[Federal Register: November 28, 2008 (Volume 73, Number 230)]
[Proposed Rules]
[Page 72421-72440]
[DOCID:fr28no08-27]

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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 82

[EPA-HQ-OAR-2008-0009; FRL-8746-6]
RIN 2060-AO78

Protection of Stratospheric Ozone: The 2009 Critical Use
Exemption From the Phaseout of Methyl Bromide

AGENCY: Environmental Protection Agency (EPA).

ACTION: Proposed rule.

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SUMMARY: EPA is proposing an exemption to the phaseout of methyl
bromide to meet the needs of 2009 critical uses. Specifically, EPA is
proposing uses that qualify for the 2009 critical use exemption and the
amount of methyl bromide that may be produced, imported, or supplied
from existing pre-phaseout inventory for those uses in 2009. EPA is
taking action under the authority of the Clean Air Act to reflect a
recent consensus decision taken by the Parties to the Montreal Protocol
on Substances that Deplete the Ozone Layer at the Nineteenth Meeting of
the Parties. EPA is seeking comment on the list of critical uses and on
EPA's determination of the amounts of methyl bromide needed to satisfy
those uses.

DATES: Comments must be submitted by December 29, 2008. Any party
requesting a public hearing must notify the contact person listed below
by 5 p.m. Eastern Standard Time on December 3, 2008. If a hearing is
requested it will be held on December 15, 2008 and comments will be due
to the Agency January 12, 2009. EPA will post information regarding a
hearing, if one is requested, on the Ozone Protection Web site http://
www.epa.gov/ozone/strathome.html. Persons interested in attending a
public hearing should consult with the contact person below regarding
the location and time of the hearing.

ADDRESSES: Submit your comments, identified by Docket ID No. EPA-HQ-
OAR-2008-0009, by one of the following methods:
     http://www.regulations.gov: Follow the on-line
instructions for submitting comments.
     E-mail<EMAIL_ADDRESS>     Fax:<PHONE_NUMBER>.
     Mail: Docket EPA-HQ-OAR-2008-0009, Air and Radiation
Docket and Information Center, U.S. Environmental Protection Agency,
Mail code: 6102T, 1200 Pennsylvania Ave., NW., Washington, DC 20460.
     Hand Delivery: Docket EPA-HQ-OAR-2008-0009, Air and
Radiation Docket at EPA West, 1301 Constitution Avenue, NW., Room B108,
Mail Code 6102T, Washington, DC 20460. Such deliveries are only
accepted during the Docket's normal hours of operation, and special
arrangements should be made for deliveries of boxed information.
    Instructions: Direct your comments to Docket ID No. EPA-HQ-OAR-
2008-0009. EPA's policy is that all comments received will be included
in the public docket without change and may be made available online at
http://www.regulations.gov, including any personal information
provided, unless the comment includes information claimed to be
Confidential Business Information (CBI) or other information whose
disclosure is restricted by statute. Do not submit information that you
consider to be CBI or otherwise protected through http://
www.regulations.gov or e-mail. The http://www.regulations.gov Web site
is an ``anonymous access'' system, which means EPA will not know your
identity or contact information unless you provide it in the body of
your comment. If you send an e-mail comment directly to EPA without
going through www.regulations.gov, your e-mail address will be
automatically captured and included as part of the comment that is
placed in the public docket and made available on the Internet. If you
submit an electronic comment, EPA recommends that you include your name
and other contact information in the body of your comment and with any
disk or CD-ROM you submit. If EPA cannot read your comment due to
technical difficulties and cannot contact you for clarification, EPA
may not be able to consider your comment. Electronic files should avoid
the use of special characters, any form of encryption, and be free of
any defects or viruses. For additional information about EPA's public
docket visit the EPA Docket Center homepage at http://www.epa.gov/
epahome/dockets.htm.

FOR FURTHER INFORMATION CONTACT: For further information about this
proposed rule, contact Jeremy Arling by telephone at<PHONE_NUMBER>, or
by e-mail at<EMAIL_ADDRESS>or by mail at U.S. Environmental
Protection Agency, Stratospheric Protection Division, Stratospheric
Program Implementation Branch (6205J), 1200 Pennsylvania Avenue, NW.,
Washington, DC 20460. You may also visit the Ozone Depletion Web site
of EPA's Stratospheric Protection Division at http://www.epa.gov/ozone/
strathome.html for further information about EPA's Stratospheric Ozone
Protection regulations, the science of ozone layer depletion, and
related topics.

SUPPLEMENTARY INFORMATION: This proposed rule concerns Clean Air Act
(CAA) restrictions on the consumption, production, and use of methyl
bromide (a Class I, Group VI controlled substance) for critical uses
during calendar year 2009. Under the Clean Air Act, methyl bromide
consumption (consumption is defined under the CAA as production plus
imports minus exports) and production was phased out on January 1,
2005, apart from allowable exemptions, such as the critical use
exemption and the quarantine and preshipment exemption. With this
action, EPA is proposing and seeking comment on the uses that will
qualify for the 2009 critical use exemption as well as specific amounts
of methyl bromide that may be produced, imported, or sold from pre-
phaseout inventory for proposed critical uses in 2009.

Table of Contents

I. General Information
    Regulated Entities
    What Should I Consider When Preparing My Comments?
II. What Is Methyl Bromide?
III. What Is the Background to the Phaseout Regulations for Ozone
Depleting Substances?
IV. What Is the Legal Authority for Exempting the Production and
Import of Methyl Bromide for Critical Uses Authorized by the Parties
to the Montreal Protocol?
V. What Is the Critical Use Exemption Process?
    A. Background of the Process
    B. How Does This Proposed Rule Relate to Previous Critical Use
Exemption Rules?
    C. Proposed Critical Uses
    D. Proposed Critical Use Amounts
    1. Background of Proposed Critical Use Amounts
    2. Calculation of Pre-Phaseout Inventory
    a. Supply Chain Factor
    b. Estimated Drawdown
    3. Approach for Determining Critical Use Amounts
    4. Treatment of Carry Over Material
    5. Amounts for Research Purposes
    6. Methyl Bromide Alternatives
    7. Summary of Calculations
    E. The Criteria in Decisions IX/6 and Ex. I/4
    F. Emissions Minimization
    G. Critical Use Allowance Allocations
    H. Critical Stock Allowance Allocations
    I. Stocks of Methyl Bromide
VI. Statutory and Executive Order Reviews
    A. Executive Order 12866: Regulatory Planning and Review
    B. Paperwork Reduction Act
    C. Regulatory Flexibility Act

    D. Unfunded Mandates Reform Act
    E. Executive Order 13132: Federalism
    F. Executive Order 13175: Consultation and Coordination With
Indian Tribal Governments
    G. Executive Order 13045: Protection of Children From
Environmental Health and Safety Risks
    H. Executive Order 13211: Actions That Significantly Affect
Energy Supply, Distribution, or Use
    I. National Technology Transfer and Advancement Act
    J. Executive Order 12898: Federal Actions To Address
Environmental Justice in Minority Populations and Low-Income
Populations

I. General Information

Regulated Entities

    Entities potentially regulated by this proposed action are those
associated with the production, import, export, sale, application, and
use of methyl bromide covered by an approved critical use exemption.
Potentially regulated categories and entities include producers,
importers, and exporters of methyl bromide; applicators and
distributors of methyl bromide; users of methyl bromide, e.g., farmers
of vegetable crops, fruits and nursery stock; owners of stored food
commodities and structures such as grain mills and processors; and
agricultural researchers.
    This list is not intended to be exhaustive, but rather to provide a
guide for readers regarding entities likely to be regulated by this
proposed action. To determine whether your facility, company, business,
or organization could be regulated by this proposed action, you should
carefully examine the regulations promulgated at 40 CFR part 82,
subpart A. If you have questions regarding the applicability of this
action to a particular entity, consult the person listed in the
preceding section.

What Should I Consider When Preparing My Comments?

    1. Confidential Business Information. Do not submit confidential
business information (CBI) to EPA through http://www.regulations.gov or
e-mail. Clearly mark the part or all of the information that you claim
to be CBI. For CBI information in a disk or CD-ROM that you mail to
EPA, mark the outside of the disk or CD-ROM as CBI and then identify
electronically within the disk or CD-ROM the specific information that
is claimed as CBI. In addition to one complete version of the comment
that includes information claimed as CBI, a copy of the comment that
does not contain the information claimed as CBI must be submitted for
inclusion in the public docket. Information so marked will not be
disclosed except in accordance with procedures set forth in 40 CFR Part
2.
    2. Tips for Preparing Your Comments. When submitting comments,
remember to:
     Identify the rulemaking by docket number and other
identifying information (subject heading, Federal Register date, and
page number).
     Follow directions--The agency may ask you to respond to
specific questions or organize comments by referencing a Code of
Federal Regulations (CFR) part or section number.
     Explain why you agree or disagree; suggest alternatives
and substitute language for your requested changes.
     Describe any assumptions and provide any technical
information and/or data that you used.
     If you estimate potential costs or burdens, explain how
you arrived at your estimate in sufficient detail to allow for it to be
reproduced.
     Provide specific examples to illustrate your concerns, and
suggest alternatives.
     Explain your views as clearly as possible, avoiding the
use of profanity or personal threats.
     Make sure to submit your comments by the comment period
deadline identified.

II. What Is Methyl Bromide?

    Methyl bromide is an odorless, colorless, toxic gas which is used
as a broad-spectrum pesticide and is controlled under the CAA as a
Class I ozone-depleting substance (ODS). Methyl bromide is used in the
U.S. and throughout the world as a fumigant to control a variety of
pests such as insects, weeds, rodents, pathogens, and nematodes.
Information on methyl bromide can be found at http://www.epa.gov/ozone/
mbr and http://www.unep.org/ozone.
    Methyl bromide is also regulated by EPA under the Federal
Insecticide, Fungicide, and Rodenticide Act (FIFRA) and other statutes
and regulatory authority, as well as by States under their own statutes
and regulatory authority. Under FIFRA, methyl bromide is a restricted
use pesticide. Restricted use pesticides are subject to certain Federal
and State requirements governing their sale, distribution, and use.
Nothing in this proposed rule implementing the Clean Air Act is
intended to derogate from provisions in any other Federal, State, or
local laws or regulations governing actions including, but not limited
to, the sale, distribution, transfer, and use of methyl bromide. All
entities that would be affected by provisions of this proposal must
continue to comply with FIFRA and other pertinent statutory and
regulatory requirements for pesticides (including, but not limited to,
requirements pertaining to restricted use pesticides) when importing,
exporting, acquiring, selling, distributing, transferring, or using
methyl bromide for critical uses. The regulations in this proposed
action are intended only to implement the CAA restrictions on the
production, consumption, and use of methyl bromide for critical uses
exempted from the phaseout of methyl bromide.

III. What Is the Background to the Phaseout Regulations for Ozone
Depleting Substances?

    The current regulatory requirements of the stratospheric ozone
protection program that limit production and consumption of ozone-
depleting substances can be found at 40 CFR part 82, subpart A. The
regulatory program was originally published in the Federal Register on
August 12, 1988 (53 FR 30566), in response to the 1987 signing and
subsequent ratification of the Montreal Protocol on Substances that
Deplete the Ozone Layer (Montreal Protocol). The Montreal Protocol is
the international agreement aimed at reducing and eliminating the
production and consumption of stratospheric ozone-depleting substances.
The U.S. was one of the original signatories to the 1987 Montreal
Protocol and the U.S. ratified the Protocol on April 12, 1988. Congress
then enacted, and President George H.W. Bush signed into law, the Clean
Air Act Amendments of 1990 (CAAA of 1990) which included Title VI on
Stratospheric Ozone Protection, codified as 42 U.S.C. Chapter 85,
Subchapter VI, to ensure that the United States could satisfy its
obligations under the Protocol. EPA issued regulations to implement
this legislation and has since amended the regulations as needed.
    Methyl bromide was added to the Protocol as an ozone-depleting
substance in 1992 through the Copenhagen Amendment to the Protocol. The
Parties to the Montreal Protocol (Parties) agreed that each
industrialized country's level of methyl bromide production and
consumption in 1991 should be the baseline for establishing a freeze in
the level of methyl bromide production and consumption for
industrialized countries. EPA published a final rule in the Federal
Register on December 10, 1993 (58 FR 65018), listing methyl bromide as
a Class I, Group VI controlled substance, freezing U.S. production and
consumption at this 1991 baseline level of 25,528,270

kilograms, and setting forth the percentage of baseline allowances for
methyl bromide granted to companies in each control period (each
calendar year) until 2001, when the complete phaseout would occur. This
phaseout date was established in response to a petition filed in 1991
under sections 602(c)(3) and 606(b) of the CAAA of 1990, requesting
that EPA list methyl bromide as a Class I substance and phase out its
production and consumption. This date was consistent with section
602(d) of the CAAA of 1990, which for newly listed Class I ozone
depleting substances provides that ``no extension [of the phaseout
schedule in section 604] under this subsection may extend the date for
termination of production of any class I substance to a date more than
7 years after January 1 of the year after the year in which the
substance is added to the list of class I substances.''
    At the Seventh Meeting of the Parties (MOP) in 1995, the Parties
made adjustments to the methyl bromide control measures and agreed to
reduction steps and a 2010 phaseout date for industrialized countries
with exemptions permitted for critical uses. At that time, the U.S.
continued to have a 2001 phaseout date in accordance with Section
602(d) of the CAAA of 1990. At the Ninth MOP in 1997, the Parties
agreed to further adjustments to the phaseout schedule for methyl
bromide in industrialized countries, with reduction steps leading to a
2005 phaseout.

IV. What Is the Legal Authority for Exempting the Production and Import
of Methyl Bromide for Critical Uses Authorized by the Parties to the
Montreal Protocol?

    In October 1998, the U.S. Congress amended the CAA to prohibit the
termination of production of methyl bromide prior to January 1, 2005,
to require EPA to bring the U.S. phaseout of methyl bromide in line
with the schedule specified under the Protocol, and to authorize EPA to
provide certain exemptions. These amendments were contained in Section
764 of the 1999 Omnibus Consolidated and Emergency Supplemental
Appropriations Act (Pub. L. 105-277, October 21, 1998) and were
codified in Section 604 of the CAA, 42 U.S.C. 7671c. The amendment that
specifically addresses the critical use exemption appears at section
604(d)(6), 42 U.S.C. 7671c(d)(6). EPA revised the phaseout schedule for
methyl bromide production and consumption in a direct final rulemaking
on November 28, 2000 (65 FR 70795), which allowed for the phased
reduction in methyl bromide consumption specified under the Protocol
and extended the phaseout to 2005. EPA again amended the regulations to
allow for an exemption for quarantine and preshipment (QPS) purposes on
July 19, 2001 (66 FR 37751), with an interim final rule and with a
final rule on January 2, 2003 (68 FR 238).
    On December 23, 2004 (69 FR 76982), EPA published a final rule that
established the framework for the critical use exemption; set forth a
list of approved critical uses for 2005; and specified the amount of
methyl bromide that could be supplied in 2005 from stocks and new
production or import to meet the needs of approved critical uses. EPA
subsequently published rules applying the critical use exemption
framework to the 2006, 2007, and 2008 control periods. Under authority
of section 604(d)(6) of the CAA, this action proposes the uses that
will qualify as approved critical uses in 2009 and the amount of methyl
bromide that may be produced, imported, or supplied from inventory to
satisfy those uses.
    This proposed action reflects Decision XIX/9, taken at the
Nineteenth Meeting of the Parties in September 2007. In accordance with
Article 2H(5), the Parties have issued several Decisions pertaining to
the critical use exemption. These include Decisions IX/6 and Ex. I/4,
which set forth criteria for review of proposed critical uses. The
status of Decisions is addressed in NRDC v. EPA, (464 F.3d 1, D.C. Cir.
2006) and in EPA's ``Supplemental Brief for the Respondent,'' filed in
NRDC v. EPA and available in the docket for this action. In this
proposed rule, EPA is honoring commitments made by the United States in
the Montreal Protocol context.

V. What Is the Critical Use Exemption Process?

A. Background of the Process

    Starting in 2002, EPA began notifying applicants of the process for
obtaining a critical use exemption from the methyl bromide phaseout.
The critical use exemption is designed to permit the production and
import of methyl bromide for uses that do not have technically and
economically feasible alternatives. On May 8, 2003, the Agency
published its first notice in the Federal Register (68 FR 24737)
announcing the availability of the application for a critical use
exemption and the deadline for submission of the requisite data.
Applicants were informed that they may apply as individuals or as part
of a group of users (a ``consortium'') who face the same limiting
critical conditions (i.e. specific conditions that establish a critical
need for methyl bromide). EPA has repeated this process annually since
then.
    The criteria for the exemption initially appeared in Decision IX/6.
In that Decision, the Parties agreed that ``a use of methyl bromide
should qualify as `critical' only if the nominating Party determines
that: (i) The specific use is critical because the lack of availability
of methyl bromide for that use would result in a significant market
disruption; and (ii) there are no technically and economically feasible
alternatives or substitutes available to the user that are acceptable
from the standpoint of environment and public health and are suitable
to the crops and circumstances of the nomination.'' These criteria are
reflected in EPA's definition of ``critical use'' at 40 CFR 82.3.
    In response to the annual requests for critical use exemption
applications published in the Federal Register, applicants provide data
on the technical and economic feasibility of using alternatives to
methyl bromide. Applicants also submit data on their use of methyl
bromide, on research programs into the use of alternatives to methyl
bromide, and on efforts to minimize use and emissions of methyl
bromide.
    EPA's Office of Pesticide Programs reviews the data submitted by
applicants, as well as data from governmental and academic sources, to
establish whether there are technically and economically feasible
alternatives available for a particular use of methyl bromide and
whether there would be a significant market disruption if no exemption
were available. In addition, EPA reviews other parameters of the
exemption applications such as dosage and emissions minimization
techniques and applicants' research or transition plans. This
assessment process culminates in the development of a document referred
to as the critical use nomination (CUN). The U.S. Department of State
submits the CUN annually to the United Nations Environment Programme
(UNEP) Ozone Secretariat. The Methyl Bromide Technical Options
Committee (MBTOC) and the Technology and Economic Assessment Panel
(TEAP), which are independent advisory bodies to Parties to the
Montreal Protocol, subsequently review the CUNs of the various
countries and make recommendations to the Parties on the nominations.
The Parties then take a Decision to authorize a critical use exemption
for a particular country. The Decision also identifies how much methyl
bromide may be supplied for the exempted critical uses. As required in
section 604(d)(6) of the Clean Air Act, for each exemption

period, EPA consults with the United States Department of Agriculture
and other departments and institutions of the Federal government that
have regulatory authority related to methyl bromide, and provides an
opportunity for public comment on the amounts of methyl bromide that
the Agency has determined to be necessary for critical uses and the
uses that the Agency has determined meet the criteria of the critical
use exemption.
    More on the domestic review process and methodology employed by the
Office of Pesticide Programs is available in a detailed memorandum
titled ``Development of 2003 Nomination for a Critical Use Exemption
for Methyl Bromide for the United States of America,'' contained in the
docket for this rulemaking. While the particulars of the data continue
to evolve and administrative matters are further streamlined, the
technical review itself remains rigorous with careful consideration of
new technical and economic conditions.
    On December 22, 2006, the U.S. Government (USG) submitted the fifth
Nomination for a Critical Use Exemption for Methyl Bromide for the
United States of America to the Ozone Secretariat of the UNEP. This
fifth nomination contained the request for 2009 critical uses. In
February 2007, MBTOC sent questions to the USG concerning technical and
economic issues in the 2009 nomination. The USG transmitted preliminary
responses to MBTOC on March 13, 2007. The USG received a second round
of questions from MBTOC and submitted responses to those questions in
May, 2007. These documents, together with reports by the advisory
bodies noted above, are in the public docket for this rulemaking. The
determination in this proposed rule reflects the analysis contained in
those documents.

B. How Does This Proposed Rule Relate to Previous Critical Use
Exemption Rules?

    The December 23, 2004, Framework Rule (69 FR 76982) established the
operational framework for the critical use exemption program in the
U.S., including definitions, prohibitions, trading provisions, and
recordkeeping and reporting obligations. The preamble to the Framework
Rule included EPA's determinations on key issues for the critical use
exemption program.
    Since publishing the Framework Rule, EPA has annually promulgated
regulations to exempt from the phaseout of methyl bromide specific
quantities of production and import for each control period (each
calendar year) and to indicate which uses meet the criteria for the
exemption program for that year. See 71 FR 5985 (calendar year 2006),
71 FR 75386 (calendar year 2007), and 72 FR 74118 (calendar year 2008).
    Today's action proposes the uses that would qualify as critical
uses for 2009 and the amounts of Critical Use Allowances (CUAs) and
Critical Stock Allowances (CSAs) to be allocated for those uses. The
uses that EPA is proposing to qualify as 2009 critical uses are the
uses which the USG included in the fifth CUN, and which were approved
by the Parties in Decision XIX/9. EPA is not proposing to modify the
Framework Rule or the basic elements of the refined approach to
determining the level of available stocks finalized in the 2008 CUE
rule published on December 28, 2007.

C. Proposed Critical Uses

    In Decision XIX/9, taken in September 2007, the Parties to the
Protocol agreed ``to permit, for the agreed critical use categories for
2009, set forth in table C of the annex to the present decision for
each Party, subject to the conditions set forth in the present decision
and decision Ex.I/4 to the extent that those conditions are applicable,
the levels of production and consumption for 2009 set forth in table D
of the annex to the present decision which are necessary to satisfy
critical uses * * *.''
    The following uses are those set forth in table C of the annex to
Decision XIX/9: Commodities, NPMA food processing structures (cocoa
beans removed),\1\ Mills and processors, Dried cured pork, Cucurbits,
Eggplant--field, Forest nursery seedlings, Nursery stock--fruit, nut,
flower, Orchard replant, Ornamentals, Peppers--field, Strawberry--
field, Strawberry runners, Tomatoes--field, Sweet potato slips. The
agreed critical use levels for 2009 total 4,261,974 kilograms (kg),
which is equivalent to 16.7% of the U.S. 1991 methyl bromide
consumption baseline of 25,528,270 kg. However, the maximum amount of
allowable new production and import as set forth in table D of Decision
XIX/9 is 3,961,974 kg (15.5% of baseline), minus available stocks. For
the reasons described in section V.D of this preamble, EPA is proposing
to allow limited amounts of new production or import of methyl bromide
for critical uses for 2009 up to the amount of 1,617,921 kg (6.3% of
baseline), with 2,576,987 kg (10.1% of baseline) coming from pre-
phaseout inventory (i.e., stocks).
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    \1\ NPMA, National Pest Management Association, includes both
food processing structures and processed foods. This year's
exemption does not include cocoa beans.
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    In this proposed rule, EPA is proposing to modify 40 CFR part 82,
subpart A, appendix L to reflect the agreed critical use categories
identified in Decision XIX/9 for the 2009 control period (calendar
year). The Agency is proposing to amend the table of critical uses
based, in part, on the technical analysis contained in the 2009 U.S.
nomination that assesses data submitted by applicants to the critical
use exemption program as well as public and proprietary data on the use
of methyl bromide and its alternatives. EPA is seeking comment on the
technical analysis (which is provided in the docket) and seeks
information regarding changes to the registration or use of
alternatives that may have transpired after the 2009 U.S. nomination
was written. Such information has the potential to alter the technical
or economic feasibility of an alternative and could thus cause EPA to
modify the analysis that underpins EPA's determination as to which uses
and what amounts of methyl bromide qualify for the critical use
exemption. EPA notes that while the Agency may, in response to
comments, reduce the proposed quantities of critical use methyl
bromide, or decide not to approve uses authorized by the Parties, the
Agency does not intend to increase the quantities or add new uses in
the final rule beyond those authorized by the Parties. Therefore, if
there has been a change in registration of an alternative that results
in that alternative no longer being available to a particular use, EPA
does not intend to add uses or amounts of methyl bromide beyond those
identified here to appendix L as part of this rulemaking. Under such
circumstances, the user should apply to EPA, requesting that the U.S.
nominate its use for a critical use exemption in the future. Based on
the information described above, EPA is proposing that the uses in
Table I: Approved Critical Uses, with the limiting critical conditions
specified, qualify to obtain and use critical use methyl bromide in
2009.

                                         Table I--Approved Critical Uses
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               Column A                          Column B                             Column C
----------------------------------------------------------------------------------------------------------------
Approved Critical Uses                  Approved Critical User     Limiting Critical Conditions
                                         and Location of Use       That exist, or that the approved critical
                                                                    user reasonably expects could arise without
                                                                    methyl bromide fumigation:
----------------------------------------------------------------------------------------------------------------
                                                 PRE-PLANT USES
----------------------------------------------------------------------------------------------------------------
Cucurbits.............................  (a) Growers in Delaware,   Moderate to severe soilborne disease
                                         Maryland, and Michigan.    infestation.
                                                                   A need for methyl bromide for research
                                                                    purposes.
                                        (b) Growers in Georgia     Moderate to severe yellow or purple nutsedge
                                         and Southeastern U.S.      infestation.
                                         limited to growing        Moderate to severe soilborne disease
                                         locations in Alabama,      infestation.
                                         Arkansas, Kentucky,       Moderate to severe root knot nematode
                                         Louisiana, Mississippi,    infestation.
                                         North Carolina, South     A need for methyl bromide for research
                                         Carolina, Tennessee, and   purposes.
                                         Virginia.
Eggplant..............................  (a) Florida growers......  Moderate to severe yellow or purple nutsedge
                                                                    infestation.
                                                                   Moderate to severe soilborne disease
                                                                    infestation.
                                                                   Restrictions on alternatives due to karst
                                                                    topographical features and soils not
                                                                    supporting seepage irrigation.
                                                                   A need for methyl bromide for research
                                                                    purposes.
                                        (b) Georgia growers......  Moderate to severe yellow or purple nutsedge
                                                                    infestation.
                                                                   Moderate to severe nematode infestation.
                                                                   Moderate to severe pythium collar, crown and
                                                                    root rot.
                                                                   Moderate to severe southern blight
                                                                    infestation.
                                                                   Restrictions on alternatives due to karst
                                                                    topographical features and soils not
                                                                    supporting seepage irrigation.
                                                                   A need for methyl bromide for research
                                                                    purposes.
                                        (c) Michigan growers.....  Moderate to severe soilborne disease
                                                                    infestation.
                                                                   A need for methyl bromide for research
                                                                    purposes.
Forest Nursery Seedlings..............  (a) Growers in Alabama,    Moderate to severe yellow or purple nutsedge
                                         Arkansas, Georgia,         infestation.
                                         Louisiana, Mississippi,   Moderate to severe soilborne disease
                                         North Carolina,            infestation.
                                         Oklahoma, South           Moderate to severe nematode infestation.
                                         Carolina, Tennessee,
                                         Texas, and Virginia.
                                        (b) International Paper    Moderate to severe yellow or purple nutsedge
                                         and its subsidiaries       infestation.
                                         limited to growing        Moderate to severe soilborne disease
                                         locations in Alabama,      infestation.
                                         Arkansas, Georgia, South
                                         Carolina, and Texas.
                                        (c) Government-owned       Moderate to severe weed infestation including
                                         seedling nurseries in      purple and yellow nutsedge infestation.
                                         Illinois, Indiana,        Moderate to severe Canada thistle
                                         Kentucky, Maryland,        infestation.
                                         Missouri, New Jersey,     Moderate to severe nematode infestation.
                                         Ohio, Pennsylvania, West  Moderate to severe soilborne disease
                                         Virginia, and Wisconsin.   infestation.
                                        (d) Weyerhaeuser Company   Moderate to severe yellow or purple nutsedge
                                         and its subsidiaries       infestation.
                                         limited to growing        Moderate to severe soilborne disease
                                         locations in Alabama,      infestation.
                                         Arkansas, North           Moderate to severe nematode or worm
                                         Carolina, and South        infestation.
                                         Carolina.
                                        (e) Weyerhaeuser Company   Moderate to severe yellow nutsedge
                                         and its subsidiaries       infestation.
                                         limited to growing        Moderate to severe soilborne disease
                                         locations in Oregon and    infestation.
                                         Washington.
                                        (f) Michigan growers.....  Moderate to severe soilborne disease
                                                                    infestation.
                                                                   Moderate to severe Canada thistle
                                                                    infestation.
                                                                   Moderate to severe nutsedge infestation.
                                                                   Moderate to severe nematode infestation.
Orchard Nursery Seedlings.............  (a) Members of the         Moderate to severe nematode infestation.
                                         Western Raspberry         Medium to heavy clay soils.
                                         Nursery Consortium        Local township limits prohibiting 1,3-
                                         limited to growing         dichloropropene.
                                         locations in Washington,  A need for methyl bromide for research
                                         and members of the         purposes.
                                         California Association
                                         of Nursery and Garden
                                         Centers representing
                                         Deciduous Tree Fruit
                                         Growers.
                                        (b) California rose        Moderate to severe nematode infestation.
                                         nurseries.
                                                                   Local township limits prohibiting 1,3-
                                                                    dichloropropene.
                                                                   A need for methyl bromide for research
                                                                    purposes.
Orchard Replant.......................  (a) California stone       Moderate to severe nematode infestation.
                                         fruit, table and raising  Moderate to severe soilborne disease
                                         grape, wine grape,         infestation.
                                         walnut, and almond        Replanted orchard soils to prevent orchard
                                         growers.                   replant disease.
                                                                   Medium to heavy soils.
                                                                   Local township limits prohibiting 1,3-
                                                                    dichloropropene.
Ornamentals...........................  (a) California growers...  Moderate to severe soilborne disease
                                                                    infestation.
                                                                   Moderate to severe nematode infestation.
                                                                   Local township limits prohibiting 1,3-
                                                                    dichloropropene.
                                                                   A need for methyl bromide for research
                                                                    purposes.

                                        (b) Florida growers......
                                        Moderate to severe weed
                                         infestation..
                                        Moderate to severe
                                         soilborne disease
                                         infestation..
                                        Moderate to severe
                                         nematode infestation..
                                        Restrictions on
                                         alternatives due to
                                         karst topographical
                                         features and soils not
                                         supporting seepage
                                         irrigation..
                                        A need for methyl bromide
                                         for research purposes..
                                        (c) Michigan herbaceous    Moderate to severe nematode infestation.
                                         perennial growers.        Moderate to severe soilborne disease
                                                                    infestation.
                                                                   Moderate to severe yellow nutsedge and other
                                                                    weed infestation.
Peppers...............................  (a) Alabama, Arkansas,     Moderate to severe yellow or purple nutsedge
                                         Kentucky, Louisiana,       infestation.
                                         Mississippi, North        Moderate to severe nematode infestation.
                                         Carolina, South           Moderate to severe pythium root, collar,
                                         Carolina, Tennessee, and   crown and root rots.
                                         Virginia growers.         A need for methyl bromide for research
                                                                    purposes.
                                        (b) Florida growers......  Moderate to severe yellow or purple nutsedge
                                                                    infestation.
                                                                   Moderate to severe soilborne disease
                                                                    infestation.
                                                                   Moderate to severe nematode infestation.
                                                                   Restrictions on alternatives due to karst
                                                                    topographical features and soils not
                                                                    supporting seepage irrigation.
                                                                   A need for methyl bromide for research
                                                                    purposes.
                                        (c) Georgia growers......  Moderate to severe yellow or purple nutsedge
                                                                    infestation.
                                                                   Moderate to severe nematode infestation, or
                                                                    moderate to severe pythium root and collar
                                                                    rots.
                                                                   Moderate to severe southern blight
                                                                    infestation, crown or root rot.
                                                                   Restrictions on alternatives due to karst
                                                                    topographical features and soils not
                                                                    supporting seepage irrigation.
                                                                   A need for methyl bromide for research
                                                                    purposes.
                                        (d) Michigan growers.....  Moderate to severe soilborne disease
                                                                    infestation.
                                                                   A need for methyl bromide for research
                                                                    purposes.
Strawberry Fruit......................  (a) California growers...  Moderate to severe black root rot or crown
                                                                    rot.
                                                                   Moderate to severe yellow or purple nutsedge
                                                                    infestation.
                                                                   Moderate to severe nematode infestation.
                                                                   Local township limits prohibiting 1,3-
                                                                    dichloropropene.
                                                                   Time to transition to an alternative.
                                                                   A need for methyl bromide for research
                                                                    purposes.
                                        (b) Florida growers......  Moderate to severe yellow or purple nutsedge
                                                                    infestation.
                                                                   Moderate to severe nematode infestation.
                                                                   Moderate to severe soilborne disease
                                                                    infestation.
                                                                   Carolina geranium or cut-leaf evening
                                                                    primrose infestation.
                                                                   Restrictions on alternatives due to karst
                                                                    topographical features and soils not
                                                                    supporting seepage irrigation.
                                                                   A need for methyl bromide for research
                                                                    purposes.
                                        (c) Alabama, Arkansas,     Moderate to severe yellow or purple nutsedge
                                         Georgia, Illinois,         infestation.
                                         Kentucky, Louisiana,      Moderate to severe nematode infestation.
                                         Maryland, Mississippi,    Moderate to severe black root and crown rot.
                                         Missouri, New Jersey,     A need for methyl bromide for research
                                         North Carolina, Ohio,      purposes.
                                         South Carolina,
                                         Tennessee, and Virginia
                                         growers.
Strawberry Nurseries..................  (a) California growers...  Moderate to severe soilborne disease
                                                                    infestation.
                                                                   Moderate to severe yellow or purple nutsedge
                                                                    infestation.
                                                                   Moderate to severe nematode infestation.
                                                                   A need for methyl bromide for research
                                                                    purposes.
                                        (b) North Carolina and     Moderate to severe black root rot.
                                         Tennessee growers.        Moderate to severe root-knot nematode
                                                                    infestation.
                                                                   Moderate to severe yellow and purple nutsedge
                                                                    infestation.
                                                                   A need for methyl bromide for research
                                                                    purposes.
Sweet Potato Slips....................  (a) California growers...  Local township limits prohibiting 1,3-
                                                                    dichloropropene.
Tomatoes..............................  (a) Michigan growers.....  Moderate to severe soilborne disease
                                                                    infestation.
                                                                   Moderate to severe fungal pathogen
                                                                    infestation.
                                                                   A need for methyl bromide for research
                                                                    purposes.
                                        (b) Alabama, Arkansas,     Moderate to severe yellow or purple nutsedge
                                         Florida, Georgia,          infestation
                                         Kentucky, Louisiana,      Moderate to severe soilborne disease
                                         Mississippi, North         infestation.
                                         Carolina, South           Moderate to severe nematode infestation.
                                         Carolina, Tennessee, and  Local township limits prohibiting 1,3-
                                         Virginia growers.          dichloropropene.
                                                                   A need for methyl bromide for research
                                                                    purposes.
                                        (c) Maryland growers.....  High water tables and proximity to
                                                                    environmentally sensitive estuaries which
                                                                    limit use of 1-3D.

                                                                   Moderate to severe fungal pathogen
                                                                    infestation.
----------------------------------------------------------------------------------------------------------------
                                                POST-HARVEST USES
----------------------------------------------------------------------------------------------------------------
Food Processing.......................  (a) Rice millers in the    Moderate to severe beetle, weevil, or moth
                                         U.S. who are members of    infestation.
                                         the USA Rice Millers      Presence of sensitive electronic equipment
                                         Association.               subject to corrosion.
                                                                   Time to transition to an alternative.
                                        (b) Pet food               Moderate to severe beetle, moth, or cockroach
                                         manufacturing facilities   infestation.
                                         in the U.S. who are       Presence of sensitive electronic equipment
                                         members of the Pet Food    subject to corrosion.
                                         Institute.                Time to transition to an alternative.
                                        (c) Bakeries in the U.S..  Presence of sensitive electronic equipment
                                                                    subject to corrosion.
                                                                   Time to transition to an alternative.
                                        (d) Members of the North   Moderate to severe beetle infestation.
                                         American Millers'         Presence of sensitive electronic equipment
                                         Association in the U.S.    subject to corrosion.
                                                                   Time to transition to an alternative.
                                        (e) Members of the         Moderate to severe beetle or moth
                                         National Pest Management   infestation.
                                         Association treating      Presence of sensitive electronic equipment
                                         facilities, spaces, and    subject to corrosion.
                                         equipment associated      Time to transition to an alternative.
                                         with processed food,
                                         cheese, herbs, and
                                         spices.
Commodities...........................  (a) California entities    Rapid fumigation required to meet a critical
                                         storing walnuts, beans,    market window, such as during the holiday
                                         dried plums, figs,         season.
                                         raisins, and dates (in    Export to countries which do not allow the
                                         Riverside county only)     use of sulfuryl fluoride.
                                         in California.            A need for methyl bromide for research
                                                                    purposes.
Dry Cured Pork Products...............  (a) Members of the         Red legged ham beetle infestation.
                                         National Country Ham      Cheese/ham skipper infestation.
                                         Association and the       Dermested beetle infestation.
                                         Association of Meat       Ham mite infestation.
                                         Processors, Nahunta Pork
                                         Center (North Carolina),
                                         and Gwaltney and
                                         Smithfield Inc.
----------------------------------------------------------------------------------------------------------------

    EPA is proposing to amend the table in 40 CFR part 82, subpart A,
appendix L, as reflected above. Specifically, changes made to the table
include: Adding cucurbits grown in Maryland and Delaware as a critical
use under the limiting critical conditions listed in the table; moving
herbaceous perennials grown in Michigan from forest nursery seedlings
to ornamentals; adding ``restrictions on alternatives due to karst
topographical features and soils not supporting seepage irrigation'' as
a limiting critical condition for Georgia grown peppers; adding
tomatoes grown in Maryland as a critical use under the limiting
critical conditions listed in the table; adding ``export to countries
which do not allow the use of sulfuryl fluoride'' as a limiting
critical condition for commodities; and revising the description of
NPMA to remove cocoa beans.
    In addition, EPA is proposing editorial changes to Table I to
remove redundancy and ensure that the limiting critical conditions are
described uniformly throughout. For example, within a critical use, all
critical users with the same limiting critical conditions are to be
consolidated into the same row. EPA also proposes to move clarifying
information from the table to the preamble to improve readability.
Therefore, EPA clarifies here that the ``local township limits
prohibiting 1,3-dichloropropene'' are prohibitions on the use of 1,3-
dichloropropene products because local township limits on use of this
alternative have been reached. In addition, ``pet food'' under
subsection B of Food Processing refers to domestic dog and cat food.
Finally, ``rapid fumigation'' for commodities is when a buyer provides
short (two working days or fewer) notification for a purchase or there
is a short period after harvest in which to fumigate and there is
limited silo availability for using alternatives. EPA does not intend
for these edits to change the effect of any of the limiting critical
conditions, the approved critical user, location of use, or any other
aspect of the table.
    Since the critical use exemption was first established, many
critical users have transitioned to alternatives and a variety of
sectors that were once critical uses no longer are. These uses include
ginger, golf courses and turf production, tobacco, cocoa beans, and
pistachios.
    The categories listed in Table I above have been designated
critical uses for 2009 in Decision XIX/9 of the Parties. The amount of
methyl bromide approved for research purposes is included in the amount
of methyl bromide approved by the Parties for the commodities for which
``research purposes'' is indicated as a limiting critical condition in
the table above. As explained in Section V.D.5., EPA is proposing to
issue CSAs to allow the sale of 22,171 kg of methyl bromide from
existing stocks for research purposes.
    In accordance with Decision XIX/9, available on the docket for this
rulemaking, EPA is proposing that the following sectors be allowed to
use critical use methyl bromide for research purposes: Commodities,
cucurbits, eggplant (field), nursery stock (fruit, nut, flower),
orchard replant, ornamentals, peppers (field), strawberry (field),
strawberry runners, sweet potato slips, and tomatoes (field). As
discussed below, EPA allows the use of newly produced methyl bromide
for research purposes but encourages researchers to use pre-phaseout
inventory. In their applications to EPA, these sectors identified
research programs that require the use of methyl bromide.

D. Proposed Critical Use Amounts

    Section V.C. of this preamble explains that Table C of the annex to
Decision XIX/9 lists critical uses and amounts agreed to by the Parties
to the Montreal Protocol. When added together, the authorized critical
use amounts for 2009 total 4,261,974 kilograms (kg), which is
equivalent to 16.7% of the U.S. 1991 methyl bromide consumption
baseline of 25,528,270 kg as defined at 40 CFR 82.3. However, the
maximum amount of

authorized new production or import as set forth in Table D of the
annex to Decision XIX/9 is 3,961,974 kg (15.5% of baseline).
    EPA is proposing to exempt limited amounts of new production and
import of methyl bromide for critical uses for 2009 in the amount of
1,617,921 kg (6.3% of baseline) as shown in Table II. EPA is also
proposing to allow sale of 2,576,987 kg (10.1% of baseline) of existing
inventories for critical uses in 2009. EPA is seeking comment on the
proposed total levels of exempted new production and import for
critical uses and the amount of material that may be sold from stocks
for critical uses. The sub-sections below explain EPA's reasons for
proposing the above critical use amounts for 2009.
1. Background of Proposed Critical Use Amounts
    The December 23, 2004, Framework Rule and subsequent CUE rules each
took note of language regarding stocks of methyl bromide in relevant
decisions of the Parties. In developing this proposed action, the
Agency notes that paragraph seven of Decision XIX/9 contains the
following language: ``That each Party which has an agreed critical use
renews its commitment to ensure that the criteria in paragraph 1 of
decision IX/6 are applied when licensing, permitting or authorizing
critical use of methyl bromide and, in particular, the criterion laid
down in paragraph 1(b)(ii) of decision IX/6.''
    In the Framework Rule, which established the architecture of the
CUE program and set out the exempted levels of critical use for 2005,
EPA interpreted paragraph 5 of Decision Ex. I/3, which is similar to
Decision XIX/9(7), ``as meaning that the U.S. should not authorize
critical use exemptions without including provisions addressing
drawdown from stocks for critical uses'' (69 FR 76987). Consistent with
that interpretation, the Framework Rule (69 FR 52366) established
provisions governing the sale of pre-phaseout inventories for critical
uses, including the concept of CSAs and a prohibition on the sale of
pre-phaseout inventories for critical uses in excess of the amount of
CSAs held by the seller. In addition, EPA noted that pre-phaseout
inventories were further taken into account through the trading
provisions that allow CUAs to be converted into CSAs. EPA is not
proposing changes to these basic CSA provisions for calendar year 2009.
    Paragraph 5 of Decision XIX/9 further addresses pre-phaseout
inventory of methyl bromide. The Decision states ``that a Party with a
critical use exemption level in excess of permitted levels of
production and consumption for critical uses is to make up any such
differences between those levels by using quantities of methyl bromide
from stocks that the Party has recognized to be available.'' In the
August 25, 2004, proposed Framework Rule (69 FR 52366), EPA proposed to
adjust the authorized level of new production and consumption for
critical uses by the amount of ``available stocks.'' The methodology
for determining the amount of available stocks considered exports,
methyl bromide for feedstock uses, and the need for a buffer in case of
catastrophic events. However, the final Framework Rule did not adopt
the proposed methodology for determining available stocks. Instead, EPA
issued CSAs in an amount equal to the difference between the total
authorized CUE amount and the amount of new production or import
authorized by the Parties (Total Authorized CUE Amount-Authorized New
Production and Import).
    In the 2006, 2007, and 2008 CUE Rules, EPA issued a number of CSAs
that represented not only the difference between the total authorized
CUE amount and the amount of authorized new production and import but
also an additional amount. In the 2006 CUE Rule, EPA issued a total of
1,136,008 CSAs, equivalent to 4.4% of baseline. For that control
period, the difference in the Parties' decision between the total CUE
amount and the amount of new production and import was 3.6% of
baseline. In the 2007 rule, EPA added to the minimum amount (6.3% of
baseline) an additional amount (1.2% of baseline) for a total of
1,914,600 CSAs (7.5% of baseline). In the 2008 rule, EPA added to the
minimum amount (3.0% of baseline) an additional amount (3.8% of
baseline) for a total of 1,729,689 CSAs (6.8% of baseline). Due to
allocating additional CSAs, EPA reduced the portion of CUE methyl
bromide to come from new production and import in each of the 2006-2008
control periods such that the total amount of methyl bromide exempted
for critical uses did not exceed the total amount authorized by the
Parties for that year.
    As established in these earlier rulemakings, EPA views the
allocation of additional CSA amounts as an appropriate exercise of its
discretion. The Agency is not required to allocate the full amount of
authorized new production and consumption. The Parties agreed to
``permit'' a particular level of production and consumption; they did
not--and could not--mandate that the U.S. authorize this level of
production and consumption domestically. Nor does the CAA require EPA
to exempt the full amount permitted by the Parties. Section 604(d)(6)
of the Clean Air Act (CAA) does not require EPA to exempt any amount of
production and consumption for critical uses, but instead specifies
that the Agency ``may'' exempt amounts for production, importation, and
consumption, thus providing EPA with substantial discretion in creating
critical use exemptions.
    Prior to determining the CSA amount for a particular year, EPA
considers what portion of ``existing'' stocks is ``available'' for
critical uses. As discussed in the 2008 rulemaking, the Parties to the
Protocol recognized in their Decisions that the level of existing
stocks may differ from the level of available stocks. For example,
Decision IX/6 states that ``production and consumption, if any, of
methyl bromide for critical uses should be permitted only if * * *
methyl bromide is not available in sufficient quantity and quality from
existing stocks.'' In addition, Decision XIX/9, as well as earlier
decisions, refers to use of ``quantities of methyl bromide from stocks
that the Party has recognized to be available.'' Thus, it is clear that
individual Parties have the ability to determine their level of
available stocks. Decision XIX/9 further reinforces this concept by
including the phrase ``minus available stocks'' as a footnote to the
United States' authorized level of production and consumption in Table
D. Section 604(d)(6) of the Clean Air Act does not require that EPA
adjust the amount of new production and import to reflect the
availability of stocks: however, as explained in previous rulemakings,
making such an adjustment is a reasonable exercise of EPA's discretion
under this provision. In this action, EPA is not proposing to change
its practice of adjusting the level of new production and import
authorized by the Parties to reflect the availability of stocks.
    EPA introduced in the 2008 CUE rule a refined approach for
determining the amount of existing methyl bromide stocks that is
available for critical uses. (72 FR 74118). That approach involves the
concept of a ``Supply Chain Factor'' (SCF). The SCF represents EPA's
technical estimate of the amount of methyl bromide inventory that would
be adequate to meet a need for critical use methyl bromide after an
unforeseen domestic production failure. The SCF appears in the formula
finalized in the 2008 CUE rule for calculating the available stocks.
That formula was expressed as AS = ES - D - SCF, where AS = available
stocks; ES = existing pre-phaseout stocks of methyl

bromide held in the United States by producers, importers, and
distributors; and D = estimated drawdown of existing stocks. In the
2008 rulemaking, EPA stated that it would use the refined approach in
2008 and each year thereafter as appropriate and feasible (72 FR
14134). EPA is not proposing any changes to the concept of a ``Supply
Chain Factor'' or to the formula finalized in the 2008 CUE rule for
calculating the available stocks. EPA finds that this approach
continues to be appropriate and feasible, as it is the most reasonable,
efficient, and transparent way for the Agency to continue to facilitate
responsible management of the pre-phaseout inventory. Therefore the
Agency intends to use the same basic SCF approach in its calculation of
how much sale of existing stocks and how much production and import to
allow for critical uses in 2009. The Agency plans, however, to use more
current data as inputs to some of the underlying calculations, and is
proposing to adopt a new statistical model for projecting future
inventory of pre-2005 methyl bromide.
2. Calculation of Available Pre-Phaseout Inventory
    In this action, EPA intends to adjust the authorized level of new
production and consumption for critical uses to account for the amount
of existing pre-phaseout inventory that is ``available'' for critical
uses. EPA proposes to calculate the amount of existing stocks that is
available for critical uses in 2009 based on the Supply Chain Factor
and formula introduced in the 2008 CUE final rule (72 FR 74118). EPA
will allow sales of the amount of existing pre-phaseout inventory that
the Agency has determined to be available for critical uses by issuing
an equivalent number of CSAs on a one-CSA-per-one-kilogram-of-methyl-
bromide basis.
    As described in the 2008 CUE Rule, EPA calculates the amount of
available stocks as follows: AS2009 = ES2008 -
D2008 - SCF2009, where AS2009 is the
available stocks on January 1, 2009; ES2008 is the existing
pre-phaseout stocks of methyl bromide held in the United States by
producers, importers, and distributors on January 1, 2008;
D2008 is the estimated drawdown of existing stocks during
calendar year 2008; and SCF2009 is the supply chain factor
for 2009. Using the above method, EPA calculates that 2,576,987 kg
(10.1% of baseline) of existing pre-phaseout stocks of methyl bromide
will be ``available'' for critical uses on January 1, 2009. This
calculation uses EPA's preferred approach to estimating the 2008
drawdown, as discussed in more detail below. If EPA were to estimate
the 2008 drawdown using the approach taken in the 2008 CUE rule, the
calculated amount of available stocks would be 777 MT (3% of baseline).
For the reasons described below, EPA prefers the approach it is
proposing in today's action. EPA, however, seeks comment on the amount
of the pre-phaseout stock that it estimates will be available for
critical uses on January 1, 2009.
    In the above formula, ``ES2008'' refers to pre-phaseout
inventory--i.e., existing stocks of methyl bromide that was produced
before January 1, 2005, and that is still held by domestic producers,
distributors, and third-party applicators. January 1, 2005, was the
phaseout date for production and import of methyl bromide in the United
States. ES2008 does not include critical use methyl bromide
that was produced after January 1, 2005, and carried over into
subsequent years. EPA addresses the carryover amount in section V.D.4
of this preamble. In the 2007 and 2008 CUE rules, EPA deducted the
amount carried over into a new control period from the amount of
allowable new production for the control periods in question. In this
2009 CUE proposed rule, EPA proposes to maintain the carry over
deduction. ``ES2008'' also does not include methyl bromide
produced (1) under the quarantine and preshipment (QPS) exemption, (2)
with Article 5 allowances to meet the basic domestic needs of Article 5
countries, or (3) for feedstock or transformation purposes. Methyl
bromide produced for QPS uses or for export to Article 5 countries may
not be sold to domestic entities for critical uses and, therefore, is
separate from the CUE program. Thus, such amounts have been removed
from the calculation of the amount of ``available stocks'' for critical
uses. EPA also considers all pre-phaseout inventory to be suitable for
both pre-plant and post harvest uses. Despite prior requests, EPA has
received no data that show that pre-phaseout inventory is mixed with
chloropicrin and is unsuitable for post-harvest uses. Unless the Agency
receives evidence otherwise, it will assume all pre-2005 inventory is
suitable for all uses. Similarly, EPA considers inventory methyl
bromide to be available to users in California and the Southeastern
United States. EPA bases this conclusion on the geographic distribution
of the companies that are granted CSAs (See Table III). EPA welcomes
comments on the availability of pre-phaseout inventory based on
geography.
(a) Supply Chain Factor
    EPA's method for determining the amount of available stocks for
critical uses includes a supply chain factor which for 2009 can be
expressed as ``SCF2009.'' The supply chain factor represents
EPA's technical estimate of the amount of pre-phaseout inventory that
would be adequate to meet a need for critical use methyl bromide after
an unforeseen domestic production failure. For 2009, EPA proposes to
use a supply chain factor equal to 2,352,013 kg in the Agency's
calculation of the amount of available stocks. Consistent with the 2008
CUE rule, EPA is proposing a conservative estimate of the supply chain
factor that considers a supply disruption during the estimated peak 15-
week period of critical use supply. As described in the 2008 CUE rule,
EPA estimates that in the event of a major supply disruption, it would
take 15 weeks for significant imports of methyl bromide to reach the
U.S. Using updated numbers on average production during each quarter of
the year, EPA estimates that critical use production in the first 15
weeks of each year (the peak supply period) accounts for 55% of annual
critical use methyl bromide production. EPA, therefore, estimates that
the peak 15-week shortfall in 2009 could be 2,352,013 kg (55.186% x
4,261,974 kg).
    As EPA stated in the 2008 CUE Rule, the supply chain factor is not
a ``reserve'' or ``strategic inventory'' of methyl bromide. Rather, it
is merely an analytical tool used to provide greater transparency
regarding how the Agency determines CSA amounts. For further general
discussion of the supply chain factor, see the final 2008 CUE rule (72
FR 74118). Further detail about the analysis used to derive the value
for the 2009 supply chain factor is provided in the Technical Support
Document available on the public docket for this rulemaking.
(b) Estimated Drawdown
    In the 2008 CUE rule, EPA estimated the drawdown of existing
stocks, the D2008 term in the above equation, by using a
simple linear fit estimation of inventory data from all available
years. In this action, EPA proposes not to estimate drawdown using a
linear fit projection as done last year but instead use an exponential
projection for 2008. EPA invites comment on both methods of estimating
the 2008 drawdown as well as on any alternative method of estimating
drawdown.
    EPA's projections are based on fitting either an exponential curve
(the agency's preferred approach for this

rulemaking) or a linear curve (the agency's approach finalized last
year) to reported annual data on pre-phaseout inventory. Given the
small sample size (5 data observations), the reader should be cautious
about drawing inferences. However, the Agency believes, combined with
other information, the exponential curve approach may present a more
reasonable approach to projecting the drawdown of pre-phaseout
inventory.
    EPA is proposing to estimate the drawdown of inventory in 2008
based on an exponential projection. Using this method, EPA projects
that the pre-phaseout methyl bromide inventory, which was 6,457,806 kg
on January 1, 2008, will be drawn down by 1,528,806 kg during 2008.
This will result in a pre-phaseout inventory of 4,929,000 kg on January
1, 2009. EPA's proposed methodology for estimating the inventory
drawdown is described in more detail in the Technical Support Document
available on the public docket for this rulemaking.
    When EPA looks at the market conditions that could affect the
drawdown of inventory, EPA believes that the exponential estimate
(1,529 MT) provides a more reasonable reflection of market conditions
than the linear estimate (3,329 MT). The exponential estimate closely
matches the drawdown in 2007, which was 1,213 MT whereas the linear
estimate most closely matches the drawdown in 2004, which was 3,428 MT
and the highest drawdown in EPA's data set. EPA believes that the
market conditions in 2008 are different enough from those in 2004 that
the rate of drawdown during 2008 will be more like the rate of drawdown
of 2007 than 2004. First, the Critical Use Exemption process did not
exist in 2004, as that was the last year of the methyl bromide
phaseout. EPA believes that the economics and use patterns pre-phaseout
are different than conditions after the phaseout. Second, at the
beginning of 2004, the inventory was 16,422 MT, a substantially higher
amount than the estimated inventory at the end of 2008, regardless of
the drawdown estimate used. Third, the price of methyl bromide has
increased roughly 30-50% since 2004. Therefore, today growers face
stronger economic incentive to use alternatives and reduce application
rates than they did in 2004. Fourth, more alternatives are available,
including sulfuryl fluoride and iodomethane, reducing the total demand
for methyl bromide. Fifth, sales data reported to EPA show that less of
the inventory was used for non-critical uses in 2007 than 2006. In
2006, 1,519 MT of pre-phaseout inventory was for non-critical uses,
whereas in 2007, this dropped to 291 MT.
    EPA also considered estimating the drawdown of inventoried methyl
bromide using the simple linear fit that EPA has used in all of the
previous CUE rules. Under the linear estimate, the drawdown in 2008
would be 3,329 MT. Using the equation discussed above,
AS2009 = ES2008-D2008-
SCF2009, ``Available Stocks 2009'' under the linear method
would be 777 MT. Therefore the CSA amount would be 777 MT, or 3.0% of
baseline. Using the same calculation summarized in Section V.D.7, new
production would be 3,418 MT, or 13.4% of baseline. This value falls
below the 15.5% of baseline authorized by the Parties in Decision XIX/
9. This amount of new production is greater than the level allocated in
the 2008 CUE Rule, which was 3,084 MT, or 12.1% of baseline. EPA
welcomes comment on the linear approach and its potential outcomes for
the values of new production and CSAs.
    The goal of EPA's methodology for the CSA allocation is to allocate
CSAs equal to ``available stocks'' such that the private sector has the
flexibility to retain in inventory the amount needed in case of a
catastrophic supply chain failure (the Supply Chain Factor). As the
Agency stated in the 2008 CUE Rule and in Section V.D.3 below, once the
inventory declines below the SCF level, the Agency will not require any
additional drawdown of stocks beyond what is required by the Parties to
the Protocol.
    EPA invites comment on both the linear and exponential methods of
estimating 2008 drawdown. EPA also welcomes comment on any alternative
method of estimating drawdown as well as the market conditions
affecting the decline in inventory use. Most helpful to the Agency in
determining the drawdown in 2008 is not an evaluation of statistical
methods but data on whether inventory during 2008 is being depleted at
rates similar to 2007 or whether it is being depleted faster than that.
3. Approach for Determining Critical Use Amounts
    EPA estimates that, as of January 1, 2009, 2,576,987 kg of pre-
phaseout inventory will meet the definition of ``available stocks'' as
calculated using the approach described in Section V.D.2. of this
preamble. Based on these calculated figures and the allocation approach
described in this section, and after making reductions for carry over
and research amounts as explained in sections V.D.4. and V.D.5. of this
preamble, EPA proposes to allocate critical use allowances (CUAs)
permitting 1,617,921 kg of new methyl bromide production and import for
critical uses in 2009, and to allow sale of 2,576,987 kg from existing
stocks for critical uses by allocating an equivalent number of critical
stock allowances (CSAs). EPA seeks comment on the amount of CUAs and
CSAs that the Agency is proposing to distribute in 2009.
    In this action, EPA is proposing to allocate CSAs in an amount
equal to the estimated number of kilograms of available stocks on
January 1, 2009. As in past years, EPA intends to allocate a total
number of CUAs such that the total number of CUAs and CSAs is not
greater than the total critical use amount authorized by the Parties
for the year in question. To account for carry over amounts of methyl
bromide, amounts for research purposes, or for other appropriate
reasons, including updated information on alternatives, EPA may
allocate a total number of CUAs and CSAs that is less than the total
critical use amount authorized by the Parties for the year in question.
As in previous CUE rules, because the proposed amount is less than the
total amount authorized by the Parties, the Agency seeks comment on the
reasons for, and amounts of, each reduction.
    EPA recognizes that in a future CUE allocation rule proposal, the
Agency could estimate, using the method described in Section V.D.2.,
that the amount of available stocks at the beginning of a future year
is less than the difference between the total critical use amount
authorized by the Parties and the amount of new production and imports
authorized by the Parties for the year in question. This scenario can
be described with the following inequality: Available Stocks < (Total
CUE Amount Authorized-New Production and Imports Authorized). Under the
approach introduced in the 2008 CUE rule, in such a case EPA would
propose to allow the maximum amount of new production and imports
authorized by the Parties, minus any reductions as described above and
finalized in the 2008 CUE Rule. EPA would also allow critical users to
access a limited amount of existing stocks by allocating a number of
CSAs equal to the difference between the total CUE amount authorized by
the Parties and the amount of new production and imports authorized for
the year in question (CSA = Total CUE Amount Authorized-New Production
and Imports Authorized), again minus any reductions as discussed here.
EPA will continue to collect inventory data and make critical use
allocations on an annual basis. Similarly, unless the

Parties approve multi-year critical use exemptions, EPA intends to
continue to calculate the amount of available stocks on an annual basis
and to explain those calculations in the annual CUE allocation
rulemaking process.
4. Treatment of Carry Over Material
    As described in the December 23, 2004, Framework Rule (69 FR
76997), EPA is not permitting entities to build stocks of methyl
bromide produced or imported after January 1, 2005, under the critical
use exemption. Under the current regulations, quantities of methyl
bromide produced, imported, exported, or sold to end-users under the
critical use exemption in a calendar year must be reported to EPA the
following year. These reporting requirements appear at 40 CFR
82.13(f)(3), 82.13(g)(4), 82.13(h)(1), 82.13(bb)(2), and 82.13(cc)(2).
EPA uses the reported information to calculate the amount of methyl
bromide produced or imported under the critical use exemption, but not
exported or sold to end-users in that year. An amount equivalent to
this ``carry over,'' whether pre-plant or post-harvest, is then
deducted from the total level of allowable new production and import in
the year following the year of the data report. For example, the amount
of carry over from 2005, which was reported in 2006, was deducted from
the allowable amount of production or import for critical uses in 2007.
As discussed in section V.D.2., carry over material is not included in
EPA's definition of existing stocks (ES) as it applies to the proposed
formula for determining the amount of available stocks (AS). EPA is not
including carry over amounts as part of ES, because doing so could lead
to a double-counting of carry over amounts, and thus a double reduction
of critical use allowances (CUAs).
    In 2008, 57 entities reported information to EPA under the
reporting requirements at 40 CFR 82.13 about critical use methyl
bromide production, imports, exports, sales and/or inventory holdings
in 2007. 4,314,150 kg of critical use methyl bromide was acquired
through production or import in 2007. The information reported to EPA
indicates that 4,269,255 kg of critical use methyl bromide was exported
or sold to end-users in 2007. EPA calculates that the carry over amount
at the end of 2007 was 44,895 kg, which is the difference between the
reported amount of critical use methyl bromide acquired in 2007 and the
reported amount of exports or sales of that material to end users in
2007 (4,314,150 kg-4,269,255 kg = 44,895 kg). EPA's calculation of the
amount of carry over at the end of 2007 is consistent with the method
used in the final 2008 CUE Rule, and with the method agreed to by the
Parties in Decision XVI/6, which established the Accounting Framework
for critical use methyl bromide, for calculating column L of the U.S.
Accounting Framework. The 2007 U.S. Accounting Framework is available
in the public docket for this rulemaking.
    As a result of stakeholder concerns regarding the completeness of
reporting and in response to public comment, EPA stated in the 2008 CUE
Rule (72 FR 74137) that:

    It would be beneficial to acquire the names of all distributors
and third-party applicators with critical use exemption reporting
requirements under 40 CFR 82.13. Collecting the names of these
entities will facilitate Agency follow-up with non-reporters,
allowing collection of necessary information in a more targeted
manner than collecting detailed information from all entities. In
early 2008 EPA will use its information gathering authority under
section 114 of the Clean Air Act to ask all entities that sell
critical use methyl bromide to report the names of all non-end user
entities (i.e.producers, importers, distributors and third-party
applicators) to which they sold critical use methyl bromide during
the 2007 control period.

    On January 31, 2008, EPA sent letters to all producers,
distributors, and third-party applicators of critical use methyl
bromide that it was aware of asking for ``the name and address of each
non-end user entity (i.e. distributors of methyl bromide and third-
party applicators of methyl bromide) to which your company sold
critical use methyl bromide during calendar year 2007.'' As a result,
EPA received contact information for distributors and third-party
applicators that had never reported sales data to EPA as well as actual
sales reports from some of those new entities. On March 11, 2008, the
Agency sent a follow-up letter to the previously unknown entities that
had not reported sales data for 2007 and reminded them of their
reporting obligations under 40 CFR 82.13. The Agency has received 18
responses from previously unknown entities satisfying the required
annual reporting requirements. The Agency is considering options to
pursue the remaining unreported data. EPA may take into account
additional reports received within a reasonable time in calculating the
carry over amount for the final 2009 rule.
    In previous CUE rules, EPA has used the approach described in the
Framework Rule for implementing carry over reductions. Consistent with
that approach, EPA is proposing to reduce the total level of new
production and import for critical uses by 44,895 kg to reflect the
total level of carry over material in existence at the end of 2007.
After applying this reduction to the total volumes of allowable new
production or import, EPA pro-rated CUAs to each company based on their
1991 baseline market share.
    EPA continues to seek comment on ways to improve the completeness
of data reporting by affected companies. It is important for
stakeholders to recognize that the process for calculating the amount
of carry over CUE material each year relies on sales to end-user data
reported to EPA by distributors and applicators.
5. Amounts for Research Purposes
    As in the 2008 CUE rule, EPA is proposing to encourage research
needs to be met through the sale of inventory by deducting the amount
needed for research from the overall critical use production level and
issuing additional CSAs in that amount.
    The use of methyl bromide under the critical use exemption for
research is distinct from the use of methyl bromide under the
laboratory and analytical use exemption. Decision XVIII/15(1)
authorizes ``the production and consumption of [methyl bromide]
necessary to satisfy laboratory and analytical critical uses.''
Paragraph 2 of that Decision states that methyl bromide produced under
the exemption for laboratory and analytical uses may be used as a
reference or standard; in laboratory toxicology studies; to compare the
efficacy of methyl bromide and its alternatives inside a laboratory;
and as a laboratory agent which is destroyed in a chemical reaction in
the manner of feedstock. On December 27, 2007, EPA promulgated
regulations implementing the exemption authorized in Decision XVIII/15
(72 FR 73264).
    There continues to be a need for methyl bromide for research
purposes that do not meet the criteria for laboratory and analytical
uses, as defined in Decision XVIII/15. A common example is an outdoor
field experiment that requires methyl bromide as a standard control
treatment with which to compare the trial alternatives' results. The
critical use sectors that were approved by the Parties to use methyl
bromide for research purposes in 2009 are listed in Section V.C. and
have ``research purposes'' listed in their limiting critical conditions
in Table I of this preamble.
    In this action, EPA is proposing to allow sale of 22,171 kg of
existing stocks for research purposes in 2009 to account for the amount
authorized for those

purposes. EPA proposes to allow methyl bromide sale from stocks for
exempted research purposes by expending CSAs. An explanation of what
amounts of methyl bromide and of what sectors qualify for research
purposes can be found in Section V.C. of this preamble. If EPA adopts
this proposal, the Agency will continue to encourage methyl bromide
suppliers to sell inventory to researchers and to encourage researchers
to purchase inventory for research purposes. EPA seeks comment on its
proposal to issue CSAs for sale of methyl bromide stocks for exempted
research purposes.
6. Methyl Bromide Alternatives
    In the 2006 CUE Rule (71 FR 5985), EPA allocated less methyl
bromide for critical uses than was authorized by the Parties in order
to account for the recent registration of sulfuryl fluoride. The
allocation reductions in that rule reflected transition rates that were
included for the first time in the 2007 U.S. Critical Use Nomination
(CUN). In the 2008 CUE Rule (72 FR 74139), EPA explained that the
transition rates had already been applied as part of the international
review process for that year, and therefore it was not necessary to
apply them as part of the Agency's domestic rulemaking. EPA did,
however, reduce the total volume of critical use methyl bromide in the
final CUE rule for 2008 by 27,769 kg to account for new data indicating
the uptake of two alternatives, sulfuryl fluoride and iodomethane.
    For 2009, EPA is not proposing to make any further reductions in
post-harvest or pre-plant critical use allowances to account for the
uptake of sulfuryl fluoride or any other pre-plant or post-harvest
alternative with the exception of iodomethane, which is discussed
below. In the 2009 CUN the Agency applied transition rates for all
critical use sectors. The TEAP report of August 2007 included
reductions in its recommendations for critical use categories based on
the transition rates in the 2009 CUN. The TEAP's recommendations were
then considered in the Parties' 2009 authorization amounts, as listed
in Decision XIX/9. Therefore, transition rates, which account for the
uptake of alternatives, have already been applied for authorized 2009
critical use amounts.
    Furthermore, the 2010 CUN, which represents the most recent
analysis and the best available data for methyl bromide alternatives,
does not conclude that transition rates should be increased for 2009.
As the 2010 CUN reflects, the United States Government has not found
new information that supports changing the 2009 transition rates
included in the 2009 CUN and applied by MBTOC. EPA continues to gather
information about methyl bromide alternatives through the CUE
application process, and by other means.
    Finally, although the Agency intends for the final rule to account
for use of iodomethane in the 2009 control period, this proposed rule
does not include a specific reduction to account for that use. Because
EPA initially registered iodomethane on a time-limited basis, which was
to expire in October 2008, EPA did not nominate its use as an
alternative to the TEAP. Thus EPA did not make any reductions in the
2009 or 2010 CUNs to account for iodomethane uptake. On October 2,
2008, EPA renewed the registration of iodomethane. The Agency will
account for any potential market uptake of iodomethane in the final
rule given that the alternative's registration status has changed. The
amount of market uptake will also depend on how many and which States
have registered iodomethane for use. Iodomethane is currently
registered for use in 47 states, including Florida. EPA requests
comment on the amount of estimated market uptake of iodomethane to
include in the final rule. For reference, the estimated market uptake
for iodomethane in the 2008 rule was 14,472 kg. At that time, 14
states, which did not include Florida, had registered iodomethane for
use.
    EPA seeks comment on its proposal not to make further reductions in
2009 to account for the uptake of methyl bromide alternatives other
than iodomethane, because the Agency has already accounted for these
other alternatives' transition rates. EPA continues to support research
and adoption of methyl bromide alternatives, and to request information
about the economic and technical feasibility of all existing and
potential alternatives.
7. Summary of Calculations
    The calculations described above for determining the level of new
production and critical stock allowances are summarized in the table
below:

------------------------------------------------------------------------
                                                             Kilograms
------------------------------------------------------------------------
Step 1: Calculate supply chain factor:
    U.S. authorization for 2009.........................       4,261,974
    -Further reduction for uptake of alternatives.......               0
    = One year's CUE need...............................       4,261,974
    x Percentage of year's production to recover from            55.186%
     production failure.................................
    = Supply Chain Factor...............................       2,352,013
Step 2: Calculate available stocks:
    Existing pre-phaseout inventory on January 1, 2008         6,457,806
     (``ES2008'').......................................
    -Estimated drawdown of inventory during 2008               1,528,806
     (``D2008'')........................................
    -Supply Chain Factor................................       2,352,013
    = Available stocks (``AS2009'') = Critical Stock           2,576,987
     Allowance..........................................
Step 3: Calculate carry over:
    Reported as produced/imported in 2007...............       4,314,150
    -Reported as sold in 2007...........................       4,269,255
    = Carry over........................................          44,895
Step 4: Calculate new production:
    U.S. authorization for 2009.........................       4,261,974
    -Critical Stock Allowance (Step 2)..................       2,576,987
    -Carryover (Step 3).................................          44,895
    -Amounts Used for Research..........................          22,171
    -Uptake of alternatives.............................               0
    = New production = Critical Use Allowance...........       1,617,921
------------------------------------------------------------------------

E. The Criteria in Decisions IX/6 and Ex. I/4

    Paragraphs 2 and 7 of Decision XIX/9 request Parties to ensure that
the conditions or criteria listed in Decisions Ex. I/4 and IX/6,
paragraph 1, are applied to exempted critical uses for the 2009 control
period. A discussion of the Agency's application of the criteria in
paragraph 1 of Decision IX/6 appears in sections V.A., V.C., V.D., and
V.H. of this preamble. In section V.C. the Agency is soliciting
comments on the technical and economic basis for determining that the
uses listed in this proposed rule meet the criteria of the critical use
exemption (CUE). The critical use nominations (CUNs) detail how each
proposed critical use meets the criteria listed in paragraph 1 of
Decision IX/6, apart from the criterion located at (b)(ii), as well as
the criteria in paragraphs 5 and 6 of Decision Ex. I/4.
    The criterion in Decision IX/6(1)(b)(ii), which refers to the use
of available stocks of methyl bromide, is addressed in sections V.D.,
V.G., and V.H. of this preamble. The Agency has previously provided its
interpretation of the criterion in Decision IX/6(1)(a)(i) regarding the
presence of significant market disruption in the absence of an
exemption, and EPA refers readers to the 2006 CUE final rule (71 FR
5989) as well as to the memo on the docket titled ``Development of 2003
Nomination for a Critical Use Exemption for Methyl Bromide for the
United States of America'' for further elaboration.
    The remaining considerations, including the lack of available
technically and economically feasible alternatives under the
circumstance of the nomination; efforts to minimize use and emissions
of methyl bromide where technically and economically feasible; the
development of research and transition plans; and the requests in
Decision Ex. I/4(5) and (6) that Parties consider and implement MBTOC
recommendations, where feasible, on reductions in the critical use of
methyl bromide and include information on the methodology they use to
determine economic feasibility, are all addressed in the nomination
documents.
    Some of these criteria are evaluated in other documents as well.
For example, the U.S. has further considered matters regarding the
adoption of alternatives and research into methyl bromide alternatives,
criterion (1)(b)(iii) in Decision IX/6, in the development of the
National Management Strategy submitted to the Ozone Secretariat in
December 2005 and in ongoing consultations with industry. The National
Management Strategy addresses all of the aims specified in Decision Ex.
I/4(3) to the extent feasible and is available in the docket for this
rulemaking.

F. Emissions Minimization

    Decision XIX/9, paragraph 11 states that Parties shall request
critical users to employ ``emission minimization techniques such as
virtually impermeable films, barrier film technologies, deep shank
injection and/or other techniques that promote environmental
protection, whenever technically and economically feasible.'' In the
judgment of USG scientists, use of virtually impermeable film (VIF)
tarps allows pest control with lower application rates in addition to
minimizing emissions. The quantity of methyl bromide nominated by the
U.S. Government reflects the lower application rates necessary when
using tarps. Users of methyl bromide should make every effort to
minimize overall emissions of methyl bromide by implementing measures
such as the ones listed above, to the extent consistent with State and
local laws and regulations. The Agency encourages researchers and users
who are successfully utilizing such techniques to inform EPA of their
experiences as part of their comments on this proposed rule and to
provide such information with their critical use applications. In
addition, the Agency welcomes comments on the implementation of
emission minimization techniques and whether and how further emissions
could be reduced further.

G. Critical Use Allowance Allocations

    EPA is proposing to allocate 2009 critical use allowances for new
production or import of methyl bromide up to the amount of 1,617.921 kg
(6.3% of baseline) as shown in Table II below. EPA is seeking comment
on the total levels of exempted new production or import for pre-plant
and post-harvest critical uses in 2009. Each critical use allowance
(CUA) is equivalent to 1 kg of critical use methyl bromide. These
allowances expire at the end of the control period and, as explained in
the Framework Rule, are not bankable from one year to the next. This
proposal for allocating the following number of pre-plant and post-
harvest CUAs to the entities listed below is subject to the trading
provisions at 40 CFR 82.12, which are discussed in section V.G. of the
preamble to the Framework Rule (69 FR 76982).
---------------------------------------------------------------------------

    \2\ Due to rounding, numbers do not add exactly.

        Table II--Proposed Allocation of Critical Use Allowances
------------------------------------------------------------------------
                                    2009 Critical use  2009 Critical use
                                      allowances for     allowances for
              Company                pre-plant uses *  post-harvest uses
                                       (kilograms)       *  (kilograms)
------------------------------------------------------------------------
Great Lakes Chemical Corp. A                  888,477             94,733
 Chemtura Company.................
Albemarle Corp....................            365,362             38,956
Ameribrom, Inc....................            201,907             21,528
TriCal, Inc.......................              6,287                670
                                   -------------------------------------
    Total \2\.....................          1,462,032            155,888
------------------------------------------------------------------------
* For production or import of Class I, Group VI controlled substance
  exclusively for the Pre-Plant or Post-Harvest uses specified in
  appendix L to 40 CFR part 82.

    Paragraph six of Decision XIX/9 states ``that Parties shall
endeavor to license, permit, authorize or allocate quantities of
critical-use methyl bromide as listed in tables A and C of the annex to
the present decision.'' This is similar to language in Decisions Ex. I/
3(4), Ex. II/1(4), XVII/9(4), and XVIII/13(5) regarding 2005, 2006,
2007, and 2008 critical uses, respectively. The language from these
Decisions calls on Parties to

endeavor to allocate critical use methyl bromide on a sector basis.
    EPA's August 2004 proposed Framework Rule (69 FR 52366) proposed
several options for allocating critical use allowances, expressing a
preference for a sector-by-sector approach. The Agency evaluated the
various options based on their economic, environmental, and practical
effects. After receiving comments, EPA determined in the final
Framework Rule (69 FR 76989) that a lump-sum, or universal, allocation,
modified to include distinct caps for pre-plant and post-harvest uses,
was the most efficient and least burdensome approach that would achieve
the desired environmental results, and that a sector-specific approach
would pose significant administrative and practical difficulties.
Although the approach adopted in the Framework Rule does not directly
allocate allowances to each category of use, the Agency anticipates
that reliance on market mechanisms will achieve similar results
indirectly. The TEAP recommendations are based on data submitted by the
U.S. which in turn are based on recent use data in the current methyl
bromide market. In other words, the TEAP recommendations agreed to by
the Parties are based on current use and the current use patterns take
place in a market where all pre-plant and post-harvest methyl bromide
uses compete for a lump sum supply of critical use material. Therefore,
the Agency believes that under a system of universal allocations,
divided into pre-plant and post-harvest sectors, the actual critical
use will closely follow the sector breakout listed by the TEAP. These
issues were addressed in previous rules and EPA is not aware of any
factors that would alter the analysis performed during the development
of the Framework Rule.
    EPA is not proposing to change the approach adopted in the
Framework Rule for the allocation of CUAs but, in an endeavor to
address Decision XIX/9(6), EPA will consider additional comment on the
Agency's allocation of CUAs in the two groupings (pre-plant and post-
harvest) that the Agency has employed in the past.

H. Critical Stock Allowance Allocations

    For the reasons described in Section V.D., EPA is proposing to
allocate critical stock allowances (CSAs) to the entities listed below
in Table III for the 2009 control period in the amount of 2,576,987 kg
(10.1% of baseline). This proposed amount of CSA allowances is
consistent with the approach to determining available stocks introduced
in the 2008 CUE rule and described in section V.D.4.
    In 2006, the United States District Court for the District of
Columbia upheld EPA's treatment of company-specific methyl bromide
inventory information as confidential. NRDC v. Leavitt, 2006 WL 667327
(D.D.C. March 14, 2006). EPA's allocation of CSAs is based on each
company's proportionate share of the aggregate inventory. Therefore,
the documentation regarding company-specific allocation of CSAs is in
the confidential portion of the rulemaking docket and the individual
CSA allocations are not listed in the table below. EPA will inform the
listed companies of their CSA allocations in a letter following
publication of the final rule.

                           Table III--Proposed Allocation of Critical Stock Allowances
----------------------------------------------------------------------------------------------------------------

----------------------------------------------------------------------------------------------------------------
                                                     Company
----------------------------------------------------------------------------------------------------------------
Albemarle                             Hendrix & Dail                        Royster-Clark, Inc.
Ameribrom, Inc.                       Hy Yield Bromine                      Trical Inc.
Bill Clark Pest Control, Inc.         Industrial Fumigation Company         Trident Agricultural Products
Burnside Services, Inc.               Pacific Ag                            UAP Southeast (NC)
Cardinal Professional Products        Pest Fog Sales Corp.                  UAP Southeast (SC)
Chemtura Corp.                        Prosource One                         Univar
Degesch America, Inc.                 Reddick Fumigants                     Western Fumigation
Helena Chemical Co.                   ....................................  ....................................
    Total--2,576,987 kilograms
----------------------------------------------------------------------------------------------------------------

Several companies that receive very small amounts of CSAs from EPA have
contacted the Agency and requested that they be permitted to
permanently retire their allowances. Some companies receive as few as 6
allowances which allow the holder to sell up to 6 kilograms of methyl
bromide to critical uses. Due to the small allocation and because they
typically do not sell critical use methyl bromide, some companies find
the allocation of CSAs, and associated record-keeping and reporting
requirements, to be unduly burdensome.
    In response to this concern, for the last two rounds of CUE
allocation rulemakings EPA has allowed CSA holders, on a voluntary
basis, to permanently relinquish their allowances through written
notification to the Agency. Such companies would not receive CSA
allocations and would be excluded from future allocations. During the
comment period for the 2008 CUE Rule, seven companies voluntarily
agreed to permanently relinquish their allowances. In the final 2008
CUE Rule, the Agency reallocated all allowances forfeited by these
companies to the remaining companies on a pro-rata basis. EPA continues
to strongly encourage CSA holders to take advantage of this voluntary
opportunity to retire their CSA allocations by providing written
notification to the Agency during the comment period for this
rulemaking.

I. Stocks of Methyl Bromide

    As discussed above and in the December 23, 2004, Framework Rule, an
approved critical user may purchase methyl bromide produced or imported
with CUAs as well as limited inventories of pre-phaseout methyl
bromide, the combination of which constitute the supply of ``critical
use methyl bromide'' intended to meet the needs of agreed critical
uses. The Framework Rule established provisions governing the sale of
pre-phaseout inventories for critical uses, including the concept of
CSAs and a prohibition on the sale of pre-phaseout inventories for
critical uses in excess of the amount of CSAs held by the seller. It
also established trading provisions that allow critical use allowances
(CUAs) to be converted into CSAs. Under this proposed action, no
changes would be made to those provisions.
    EPA believes that the refined approach for calculating available
stocks that was finalized in the 2008 CUE Rule reduces the risks of
methyl bromide shortages for critical uses. However, as in prior years,
the Agency will continue to closely monitor CUA and CSA data.

Further, as stated in the final 2006 CUE rule, safety valves continue
to exist. If an inventory shortage occurs, EPA may consider various
options including authorizing the conversion of a limited number of
CSAs to CUAs through a rulemaking, bearing in mind the upper limit on
U.S. production/import for critical uses. In sections V.D. and V.G. of
this preamble, EPA seeks comment on the amount of critical use methyl
bromide to come from stocks compared to new production and import.
    The aggregate amount of pre-phaseout methyl bromide reported as
being in inventory at the beginning of 2008 is 6,458 MT. EPA estimates
that the aggregate inventory on January 1, 2009, will be approximately
4,929 MT. As explained in detail in the 2008 CUE final rule, the Agency
intends to continue releasing the aggregate of methyl bromide stockpile
information reported to the Agency under the reporting requirements at
40 CFR 82.13 for the end of each control period. EPA notes that if the
number of competitors in the industry were to decline appreciably, EPA
would revisit the question of whether the aggregate is entitled to
treatment as confidential information and whether to release the
aggregate without notice. EPA is not proposing to change the treatment
of submitted information but welcomes information concerning the
composition of the industry in this regard. The aggregate information
for 2003 through 2007 is available in the docket for this rulemaking.

VI. Statutory and Executive Order Reviews

A. Executive Order 12866: Regulatory Planning and Review

    Under Executive Order (EO) 12866 (58 FR 51735, October 4, 1993),
this action proposes a ``significant regulatory action.'' This action
is likely to result in a rule that may raise novel legal or policy
issues. Accordingly, EPA submitted this action to the Office of
Management and Budget (OMB) for review under EO 12866 and any changes
made in response to OMB recommendations have been documented in the
docket for this action.

B. Paperwork Reduction Act

    This action does not impose any new information collection burden.
The application, recordkeeping, and reporting requirements have already
been established under previous Critical Use Exemption rulemakings and
this action does not propose to change any of those existing
requirements. However, the Office of Management and Budget (OMB) has
previously approved the information collection requirements contained
in the existing regulations at 40 CFR part 82 under the provisions of
the Paperwork Reduction Act, 44 U.S.C. 3501 et seq. and has assigned
OMB control numbers 2060-0482 and 2060-0564. The OMB control numbers
for EPA's regulations in 40 CFR are listed in 40 CFR part 9.

C. Regulatory Flexibility Act

    The RFA generally requires an agency to prepare a regulatory
flexibility analysis of any rule subject to notice-and-comment
rulemaking requirements under the Administrative Procedure Act or any
other statute unless the agency certifies that the rule will not have a
significant economic impact on a substantial number of small entities.
Small entities include small businesses, small organizations, and small
governmental jurisdictions. For purposes of assessing the impacts of
this proposed rule on small entities, small entity is defined as: (1) A
small business that is identified by the North American Industry
Classification System (NAICS) Code in the Table below; (2) a small
governmental jurisdiction that is a government of a city, county, town,
school district or special district with a population of less than
50,000; and (3) a small organization that is any not-for-profit
enterprise which is independently owned and operated and is not
dominant in its field.

----------------------------------------------------------------------------------------------------------------
                                                                                NAICS Small business
                                                                                size standard  (in
             Category                       NAICS code                   SIC code            number of employees
                                                                                or millions of
                                                                                dollars)
----------------------------------------------------------------------------------------------------------------
Agricultural production...........  1112--Vegetable and Melon   0171--Berry Crops.........  $0.75 million.
                                     farming.
                                    1113--Fruit and Nut Tree    0172--Grapes..............
                                     Farming.
                                    1114--Greenhouse, Nursery,  0173--Tree Nuts...........
                                     and Floriculture           0175--Deciduous Tree
                                     Production.                 Fruits (except apple
                                                                 orchards and farms).
                                                                0179--Fruit and Tree Nuts,
                                                                 NEC.
                                                                0181--Ornamental
                                                                 Floriculture and Nursery
                                                                 Products.
                                                                0831--Forest Nurseries and
                                                                 Gathering of Forest
                                                                 Products.
Storage Uses......................  115114--Postharvest Crop    ..........................  $6.5 million.
                                     activities (except Cotton
                                     Ginning).
                                    311211--Flour Milling.....  2041--Flour and Other
                                                                 Grain Mill Products.
                                    311212--Rice Milling......  2044--Rice Milling........
                                    493110--General             4225--General Warehousing   $23.5 million.
                                     Warehousing and Storage.    and Storage.
                                    493130--Farm Product        4221--Farm Product          500 employees.
                                     Warehousing and Storage.    Warehousing and Storage.
Distributors and Applicators......  115112--Soil Preparation,   0721--Crop Planting,        $6.5 million.
                                     Planting and Cultivating.   Cultivation, and
                                                                 Protection.
Producers and Importers...........  325320--Pesticide and       2879--Pesticides and        500 employees.
                                     Other Agricultural          Agricultural Chemicals,
                                     Chemical Manufacturing.     NEC.
----------------------------------------------------------------------------------------------------------------

    Agricultural producers of minor crops and entities that store
agricultural commodities are categories of affected entities that
contain small entities. This proposed rule will only affect entities
that applied to EPA for a de-regulatory exemption. In most cases, EPA
received aggregated requests for exemptions from industry consortia. On
the exemption application, EPA asked consortia to describe the number
and size distribution of entities their application covered. EPA
estimated that 3,218 entities petitioned EPA for an exemption for the
2005 control period.

EPA now estimates there to be 2,000 end users of critical use methyl
bromide. Since many applicants did not provide information on the
distribution of sizes of entities covered in their applications, EPA
estimated that, based on the above definition, between one-fourth and
one-third of the entities may be small businesses. In addition, other
categories of affected entities do not contain small businesses based
on the above description.
    After considering the economic impacts of this proposed rule on
small entities, EPA certifies that this action will not have a
significant economic impact on a substantial number of small entities.
In determining whether a rule has a significant economic impact on a
substantial number of small entities, the impact of concern is any
significant adverse economic impact on small entities, since the
primary purpose of the regulatory flexibility analyses is to identify
and address regulatory alternatives ``which minimize any significant
economic impact of the proposed rule on small entities.'' (5 U.S.C.
603-604). Thus, an Agency may certify that a rule will not have a
significant economic impact on a substantial number of small entities
if the rule relieves a regulatory burden, or otherwise has a positive
economic effect on all of the small entities subject to the rule. Since
this rule exempts methyl bromide for approved critical uses after the
phaseout date of January 1, 2005, this is a de-regulatory action which
will confer a benefit to users of methyl bromide. EPA believes the
estimated de-regulatory value for users of methyl bromide is between
$20 million and $30 million annually. We have therefore concluded that
this proposed rule will relieve regulatory burden for all small
entities.

D. Unfunded Mandates Reform Act

    Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), Public
Law 104-4, establishes requirements for Federal agencies to assess the
effects of their regulatory actions on State, local, and tribal
governments and the private sector. Under section 202 of the UMRA, EPA
generally must prepare a written statement, including a cost-benefit
analysis, for proposed and final rules with ``Federal mandates'' that
may result in expenditures to State, local, and tribal governments, in
the aggregate, or to the private sector, of $100 million or more in any
one year. Before promulgating an EPA rule for which a written statement
is needed, section 205 of the UMRA generally requires EPA to identify
and consider a reasonable number of regulatory alternatives and adopt
the least costly, most cost-effective or least burdensome alternative
that achieves the objectives of the rule. The provisions of section 205
do not apply when they are inconsistent with applicable law. Moreover,
section 205 allows EPA to adopt an alternative other than the least
costly, most cost-effective or least burdensome alternative if the
Administrator publishes with the final rule an explanation why that
alternative was not adopted. Before EPA establishes any regulatory
requirements that may significantly or uniquely affect small
governments, including tribal governments, it must have developed under
section 203 of the UMRA a small government agency plan. The plan must
provide for notifying potentially affected small governments, enabling
officials of affected small governments to have meaningful and timely
input in the development of EPA regulatory proposals with significant
Federal intergovernmental mandates, and informing, educating, and
advising small governments on compliance with the regulatory
requirements.
    This proposed rule contains no Federal mandates (under the
regulatory provisions of Title II of the UMRA) for State, local, or
tribal governments or the private sector. This action is deregulatory
and does not impose any new requirements on any entities. Thus, this
proposed rule is not subject to the requirements of sections 202 and
205 of the UMRA. Further, EPA has determined that this rule contains no
regulatory requirements that might significantly or uniquely affect
small governments.

E. Executive Order 13132: Federalism

    Executive Order 13132, entitled ``Federalism'' (64 FR 43255, August
10, 1999), requires EPA to develop an accountable process to ensure
``meaningful and timely input by State and local officials in the
development of regulatory policies that have federalism implications.''
The phrase ``policies that have federalism implications'' is defined in
the Executive Order to include regulations that have ``substantial
direct effects on the States, on the relationship between the national
government and the States, or on the distribution of power and
responsibilities among the various levels of government.''
    This proposed rule does not have federalism implications. It will
not have substantial direct effects on the States, on the relationship
between the national government and the States, or on the distribution
of power and responsibilities among the various levels of government,
as specified in Executive Order 13132. This proposed rule is expected
to primarily affect producers, suppliers, importers and exporters and
users of methyl bromide. Thus, Executive Order 13132 does not apply to
this proposed rule.

F. Executive Order 13175: Consultation and Coordination With Indian
Tribal Governments

    Executive Order 13175, titled ``Consultation and Coordination with
Indian Tribal Governments'' (65 FR 67249, November 9, 2000), requires
EPA to develop an accountable process to ensure ``meaningful and timely
input by tribal officials in the development of regulatory policies
that have tribal implications.'' This proposed rule does not have
tribal implications, as specified in Executive Order 13175. This
proposed rule does not significantly or uniquely affect the communities
of Indian tribal governments. The proposed rule does not impose any
enforceable duties on communities of Indian tribal governments. Thus,
Executive Order 13175 does not apply to this proposed rule.

G. Executive Order No. 13045: Protection of Children From Environmental
Health and Safety Risks

    EPA interprets EO 13045 (62 F.R. 19885, April 23, 1997) as applying
only to those regulatory actions that concern health or safety risks,
such that the analysis required under section 5-501 of the EO has the
potential to influence the regulation. This action is not subject to EO
13045 because it does not establish an environmental standard intended
to mitigate health or safety risks.

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

    This proposed rule is not a ``significant energy action'' as
defined in Executive Order 13211, ``Actions Concerning Regulations That
Significantly Affect Energy Supply, Distribution, or Use'' (66 FR 28355
(May 22, 2001)) because it is not likely to have a significant adverse
effect on the supply, distribution, or use of energy. This proposed
rule does not pertain to any segment of the energy production economy
nor does it regulate any manner of energy use. Therefore, we have
concluded that this proposed rule is not likely to have any adverse
energy effects.

I. National Technology Transfer and Advancement Act

    Section 12(d) of the National Technology Transfer and Advancement
Act of 1995 (``NTTAA''), Public Law

104-113, 12(d) (15 U.S.C. 272 note) directs EPA to use voluntary
consensus standards in its regulatory activities unless to do so would
be inconsistent with applicable law or otherwise impractical. Voluntary
consensus standards are technical standards (e.g., materials
specifications, test methods, sampling procedures, and business
practices) that are developed or adopted by voluntary consensus
standards bodies. NTTAA directs EPA to provide Congress, through OMB,
explanations when the Agency decides not to use available and
applicable voluntary consensus standards.
    This proposed rulemaking does not involve technical standards.
Therefore, EPA is not considering the use of any voluntary consensus
standards.

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

    Executive Order (EO) 12898 (59 FR 7629 (Feb. 16, 1994)) establishes
federal executive policy on environmental justice. Its main provision
directs federal agencies, to the greatest extent practicable and
permitted by law, to make environmental justice part of their mission
by identifying and addressing, as appropriate, disproportionately high
and adverse human health or environmental effects of their programs,
policies, and activities on minority populations and low-income
populations in the United States.
    EPA has determined that this proposed rule will not have
disproportionately high and adverse human health or environmental
effects on minority or low-income populations, because it affects the
level of environmental protection equally for all affected populations
without having any disproportionately high and adverse human health or
environmental effects on any population, including any minority or low-
income population. Any ozone depletion that results from this proposed
rule will impact all affected populations equally because ozone
depletion is a global environmental problem with environmental and
human effects that are, in general, equally distributed across
geographical regions.

List of Subjects in 40 CFR Part 82

    Environmental protection, Ozone depletion, Chemicals, Exports,
Imports.

    Dated: November 21, 2008.
Stephen L. Johnson,
Administrator.

    For the reasons stated in the preamble, 40 CFR Part 82 is proposed
to be amended as follows:

PART 82--PROTECTION OF STRATOSPHERIC OZONE

    1. The authority citation for part 82 continues to read as follows:

    Authority: 42 U.S.C. 7414, 7601, 7671-7671q.