above areas do not meet the 15 percent requirement, again, they must meet the section 182( c)( 2)( B) RFP requirement, which will achieve greater reductions, that is, 3 percent per year over 6 years for a total of 18 percent, but can meet it with either VOC or NOx reductions. For moderate areas that have already met the 15 percent VOC emission reduction requirement for the 1 hour standard, EPA believes appropriate RFP under subpart 1 should be achieved. For purposes of RFP under subpart 1,

there is nothing that limits such reductions to only VOC reductions. This provision simply requires reasonable annual incremental reductions towards attainment by the applicable attainment date, and this could be achieved by either VOC or NOx emission reductions or a combination of both.

Section 182( b)( 1)( A) is the only statutory provision that limits State discretion to substitute NOx reductions for VOC reductions. This applies only for purposes of the initial 15 percent reduction requirement for the 6 year period after the baseline year.

Congress mandated that areas classified as moderate and above for ozone must submit a SIP revision after 1990 to get PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 138 a 15 percent reduction in baseline VOC emissions under CAA section 182( b)( 1)( A).

Therefore any area, except any part which is covered by an approved 15 percent VOC reduction plan in the applicable SIP, that is classified as moderate or above nonattainment for the 8 hour standard must submit a SIP that provides for a 15 percent reduction in baseline emissions.

EPA believes that the CAA does not clearly require a second 15 percent VOC only reduction under a revised ozone NAAQS in an area that ( 1) is designated nonattainment or maintenance for the 1 hour standard at the time the area was designated nonattainment for the 8 hour standard and classified as moderate, and ( 2) is already covered by a 15 percent reduction plan in the approved SIP for at least all of the area within the boundaries of the 8 hour nonattainment area. Such an area has met the literal requirement set forth in section 182( b)( 1)( A). EPA concludes that we must require such an area to do the following depending upon its 8 hour classification:

If classified as moderate, areas under the 8 hour standard that have already implemented their 15 percent plans under their 1 hour ozone SIPs would be considered to have met the statutory 15 percent requirement and RFP for PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 139 the first 6 years from the baseline year would be covered under the more generic RFP requirements of subpart 1.

If classified as serious or higher for the 8 hour standard, EPA believes that the 3 per cent per year average reduction requirement of section 182( c)( 2) would still apply except that EPA would require that the SIP for such serious and above areas must provide for 18 percent emission reductions over the first 6 years after the baseline year and then 9 percent over each of the next 3 year periods until the area's attainment date. The EPA is not waiving the 15 percent requirement for areas that have satisfied that requirement in their initial 15 percent emission reduction performed under the 1 hour standard. These areas will continue to make reductions with the 3 percent per year incremental emission reductions. The 15 percent reduction requirement still remains valid for areas that never did the initial 15 percent emission reduction.

Comment: Another commenter believed the Subpart 2 provisions of the CAA do not allow for NOx for VOC substitutions for the initial 15 percent RFP requirements.

Response: The EPA believes that the statute allows the substitution of NOx for VOC under certain circumstances.

EPA does not believe it is able to allow substitution of NOx PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 140 reductions for the initial 15 percent VOC reductions requirement, but the CAA does allow States to use both VOC and NOx for the 3 percent reductions thereafter.

Comments on draft regulatory text Comment: Another commenter generally supported the RFP provisions in this section, suggesting that in subsection ( a)( 1)( ii)( A) [ of draft section 51.910] we insert the bolded as shown here:

" An area classified as moderate or higher that has the same boundaries as an area for which EPA fully approved a 15 percent plan for the 1 hour NAAQS is not subject to section 182( b)( 1) of the Act for the 8 hour NAAQS, but instead   ( A) If classified as moderate, is subject to RFP under section 172( c)( 2) of the Act and shall meet that obligation by submitting 3 years after the effective date of its designation a SIP revision that provides for implementation of all emission reductions of VOCs and/ or NOx needed for attainment by the beginning of the ozone season in the area's attainment year." The commenter claimed this language is consistent with the approach EPA has taken in other provisions of this draft.

Response: The commenter's concern is noted. Section 51.910 has been restructured for reasons noted elsewhere in this PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 141 preamble and now addresses the commenter's concern.

Comment: One other commenter suggested that if it is shown that reduction of one precursor would be more beneficial than reduction of another, then the area should be allowed to substitute. They recommended that EPA allow NOx substitution for VOC for any ROP or RFP requirements, not just those for areas designated serious or worse for ozone.

They also suggested that Section 51.910( a)( 3) of the draft regulatory text be revised to allow ( even if conditional)

NOx reductions to be substituted for VOC reductions ( for any ROP or RFP requirement) whenever such reductions would " result in a reduction in ozone concentrations at least equivalent to that which would result from the amount of VOC emission reductions required."

Response: We addressed in general those comments that recommended alternatives to the mandatory measures of subpart 2 ( which includes the VOC only 15 percent RFP requirement) in the response to comments above under the topic, " Should prescribed requirements of subpart 2 apply in all 8 hour nonattainment areas classified under subpart 2,

or is there flexibility in application in certain narrowly defined circumstances? We concluded there that EPA had no discretion to broadly waive mandatory subpart 2 PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 142 requirements. However, we noted that case law may provide support for case by case waivers where implementation of a measure would produce an absurd result.

3. What baseline year should be required for the emissions inventory for the RFP requirement? [ Section VI. I. 4. of June 2, 2003 proposed rule ( 68 FR 32833); section 51.909 of the draft regulatory text; section 51.910( d) of the final regulatory text.]

a. Background. The baseline inventory for RFP ( under subpart 2) is used as the starting point for the determination of a target level of emissions for the future year RFP and as the baseline from which creditable reductions are determined. We designated ozone nonattainment areas in April 2004. Under the " Consolidated Emissions Reporting Rule ( 67 FR 39602, June 10, 2002)

revised emissions inventories are required for the years 2002 and 2005; therefore, we proposed to require use of the 2002 inventory as the baseline inventory for the RFP requirement. This would be the most recent inventory available at the time of designation. We issued a memorandum identifying 2002 as the anticipated emissions inventory base year for the SIP planning process to address PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 25Memorandum of November 18, 2002, from Lydia Wegman and Peter Tsirigotis, " 2002 Base Year Emission Inventory SIP Planning: 8 hr Ozone, PM2.5 and Regional Haze Programs." This document is available at the following web site: http:// www. epa. gov/ ttn/ oarpg/ meta. 442.1.2002baseinv. pdf.

26Memorandum of November 18, 2002, from Lydia Wegman and Peter Tsirigotis, " 2002 Base Year Emission Inventory SIP Planning: 8 hr Ozone, PM2.5 and Regional Haze Programs." This document is available at the following web site: http:// www. epa. gov/ ttn/ oarpg/ meta. 442.1.2002baseinv. pdf.

143 the 8 hour ozone and the PM2.5 standards. 25 b. Summary of Final Rule.

As set forth in our proposed rule, for areas designated nonattainment under the 8 hour ozone NAAQS with an effective date of June 15, 2004, we are requiring States to use the 2002 inventory as the baseline inventory for the RFP requirement for areas designated nonattainment in 2004. As noted in the proposal, the inventory for the 2002 calendar year would be the most recently available inventory at the time of designation in 2004. We noted that we had issued a memorandum identifying 2002 as the anticipated emission inventory base year for the SIP planning process to address the 8 hour ozone and the PM2.5 standards. 26 The baseline emissions inventory is calculated as of the effective date of an area's nonattainment designation using the most recent calendar year for which a complete PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 27E. g., where the effective date of the first designation to nonattainment for an area under the 8 hour ozone NAAQS is after June 1, 2007 but before June 1, 2010, the baseline inventory will be for calendar year 2005.

144 inventory is required to be submitted to EPA under subpart A of this part. Under subpart A, States are required to submit a comprehensive inventory on 3 year cycles by 17 months after the close of the reporting period. Thus, the 2002 inventory was due 17 months after the December 31, 2002 close of the latest 3 year cycle, i. e., was due by June 1,

2004. For those areas designated nonattainment for the 8

hour ozone NAAQS effective June 15, 2004 ( 69 FR 23858, April 30, 2004), the baseline emissions inventory shall be based on the calendar year 2002 because the 2002 inventory was due under subpart A of this part prior to the time of designation. For areas with an effective nonattainment designation in the future, the baseline inventory will be for the calendar year of the most recent triennial inventory as of the date of designation. 27 c. Comments and responses Comment: One commenter is convinced that EPA has misread the statute as requiring that the 6 year time period for achieving a 15 percent reduction in moderate areas or for achieving an 18 percent reduction in serious areas starts PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 145 with the baseline year. Instead, the commenter believes that the statute requires that the 6 year time period begins with the date of designation, rather than the date of the most recent completed VOC inventory. The commenter maintains that the starting point for the 6 year period obviously affects the ending point, and under EPA's interpretation there would not be a meaningful period of time available to accomplish the reductions required in serious areas. Another commenter noted that the 18 percent reduction for serious areas would have to be achieved by 2008. This is 6 years after the base year. The commenter noted that the 2 years that would remain after SIP submission ( from the proposed SIP due date of 2006 until 2008) would be totally inadequate to achieve either the 15 percent reduction in VOCs or the 18 percent reduction in VOCs and/ or NOx. The commenter noted the Act provides for submission of RFP plans within 3 years ( from 1990) in section 182( b)( 1)( A) and 4 years in section 182( c)( 2).

Another commenter agreed there is a reasonable basis to select 2002 as the date of emissions inventories for purpose of establishing creditable reductions from the inventory.

States are not required by the CAA to adopt the year of the nonattainment designation for the 8 hour standard as the PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 146 basis for their planning, even though that was the case under the 1990 Amendments. The commenter claims there are a variety of measures that would be implemented after 2002 that local jurisdictions would like to be able to account for as new emissions reductions in their modeling demonstrations. The commenter claims that this in part is justified on the basis of the 1997 revisions to the ozone NAAQS, including maximum achievable control technology ( MACT) reductions and NOx SIP Call/ 126 rule reductions. The commenter thus believes that reductions between these years " should count." In addition, this was the most recent quality assured/ quality controlled inventory used to support the proposed nonattainment designations on July 15, 2003.

Even if EPA allows States to show that air quality improved between 2001 2003 for purposes of final designations, it will be on the basis of reductions from these earlier inventories.

Another commenter referred to EPA's proposal language regarding the RFP SIP that would have required submission of the RFP plan within 2 years after designation. They stated that EPA is missing the point in that the attainment and RFP submission dates established in subpart 2 are to allow States a sufficient amount of time to achieve the mandated PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 147 goals.

That commenter refered to another alternative that would amend the proposal to require a 1990, rather than 2002 baseline for those areas not having a previously approved 15 percent RFP plan. They further commented that although a 1990 baseline would not eliminate the planning burden associated with this requirement, it would go far towards minimizing the necessary additional work.

Response: EPA has decided to establish 2002 as the baseline year for the 8 hour implementation rule in conformity with both the language of the CAA and the inventory year cycle.

Of reasonable importance is the need to maintain consistency with the periodic inventory for use in various milestone considerations such as rate of progress, compliance demonstration, attainment, and contingency plans. In addition, there should be little if any difference in the result in terms of emissions reductions needed to demonstrate timely attainment. If we use 2002, the baseline may be higher but areas can take credit for any 2002 2004 measures. If we use 2004, the baseline may be lower but areas can't take credit for measures that produce emission reductions between 2002 2004. Depending on the area, the difference should be minimal in terms of the difference in PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 148 the amount of reductions needed to reach attainment and what new measures are necessary to get there. Also, EPA selected this baseline year at the request of many States to allow areas to take credit for emission reductions achieved in the 2002 2004 period as a result of numerous recently adopted federal and State measures. We believe it is reasonable to select an inventory year for which States were already required to produce an inventory rather than requiring Sttes to produce an additional inventory ( e. g., for 2004) that is not otherwise required. Moreover, the use of an inventory for the designation year would cause delay, as it would take the States 1 2 years after the end of 2004 to produce the inventory.

We disagree with the commenters who urged use of the 1990 inventories. Use of the 1990 baseline would be unreasonable now since it would have to be substantially recalculated due to changes in emission calculating methodologies. Furthermore, a 1990 inventory was only required for nonattainment areas as of enactment of the 1990 CAAA and therefore may not exist for a number of areas that are currently designated nonattainment for the 8 hour standard.

Comment: A comment on draft regulatory text section 51.909 PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 149 noted that EPA specified various program milestone dates,

which were derived from the relationship of these dates to the expected date of initial designation. The commenter recommends deleting all such specific date references from the regulation, to avoid the need for revising regulations if the initial designations are not concluded as expected.

This should be replaced by a generic approach, for example by requiring the most recent year's data to be used as the baseline in the second sentence of section 51.909. Deleting the calendar specific dates would not change the result if the designations occur as planned, yet would allow for more recent data to be used if factors beyond the agency's control create a delay in designations. This approach also will allow the regulation to apply to future area designation changes, such as areas that are redesignated nonattainment at some point in the future. Such specific dates are more appropriately included as examples in agency guidance or within the preamble of a final rule with a discussion of how they are derived. The regulation itself should retain only the generic relationship between the milestone and the effective date of designation, which is the approach taken elsewhere in the rule.

Response: Because the designations have already taken PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 28We note that even though the draft regulatory text was structured to place the specification of the baseline year for RFP ( as well as for attainment demonstrations) in section 51.909, the final rule places the RFP baseline year requirement in section 51.910.

150 effect at this point, we believe removing the 2002 specification may only be confusing to some. The final version of rule ( now section 51.910( d)) provides specificity regarding the appropriate baseline year for subsequent nonattainment designations. 28 4. Should moderate and higher classified areas be subject to prescribed additional RFP requirements prior to their attainment date? [ Section VI. I. 5 of June 2, 2003 proposed rule ( 68 FR 32834); no draft or final regulatory text.]

a. Background. As noted in the proposal, for areas initially classified moderate and higher under the 1 hour ozone standard, the baseline inventory was defined as 1990 in the CAA Amendments. Therefore, the 6 year period for the initial 15 percent RFP requirement ended in the same year as the attainment date for moderate areas, viz., 1996. For areas classified moderate and higher under the 8 hour ozone standard, however, we proposed that the 15 percent RFP target level of emissions would be calculated for the 6 year period after the 2002 baseline year, i. e., 2003 2008. PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 151 Moderate areas would be required to meet an attainment date no later than 6 years after the area is designated nonattainment for the 8 hour standard. Since the effective date of designation of nonattainment areas is June 15, 2004,

the outside statutory attainment date would be June 15,

2010. This leaves approximately a 1 1/ 2 year gap between the end of the 6 year period for the 15 percent RFP requirement ( i. e., December 31, 2008) and the maximum statutory attainment date. If we were to also require moderate areas to obtain an additional three percent per year emission reduction beyond 2008 for the one and a half additional years out to 2010, the RFP requirement could be more than what we believe Congress intended for moderate areas under subpart 2. Additional three percent per year reductions were only required for serious and higher classified 1 hour ozone nonattainment areas. We proposed that the only specific RFP requirement applicable for moderate areas is the 15 percent VOC requirement between the end of 2002 and the end of 2008. However, section 172( c)( 2)

also applies which requires areas to meet RFP generally.

Therefore, a moderate area would still also have to provide any additional emissions reductions   VOC and/ or NOx   needed to provide for attainment by the area's attainment PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 29We note that areas must implement controls prior to the beginning of the last ozone season preceding the attainment date. For moderate areas designated as of June 15, 2004, such reductions would be needed by the beginning of the 2009 ozone season.

152 date. In proposing this approach for this circumstance, we interpreted the subpart 1 RFP requirement to mean that the area must achieve whatever further reduction is needed for attainment in the remaining period prior to the attainment date ( 2009 through June 15, 2010).

We proposed that serious and higher classified areas would need to provide in their SIPs an additional average of three percent per year emission reduction over each subsequent 3 year period beyond the initial 6 year period through the attainment year, consistent with what Congress specified in section 182( c)( 2)( B) of the CAA.

b. Summary of Final Rule.

In the final rule, we are taking the approach we proposed. Moderate areas are not subject to any additional prescribed emissions reductions for RFP but instead must provide for any additional emissions reductions ( VOC/ NOx)

needed to provide for attainment by the beginning of the ozone season prior to the area's attainment date. 29 Serious and higher classified areas would need to provide in their PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 153 SIPs an additional average of three percent per year emission reduction over each subsequent 3 year period beyond the initial 6 year period through the attainment year.

c. Comments and responses Comment: One commenter suggested that following the statutory timetable rather than the one proposed by EPA would eliminate the problem of how to handle the " 1 1/ 2 year gap between the end of the 6 year period for the 15 percent RFP requirement ( i. e., December 31, 2008, as proposed by EPA) and the attainment date." The commenter continued by saying that no such gap is contemplated by subpart 2, which provides in section 18l( b)( l) that moderate areas'

attainment dates and their 15 percent VOC RFP date are to be the same: 6 years after their designation and classification.

Response: We do not believe the Act requires the end of the 15 percent RFP period and the attainment date to be the same. The Act does provide, however, that the 15 percent emission reductions under section 182( b)( 1)( A) must be accomplished within 6 years of a base year. We have in a previous discussion above determined that 2002 is the most appropriate baseline year for RFP purposes. Therefore, if a moderate areas needs additional emission reductions beyond PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 154 2008 for attainment, there will continue to need for additional emission reductions between the end of that 6 year period and the beginning of the ozone season prior to the attainment date.

Comment: Another commenter noted the proposal states that the only specific RFP requirement applicable for moderate areas is the 15 percent VOC requirement between the end of 2002 and the end of 2008. However, section 172( c)( 2) also applies, requiring areas to meet RFP generally. Therefore,

a moderate area would still also have to provide any additional emissions reductions VOC and/ or NOx, i. e.,

whatever is needed to provide for attainment by the beginning of the ozone season prior to the area's attainment date. The commenter agrees that any additional emissions reductions needed to achieve attainment are the only reductions that should be required of moderate areas.

Response: We agree with the commenter, and our rule requires that for purposes of meeting RFP beyond 2008 until the area's attainment date, moderate areas must obtain such specific annual reductions in VOC and NOx emissions as necessary to attain by the area's attainment date.

5. What is the timing of the submission of the RFP plan?

[ Section VI. I. 6 of June 2, 2003 proposed rule ( 68 FR 32834); PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 155 section 51.910 of the draft and final regulatory text ( several locations).]

a. Background. As noted in the proposal, section 182( b)( 1)

requires that moderate and higher classified areas submit their 15 percent RFP plans within 3 years after 1990.

Obviously, applying the statute as written is absurd, since we are well past that date. The Act uses identical language for identifying areas' attainment dates under subpart 2. In our phase 1 rule, for purposes of attainment dates for the 8 hour NAAQS, we interpreted the CAA's language referring to the date of enactment of the 1990 CAA Amendments to mean the date of designations for the 8 hour standard. We noted in the proposal that if we applied the same interpretation for RFP plans, i. e., that they should be submitted within 3 years after the area's nonattainment designation date ( i. e.,

in 2007 if we designate in 2004), the plans would have to be implemented within 1 year after submission to ensure the 15 percent emissions reductions are achieved by the end of the relevant 6 year period ( i. e., December 2008). We indicated concern that this might not provide sources with sufficient time to achieve the reductions by the required deadline.

Therefore, we proposed that the RFP SIP be submitted within 2 years after nonattainment designation   namely by 2006. PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 156 This would provide for 2 years for the State to develop and submit its RFP plan, and another 2 years for the control measures to be implemented.

We also proposed that an area classified serious or above submit its ROP plan within 2 years after designation that provides for 18 percent emissions reductions ( VOC and/ or NOx) over the first 6 years from the baseline year and then submit within 3 years after designation a ROP plan that provides nine percent emissions reductions ( VOC and/ or NOx) over each of the next 3 year periods until the area's attainment date.

b. Summary of Final Rule.

In the final rule, we are taking a different approach than proposed in light of concerns raised by States in public comments that they would need more than 2 years for development, adoption and submission of RFP plans for the increment of progress over the first 6 years after the baseline year. EPA agrees with the several commenters who urged that 3 years was more consistent with the Act.

Additionally 3 years is a more reasonable time period for submission because it allows States the necessary time to move regulatory actions through their legislative processes and allos States to consider RFP in conjunction with their PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 157 attainment demonstrations. Therefore, for moderate and higher classified areas, the first RFP SIP must be submitted within 3 years after the area's nonattainment designation.

For areas with a June 15, 2004 effective date, for the 8

hour designations, the SIP would be due by June 15, 2007.

This would provide up to 3 years for States to develop and submit RFP plans, and 1 additional year ( until the end of 2008) for control measures to be implemented. The RFP SIP for any remaining 3 year periods out to the attainment date beyond the first 6 years would be submitted with the attainment demonstration, i. e., within 3 years after designation. However, since States maintain the flexibility to submit plans early to provide more time for implementation of their SIP control measures, we recommend that States complete their RFP plans as soon as possible after designation to provide as much time as possible for sources to implement the emission reductions.

c. Comments and responses Comment: Several commenters opposed EPA's proposal to shorten to 2 years the statutory 3 year period for development and submittal of 15 percent VOC RFP plans. They claim this proposal violates the guarantee of 3 years for plan development to the State in section 182( b)( l)( A) and is PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 158 contrary to EPA's basic proposed principle that [ quoting from the proposal] " subpart 2 SIP submittals will be due as a general matter by the same period of time after designation and classification under the 8 hour standard as provided in subpart 2 for areas designated and classified at the time of enactment of the 1990 CAA." The commenters contended that Subpart 2 gives EPA no authority to shorten the statutory 3 year period. In contrast, Congress in Subpart 1 authorized EPA to set a schedule for nonattainment SIP submissions, which may be no later than 3 years after designation. Congress therefore knew how to give EPA discretion to shorten SIP submission deadlines according to the commenters; it did not do so in Subpart 2.

Concerning the timing of submission of the RFP plan,

another commenter was concerned that the States may not have sufficient photochemical modeling and ambient air analyses to indicate the best mix of RFP SIP controls. Additionally,

in areas dominated by mobile source emissions, it may not be feasible to implement control measures to achieve the RFP target within the next 2 years as EPA has suggested. The commenter suggested that EPA have policy options available that allow areas in such predicaments to maintain approved SIPs if emission reductions are not available to meet RFP PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 159 requirements and/ or if available emission reduction techniques might be counterproductive to other local and regional air quality goals.

Another commenter stated revisions to State emission reduction measures cannot be adopted and implemented easily in a two year time period because they require administrative action and frequently State legislation to approve. This period can lengthen when proposed measures like enhanced vehicle inspection and maintenance involve controversial actions affecting the public. Logistically a State must establish a regulation by administrative action with public input before ( though sometimes after) such a measure is approved by the State's legislature. A number of jurisdictions' legislatures are only in regular session to consider such measures several months or, in alternate years. Thus, it is unreasonable for States to have only 2 years from their nonattainment designations to adopt new measures.

Another commenter referenced the case NRDC v. EPA, 22 F. 3d 1125, 1135 ( D. C. Cir. 1994), where the Court considered the propriety of EPA's extension of the deadlines by which States had to submit elements of their SIPs. The Court upheld EPA's decision to extend the deadline for compliance PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 160 with a procedural requirement of the Act given EPA's failure to meet its own deadline for providing certain necessary guidance to the States. The Court allowed EPA to use the extraordinary remedy of a deadline extension in this instance because Congress would have intended that the deadline be extended to provide a party the full statutory time for acting on the agency guidance. The commenter contended that Section 182( b)( 1) does not give EPA the discretion to set a shorter time period than three years, it only allows a State to make its submission early if it so desires. The commenter referenced CAA section 126( c) where EPA may set a compliance deadline " as expeditiously as possible, but in no case later than 3 years after the date of such finding."

One commenter noted that CAA section 182( b)( 1)( A) as modified by section 181( b)( 1) requires for moderate areas that the RFP SIP be submitted 3 years after designation.

The commenter disagreed with the RFP plan requirement to submit the plan 2 years after the effective date of the nonattainment designation as not being consistent with or supported by these CAA Sections. The resources involved in developing, proposing and adopting any SIP revision are not insignificant. In order to ensure the most efficient use of PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 161 resources, the commenter contended that EPA should not require this SIP revision sooner than the submission of the attainment demonstration, 3 years after the effective date of the designations. Allowing States 3 years to submit the RFP plan is consistent with existing CAA requirements.

Response: After consideration of the comments we have changed the final rule to be consistent with the approach advocated in a number of comments. In consideration of the 2004 designation and the need to achieve the 2008 RFP reductions by December 2008, it seems reasonable to EPA that States first be given sufficient time after designation to formulate RFP plans and then adequate time to meet the RFP demonstration after the RFP plan is due. Therefore, the final rule allows States up to 3 years after designation to submit their RFP SIPs; however, we recommend that States complete their RFP plans as soon as possible after designation to provide as much time as possible for sources to achieve the emission reductions.

6. How should CAA restrictions on creditable measures be interpreted? Which national measures should count as generating emissions reductions credit toward RFP requirements?

[ Section VI. I. 7 of June 2, 2003 proposed rule ( 68 FR 32834); PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 162 section 51.910( a)( 4) of the draft regulatory text; section 51.910( a)( 3) of the final regulatory text.]

a. Background. Section 182( b)( 1) contains provisions that limit creditability toward meeting RFP for certain limited emission reduction measures required prior to the enactment of the CAA Amendments of 1990. We noted in the proposal that we believe these specific restrictions should continue to apply for purposes of the 8 hour NAAQS. The proposal noted that Congress intended to prevent areas from taking credit for RFP only for those specific measures that were already adopted and in place ( or required to be in place)

prior to the date of enactment of the CAA Amendments of 1990 ( November 15, 1990). We said that this same logic holds true for the RFP requirement as it applies to the 8 hour ozone standard, namely preventing credit toward the mandatory RFP percent reductions for continuing reductions from those specific measures cited in the CAA that were already adopted and in place ( or required to be adopted and in place) prior to the date of enactment of the CAA Amendments of 1990. There is no indication in the CAA that this exclusion should be changed. Congress mandated many emission reductions in the 1990 Amendments with no indication that they should not be credited to meeting RFP PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 163 or attainment of any existing or revised NAAQS. Therefore,

we proposed that all emissions reductions that occur from all Federal and any other measures not otherwise identified in section 182( b)( 1)( D) and that occur after the baseline emissions inventory year would be creditable for the RFP requirement. A number of examples demonstrating emission reductions that would be creditable toward the RFP requirement were set forth in our proposal.

b. Summary of Final Rule.

We are taking the approach we proposed, under which all emissions reductions that occur after the baseline emissions inventory year are creditable for purposes of the RFP requirements in this section except as specifically provided in section 182( b)( 1)( C) and ( D) and section 182( c)( 2)( B) of the Act. These provisions exclude emission reductions from four categories identified above in the background. The restriction imposed by section 182( b)( 1)( D) limits crediting reductions from the following four categories:

° Corrections to SIPs: corrections to or additions of reasonable available control technology ( RACT) rules as required by CAA section 182( a)( 2)( A).

° Corrections to SIPs: corrections to vehicle inspection maintenance ( I/ M) programs for areas where the SIP PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 164 included or was required to include a schedule for I/ M implementation under the CAA in effect immediately before November 15, 1990.

° Regulations concerning Reid Vapor Pressure promulgated by EPA before November 15, 1990 or required to be promulgated under CAA section 211( h).

° Motor vehicle exhaust or evaporative emissions measures promulgated by EPA by January 1, 1990.

c. Comments and responses Comment: One commenter supported EPA's proposal to credit towards RFP requirements all emission reductions, which occur after the baseline emissions inventory year ( 2002)

from all Federal, and any other measures not otherwise identified under Section 182( b)( 1)( D). This would include reductions from cleaner fuels and engines, reductions from on going 1 hour SIP controls and VOC reductions from implementation of MACT standards after the baseline year.

The commenter stated that this proposed approach would be critical in a number of areas that already have stringent stationary source controls and/ or in areas dominated by mobile source emissions.

Response: EPA acknowledges this comment of support for our final action. PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 30For example, if an area had VOC emissions in 2001 of 100 tons per day, and a source reduces emissions by 10 tons per day in 2002, the baseline emission will be 90 tons per day. Thus the area will need to achieve 13.5 tons per day 165 Comment: Another commenter believed that early voluntary emissions reductions prior to 2003, and not required under the CAA, should also be creditable toward RFP requirements.

The commenter recommended that EPA's final rule clarify that States be allowed credit for RFP for early voluntary emissions reductions occurring prior to 2003. As a company that has proactively taken measures to reduce nitrogen oxide ( NOx) emissions through innovative Combustion Initiative ( an enhanced efficiency technology), the commenter believed that EPA's regulations should take these efforts into account as they have resulted in real improvements to air quality.

Another commenter stated that companies who made voluntary reductions prior to 2003 would be penalized for having undertaken such voluntary measures and, thus disallowing credit for these reductions provides disincentives for voluntary reductions.

Response: Voluntary reductions that occur prior to January 1, 2003 will be reflected in the area's baseline inventory.

This lower baseline means that fewer reductions will be needed to achieve RFP. 30 Allowing an area to take credit PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 reduction to meet its 15 percent requirement, rather than 15 tons per day. However, the area cannot take credit in the 15 percent plan for the 10 tons per day of emissions that are not part of the baseline inventory.

166 for reducing emissions that are not included in the inventory would result in " double counting" of those emission reductions.

Comment: One commenter suggested that areas should be able to take credit for MACT standards that may reduce VOC for which compliance is required after the 2002 baseline year.

The commenter said it would be helpful to States if EPA produced a document detailing the expected VOC reductions after implementation of MACT standards. States could claim these reductions toward any reductions required to meet their target. The commenter suggested that the most useful way to express the reduction would be as a percent of the 2002 emissions.

Response: EPA agrees that areas can take credit in RFP plans for post 2002 VOC reductions from MACT standards. We are still considering whether to develop the recommended guidance.

Comment: One commenter objected to EPA's proposal to allow States to claim RFP credit from any reductions achieved through post 1990 adoption of the types of measures listed PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 167 in section 182( b)( 1)( D). They further stated that Section 182( b)( 1)( D) prohibits granting RFP credit for any measures contained on the list. Congress wanted the RFP reductions to be new reductions rather than emission cuts that would have occurred anyway. In the case of 8 hour nonattainment areas, the baseline year will be 2002. Therefore, according to the commenter, to be consistent with subpart 2, EPA must disallow RFP credit for measures listed in section 182( b)( 1)( D) adopted any time prior to 2002.

Another commenter urged EPA to consider a hybrid approach that gives States credit for approved RFP plans that go beyond 2002, provided that the Plan is evaluated on a 2002 baseline. This approach would give States credit for ongoing emission reductions, recognize the need to address the 8 hour standard as the ozone standard ( rather than rely on plans developed to meet the 1 hour standard), and potentially avoid some unneeded controls.

Another commenter recommended that EPA not allow emissions reduction credit for all emissions reductions occurring after the baseline year. Emissions reductions to satisfy the RFP requirements of CAA section 182( b)( 1) and 182( c)( 2)( B) are required to be achieved by submitting " a revision to the applicable implementation plan to provide PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 168 for . . . emissions reductions." The commenter argued that emissions reductions already required by, or accounted for in, the applicable implementation plan may not be credited toward the new RFP requirements. For example, reductions that were required to be achieved by SIP or other requirements, but which were not achieved in practice prior to the baseline year, should not be credited toward meeting the new RFP reductions required after the baseline year.

Only new measures submitted with the new SIP revision may be credited for this purpose.

Response: EPA believes that, with certain exceptions, any reductions that occur after 2002 are creditable towards RFP and attainment and that it should not matter when the State initially adopted or EPA promulgated the measures that produce those reductions. The Act does not mandate the approaches advocated in the comments. While the comments cite phrases in the CAA that might be read to support the approach advocated in the comments, EPA believes such an interpretation is at odds with other provisions of the Act.

In addition to the restriction imposed by section 182( b)( 1)( D) on crediting certain measures, section 182( b)( 1)( C) places only two restrictions on creditability of reductions towards RFP: first, reductions are creditable PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 169 if they result from measures in the applicable implementation plan, i. e., the approved SIP, from rules promulgated by EPA or from a permit issued under Title V;

and secondly, only those reductions that have actually occurred after the baseline year and before the milestone date may be credited towards a RFP milestone. The requirement that the reductions result from measures in the applicable implementation plan, EPA regulations, or a Title V operating permit places no restriction that such measures must be measures promulgated by EPA, adopted by the State,

or in a Title V permit issued after the date of designation or after the baseline year. This restriction only requires that the measure be approved into the SIP, promulgated by EPA. or included in a the permit issued before or concurrently with approval of the RFP SIP revisions, and that the reductions occur after the baseline year and before the milestone date.

While this provision limits EPA's discretion to allow credit towards the RFP requirement from any reduction that does not fit into any of the three aforementioned classes of measures, EPA does not see anything in the statute that mandates the adoption of the approach advocated in the comments. In fact, EPA believes the opposite is the case. PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 170 The same argument ( i. e., that creditable RFP measures must be measures adopted/ promulgated after designation or after the baseline year) could have been made for the various programs mandated by the 1990 amendments to the CAA.

These mandated measures included reasonably available control technology requirements under section 182( b)( 2),

stage II vapor recovery under section 182( b)( 3), motor vehicle inspection and maintenance under sections 182( b)( 4)

and 182( c)( 3), reformulated gasoline under section 211( k),

the Tier 1 motor vehicle standards under Title II. EPA believes the statute is plain that Congress envisioned that all of these would be adopted after 1990 and in most cases implemented before 1996 because the statute contains enforceable deadlines for submission of the requisite SIP revisions or promulgation of the EPA rules and in many cases contain required implementation dates before 1996. Congress clearly did not limit credit from the RFP requirements for any of these measures. In our proposed rulemaking, EPA specifically proposed allowing use of reductions resulting from any measure as long as the reductions meet the creditability criteria of section 182( b)( 1)( C) for the very reason EPA concluded Congress did not intend to impose the sort of limit on creditability advocated in the comments for PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 171 the 1 hour standard and for any revised standard.

In summary, the statute says that only four specific categories of emission reductions are restricted. It does not refer to or include any post 1990 rules' emission reductions as restricted and only speaks to creditability in terms of when the reductions occurred, not when the rules or measures were adopted. As explained in the proposal and the preceding paragraphs, Congress had reason to limit creditability of pre 1990 rules, mandated many post 90 rules and allowed these rules to be credited towards post 90 RFP,

and nothing in the statute leads us to believe that Congress would not have wanted them to also be creditable to post

2002 RFP. The EPA believes it is appropriate to allow credit toward RFP for emission reductions other than reductions from the four categories specified in the Act pursuant to section 182( b)( 1)( C). Language that was once pertinent to the schedule of the 1990 CAAA should be reinterpreted now to mean emission reductions are creditable toward emission reductions requirements to the extent they have actually occurred as of 6 years after any baseline year including 2002.

7. For areas covered only by subpart 1, how should the RFP requirement be structured? [ Section VI. I. 8. of June 2, 2003 PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 172 proposed rule ( 68 FR 32834); section 51.910( b) of the draft and final regulatory text.]

a. Background.

The proposal noted that the RFP requirement under subpart 1 is more general than that under subpart 2, and EPA thus has more flexibility in determining what RFP means under subpart 1. For instance, the State may rely on emission reductions of VOC or NOx or a combination of both to meet its RFP requirement. However, we acknowledged the need for ensuring equity between areas with similar 8 hour ozone problems covered under subpart 1 and those covered under subpart 2.

We proposed three scenarios for three types of areas described as ( a) Areas with attainment dates 3 years or less after designation, ( b) Areas with attainment dates between 3 to 6 years after designation, and ( c) Areas with attainment dates beyond 6 years after attainment.

° Areas with attainment dates 3 years or less after designation.

We proposed an RFP requirement for these areas similar to that for areas under subpart 2 that are classified as marginal. Such an area would not be subject to a separate RFP requirement, but RFP would be met by demonstrating the PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 173 area could attain the standard by its attainment date.

° Areas with attainment dates between 3 to 6 years after designation.

These areas would have attainment dates similar to subpart 2 areas classified as moderate. We proposed two options for these areas:

° Option 1. This option would require the RFP plan to be submitted with the attainment demonstration within 3 years after designation of the nonattainment area. The SIP would have to show that all emissions reductions needed for attainment would be implemented by the attainment date. Where areas have only 3 years after SIP submission before attainment, this option recognizes that there may be only a short amount of time available to achieve any specified emission reduction beyond that needed to demonstrate attainment and therefore would not require a showing that a specified amount of emission reductions occur between the time of SIP submission and the attainment date.

The draft regulatory text incorporated this option.

° Option 2. This option would have required these areas to be treated in a manner similar to subpart 2 areas classified as moderate. The RFP SIP would have to PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 31NOx Substitution Guidance. December 15, 1993; available at http:// www. epa. gov/ ttn/ oarpg/ t1pgm. html)

174 provide for a 15 percent emission reduction from the baseline year within 6 years after the baseline year.

The RFP SIP would have to be submitted within 2 years after designation. However, since the area is subject only to subpart 1, VOC or NOx emission reductions could be relied on to meet the 15 percent reduction requirement, consistent with EPA's NOx substitution policy. 31 Also, we solicited comment on whether a percentage other than 15 percent should be required as the minimum. Additional measures that would provide the remaining portion of the emission reductions needed for attainment would have to be submitted with the area's attainment demonstration within 3 years after designation.

° Areas with attainment dates beyond 6 years after designation.

These areas are similar in attainment dates to areas classified under subpart 2 as serious or higher. We proposed that the RFP plan show increments of progress from the baseline emissions inventory year out to the attainment date. The RFP SIP would first have to provide for a 15 PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 175 percent emission reduction from the baseline year within 6 years after the baseline year. The 15 percent RFP SIP would have to be submitted within 2 years after designation.

However, since the area is subject only to subpart 1, NOx emission reductions could be substituted for some or all of the 15 percent reduction requirement, consistent with EPA's NOx substitution policy. Also, we solicited comment on whether a percentage other than 15 percent would be more appropriate. Then, for each subsequent 3 year period out to the attainment date, another RFP SIP would have to provide for an additional increment of progress no less than the amount of emission reductions that would be proportional to the time between the end of the first increment ( in 2008) to the attainment date. This second RFP SIP would have to be submitted at the same time as the attainment demonstration,

namely within 3 years after designation.

b. Summary of Final Rule.

We are finalizing rules for two, rather than three,

categories of areas based on the Act's division of attainment dates for subpart 1 areas under section 172( a)( 2). This provision requires that subpart 1 areas must attain as expeditiously as practicable but no later than 5 years after designation as a nonattainment area. It PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 176 also allows the Administrator to extend the attainment date beyond that 5 year period " . . . for a period no greater than 10 years from the date of designation as nonattainment,

considering the severity of nonattainment and the availability and feasibility of pollution control measures."

The two scenarios for RFP for subpart 1 areas are based on whether the area does or does not receive the extended attainment date. The following are the two scenarios and the RFP requirements for each:

° Scenario A: Areas with attainment dates 5 years or less after designation ( i. e., on or before June 15,

2009 for areas designated June 15, 2004).

As noted elsewhere in this preamble, for areas classified under subpart 1, emission reductions needed for attainment must occur by the beginning of the ozone season preceding the attainment date. Thus, to enable a SIP to demonstrate attainment by June 15, 2009, the area must achieve all necessary reductions by the beginning of the 2008 ozone season. The final rule provides that RFP for these areas would be met by ensuring emission reductions needed for attainment are implemented as noted above by the beginning of the ozone season prior to the attainment date.

In other words, for purposes of RFP, these areas would be PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 177 treated similar to subpart 2 RFP for areas classified as marginal ( although marginal areas are not required under the Act to submit an attainment demonstration).

° Scenario B: Areas with attainment dates more than 5 years after designation ( i. e., beyond June 15, 2009 for those areas designated June 15, 2004).

For these areas:

° The RFP plan must show increments of progress from the baseline emissions inventory year out to the attainment date.

° The RFP SIP would first have to provide for a 15 percent emission reduction from the baseline year through the 6th year after the baseline year ( i. e.,

from January 1, 2003 through December 31, 2008).

° The 15 percent RFP SIP must be submitted within 3 years after designation ( i. e., by June 15, 2007).

° However, since the area is subject only to subpart 1,

NOx or VOC emission reductions ( or both) could be used to achieve the 15 percent emission reduction requirement.

° For each subsequent 3 year period ( after 2008) out to the attainment date, the RFP SIP would have to provide for an additional increment of progress no less than PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 178 the amount of emission reductions that would be proportional to the time between the end of the first increment ( December 31, 2008) and the attainment date.

This second RFP SIP must also be submitted within 3 years after the effective date of designation ( i. e., by June 15, 2007).

While the adopted rule is not identical to any of the proposed options, we believe it is a logical outgrowth of our three proposed scenarios. The adopted approach is more stringent than certain of the proposed options and less stringent than others. Since this final decision incorporates elements of the three proposed scenarios, we believe it is similar in result to the three scenarios proposed.

c. Comments and responses Comment: One commenter stated that EPA has no authority to adopt " Option 1" for areas with attainment dates between 3 and 6 years after designation, because that option would waive any showing of RFP.

Others supported the proposal that ties the required RFP showing to the attainment date. Specifically, these commenters supported the proposal that areas with attainment dates of three years or less should have no separate RFP PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 179 requirement, consistent with the requirement applicable to marginal areas under Subpart 2. In addition, support was shown for Option 1 for Subpart 1 areas with an attainment date between 3 and 6 years following designations. Under Option 1, areas would have to show an adequate rate of reduction in order to achieve attainment by the deadline,

but there would be no specific percentage reduction required.

Another commenter believed that a 15 percent emissions reduction requirement should only be required where such reductions would meaningfully advance the date of attainment. The RFP requirement in Subpart 1 requires that the SIP provide for " reasonable further progress," and where emissions reductions would not create " reasonable further progress" either in the area itself or in downwind areas,

there is no basis under Subpart 1 to require such specific emission reductions. They further said that requiring a potentially expensive reduction in emissions in those cases where that reduction would not improve air quality was not justified based on a notion of " equity" with similar areas classified under Subpart 2 and noted that such an interpretation was not required by the statute or sensible.

That some Subpart 2 areas might have to reduce emissions by PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 180 a specified percentage even where such reductions would yield no positive environmental benefits is an unfortunate result of the Congress's decision to limit EPA's discretion under Subpart 2   which in turn is a result of a far less sophisticated understanding of the dynamics of ozone creation in 1990 than exists now   and where EPA has the discretion not to dictate an ineffective and inefficient result, it must exercise that discretion.

Response: The EPA acknowledges that Congress prescribed specific RFP requirements under subpart 2, but for subpart 1 provided more flexibility.

Our rule does not eliminate RFP obligations for subpart 1 areas. We are not requiring any specific percent reduction for areas not subject to 15 percent VOC reductions and with near term attainment dates. The measures that bring about near term attainment represent all the reductions that are reasonable to require as annual incremental progress towards attainment. The EPA is not compelled to require a 15 percent emission reduction for all subpart 1 areas, especially in those cases where a full 15 percent is not needed in order to reach attainment.

However, we believe that it is generally appropriate to require the full 15 percent for areas with long term PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 181 attainment dates to ensure interim progress towards attainment and on equity grounds.

8. How should the RFP requirements be implemented for areas designated for the 8 hour ozone standard that entirely or in part encompass areas that were designated nonattainment for the 1 hour ozone standard? [ Section VI. I. 9. of June 2, 2003 proposed rule ( 68 FR 32835); no draft regulatory text;

section 51.910( a)( 1)( iii) of final rule.]

a. Background. We proposed the following approach to address this issue. The State would have to develop a new baseline and new RFP emission reduction targets for the entire 8 hour standard nonattainment area ( i. e., the old 1

hour standard nonattainment area and the newly added portion of the 8 hour standard nonattainment area). Emissions reductions from measures in the 1 hour ozone SIP that are achieved after the 8 hour ozone NAAQS baseline year could count ( subject to creditability restrictions as discussed above in the proposed rulemaking) toward meeting the RFP requirement for the entire 8 hour area.

This approach would set an RFP target for the entire 8

hour ozone nonattainment area. The State would have to ensure that the target is at least as stringent as the 1

hour RFP target, thus ensuring no backsliding on the 1 hour PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 182 NAAQS requirements. Under this approach, the new RFP target for the 8 hour standard would replace the previous 1 hour ROP target ( while ensuring that, at a minimum, the emissions reductions required to meet the old target are met). The proposal did not address how the 15 percent ROP requirement would apply to an 8 hour area that includes ( in whole or in part) a 1 hour area that previously met the 15 percent ROP requirement, but also included one or more counties tha were not previously subject to the 15 percent ROP requirement.

b. Summary of Final Rule.

We are incorporating the proposed approach. As noted above, an 8 hour nonattainment area that is identical,

geographically, to its predecessor 1 hour nonattainment area ( which has already done the 15 percent reduction) will not be required to do another 15 percent VOC only reduction plan. Although the proposal did not address the 15 percent VOC reduction requirement for an 8 hour moderate or higher nonattainment area that contains a 1 hour nonattainment area that has an approved 15 percent VOC ROP plan, we have addressed this in the final rule. We believe the approach we have adopted is consistent with the intent of the proposal. The final rule allows States the choice between the following two options. PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 183 ° Option 1. Develop a new baseline and new 15 percent VOC ROP emission reduction target for the entire newly expanded area. Determine that emission reductions that occur after the 2002 baseline emissions inventory year are creditable in the combined new area. The reductions must be of VOC only.

° Option 2. Treat the 8 hour nonattainment area as divided between the old 1 hour area and the newly added 8 hour area. For the newly added portion ( which had not previously implemented a 15 percent plan), States must establish a separate 15 percent VOC target under subpart 2. VOC reductions to meet the 15 percent requirement for the portion of the new 8 hour nonattainment area may come from across the entire 8

hour area. The portion of the area that was nonattainment for the 1 hour standard is subject to the subpart 1 provisions of the CAA, and both VOC and NOx emission reductions can be credited toward meeting the RFP target for this portion of the nonattainment area.

Furthermore, for an 8 hour nonattainment area that is composed in total by various 1 hour areas that had 15 percent plans ( i. e., the 8 hour boundaries are not exactly the same as the 1 hour boundaries but all parts of PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 184 the area were a part of a 1 hour area with a 15 percent plan), EPA will also consider that the area has met its 15 percent VOC only requirement. As explained elsewhere in the preamble in response to comment on the draft regulatory text for section 51.910( a)( 1)( ii), EPA has modified the text in section 51.910( a)( 1)( ii) of the final rule to embody this change. Then, as a result, these areas will need to implement either " whatever reductions are necessary for attainment by its attainment date," if moderate, or 3 percent NOx/ VOC per year ( averaged over each 3 year period out to the attainment date), if serious and above. If part of an 8 hour area ( town, county, etc.) was never part of a 1 hour area with a a 15 percent VOC only plan approved by EPA, the 8 hour area must prepare and submit a 15 percent VOC only plan with the caveats outlined below.

In the case of an 8 hour nonattainment area that is classified as moderate or higher and includes an area that was not part of a 1 hour area with an the EPA approved 15 percent VOC only plan and also includes areas that had an EPA approved 15 percent VOC only plan( s), there are two possible options: ( 1) the entire 8 hour nonattainment area needs to have a new 15 percent VOC only plan; or ( 2) the 15 percent VOC only reduction plan needs to be prepared for PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 185 that portion of the area that was not previously subject to an EPA approved 15 percent VOC only plan approved. Under either option, the 15 percent reduction needed to meet the RFP milestone for the new portion of the nonattainment area can come from the anywhere in the 8 hour nonattainment area.

As an added alternative to preparing a fully modeled 15 percent VOC only plan for the expanded area, EPA believes that if this expanded area implements and has SIP approved the same VOC control measures ( for example, VOC RACT at the same source thresholds, Stage II, I/ M, etc...) that the initial area which demonstrated 15 percent had implemented and the mix of sources ( point with similar industrial mix/

area/ mobile) is similar to the existing area, then EPA will consider and presume that the expanded area has met its 15 percent VOC only requirement. EPA will propose this as acceptable on a case by case basis for any area that meets this criteria. This would be only a presumption, because EPA can not guarantee areas, up front, that they will not have to do something more for the 15 percent reduction.

This would be determined on a case by case basis in the SIP approval rulemaking in which EPA would have to respond to any comments that the presumption was inappropriate and the area actually failed to make 15 percent. If EPA does not PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 186 take action to formally agree that the area has met the 15 percent VOC only obligation in the expanded area, then that new portion of the 8 hour ozone nonattainment area must do a 15 percent VOC only plan from the 2002 base year.

Nonattainment areas subject to subpart 2 are required initially to reduce their emissions by 15 percent no later than 6 years from the base year. These reductions can only occur for VOC in order to be credited toward those first 6 years. States can begin to use NOx emission reductions to make up the 3 percent per year ( 9 percent averaged over 3 years) after the initial 6 years.

c. Comments and responses Comment: Some commenters believed an additional 15 percent VOC reduction should not be necessary for 8 hour areas that encompass in whole or in part a 1 hour nonattainment area.

Such areas should simply be required to achieve whatever NOx or VOC emission reductions are needed for attainment.

Another commenter agreed with the approach outlined in the proposal but cautioned that the States would have to ensure that the target is at least as stringent as the 1

hour ROP target, thus ensuring no backsliding on the 1 hour NAAQS requirements. Under this approach, the State would have to develop a new baseline and new RFP emission PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 187 reduction targets for the entire 8 hour standard nonattainment area. Emissions reductions from measures in the 1 hour ozone SIP that are achieved after the 8 hour ozone NAAQS baseline year could count ( subject to credibility restrictions as discussed in the proposed rulemaking) toward meeting the RFP requirement for the entire 8 hour area. The new RFP target for the 8 hour standard would replace the previous 1 hour ozone target ( while ensuring that, at a minimum, the emissions reductions required to meet the old target are met).

Response: As noted elsewhere in the preamble, if an 8 hour nonattainment area is classified as moderate or higher, and has the same geographic boundaries as a 1 hour area which has an EPA approved 15 percent ROP plan, EPA believes that the area does not need to prepare an additional 15 percent VOC only plan.

We agree with the commenter who noted that the proposed section 51.910( a)( ii) did not address all boundary change scenarios consistent with our proposed approach found in section VI. I. 9. of the June 2, 2003 proposed rule ( 68 FR 32835). We proposed an approach to deal with what RFP requirements should be implemented for areas designated for the 8 hour ozone standard that entirely or in part encompass PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 188 an area that was designated nonattainment for the 1 hour ozone standard. We stated in the proposed rule that our intent was that those portions of an 8 hour nonattainment area already covered by an approved 15 percent VOC only plan would not be subject to a second 15 percent VOC only requirement. In our discussion in section VI. I. 9. of the June 2, 2003 proposed rule we focused mainly on the most likely boundary change scenario which is where the boundary of the 8 hour area was expanded to include additional areas beyond the 1 hour area's boundaries. Considering this comment in light of our experience in setting the actual boundaries of the initially designated areas, we have now identified four scenarios of boundary changes relative to areas with approved 15 percent VOC only reduction plans:

° The first scenario is where the 1 hour boundaries are exactly the same as the 8 hour boundaries. The section 51.910( a)( 1)( ii) of the proposed regulatory text was intended to cover these areas.

° The second scenario is where a specific 8 hour area encompasses part of a former 1 hour area that already had an approved 15 percent VOC only reduction plan.

Such a scenario arises where the boundaries shrink due to deletion of part of the 1 hour area, or, the former PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 189 1 hour area has been divided among two or more adjacent 8 hour areas.

° The third scenario arises where an existing 1 hour area covered by an approved 15 percent VOC only plan receives additional portions from one or more 1 hour areas that were also covered by an approved 15 percent VOC only plan and does not include additional areas not covered by an approved 15 percent plan.

° The fourth scenario arises where part of the 8 hour area consisting of portions of one or more existing 1

hour areas each of which is covered by an approved 15 percent VOC only plan is expanded to include additional portions which are not covered by an approved 15 percent VOC only plan. This case also includes the situation where a single 1 hour area, that is covered by an approved 15 percent VOC only plan, is expanded to receive additional areas that are not covered by an approved 15 percent VOC only plan.

We have concluded that there is no rationale to require an area that falls into either the second or third scenario to do another 15 percent VOC only plan just because the boundaries do not exactly coincide with a single 1 hour area, or, just because no areas without coverage under an PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 190 approved 15 percent plan have been added.

We had proposed an approach not to require a 15 percent VOC only plan for the portion of an 8 hour area which, in part, encompassed an area that was designated nonattainment for the 1 hour ozone standard, and which, in part,

encompassed new areas. For the fourth scenario, we see no reason to distinguish the case where the 8 hour area is built from around one former nonattainment area from where the 8 hour area is built from portions of more than one former 1 hour area. Likewise, we see no rationale to distinguish an 8 hour area which falls in the second scenario from the former 1 hour nonattainment area portion of an 8 hour area that falls under the fourth scenario; the latter portion is not required to have a 15 percent VOC only plan for that portion because the boundaries have been enlarged. We had intended to treat all of these areas in a similar manner.

We received extensive comments in support of our proposal to allow flexibility in regards to the initial RFP requirement of section 182( b)( 1). Many of the comments decried the need for flexibility to allow needed NOx reductions to count towards RFP where NOx reductions contribute to attainment of the 8 hour NAAQS. As discussed PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 191 in the June 2, 2003 proposed rule and elsewhere in this preamble, we must require that the initial RFP targets reflect a 15 percent reduction in baselne VOC emissions in those areas, or portions of areas, not included in an approved 15 percent plan in the SIP.

We have revised the final section 51.910( a)( 1)( ii) from that proposed to clarify this issue and encompass the first through third scenarios. Section 51.910( a)( 1)( iii) covers the third scenario.

Comment: Another commenter prefers to work with EPA in the development of an alternative that will eliminate or minimize the planning burdens associated with development of a 15 percent RFP plan for one town. One alternative might be the development of a " comparability demonstration,"

showing that the town had implemented the same controls that had been previously responsible for achieving a 15 percent reduction in VOCs in its l hour ozone nonattainment area.

Response: As noted above in the summary of the final rule,

we have made the following provision: If part of an 8 hour area ( town, county, etc.) was never part of a 1 hour area with a a 15 percent VOC only plan approved by EPA, the 8

hour area must prepare and submit a 15 percent VOC only plan with the caveats outlined below. As an added alternative to PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 192 preparing a fully modeled 15 percent VOC only plan for the expanded area, EPA believes that if this expanded area implements and has SIP approved the same VOC control measures ( for example, VOC RACT at the same source thresholds, Stage II, I/ M, etc...) that the initial area which demonstrated 15 percent had implemented and the mix of sources ( point with similar industrial mix/ area/ mobile) is similar to the existing area, then EPA will consider and presume that the expanded area has met its 15 percent VOConly requirement. EPA will propose this as acceptable on a case by case basis for any area that meets this criteria.

This would be only a presumption, because EPA can not guarantee areas, up front, that they will not have to do something more for the 15 percent reduction. This would be determined on a case by case basis in the SIP approval rulemaking in which EPA would have to respond to any comments that the presumption was inappropriate and the area actually failed to make 15 percent. If EPA does not take action to formally agree that the area has met the 15 percent VOC only obligation in the expanded area, then that new portion of the 8 hour ozone nonattainment area must do a 15 percent VOC only plan from the 2002 base year.

Comments on draft regulatory text PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 193 Comment: One commenter stated that draft section 51.910( a)( 1)( ii) eliminates the 15 percent requirement for areas that have already achieved this requirement under the 8 hour standard and supported that change. However, they further state that the strict criteria of " same boundaries"

should be revisited because there may be limited changes in the nonattainment areas " boundaries" when areas are designated for the 8 hour standard. Such changes should not negate this provision. A broader definition needs to apply to this section to allow for changes to boundaries in nonattainment areas between 1 hour and 8 hour designations where such changes do not substantially alter the geographical or population characteristics for the area.

Another commenter supports an exemption for 8 hour nonattainment areas that have met the 15 percent ROP requirement for the 1 hour NAAQS. The commenter requests that EPA clarify the criteria that the area must have the same geographic boundaries to qualify for the exemption.

This means that in the geographic areas for which a State has an approved 15 percent plan, the 15 percent requirement will not apply, and the 15 percent requirement is only intended to apply to the new geographic areas of the 8 hour nonattainment area, and that the 15 percent reduction of PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 194 emissions from the new areas could come from the entire nonattainment area to satisfy this requirement.

Response: In the final rule, we addressed situations where the 8 hour nonattainment area includes areas that already have approved 15 percent VOC plans as well as areas that do not have such plans. As a general rule, EPA believes that the entire 8 hour nonattainment area needs a 15 percent VOConly plan either the plan approved for the 1 hour standard or a new 15 percent RFP plan for the 8 hour standrd, or alternatively, the 15 percent VOC only reduction plan needs to be prepared for that portion of the area which previously did not have an EPA approved 15 percent VOC only plan approved ( i. e., the expanded area). As an added alternative to preparing a fully modeled 15 percent VOC only plan for the expanded area, EPA believes that if this expanded area implements and has SIP approved the same VOC control measures that the initial area which demonstrated 15 percent had implemented and the mix of sources is similar to the existing area, then EPA will initially consider and presume that the expanded area has met its 15 percent VOC only requirement, as described above. Beyond this presumption,

EPA does not believe that the statute would allow expanded areas to avoid implementation of a 15 percent plan. PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 32Memorandum of May 10, 1995, " RFP, Attainment Demonstration, and Related Requirements for Ozone Nonattainment Areas Meeting the Ozone National Ambient Air Quality Standard," from John S. Seitz, Director, Office of Air Quality Planning and Standards. Available at: http:// www. epa. gov/ ttn/ oarpg/ t1/ memoranda/ clean15. pdf.

195 9. Will EPA's " Clean Data Policy" apply for purposes of 8

hour RFP? [ Section VI. I. 10 of June 2, 2003 proposed rule ( 68 FR 32835); no draft or final regulatory text.]

a. Background. As noted in the proposal, we issued a policy on May 10, 1995, which allows EPA to determine that an area has attained the standard and that certain planning requirements ( e. g., RFP and attainment demonstrations) will not apply so long as the area remains in attainment. 32 This is referred to as the " Clean Data Policy." We proposed that this policy would remain effective for purposes of areas that EPA determines have attained the 8 hour ozone NAAQS.

b. Summary of Final Rule.

As proposed, the Clean Data Policy will apply for purposes of the 8 hour standard in the same manner as we applied it for the 1 hour standard.

c. Comments and responses Comment: One commenter stated that EPA's " clean data policy" is unlawful with respect to both the 1 hour and 8

hour NAAQS. PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 196 A commenter argued that EPA also has no authority to waive the attainment demonstration and RFP plans mandated by subpart 2 on the pretext that an area has clean data. The Act unambiguously requires these plans for any area designated nonattainment for the pollutant ozone, and gives EPA no power whatsoever to waive such plan requirements.

Several other commenters supported the continued use of the " Clean Data Policy."

Response: EPA believes that the Clean Data Policy comports with the general language of the Act in regard to attainment demonstrations, rate of progress plans. The Clean Data Policy, issued on May 10, 1995, provides that where EPA has determined that an area has attained the standard, certain submissions are not required ( e. g., RFP) for so long as the area remains in attainment.

As stated in the policy, the attainment demonstration and RFP requirements are designed to bring an area into attainment. Once this goal has been achieved, it is appropriate to suspend the obligation that States submit plans to meet these goals, so long as the area continues to attain the relevant standard.

One circuit court has already upheld the use of this policy. See Sierra Club v. EPA, 99 F. 3d 1551 ( 10th Cir. PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 2/ 6/ 05 197 1996).