We are also proposing a specific deadline by which RACT measures
are to be implemented for the 2008 ozone NAAQS. Section 182(b)(2)
requires RACT measures to be implemented as expeditiously as
practicable, but no later than May 31, 1995, which was 54 and one-half
months from the date of enactment of the 1990 CAA Amendments. This date
was also near the beginning of the ozone season for many nonattainment
areas at the time of enactment, and ensured that RACT measures were
required to be in place during most of the last two ozone seasons
before the Moderate area attainment date of November 15, 1996. For the
2008 ozone NAAQS, we are proposing that areas must implement RACT
measures as expeditiously as practicable, but no later than January 1
of the fifth year after the effective date of a nonattainment
designation. Nonattainment designations for all areas of the country
were effective July 20, 2012. RACT measures for these areas would be
required to be implemented by January 1, 2017. This allows a comparable
amount of time for sources to meet RACT requirements as originally
anticipated under the 1990 CAA Amendments, and ensures that RACT
measures are required to be in place throughout the last two ozone
seasons prior to the Moderate area attainment date of December 31,
2018.
    If we finalize the ``state's choice'' approach for when SIP
elements would be due, those states which chose to submit a
consolidated SIP within 30 months of designation would have a little
longer to develop and submit their RACT SIPs, but affected sources
would have a little less lead time to implement the adopted
requirements. Thus, any emission reductions due to RACT would not be
delayed due to the slightly later RACT SIP submission date. The EPA
believes this is a reasonable interpretation of the statute in this
case.
2. Reasonably Available Control Measures (RACM)
    The RACM requirement, which is set forth in section 172(c)(1) of
the CAA, applies to all nonattainment areas that are required to submit
an attainment demonstration. The EPA has issued policies and procedures
related to RACM. Specifically, the EPA has issued guidance that
interprets the RACM provision to require a demonstration that the state
has adopted all reasonable measures (including RACT) to meet RFP
requirements and to demonstrate attainment as expeditiously as
practicable and thus that no additional measures that are reasonably
available will advance the attainment date or contribute to RFP for the
area.42 43 44 We believe that this guidance should continue
to apply for purposes of the 2008 ozone NAAQS.
---------------------------------------------------------------------------

    \42\ ``State Implementation Plans; General Preamble for Proposed
Rulemaking on Approval of Plan Revisions for Nonattainment Areas''
44 FR 20372 at 20375 (April 4, 1979). ``State Implementation Plans;
General Preamble for the Implementation of Title I of the Clean Air
Act Amendments of 1990; Proposed Rule.'' 57 FR 13498 at 13560 (April
16, 1992).
    \43\ ``Guidance on the Reasonably Available Control Measures
(RACM) Requirement and Attainment Demonstration Submissions for
Ozone Nonattainment Areas.'' John S. Seitz, Director, Office of Air
Quality Planning and Standards. November 30, 1999. www.epa.gov/ttn/oarpg/t1/memoranda/revracm.pdf.
    \44\ Memorandum of December 14, 2000, from John S. Seitz,
Director, Office of Air Quality Planning and Standards, re:
``Additional Submission on RACM from States with Severe One-Hour
Ozone Nonattainment Area SIPs.'' www.epa.gov/ttn/oarpg/t1/memoranda/121400_racmmemfin.pdf.
---------------------------------------------------------------------------

    The determination of whether a SIP contains all RACM requires an
area-specific analysis that there are no additional economically and
technologically feasible control measures (alone or cumulatively) that
will advance the attainment date.\45\ The EPA's RACM policy, as
outlined in the April 16, 1992, General Preamble, indicates that states
should consider all candidate measures that are potentially available
for the particular nonattainment area that could advance the attainment
date by 1 year.\46\ The April 16, 1992, General Preamble \47\ also
provides that ``any measure that a commenter indicates during a public
comment period is reasonably available should be closely reviewed by
the planning agency to determine if it is in fact reasonably available
for implementation in the area in light of local circumstances.''
Although states should consider all available measures, including those
being implemented in other areas, a state must adopt measures for an
area only if those measures are economically and technologically
feasible and will advance the attainment date or are necessary for RFP.
This interpretation of the section 172 requirements has been upheld by
several courts. See, e.g., Sierra Club v. EPA, et al., 294 F.3d 155
(D.C. Circuit, 2002).
---------------------------------------------------------------------------

    \45\ Ibid.
    \46\ ``State Implementation Plans; General Preamble for the
Implementation of Title I of the Clean Air Act Amendments of 1990;
Proposed Rule.'' 57 FR 13507 (April 16, 1992). The discussion of
RACM in that document contains other relevant history concerning the
RACM requirement.
    \47\ 57 FR 13498.
---------------------------------------------------------------------------

E. Does the 2008 ozone NAAQS result in any new inspection and
maintenance (I/M) programs?

    No new I/M programs are currently required as a result of areas
being designated and classified nonattainment for the 2008 ozone NAAQS.
The applicable requirements for ozone nonattainment areas that are
required to adopt I/M programs are described in sections 182(a)(2)(B),
182(b)(4), 182(c)(3), and 184(b)(1)(A) of the CAA and further defined
in section 51.350 (``Applicability'') of the I/M rule (40 CFR part 51,
subpart S). Under these cumulative requirements, Moderate ozone
nonattainment areas in urbanized areas with 1990 Census populations of
200,000 or more are required to adopt basic I/M programs, while Serious
and higher classified ozone nonattainment areas outside of the
northeast OTR with 1980 Census-defined urbanized populations of 200,000
or more are required to adopt enhanced I/M programs. Within the OTR,
MSAs with populations of 100,000 or more are required to adopt enhanced
I/M programs, regardless of attainment status. Currently, all the
nonattainment areas meeting the criteria for mandatory I/M under the
2008 ozone NAAQS are already operating I/M programs due to being
designated nonattainment and classified as Moderate or above under an
earlier ozone standard. If a Marginal 2008 ozone nonattainment area
meeting the population cutoff for mandatory I/M is ever in the future
reclassified to Moderate or a higher classification, then an I/M
program meeting the SIP

submittal and program implementation requirements of the I/M rule would
be required at that time.
1. If new I/M programs are required in the future, what are the SIP and
implementation requirements?
    On April 7, 2006, the EPA finalized a suite of revisions to the I/M
rule (71 FR 17705) to address the implementation of I/M under an 8-hour
ozone NAAQS. The revised rule included deadlines for 8-hour
nonattainment areas that were tied to the effective date of a given
area's designation and classification under the 8-hour ozone NAAQS.
Specifically, the April 2006 rulemaking established a deadline for
submission of an I/M SIP no later than one year after the effective
date of the area's nonattainment designation and classification for the
8-hour ozone standard. This rule was originally applied for purposes of
the 1997 8-hour NAAQS, but it remains applicable to the 2008 8-hour
NAAQS. In addition to establishing the I/M SIP submittal schedule, the
April 2006 rulemaking also set a deadline of no later than 4 years
after the effective date of designation and classification by which the
I/M program in question would actually begin testing vehicles.
2. Should the EPA allow more time for states to submit future I/M SIPs?
    Since the 2006 I/M rulemaking, the EPA has revisited the question
of how much time it takes to submit an I/M SIP based upon the degree to
which the modeling work needed to demonstrate attainment is closely
linked to the modeling work required to design an I/M program that
meets the area's attainment needs. Put simply, areas need to determine
together the amount of emissions reductions needed for attainment and
the amount of emissions reductions to get from different sectors and
strategies (including I/M), before designing an I/M program capable of
achieving the necessary reductions to demonstrate attainment. Requiring
submittal of an I/M program in advance of an attainment demonstration
for the current or future ozone standard could result in significant
unnecessary work on modeling, SIP revisions, and implementation, if
revisions to the I/M program are later deemed necessary.
    Because control strategy decisions and the modeling needed to
perform the attainment demonstration are intertwined with decisions and
modeling needed to design the local I/M program to such a high extent,
the EPA is requesting comment on its proposal to align deadlines for
the attainment SIP and the I/M SIP so that both are due at the same
time.\48\ Commenters are asked to take the following factors into
consideration when providing comments on this portion of the proposed
rulemaking: Areas' need to analyze various I/M program designs to
determine which combination of program parameters is capable of meeting
the emission reduction needs of the attainment SIP; the need to secure
legal authority when some of the potentially affected state
legislatures may only meet for 2-4 months during any given legislative
session; the time needed to promulgate a regulation; and the impact on
timing of other, potentially competing resource demands that will be
placed on states as a result of the need to meet current and/or future
ozone standards.
---------------------------------------------------------------------------

    \48\ As discussed in section III.A of today's proposal, the EPA
is soliciting comment on alternative deadlines for attainment SIP
submissions. The EPA is here soliciting comment on aligning the
deadline for I/M submittal with those alternative deadlines.
---------------------------------------------------------------------------

3. How is modern I/M different from the last time new I/M programs were
required?
    It is important to note that much has changed since I/M programs
were required under the original, November 5, 1992, I/M Rule. At that
time, an I/M program would have included testing a vehicle's tailpipe
emissions, in some cases using a treadmill-like device (dynamometer),
so that the emissions were measured under more realistic driving
conditions rather than at rest (idle). Dynamometer-based tests also
allowed for measurement of NOX emissions, which was not
possible at idle. The equipment needed for these types of programs was
expensive compared to today's next-generation alternatives and the test
itself was time consuming as the vehicle needed to be secured to the
dynamometer and then driven through the test cycle.
    Beginning with the 1996 model year, vehicles have been equipped
with a computerized system known as onboard diagnostics or OBD. The OBD
system monitors the vehicle's emission control system continuously and
illuminates the vehicle's dashboard ``Check Engine'' light if a problem
is detected. The vehicle's computer stores information on the type of
malfunction detected, and is therefore able to provide repair shops
with information on the type of repair that is needed. The EPA
estimates that about 80 percent of the national vehicle fleet is
already equipped with an OBD system and that by the time any potential
new I/M programs would be required to begin operation, about 90 percent
of the national vehicle fleet will be OBD equipped. As a result, the
EPA believes that I/M programs will no longer need to use tailpipe
testing, and can instead rely on a simple, fast and inexpensive
interrogation of the OBD system.
    There are many ways to conduct OBD system checks but all involve a
relatively inexpensive scanner. The scanner is connected to a port in
the vehicle and the tool downloads information from the vehicle's
computer. This type of testing can be done either in a centralized
testing facility, directly at a repair shop, or even remotely using
telematics technology. Compared to earlier vehicle test methods, next-
generation I/M testing through OBD system checks is substantially
quicker, less invasive, less costly to implement and ideally suited to
innovative testing strategies such as remote inspections using cellular
or telematic technologies, self-serve testing kiosks and even mail-in
data loggers, none of which were practical under the previous
generation of tailpipe tests and all of which are available for use in
today's and future I/M programs.
    The EPA believes that OBD technology can change not only the way
vehicles are tested but also whether vehicles need to be independently
tested at all. This is because OBD offers vehicle owners all the
information they need regarding whether or not their vehicle will pass
or fail an I/M inspection. Simply put, if the ``Check Engine'' light is
on, the vehicle will fail. This capability of OBD to provide immediate
driver feedback suggests some as-yet untested but nevertheless
intriguing alternatives to traditional I/M.
    One such alternative--the EPA believes--would include programs that
offer some vehicle owners free or subsidized repairs of vehicles with
lit ``Check Engine'' lights. Should such a program result in the same
number of vehicles being repaired as would be the case in a traditional
I/M program, then the program in question would be considered
functionally equivalent to I/M. The choice of how to fund these repairs
would rest with the state but could include collecting a fee equivalent
to what would otherwise be charged for testing from all registrants,
requiring vehicle insurance providers or a state to cover the cost of
repairing the vehicle when the ``Check Engine'' light comes on,
partnering with local vocational-technical schools to provide repair
services, making driving with a lit ``Check Engine'' light on a
secondary traffic offense (similar to driving without a seat belt or
working headlights in some states), etc. Ultimately, program
equivalency would

not depend upon how repairs are funded but rather on the number of
relevant repairs accomplished by the program. Similarly, programs that
accelerate the retirement of vehicles in need of emission-related
repairs or that significantly prompt older vehicles to be replaced by
cleaner technology could be considered equivalent to I/M if the amount
of emission reductions achieved equals or exceeds what would be
achieved by a traditional enhanced I/M program.
    The EPA is requesting comments on these or other ideas for ``right
sizing'' I/M for the current and future fleet. Comments should address
how proposals will meet the minimum statutory requirements for I/M
while still achieving I/M's primary goal of reducing emissions from the
fleet in-use and supporting vehicle maintenance and emission repair.

F. How does transportation conformity apply to the 2008 ozone NAAQS?

1. What is transportation conformity?
    Transportation conformity is required under CAA section 176(c) to
ensure that transportation plans, transportation improvement programs
(TIPs) and federally supported highway and transit projects are
consistent with (``conform to'') the purpose of the SIP. Conformity to
the purpose of the SIP means that transportation activities will not
cause new air quality violations, worsen existing violations, or delay
timely attainment of the relevant NAAQS or interim reductions and
milestones. Transportation conformity applies to areas that are
designated nonattainment, and to those former nonattainment areas that
have been redesignated to attainment since 1990 and have a CAA section
175A maintenance plan (``maintenance areas'') for transportation-
related criteria pollutants: Carbon monoxide, ozone, nitrogen dioxide,
and particulate matter.
    The EPA's Transportation Conformity Rule (40 CFR 51.390 and Part
93, subpart A) establishes the criteria and procedures for determining
whether transportation activities conform to the SIP. The EPA first
promulgated the Transportation Conformity Rule on November 24, 1993 (58
FR 62188), and subsequently published several amendments. For example,
the EPA published a final rule on July 1, 2004 (69 FR 40004) that
provided transportation conformity procedures for state and local
agencies under the 1997 ozone NAAQS, among other things. For further
information on transportation conformity rulemakings, policy guidance
and outreach materials, see the EPA's Web site at http://www.epa.gov/otaq/stateresources/transconf/index.htm.
2. Why is the EPA discussing transportation conformity in this proposed
rulemaking?
    We are discussing transportation conformity in this proposed
rulemaking in order to provide affected parties with information on
when transportation conformity must be implemented for the 2008 ozone
NAAQS and how we plan to make the transition from the 1997 ozone NAAQS
to the 2008 ozone NAAQS with respect to transportation conformity.
Affected parties would include state and local transportation and air
quality agencies, metropolitan planning organizations (MPOs) and the
U.S. Department of Transportation (the DOT) (40 CFR 93.102).
3. When would transportation conformity apply to areas designated
nonattainment for the 2008 ozone NAAQS?
    Transportation conformity for the 2008 ozone NAAQS applies 1 year
after the effective date of nonattainment designations for that
standard. This is because CAA section 176(c)(6) and 40 CFR 93.102(d)
provide a 1-year grace period from the effective date of initial
designations before transportation conformity applies in areas newly
designated nonattainment for a particular pollutant and standard.
4. How would the 1-year transportation conformity grace period apply?
    The transportation conformity grace period applies to all areas
designated nonattainment for the 2008 ozone NAAQS. Metropolitan areas
are urbanized areas that have a population greater than 50,000 and a
designated MPO responsible for transportation planning per 23 U.S.C.
134. In general, within 1 year after the effective date of the initial
nonattainment designation for a given pollutant and standard, the
area's MPO and the DOT must make a conformity determination with regard
to that pollutant and standard for the area's transportation plan and
TIP. The conformity requirements for donut areas,\49\ including the
application of the 1-year conformity grace period, are generally the
same as those for metropolitan areas. MPOs and any adjacent donut areas
must continue to meet conformity requirements in nonattainment and
maintenance areas for the 1997 ozone NAAQS during the grace period, in
addition to any other applicable standards. If, at the end of the grace
period, the MPO and the DOT have not made a transportation plan and TIP
conformity determination for the relevant pollutant and standard, the
area would be in a conformity ``lapse.'' During a conformity lapse,
only certain projects can receive additional federal funding or
approvals to proceed. The practical impact of a conformity lapse will
vary from area to area.
---------------------------------------------------------------------------

    \49\ For the purposes of transportation conformity, a ``donut''
area is the geographic area outside a metropolitan planning area
boundary, but inside a designated nonattainment or maintenance area
boundary that includes an MPO (40 CFR 93.101).
---------------------------------------------------------------------------

    Isolated rural nonattainment and maintenance areas are areas that
do not contain or are not part of an MPO (40 CFR 93.101). Conformity
requirements for isolated rural nonattainment and maintenance areas can
be found at 40 CFR 93.109(g). An isolated rural area would be required
to make a conformity determination only at the point when a new
transportation project needs funding or approval. This point may occur
significantly after the 1-year grace period has ended. See the EPA's
July 1, 2004, final rule for further background on how the EPA has
implemented this conformity grace period for the 1997 ozone NAAQS in
metropolitan, donut and isolated rural areas (69 FR 40008-40014).\50\
---------------------------------------------------------------------------

    \50\ Also, see the EPA's transportation conformity Web site for
more information, including EPA's ``Transportation Conformity
Guidance for 2008 Ozone NAAQS Nonattainment Areas'' at: www.epa.gov/otaq/statesresources/transconf/2008naaqs.htm.
---------------------------------------------------------------------------

5. What flexibilities exist for isolated rural areas?
    As discussed previously in this proposal, for transportation
conformity purposes, isolated rural nonattainment and maintenance areas
are areas that do not contain or are not part of an MPO (40 CFR
93.101). In general, ozone nonattainment and maintenance areas with
populations of less than 50,000 would be considered to be isolated
rural areas for transportation conformity purposes because the DOT only
requires an MPO to be established when an area's population exceeds
50,000.
    The Transportation Conformity Rule contains a number of
flexibilities that apply to isolated rural areas. As discussed
previously, they are not required to determine conformity by the end of
the 1-year grace period that applies for new nonattainment areas, since
isolated rural areas do not have MPOs and do not have transportation
plans that are subject to the requirements to demonstrate conformity on
a periodic basis. Isolated rural areas are only required to demonstrate
conformity when a non-exempt Federal Highway Administration or Federal

Transit Administration project in the nonattainment or maintenance area
requires funding or approval. Experience has shown that isolated rural
areas have few projects that require a transportation conformity
determination. Another available flexibility is that isolated rural
areas may choose from several alternative conformity tests that may be
used for analysis years beyond the last year for which the SIP has
established a motor vehicle emissions budget. These alternative tests
are described in 40 CFR 93.109(g)(2)(ii)(A)-(C). We also note that
since these areas do not have transportation plans or TIPs, they would
never experience a conformity lapse.
6. Does transportation conformity apply for the 1997 ozone NAAQS once
that standard is revoked?
    The CAA only requires transportation conformity in areas that are
designated nonattainment or maintenance for a given pollutant and
standard. Therefore, transportation conformity would no longer apply
for purposes of the 1997 ozone NAAQS as of the time that standard (and
thus an area's designation for that standard) is revoked. In other
words, existing 1997 ozone NAAQS nonattainment and maintenance areas,
regardless of their designation for the 2008 ozone NAAQS, would no
longer be required to demonstrate transportation conformity for the
1997 ozone NAAQS after the 1997 ozone NAAQS is revoked. The EPA revoked
the 1997 ozone NAAQS for transportation conformity purposes in the
Classifications Rule for the 2008 ozone NAAQS. The revocation will
become effective on July 20, 2013, 1 year after the effective date of
designations for the 2008 ozone NAAQS. Under our current Transportation
Conformity Rule, the latest approved or adequate emission budgets for a
previous ozone NAAQS (i.e., the 1997 or the 1-hour ozone NAAQS) would
continue to be used in conformity determinations for the 2008 ozone
NAAQS until emission budgets are established and found adequate or are
approved for the 2008 ozone NAAQS. 77 FR 14981-2.
7. What impact will the implementation of the 2008 ozone NAAQS have on
a state's Transportation Conformity SIP?
    Since we are not proposing to make revisions to our Transportation
Conformity Rule in this proposal, states with previously approved
Transportation Conformity SIPs should not need to revise those SIPs,
unless they need to do so to ensure that existing state regulations
apply in the appropriate newly designated areas. However, if this is
the first time that transportation conformity will apply in a state,
such a state is required to submit a SIP revision that covers the three
specific transportation conformity requirements that are delineated in
CAA section 176(c)(4)(E). These specific requirements are consultation
procedures and written commitments to control or mitigation measures
associated with conformity determinations for transportation plans,
TIPs or projects. 40 CFR 51.390. Additional information and guidance
can be found in EPA's ``Guidance for Developing Transportation
Conformity State Implementation Plans'' (http://www.epa.gov/otaq/stateresources/transconf/policy/420b09001.pdf).

G. What requirements for general conformity apply to the 2008 ozone
NAAQS?

1. What is the purpose of the general conformity regulations?
    Section 176(c) of the CAA requires that before a federal entity
takes an action affecting air quality in a state, it must make a
determination that the proposed action will not interfere with the SIP
or the state's ability to attain and maintain the NAAQS. In November
1993, the EPA promulgated two sets of regulations to implement section
176(c). One set, known as the Transportation Conformity Rules
(described previously in this proposal), deals with approval and
funding of highway and mass transit projects. The other set, known as
the General Conformity Regulations, deals with all other federal
activities. Besides ensuring that federal actions will not interfere
with the SIP, the general conformity program also fosters
communications between federal agencies and state/local air quality
agencies, provides for public notification of and access to federal
agency conformity determinations and allows for air quality review of
individual federal actions. In 1995, Congress limited the application
of section 176(c) to nonattainment and maintenance areas only.
2. How are federal actions in nonattainment or maintenance areas
addressed?
    Federal agencies must demonstrate that their new actions occurring
in a nonattainment or maintenance area will conform with the SIP by
showing they will not (1) cause or contribute to any new violation of
any standard in respective nonattainment and maintenance areas; (2)
interfere with provisions in the applicable SIP for maintenance of any
standard; (3) increase the frequency or severity of any existing
violation of any standard; or (4) delay timely attainment of any
standard or any required interim emissions reductions or other
milestone. Information on what federal actions are covered and how to
demonstrate conformity are found in 40 CFR part 93 subpart B. On March
24, 2010, former Administrator Lisa P. Jackson signed the General
Conformity Final Rule ``Revisions to the General Conformity
Regulations,'' which was published April 5, 2010 (75 FR 17254-17279).
More information on the general conformity program is available at
http://www.epa.gov/air/genconform/.
3. General Conformity for the 2008 Ozone NAAQS
a. What de minimis emission levels will apply for ozone precursors?
    For the ozone precursors VOC and NOX, the existing de
minimis emission levels that are set forth in the EPA's General
Conformity Regulations at 40 CFR 93.153(b)(1) continue to apply to the
2008 ozone NAAQS. Those levels were based on the definition of a major
stationary source for NSR programs as established by sections 182, 183
and 302 of the CAA. Federal actions estimated to have an annual net
emissions increase less than the de minimis levels are not required to
demonstrate conformity under the General Conformity Regulations. The
current de minimis levels are identified in Table 1.

           Table 1--De Minimis Emission Levels for VOC and NOX
------------------------------------------------------------------------
                                                 VOC  tons/   NOX  tons/
              Type of ozone area                    year         year
------------------------------------------------------------------------
Extreme Nonattainment.........................           10           10
Severe Nonattainment..........................           25           25
Serious Nonattainment.........................           50           50
Other ozone Nonattainment areas outside an              100          100
 ozone transport region.......................

Other ozone Nonattainment areas inside an                50          100
 ozone transport region.......................
------------------------------------------------------------------------

b. What impact will implementation of the 2008 ozone NAAQS have on a
state's General Conformity SIP?
    We are not proposing to make revisions to our General Conformity
Regulations in this proposal. States with approved General Conformity
SIPs should not need to revise those SIPs, unless they need to do so to
ensure the existing regulations apply in the appropriate newly
designated areas.
c. Are there any other impacts related to general conformity based on
implementation of the 2008 ozone NAAQS?
    As noted above, we are not proposing any revisions to the General
Conformity Regulations at this time. However, as areas develop SIPs for
the 2008 ozone NAAQS, we recommend that state and local air quality
agencies work with federal agencies with major facilities that are
subject to the General Conformity Regulations (e.g., commercial
airports, ports and large military bases) to establish an emission
budget for those facilities in order to facilitate future conformity
determinations. Such a budget could be used by federal agencies in
determining conformity or identifying mitigation measures if the budget
level is included and identified in the SIP.
    One federal activity subject to general conformity requirements is
prescribed burning. The EPA recognizes that prescribed fire in some
instances must be employed for natural resource management purposes and
prevention or control of wildfires. The use of prescribed fire presents
federal agencies, states and tribes with the challenge to balance and
integrate two public policy goals, (1) to allow fire to function, as
nearly as possible, in its natural role in maintaining healthy wildland
ecosystems; and (2) to protect public health and welfare by mitigating
the impacts of air pollutant emissions on air quality. The EPA
encourages states and tribes to work with federal agencies to develop
Smoke Management Programs (SMPs) and use Basic Smoke Management
Practices (BSMPs) that identify the responsibilities of Federal Land
Managers and state/tribal air quality managers to coordinate fire
activities, minimize air pollutant emissions, manage smoke from
prescribed fires for resource benefits, ensure the safety of burners
and those in the forest/urban interface and establish emergency action
programs to mitigate the impacts on the public. To reduce
administrative burden on federal agencies, the EPA's April 5, 2010
revisions, to its General Conformity Regulations (75 FR 17254) provided
flexibilities in 40 CFR 93.153(h) and (i) for prescribed fires to meet
general conformity requirements using SMPs and BSMP.
4. When would general conformity apply to areas designated
nonattainment for the 2008 ozone NAAQS?
    General conformity for the 2008 ozone NAAQS applies 1 year after
the effective date of nonattainment designations for that standard.
This is because CAA section 176(c)(6) (which applies to general
conformity as well as to transportation conformity) provides a 1-year
grace period from the effective date of initial designations before
general conformity determinations are required in areas newly
designated nonattainment for a particular pollutant and standard.
5. How does the 1-year grace period apply to general conformity
determinations?
    As discussed previously in this proposal, CAA section 176(c)(6)
applies to both transportation and general conformity. Therefore, the
EPA's April 2010 revisions to its the General Conformity Regulations
(see 75 FR 17277, April 5, 2010) apply the grace period for the
purposes of general conformity in the same manner as for transportation
conformity.
6. How would the revocation of the 1997 ozone NAAQS affect general
conformity requirements?
    Our proposal to revoke the 1997 ozone NAAQS at the time the final
SIP Requirements Rule is published in the Federal Register means that
general conformity requirements under the 1997 ozone NAAQS would end
after the 2008 ozone NAAQS general conformity requirements begin.

H. What are the requirements for contingency measures in the event of
failure to meet a milestone or to attain?

1. Background
    Contingency measures are additional emissions control measures
states must implement in the event a nonattainment area fails to meet
an RFP milestone or fails to attain by its attainment date. Under the
CAA, nonattainment areas that are classified under subpart 2 of part D
of title I as Moderate, Serious, Severe or Extreme must include in
their SIPs contingency measures consistent with section 172(c)(9), and
those classified as Severe or higher must include contingency measures
that are also consistent with section 182(c)(9). These contingency
measures must be fully adopted rules or measures that are ready for
implementation quickly upon failure to meet milestones or attain. Per
EPA guidance,\51\ these measures should represent 1 year's worth of
reductions, or approximately 3 percent of the baseline emissions
inventory. For additional background information on contingency
measures, see 68 FR 32802 (June 3, 2003) and 70 FR 71650 (November 29,
2005) (the proposed and final Phase 2 Rule).
---------------------------------------------------------------------------

    \51\ August 23, 1993 memorandum from Michael H. Shapiro, Acting
Assistant Administrator for Air and Radiation, to Regional Air
Directors, ``Guidance on Issues Related to 15 Percent Rate-of-
Progress Plans.''
---------------------------------------------------------------------------

    Guidance developed by the EPA in 1993 specified the content of the
contingency measures. This guidance indicated that for areas classified
Moderate and higher that had completed the initial 15 percent VOC
reductions, contingency measures could be a mixture of VOC and
NOX reductions. The guidance indicated that of the 3 percent
emissions reductions required, 0.3 percent had to be VOC emissions
reductions, allowing the remaining 2.7 percent of emissions reductions
to be NOX emissions reductions.
2. Proposal
    The EPA is proposing to interpret the contingency measure
requirement for the 2008 ozone NAAQS in the same manner it has
interpreted that requirement for the 1-hour and 1997 ozone NAAQS, with
the exception of the content of the contingency

measures, as discussed below. The EPA is proposing that the contingency
measures required for Moderate and above areas under CAA sections
172(c)(9) and 182(c)(9) must provide for the implementation of specific
measures if the area fails to meet any applicable milestone. These
measures must be submitted for approval into the SIP as adopted
measures that would take effect without further rulemaking action by
the state or the Administrator upon a determination that an area failed
to attain or meet the applicable milestone. Contingency measures should
represent 1 year's worth of progress for the nonattainment area, which
would be achieved while the area is revising its plan. Where
appropriate, federal measures providing ongoing reductions into the
future can be used as contingency measures. Innovative measures such as
energy efficiency programs or renewable energy programs that meet the
requirements of CAA section 172(c)(9), as well as section 182(c)(9) for
areas classified as Serious or higher, can also be used as contingency
measures.
    Regarding content of the 1 year's worth of emissions covered by the
contingency measures, the EPA believes that prior contingency measure
guidance specifying a minimum of 0.3 percent of the emission reductions
(i.e., one-tenth of the total 3 percent emission reduction requirement)
must be from VOCs is no longer necessary. The EPA is proposing that for
Moderate and above areas that have completed the initial 15 percent VOC
reduction required by CAA section 182(b)(1)(A)(i), the 3 percent
emissions reductions of the contingency measures may be based entirely
on NOX controls if that is what the state's analyses have
demonstrated would be most effective in bringing the area into
attainment. There is no minimum VOC requirement.
    We are soliciting comment on a contingency measure issue for
nonattainment areas classified as Extreme, based on past state
experience developing control plans for Extreme areas. The CAA in
section 182(e)(5) allows the EPA to approve an Extreme area attainment
plan that relies, in part, on the future development of new control
technologies or improvements of existing control technologies. This
discretion is available as long as the state has demonstrated that: all
reasonably available control measures, including RACT, have been
included in the plan; the area's RFP demonstration during the first 10
years after designation does not rely on anticipated future
technologies; and the state has submitted enforceable commitments to
develop and adopt contingency measures in the event that anticipated
future technologies do not achieve planned reductions.
    If an Extreme area qualifies for the discretion authorized by
section 182(e)(5), it could be argued that it is unreasonable to expect
the state to provide for the contingency measures required by sections
172(c)(9) and 182(c)(9). Indeed, it is hard to know how an area whose
attainment SIP can include measures that are not fully developed would
be able to identify contingency measures that are more specific. And
while the CAA does not limit these measures to ``feasible'' measures,
we do not believe that such areas should be required to adopt
unreasonable or draconian measures when all reasonable candidate
contingency measures will already have been employed in the plan to
meet the RACM and RFP requirements. In this case it could be argued
that the section 182(e)(5) contingency measure provision is the only
reasonable way to meet the section 172(c)(9) and 182(c)(9) contingency
measure requirements. Accordingly, the EPA is soliciting comments on
how Extreme areas that can demonstrate they have implemented all
feasible measures for purposes of their RFP SIPs and their RACM
analyses can legally address CAA contingency measure requirements.
3. Additional Guidance for States That Use a Federal Measure as a
Contingency Measure
    The EPA has a long-standing practice of allowing federal measures
to be used as contingency measures as long as they provide emissions
reductions in the relevant years in excess of those needed for
attainment or RFP. The EPA has interpreted this policy as applying to
federal measures that have already been adopted, which would include
emissions reductions from fleet turnover to lower emitting on-road
vehicles and non-road equipment such as on-road vehicles certified to
Tier 2 light-duty vehicle emission standards.\52\ The EPA has approved
the use of federal measures to meet contingency measure requirements in
several EPA actions approving 1-hour and 8-hour ozone SIPs. (62 FR
15844, April 3, 1997), (62 FR 66279, December 18, 1997), (66 FR 30811,
June 8, 2001), (66 FR 586 and 66 FR 634, January 3, 2001) (74 FR 1903,
January 14, 2009). We plan to continue to allow areas to use future
reductions from promulgated federal measures as contingency measures
for the 2008 ozone NAAQS, consistent with our practice for both the 1-
hour and 1997 ozone NAAQS.
---------------------------------------------------------------------------

    \52\ Fleet turnover is the change in model year composition of
the local motor vehicle fleet. The composition of the motor vehicle
fleet changes as new vehicles enter the fleet and old vehicles are
removed. Generally, this results in a decrease in fleet average
NOX and VOC emissions each year as older model year
vehicles certified to less stringent emission standards leave the
fleet and are replaced by newer vehicles certified to more stringent
standards. The emission impacts of fleet turnover outside of
California are currently calculated using EPA's MOVES emission
factor model. 75 FR 9411, March 2, 2010. In California these
emissions impacts are currently calculated using EMFAC2007.
---------------------------------------------------------------------------

    States using on-road motor vehicle fleet turnover as a contingency
measure should establish and submit, as part of the SIP containing the
contingency measure, motor vehicle emissions budgets (MVEBs) consistent
with the use of on-road fleet turnover as a contingency measure. Such
budgets would help to ensure that the emissions reductions attributed
to the on-road fleet turnover contingency measure are actually
available in the event that the contingency measure is triggered and
would be available to serve the purpose intended by the SIP. For
example, if an area is required to attain the 2008 ozone NAAQS in 2018
and the SIP includes VOC and NOX emissions reductions
resulting from on-road fleet turnover as a contingency measure in the
event that the area fails to attain by 2018, the SIP for that area
should include VOC and NOX MVEBs for 2019 (the year after
the attainment date) that are consistent with the use of the on-road
fleet turnover contingency measure. Having such budgets would help to
ensure that reductions from a fleet turnover contingency measure would
be surplus and available for the SIP in the event that contingency
measures are triggered.

I. How do the NSR requirements apply for the 2008 ozone NAAQS?

1. NSR Requirements for the 2008 Ozone NAAQS
    The NSR programs contained in parts C and D of title I of the CAA
are preconstruction review and permitting programs applicable to new or
modified major stationary sources of air pollutants regulated under the
CAA. In attainment and unclassifiable areas outside the OTR, the
requirements under part C apply under the PSD program. In nonattainment
areas and throughout the OTR, the program is implemented under the
requirements of part D, under the nonattainment NSR program.
Collectively, we commonly refer to the PSD and nonattainment NSR
programs together as the ``major NSR programs.''
    The regulations for the major NSR programs are contained in 40 CFR

51.166 and 52.21 for PSD, and 51.165, 52.24 and part 51, Appendix S for
nonattainment NSR. Among other things, in unclassifiable and attainment
areas outside of the OTR, the PSD program requires a new major source,
or a major modification to an existing source, to install best
available control technology (BACT) and conduct an air quality impact
analysis, including an analysis of potential impacts on Class I areas
(see CAA sections 162, 165(a)(3), 165(a)(4), 165(a)(5) and 165(d)).
    Section 165(a)(3) of the CAA provides that in order to obtain a PSD
permit the owner or operator of a proposed facility must, among other
things, demonstrate that ``emissions from construction or operation of
such facility will not cause, or contribute to, air pollution in excess
of any . . . national ambient air quality standard in any air control
region.'' The EPA has generally interpreted this requirement to include
any NAAQS that is in effect at the time a permit is issued.\53\ See,
e.g., 73 FR 28321, 28324, 28340 (May 16, 2008); Memorandum from Stephen
D. Page, Director, Office of Air Quality Planning & Standards,
``Applicability of the Federal Prevention of Significant Deterioration
Permit Requirements to New and Revised National Ambient Air Quality
Standards'' (April 1, 2010). Accordingly, since the May 27, 2008,
effective date of the 2008 ozone NAAQS, permit applications for new
major stationary sources and major modifications have been subjected to
the PSD program requirements for ozone under two sets of circumstances:
first, prior to the designation of areas based on the 2008 ozone NAAQS,
sources locating in areas designated attainment or unclassifiable for
the 1997 ozone NAAQS; and second, on and after the July 20, 2012
effective date of area designations for the 2008 ozone NAAQS, sources
locating in areas designated as attainment or unclassifiable for both
the 1997 and 2008 ozone NAAQS. In all cases, the permit applicants
must, among other things, demonstrate that the proposed project's
emissions increase will not cause or contribute to a violation of the
2008 ozone NAAQS.
---------------------------------------------------------------------------

    \53\ However, the EPA has also recognized that it has discretion
to grandfather, under appropriate circumstances, permit applications
that are pending at the time a new or revised NAAQS comes into
effect from the requirement to demonstrate that a major new source
or modification does not cause or contribute to a violation of a new
or revised NAAQS. Since the NAAQS has been in effect since 2008, the
EPA does not believe any grandfathering is necessary and proposes no
such action here.
---------------------------------------------------------------------------

    For purposes of determining individual source impacts with respect
to the 2008 ozone NAAQS, PSD permit applicants and permitting
authorities should continue to follow the current practice described in
Appendix W to 40 CFR part 51, which is to consult with the applicable
EPA regional office to determine the appropriate means of addressing
such impacts. 40 CFR part 51, App. W, Sec.  5.2.1(c). Although those
applicants must demonstrate that the proposed source or modification
will not cause or contribute to a violation of the 2008 ozone NAAQS,
that demonstration does not necessarily require the permit applicants
to perform new air quality modeling. See 40 CFR 51.166(k)(1) and
52.21(k)(1) (requiring source impact analysis); see also 40 CFR part
51, App. W, Sec.  5.2.1(c) (explaining that the choice of methods to
assess the impact of an individual source on the ozone NAAQS depends on
the nature of the source and its emissions, and that appropriate
methods are determined in consultation with the EPA regional office on
a case-by-case basis). As appropriate, after consultation with the
applicable EPA regional office, the demonstration can be made using
modeling performed previously for air quality planning purposes or with
other forms of qualitative or quantitative analysis, as has generally
been the case in past permits. The adoption of the 2008 ozone NAAQS
does not change that approach.
    Following the July 20, 2012, effective date of area designations
and classifications for the 2008 ozone NAAQS, and in keeping with the
general policy that the permit issued to a major new source or major
modification must satisfy the applicable permit requirements in effect
as of the date of permit issuance, the requirements to be satisfied by
the permit applicant in an area designated nonattainment for the 2008
ozone NAAQS will have depended on the area's highest nonattainment
classification, whether for the 2008 ozone NAAQS or a previous ozone
NAAQS for which the area remains nonattainment. See section IV of this
proposal for a more detailed description of anti-backsliding
requirements. Accordingly, some pending permits that were originally
being reviewed under the PSD requirements but not yet issued were to
have been (or may need to be) revised to adequately reflect the area's
new status as nonattainment for the 2008 ozone NAAQS. For example, if
an area designated as attainment or unclassifiable for the 1997 ozone
NAAQS was designated as nonattainment for the 2008 ozone NAAQS, any
permit issued on or after the July 20, 2012, effective date of the new
nonattainment designation (and classification) must satisfy the
requirements for nonattainment NSR. In an area that was already
designated as nonattainment for the 1997 ozone NAAQS at the time it was
designated nonattainment for the 2008 ozone NAAQS, the source would
need to ensure that its permit application applies the appropriate
nonattainment NSR requirements (e.g., the applicable major source
thresholds and offsets) consistent with the area's new classification
under the 2008 ozone NAAQS as reflected in the SIP and the final NSR
anti-backsliding provisions for the 2008 ozone NAAQS, as discussed in
section IV.
    Some states may already have had in place a nonattainment NSR
program consistent with the applicable part D requirements of the Act
that can be directly applied to areas designated nonattainment for the
2008 ozone NAAQS and that were not designated nonattainment for the
1997 ozone NAAQS as of the July 20, 2012, effective date of the
designations for the 2008 ozone NAAQS. For nonattainment areas in
states with SIPs containing a generic requirement to issue
nonattainment NSR permits in areas designated as nonattainment, those
permit requirements for the 2008 ozone NAAQS became automatically
effective upon designation.
    For a newly designated 2008 ozone nonattainment area in a state
with a SIP that specifically lists the areas in which nonattainment NSR
requirements under part D apply, or in a state which currently has no
approved nonattainment NSR program, there will be an interim period
between the July 20, 2012, designation date and the date when the state
amends its SIP either to list any new nonattainment area(s) or to
include a part D plan. During this interim period, nonattainment NSR
requirements are governed by the EPA's Emission Offset Interpretative
Ruling codified in appendix S to 40 CFR part 51. In general, appendix S
requires new or modified major sources in nonattainment areas to meet
the lowest achievable emission rate (LAER) and obtain sufficient
offsetting emissions reductions to assure that the new or modified
major sources will not interfere with the area's progress toward
attainment. Readers should refer to 40 CFR part 51, appendix S for a
complete understanding of these and other appendix S permitting
requirements.
    Section 110(a)(2)(C) of the CAA establishes a general duty on the
state to include a program in its SIP that regulates the modification
and construction of any stationary source as necessary to assure that
NAAQS are

achieved. This general duty exists during all periods, including the
period between the effective date of a new nonattainment area
designation and the date when a state has an EPA-approved nonattainment
NSR program satisfying the applicable part D requirements. Although
section 110(a)(2)(C) does not contain specific requirements a state
must follow for issuing major source permits during the interim period,
the EPA's regulations at 40 CFR 52.24(k) require the state to follow 40
CFR part 51, appendix S, during this time. The availability of the
waiver provision in section VI of appendix S is limited by the court's
ruling in NRDC v. EPA, 571 F.3d 1245 (D.C. Cir. 2009). In the EPA's
Phase 2 Rule for the 1997 ozone NAAQS, the EPA revised section 52.24(k)
to eliminate language stating that if a nonattainment area did not have
an approved nonattainment NSR program within 18 months after
designation, a construction ban would apply. 70 FR 71612 (November 29,
2005). The effect was to extend the applicability of appendix S,
including the section VI waiver provision, to cover the full period
from the date of designation to the date on which the EPA approved the
nonattainment NSR SIP.
    In NRDC v. EPA (571 F.3d 1245 (D.C. Cir. 2009)), the court
considered the petitioners' general objections to the NSR waiver
provision in section VI of appendix S, as well as the EPA's elimination
of the 18-month limit on the applicability of that section. The court
dismissed the petitioners' general objections as ``untimely'' but
vacated ``the elimination of the 18-month time limit for NSR waivers
under Appendix S'' on the ground that it violated section 172(e) of the
CAA (571 F.3d at 1276). The EPA intends to revise section 52.24(k) to
reflect the court's vacatur of the extension of the 18-month time limit
for section VI of appendix S. In the meantime, as a result of the
vacatur, no section VI waivers may be granted beyond 18 months from the
date of designation.
2. Facilitating New Source Growth in Nonattainment Areas
a. Offset Banks
    The Act requires new and modified major sources in nonattainment
areas to secure emissions reductions (i.e., ``offsets'') to compensate
for the proposed emissions increase. States can help facilitate
continued economic development in a nonattainment area by establishing
offset banks or registries. Such banks or registries can help new or
modified major stationary source owners meet offset requirements by
streamlining identification and access to available emissions
reductions. Several states have established offset banks to help ensure
a consistent method for generating and transferring NOX and
VOC offsets.\54\ Offsets are generated by emissions reductions that
meet specific creditability criteria set forth by EPA regulations.\55\
40 CFR 51.165(3)(ii)(A)-(J).
---------------------------------------------------------------------------

    \54\ See, for example, emission reduction credit banking
programs in Ohio (OAC Chapter 3745-1111) and California (H&SC
Section 40709).
    \55\ See the EPA's ``Improving Air Quality with Economic
Incentive Programs'' document at http://www.epa.gov/region07/air/nsr/nsrmemos/eipfin.pdf. For additional memoranda and guidance
documents, see http://www.epa.gov/region7/air/nsr/nsrindex.htm.
---------------------------------------------------------------------------

b. Interpollutant Offset Substitution
    States can make it easier for new or modified major sources to
satisfy the offset requirements in an area by establishing
interpollutant offset substitution provisions. Such provisions create
additional flexibility in meeting offset requirements by allowing
NOX emissions reductions to satisfy VOC offset requirements
and vice versa. The appropriate exchange rate for substitution is
determined by the state for each area consistent with the attainment
needs of the area and must be approved by the EPA.
c. Economic Development Zones
    Section 173(a)(1)(B) of the CAA authorizes the Administrator, in
consultation with the Secretary of Housing and Urban Development (HUD),
to identify areas within nonattainment areas as ``zone(s) to which
economic development should be targeted.'' In these zones, states are
able to assist new or modified major sources in meeting the
nonattainment area offset requirement by setting aside growth
``allowances'' that serve as a pool of offsets to be tapped by such
sources. The advantage of creating an offset pool specifically for a
CAA economic development zone (EDZ) relative to relying on a
traditional offset bank is that the offsets can be fully owned and
controlled by the state, and the offsets do not need to be obtained
from facility-specific emissions reductions or shutdowns in the
nonattainment area. Accordingly, this provision is especially well
suited to address the needs of the manufacturing sector and small
businesses. The EPA is willing to work with HUD and states to identify
potential areas.
    In the context of the 1997 ozone NAAQS, the EPA previously worked
with Arkansas officials to create a CAA EDZ in Crittenden County, which
is part of the Memphis ozone nonattainment area (see 71 FR 8857,
February 21, 2006). The EPA identified Crittenden County as a CAA EDZ
after consultation with the Secretary of HUD to review qualification
information associated with HUD-implemented economic development
programs. We also evaluated socio-economic statistics for Crittenden
County in comparison with similar information for other U.S. counties,
and we reviewed air quality modeling of the Memphis nonattainment area
provided by the Arkansas Department of Environmental Quality
demonstrating that a specified growth allowance pool was consistent
with timely attainment of the 1997 ozone NAAQS. After reviewing this
information, the Administrator determined that the EDZ designation
would help the citizens of Crittenden County without jeopardizing the
clean air goals of the Greater Memphis area. The Memphis area has since
attained the 1997 ozone NAAQS and the Arkansas portion of the Memphis
nonattainment area was redesignated to attainment on March 24, 2010.

J. What are the emission inventory and emission statement requirements?

1. Emission Inventory Requirements
    Emission inventories are critical for the efforts of state, local
and federal agencies to attain and maintain the NAAQS that the EPA has
established for criteria pollutants, including ozone. Pursuant to
section 110(a)(2)(F)(ii) of the CAA, states must submit emission
inventories containing information regarding the current emissions of
criteria pollutants and their precursors. The EPA first codified
regulations to implement CAA section 110(a)(2)(F)(ii) in 40 CFR part
51, subpart Q in 1979 and amended them in 1987.
    The 1990 CAA Amendments established new emission inventory
requirements applicable to certain areas that were designated
nonattainment for certain pollutants. First, CAA section 182(a)(1)
requires that Marginal and above ozone nonattainment areas submit a
base year emission inventory for the nonattainment area 2 years after
designation as nonattainment in 1990. For areas designated
nonattainment for the 2008 ozone NAAQS, we are proposing that the base
year emission inventory submission be due no later than 2 years after
the effective date of designation, or alternatively, 30 months
following the effective date of designation under the consolidated SIP
submittal option described in section III.A of this preamble.

    Second, CAA section 182(a)(3)(A) requires that states submit
periodic emission inventories every 3 years after the initial base year
inventory for Marginal and above ozone nonattainment areas. The
periodic inventory must include emissions of VOC and NOX for
point, nonpoint and mobile sources (on-road and non-road). On December
4, 2008, the EPA promulgated the AERR rule (40 CFR 51, subpart A). The
AERR requires states to submit comprehensive statewide 3-year cycle
emission inventories (2008, 2011, 2014, etc.) regardless of an area's
attainment status. The EPA thinks it would be appropriate for states
with periodic inventory obligations under 182(a)(3)(A) to rely on their
3-year cycle inventory as described in the AERR to satisfy their
182(a)(3)(A) periodic inventory obligation. In cases where a state will
use its 3-year cycle inventory to meet its 182(a)(3)(A) inventory
obligation, we are further proposing that the emissions reporting
requirements of the AERR be applied to determine all of the data
elements required for such inventories. (see, e.g. Tables 2A, 2B, 2C
and 2D of 40 CFR part 51, subpart A, Appendix A).
    For all inventories that are used in developing RFP plans or
attainment demonstrations, mobile source emissions should be estimated
using the latest emissions models, data and planning assumptions. The
latest approved models should be used to estimate emissions from on-
road and non-road sources, in combination with the latest available
estimates of VMT, vehicle population, and/or equipment activity. States
are advised to check the EPA Web pages for the mobile source models and
to consult with the EPA Office of Transportation and Air Quality and
their regional office to determine the versions of models to use for
their SIPs for the 2008 ozone NAAQS.
    Currently, the most recently approved model for estimating on-road
emissions in states outside of California is MOVES2010 \56\ which
initially was approved for use in SIPs on March 2, 2010 (75 FR
9411).\57\ The EPA has subsequently released two minor updates to
MOVES2010, MOVES2010a and MOVES2010b that are also approved for use in
SIPs. The on-road emissions can be generated either through inventory
mode (via MOVES) or through emission rates mode (via SMOKE-MOVES \58\).
Guidance on using MOVES as well as information on the current version
of MOVES that has been approved for use in SIPs and transportation
conformity is available at: http://www.epa.gov/otaq/models/moves/index.htm.
---------------------------------------------------------------------------

    \56\ MOVES2010 refers to the initial version of the model that
was approved for use in SIPs and regional transportation conformity
analyses on March 2, 2010, as well as subsequent minor upgrades to
the model such as MOVES2010a and MOVES2010b.
    \57\ EMFAC is the model used to estimate on-road mobile source
emissions in California. The latest version of the model that has
been approved for SIP and conformity purposes is EMFAC2011. See 78
FR 14533 (March 6, 2013).
    \58\ For more information, see http://www.smoke-model.org/index.cfm.
---------------------------------------------------------------------------

    Emissions from non-road equipment should be estimated with the
latest official version of the EPA's NONROAD model, and other
appropriate methods for estimating emissions from sources not covered
by these models. Links to Federal Register notices and policy guidance
memos on the latest approved versions of MOVES and NONROAD can be found
at http://www.epa.gov/otaq/models.htm. States should consult the
guidance document ``Emission Inventory Guidance for Implementation of
Ozone and Particulate Matter National Ambient Air Quality Standards
(NAAQS) and Regional Haze Regulations,'' EPA-454/R-05-001 (updated
November 2005) and submit inventories that are appropriate for each
nonattainment area and consistent with this guidance.
    As indicated above, some inventories submitted to meet the
requirements of section 182(a)(1) and 182(a)(3)(A) may be used in the
development of RFP plans and/or attainment demonstrations. As such, the
EPA requires the methodologies used to develop these inventories to be
clearly documented and the inventories themselves to be subject to
public participation requirements and formal approval/disapproval by
the EPA.\59\
---------------------------------------------------------------------------

    \59\ In comparison, the AERR emissions data are submitted by the
states to the EPA, electronically via the Emission Inventory System
to the National Emissions Inventory (NEI), without public review.
The states submit AERR data to the NEI inventory 12 months after the
NEI inventory year (i.e., calendar year 2014 NEI inventory data are
submitted by December 31, 2015). The NEI process provides for the
states to review the data as collected by the EPA before the EPA
officially publishes the data. (Under the current process, the EPA
would intend to publish the data for the 2014 NEI in June of 2016, 6
months after the AERR data is required to be submitted to the EPA.)
---------------------------------------------------------------------------

    In guidance titled, ``Public Hearing Requirements for 1990 Base-
Year Emissions Inventories for Ozone and Carbon Monoxide Nonattainment
Areas,'' September 29, 1992, the EPA set forth its interpretation of a
``de minimis'' deferral of the public hearing requirement and the
requirement for the EPA to approve or disapprove certain emissions
inventories under section 110(k).\60\ The EPA is proposing to follow
this guidance in implementing the emissions inventory requirements
under CAA sections 182(a)(1) and 182(a)(3)(A) for purposes of the 2008
ozone NAAQS. Under this approach, where emission inventories are used
in the development of an RFP plan or attainment demonstration, states
can defer the public hearing on these inventories until the time the
areas adopt and submit their RFP plans and/or attainment demonstrations
that rely on such inventories. The EPA would not take action to approve
or disapprove such inventories until the state completes the state
public participation process. If a state opts to submit a consolidated
SIP submittal, this should not be an issue.
---------------------------------------------------------------------------

    \60\ CAA section 110(k) lists the actions that the EPA may take
on SIP submissions, including approval and disapproval of the SIP.
---------------------------------------------------------------------------

2. Source Emission Statements
    Section 182(a)(3)(B) of the CAA requires Marginal and above areas
to submit an emissions statement within 2 years of enactment of the CAA
Amendments of 1990. Specifically it provides that the emission
statement must: ``. . . require that the owner or operator of each
stationary source of oxides of nitrogen or volatile organic compounds
provide the state with a statement, in such form as the Administrator
may prescribe (or an equivalent alternative developed by the state),
for classes or categories of sources, showing the actual emissions of
oxides of nitrogen and volatile organic compounds from that source. The
first such statement shall be submitted within 3 years after the date
of the enactment of the CAA Amendments of 1990. Subsequent statements
shall be submitted at least every year thereafter. The statement shall
contain a certification that the information contained in the statement
is accurate to the best knowledge of the individual certifying the
statement.''
    We published guidance on source emission statements in a July 1992
memorandum titled, ``Guidance on the Implementation of an Emission
Statement Program.'' A memorandum titled, ``Emission Statement
Requirements Under 8-hour Ozone NAAQS Implementation,'' dated March 14,
2006, clarified that the source emission statement requirement under
the CAA was applicable to all areas designated nonattainment for the
1997 ozone NAAQS and classified as Marginal or higher under subpart 2,
part D, title I of the CAA. This requirement similarly applies to all
areas designated

nonattainment for the 2008 ozone NAAQS and classified as Marginal or
higher under subpart 2. The EPA is proposing this SIP submittal be due
2 years after the effective date of designations or, alternatively, no
later than 30 months after the effective date of designations as part
of a consolidated SIP submission as described previously in this
proposal. Most areas that need an emission statement program already
have one in place due to a nonattainment designation for an earlier
ozone NAAQS. If an area has a previously approved emission statement
rule in force for the 1997 ozone NAAQS or the 1-hour ozone NAAQS that
covers all portions of the nonattainment area for the 2008 ozone NAAQS,
such rule should be sufficient for purposes of the emissions statement
requirement for the 2008 ozone NAAQS. The state should review the
existing rule to ensure it is adequate and, if it is, may rely on it to
meet the emission statement requirement for the 2008 ozone NAAQS.
    We note that regardless of whether states submit their emissions
inventory statements within 2 years of the effective date of
designations, or within 30 months of the effective date of designations
as part of a consolidated SIP submission, this proposed rule will
ensure that, consistent with the intent of section 182(a)(3)(B), states
will submit their first emission statements no later than 3 years
following the effective date of designations for the 2008 NAAQS. We are
soliciting comments on our interpretation of the emission statement
requirements under section 182(a)(3)(B) as they would apply to areas
designated nonattainment for the 2008 ozone NAAQS.

K. What are the ambient monitoring requirements?

    Ozone monitoring data play an important role in designations,
classifications, control strategy development and related
implementation activities. The EPA's ambient monitoring requirements
are contained in 40 CFR part 58. On July 16, 2009, the EPA proposed
revised rules for monitoring ambient ozone (74 FR 34525). The EPA
proposed to modify minimum monitoring requirements in urban areas, add
new minimum monitoring requirements in non-urban areas and extend the
length of the required ozone monitoring season in some states. The
schedule for finalizing any or all aspects of the ambient ozone
monitoring proposal remains unclear at this time. There were no new
monitoring requirements included in the 2008 ozone NAAQS rule.
    The Photochemical Assessment Monitoring Station (PAMS) program,
required by CAA section 182(c)(1), collects enhanced ambient air
measurements in areas classified as Serious, Severe, or Extreme ozone
nonattainment. Each PAMS area collects data for a target list of
volatile organic compounds (VOCs), NOX, NOy, and
ozone, as well as surface and upper air meteorological measurements.
Monitoring rule amendments published on October 17, 2006, (71 FR 61236)
reduced the minimum PAMS requirements. The revisions were intended to
require the retention of the minimum common PAMS network elements
necessary to meet the objectives of every PAMS program, while freeing
up resources for states to tailor other features of their own PAMS
networks to suit their specific data needs.

L. How can states qualify for a 1-year attainment deadline extension?

    Section 181(a)(5) of the CAA addresses the conditions under which
an area may be eligible for a 1-year extension of its attainment date.
Because that statutory provision was written for an exceedance-based
standard, such as the 1-hour ozone NAAQS, the EPA established through
the Phase 1 Rule (40 CFR 51.907) an interpretation that would apply to
a concentration-based standard, such as the 1997 ozone NAAQS.\61\ The
2008 ozone NAAQS is also a concentration-based standard. Thus, we are
proposing the same approach as set forth in section 51.907 for purposes
of the 2008 ozone NAAQS. Under this approach, an area that fails to
attain the 2008 ozone NAAQS by its attainment date would be eligible
for the first 1-year extension if, for the attainment year, the area's
4th highest daily 8-hour average is at or below the level of the
standard. The area would be eligible for the second 1-year extension if
the area's 4th highest daily 8-hour value, averaged over both the
original attainment year and the first extension year, is at or below
the level of the standard. Thus, to be eligible for the first 1-year
extension, the 4th highest daily 8-hour value for an area would need to
be at or below 0.075 ppm. The area would be eligible for the second
extension if the area's 4th highest daily 8-hour value, averaged over
both the original attainment year and the first extension year, is less
than or equal to 0.075 ppm.
---------------------------------------------------------------------------

    \61\ The exceedance based standard basically allowed the NAAQS
level to be exceeded an average of only once a year over a 3-year
period. (This is a generalization of how attainment is determined;
the actual method considers other factors such as completeness of
the data.) See 40 CFR, appendix H. In contrast, the concentration
based standard allows the level of the 8-hour ozone NAAQS to be
``exceeded'' more than once a year on average because the form
(concentration-based) of that NAAQS is determined by averaging the
4th highest reading for each year over a 3-year period.
---------------------------------------------------------------------------

M. How will the EPA address transport of ozone and its precursors for
rural nonattainment areas, multi-state nonattainment areas and
international transport?

1. Rural Transport Areas (RTAs)
    Section 182(h) of the CAA recognizes that ozone standard violations
in some rural areas may be almost entirely attributable to emissions
from outside the nonattainment area (i.e., from upwind areas). That
section provides that an area meeting certain criteria may, at the
Administrator's discretion, be treated as a ``rural transport area.''
Under this classification, the area's ozone implementation requirements
are met if the area satisfies the requirements applicable to areas
classified as Marginal. This means that the area does not need to
provide an attainment demonstration or adopt specific mandatory
measures associated with higher classifications. The only requirements
that would apply, regardless of the level of ozone air quality, would
be nonattainment NSR, at the Marginal major source threshold and offset
ratio, and conformity requirements associated with a nonattainment
designation, as well as the emission inventory and source emission
statement requirements. Because the area's nonattainment problem is
primarily due to upwind sources outside the control of the area, the
consequences of failure to attain by the Marginal area deadline would
not apply.
    The EPA may determine an area is a rural transport area if it meets
two statutory criteria. First, a nonattainment area may only be a rural
transport area if it ``. . . does not include, and is not adjacent to,
any part of a Metropolitan Statistical Area or, where one exists, a
Consolidated Metropolitan Statistical Area . . .'' In addition, the EPA
must determine that ``sources of VOC emissions (and, where the
Administrator determines relevant, NOX emissions) within the
area do not make a significant contribution to the ozone concentrations
measured in the area or in other areas.'' The metropolitan areas
addressed in section 182(h) were only those with population cores of
50,000 or more.
    In 2000, OMB issued new standards for defining statistical areas
(65 FR 82228; December 27, 2000). The new

statistical area standards supersede and replace the previous 1990
standards for defining metropolitan areas, which the EPA used for the
ozone designations and classifications for the 1-hour ozone NAAQS and
the 1997 ozone NAAQS. In order to facilitate comparison of data for
MSAs over time, OMB retained the conceptual approach to defining
metropolitan statistical areas based around population cores of 50,000
or more. These core areas are not necessarily confined to city limits,
and may include multiple counties or parts of counties. Because of the
usefulness of the metropolitan area standards and data products, OMB
received requests that the new standards take into account more
territory of the United States. In response, OMB established a new
category called micropolitan statistical areas, which are defined as
areas with an urban core population of at least 10,000 but less than
50,000. The new standards also establish the term Core Based
Statistical Area (CBSA), which refers collectively to both metropolitan
statistical areas and the new smaller micropolitan statistical areas,
and the term Combined Statistical Area (CSA), which consists of two or
more adjacent CBSAs that are linked by commuting patterns. (See http://www.census.gov/population/www/metroareas/metrodef.html.)
    In light of the changed OMB definitions, the EPA has considered how
the reference in section 182(h) to areas adjacent to a ``Metropolitan
Statistical Area or, where one exists, a Consolidated Metropolitan
Statistical Area'' should be interpreted. We intend to interpret this
language to refer to OMB's current definition of MSA. In other words,
to qualify for a rural transport classification, the nonattainment
area's boundary could not include or be adjacent to an OMB-defined MSA
based on the Census Bureau's latest population estimates. Under this
approach, any nonattainment area associated with a micropolitan area or
area too sparsely populated to be included in a census-defined
statistical area, based on Census Bureau population estimates, may be
able to qualify for a rural transport classification.
    The EPA believes this interpretation of CAA section 182(h) is
consistent with the scope of section 182(h) as promulgated in 1990 and
provides maximum flexibility for areas to qualify for this
classification where appropriate. During the designations process for
the 2008 ozone NAAQS, no states identified any rural transport areas.
2. Multi-State Nonattainment Areas
    Each state within a multi-state ozone nonattainment area is
responsible for meeting all the requirements relevant to the given
area. Section 182(j)(1)(a) requires that states should ``take all
reasonable steps to coordinate substantively and procedurally'' on SIP
development. States should coordinate on topics such as determining the
appropriate modeling domain, baseline year, projection years and
meteorological episodes. In addition, they should coordinate modeling
efforts and, as required by section 182(j)(1)(B), the attainment
demonstration must be based on photochemical grid modeling or another
method determined by the EPA to be at least as effective.
    Section 182(j)(2) recognizes that in certain instances, one or more
states within a multi-state nonattainment area may not submit an
attainment plan by the required date, and thus interfering with the
ability of the area as a whole to demonstrate attainment. In such case,
section 182(j) provides that even though the area as a whole would not
be able to demonstrate attainment, the sanction provisions of section
179 shall not apply in the portion of the nonattainment area located in
a state that submitted all other provisions of an attainment plan and
demonstrated that it could have demonstrated attainment but for the
failure of the other state to cooperate.
3. International Transport
a. Transboundary Transport
    Most ozone air quality problems in the United States are due
primarily to emission sources within the United States. However,
domestic ozone air quality can also be affected by sources of emissions
located across United States borders in Canada and Mexico, and from
other continents. These contributions to U.S. ozone concentrations from
sources outside the United States can affect to varying degrees the
ability of some areas to attain and maintain the 2008 ozone NAAQS and
may play a larger role in ozone attainment demonstrations for future
NAAQS.
    There is strong evidence that baseline levels of tropospheric ozone
have risen above pre-industrial levels in the northern hemisphere, and
much of this increase can be directly attributed to human-caused
emissions of ozone precursors. Our ability to fully characterize and
quantify the impact of sources of air pollution from other parts of
North America (Canada and Mexico) has been steadily improving; however,
our ability to assess the impacts of air pollution from other
continents on air quality in the U.S. is still developing. Some factors
that affect our current ability to fully characterize international
transboundary transport of air pollution from other continents are
uncertainties in foreign emissions inventories, incomplete
understanding of atmospheric chemistry during transport and the
inability to distinguish long-range pollutant contributions from local
and regional sources of air pollution.
    In order to address the challenging and complex problem of the
impact of foreign emissions on air quality in the U.S., the EPA has
been engaged in a number of different efforts both domestically and
internationally. In 1991, the U.S. and Canada entered into an agreement
to address transboundary air pollution (U.S.-Canada Air Quality
Agreement); and in 2000 an Ozone Annex was added to the agreement to
establish commitments to reduce ozone and its precursors--
NOX and VOCs. Under this agreement, significant progress has
been made in reducing transport of ozone and its precursors across the
U.S.-Canada border. Similarly, the U.S. has been working with Mexico in
addressing the transboundary transport of air pollution under the La
Paz Agreement (Cooperation for the Protection and Improvement of the
Environment in the Border Area) established in 1983.
    In addition, the EPA, along with several other federal agencies,
sponsored a National Academy of Sciences study to summarize the state
of knowledge regarding the international flows of air pollutants into
and out of the U.S. and consider the impact of these flows on the
achievement of environmental objectives related to air quality and
pollutant deposition in the U.S.\62\ The study, completed in 2009,
recommended a variety of research initiatives, such as advanced
``fingerprinting'' techniques to better identify source-specific
pollutant characteristics in order to enhance the understanding of
long-range transport of pollution. Moreover, the EPA co-chairs the Task
Force on Hemispheric Transport of Air Pollution under the Convention on
Long-range Transboundary Air Pollution of the United Nations Economic
Commission for Europe. The task force was established to develop a
fuller understanding of intercontinental transport of air pollution in
the northern hemisphere, and serves as a forum for international
scientific communication

and collaboration and as a bridge between the international research
community and the international air quality policy community. This task
force concluded that methane is an important precursor to tropospheric
ozone on global scales and that decreasing methane emissions will, over
several decades, decrease background ozone levels and help mitigate
climate change.
---------------------------------------------------------------------------

    \62\ ``Global Sources of Local Pollution: An Assessment of Long-
Range Transport of Key Air Pollutants to and from the United
States.'' http://www.nap.edu/catalog.php?record_id=12743.
---------------------------------------------------------------------------

    Methane has not been addressed as part of ozone attainment planning
in the past because of the limited effect that local measures to
control methane would have on local or regional ozone concentrations in
the immediate time frame. Given the temporal and spatial
characteristics associated with methane and ozone, we continue to
believe that it is inappropriate to require or rely on local methane
emission reductions in ozone SIPs. Through voluntary partnership
programs focused on greenhouse gas reduction, the EPA has worked with
U.S. industries and state and local governments to promote cost-
effective opportunities for reducing methane emissions from the coal,
natural gas, petroleum, landfill and agricultural industries. Building
on these domestic programs and the international Methane to Markets
Partnership, the United States has joined with other countries to
launch the Global Methane Initiative to facilitate the reduction of
methane emissions globally. These domestic and international efforts
will help mitigate climate change and decrease background ozone levels
over the next several years and decades.
    The EPA will continue to work with our domestic and international
partners to better understand the extent and implications of
transboundary flows of air pollutants and, where possible, to mitigate
their impact on U.S. domestic air quality.
b. The SIP Approval Process Under Section 179B for International Border
Areas
    Emissions from sources outside the United States that may
contribute to violations of the 2008 ozone NAAQS in an area designated
as nonattainment may be addressed by section 179B of the CAA. This
section allows the EPA to approve an attainment demonstration for a
nonattainment area if: (1) The attainment demonstration meets all other
applicable requirements of the CAA; and (2) the submitting state can
satisfactorily demonstrate that ``but for emissions emanating from
outside of the United States,'' the area would attain and maintain the
ozone standard. The EPA is proposing that this could include
consideration of any emissions from North American or intercontinental
sources. The EPA has historically evaluated these ``but for''
demonstrations on a case-by-case basis, based on the individual
circumstances, the classification of the area and the data provided by
the submitting state. These data have included ambient air quality
monitoring data, modeling scenarios, emissions inventory data and
meteorological or satellite data. For areas classified as Moderate and
above, the modeling and other elements of the attainment demonstration
must show timely attainment of the NAAQS but for the emissions from
outside of the U.S. Section 179B does not, however, provide authority
to exclude monitoring data influenced by international transport from
regulatory determinations related to attainment and nonattainment.
Thus, even if the EPA approves a section 179B ``but for'' demonstration
for an area, the area would continue to be designated as nonattainment
and subject to the applicable requirements, including nonattainment new
source review, conformity and other measures prescribed for
nonattainment areas by the CAA. However, if the EPA approves a ``but
for'' demonstration for an area, the area would not be subject to
reclassification for failure to attain by its attainment deadline and,
if such areas were classified as Severe or Extreme, the section 185 fee
program would not apply based on a failure to attain by the attainment
date.
    Although monitored data cannot be excluded for a determination of
whether an area has attained based solely on the fact the data are
affected by emissions from outside the U.S., such data may be excluded
from consideration if they were significantly influenced by exceptional
events. CAA section 319(b)(3). Where international transport meets the
criteria contained in the EPA's Exceptional Events Rule (40 CFR 50.14),
it can be addressed by that rule.
    The EPA believes that the best approach for addressing the
potential impacts of international transport on nonattainment is for
states to work with the EPA on a case-by-case basis to determine the
most appropriate information and analytical methods for each area's
unique situation. We will work with states that are developing plans
pursuant to section 179B, and ensure the states have the benefit of the
EPA's developing understanding of international transport of ozone and
its precursors.

N. How will the section 182(f) NOX provisions be handled?

1. Background
    Section 182(f) of the CAA applies to areas designated nonattainment
for ozone and classified as Serious and above under subpart 2 of part D
of title 1, and to areas in the OTR. It requires states to apply the
same requirements to major stationary sources of NOX as
apply to major stationary sources of VOC under subpart 2. Specifically,
this requirement applies to RACT and nonattainment NSR for major
stationary sources of NOX in these areas.\63\ However, while
NOX emissions are necessary for the formation of ozone in
the lower atmosphere, a local decrease in NOX emissions can,
in some cases, increase local ozone concentrations. Thus, section
182(f) also allows a person or a state to request an exemption from or
limitation on the application of the specified NOX
requirements if specific circumstances are met (``NOX
exemption''). Areas granted a NOX exemption under section
182(f) may also be granted an exemption from certain requirements of
the EPA's motor vehicle I/M regulations and from certain federal
requirements of General and Transportation Conformity.\64\ The EPA
initially issued guidance on the section 182(f) NOX
requirements in 1993.\65\ On January 14, 2005, the EPA issued an update
to that guidance to address implementation of the 1997 ozone NAAQS.\66\
---------------------------------------------------------------------------

    \63\ See 57 FR 55622, November 25, 1992, ``Nitrogen Oxides
Supplement to the General Preamble.''
    \64\ As stated in the EPA's I/M rule (57 FR 52950; November 5,
1992) and conformity rules (60 FR 57179, November 14, 1995 for
transportation conformity and 58 FR 63214, November 30, 1993 for
general conformity), certain NOX requirements in those
rules do not apply where the EPA grants an area-wide exemption under
section 182(f).
    \65\ In 1993 the EPA issued a guidance document for application
of the section 182(f) provisions with respect to the 1-hour ozone
NAAQS. The document was titled ``Guideline for Determining the
Applicability of Nitrogen Oxides Requirements under Section 182(f),
from John S. Seitz, Director, Office of Air Quality Planning and
Standards, to the Regional Division Directors, December 16, 1993.
The NOX exemption guidance was revised later in ``Section
182(f) Nitrogen Oxides (NOX) Exemptions Revised Process
and Criteria,'' memorandum from John S. Seitz, Director, Office of
Air Quality and Standards, to the Regional Division directors, May
27, 1994; and ``Section 182(f) Nitrogen Oxides (NOX)
Exemptions--Revised Process and Criteria,'' memorandum from John S.
Seitz, Director, Office of Air Quality and Standards, to the
Regional Division Directors, February 8, 1995.
    \66\ Memorandum dated January 14, 2005, ``Guidance on Limiting
Nitrogen Oxides (NOX) Requirements Related to 8-Hour
Ozone Implementation'' from Stephen D. Page, Director, Office of Air
Quality Planning and Standards, to Air Directors, Regions I-X.

---------------------------------------------------------------------------

2. Proposal
    We are not proposing any modifications to our previous
interpretation of the NOX RACT requirement for purposes of
implementing the 2008 ozone NAAQS. Consistent with the approach taken
in the 2005 updated guidance and the Phase 2 Rule, we are proposing
that a previously granted NOX exemption (or waiver) under
the 1-hour or 1997 ozone NAAQS would not apply for purposes of
implementing the 2008 ozone NAAQS. A state would need to submit a new
request for an exemption that is supported by analyses specific to the
2008 ozone NAAQS and considers any relevant information developed after
the 1-hour or 1997 ozone NAAQS waivers were granted. As states evaluate
whether to seek a NOX waiver, the EPA encourages them to
include consideration of air quality effects that may extend beyond the
designated nonattainment area. See, for example, the discussion in the
Phase 2 Rule, November 29, 2005, on page 71661 (70 FR at 71661-71662).
    A SIP revision requesting a NOX exemption for the 2008
ozone NAAQS must contain adequate documentation that the provisions of
section 182(f) and our regulations are met. The EPA has issued guidance
on appropriate documentation regarding section 182(f) for application
to the 8-hour ozone program.\67\ The EPA believes this guidance is
sufficient to cover the 2008 ozone NAAQS.
---------------------------------------------------------------------------

    \67\ Memorandum dated January 14, 2005, ``Guidance on Limiting
Nitrogen Oxides (NOX) Requirements Related to 8-Hour
Ozone Implementation'' from Stephen D. Page, Director, Office of Air
Quality Planning and Standards, to Air Directors, Regions I-X.
---------------------------------------------------------------------------

O. Emissions Reduction Benefits of Energy Efficiency/Renewable Energy
Policies and Programs, Land Use Planning and Travel Efficiency

1. Energy Efficiency/Renewable Energy Policies and Programs
    Governments at all levels--local, state, tribal and federal--have
been developing energy efficiency/renewable energy (EE/RE) policies and
programs to reduce demand for and production of fossil-fuel driven
electric power. As of 2011, twenty-nine states (and Washington, DC) had
adopted renewable portfolio standards (RPS) which require retail
electricity providers to supply a minimum percentage or amount of
retail demand with renewable resources, more than double the number of
states in 2000.68 69 Although the details of each RPS policy
vary, generally they are structured such that, initially, a relatively
small percentage of a state's electricity supply must come from
renewable sources, and over time the percentage increases until a
state-specified target is achieved. For example, the State of
Connecticut requires that 4.5 percent of electricity come from
renewable sources beginning in 2005, and the target increases to 27
percent by 2020.\70\
---------------------------------------------------------------------------

    \68\ For more information, see presentations from the 2011
National Summit on RPS at http://www.cleanenergystates.org/assets/Uploads/2011-RPS-Summit-Combined-Presentations-File.pdf.
    \69\ See Database of CHP Policies and Incentives (dCHPP) at
http://www.epa.gov/chp/policies/database.html.
    \70\ http://www.dpuc.state.ct.us/electric.nsf/
$FormRenewableEnergyView?OpenForm&.
---------------------------------------------------------------------------

    Energy efficiency policies refer to a range of laws, regulations,
and public utility commission (PUC) orders aimed at reducing energy
demand through the use of more energy efficient equipment,
technologies, and practices. These policies can be funded through
ratepayer surcharges, federal funds (e.g., American Recovery and
Reinvestment Act \71\), state general funds, proceeds from pollution
auctions such as the Regional Greenhouse Gas Initiative \72\ and/or any
combination of the above. Examples of energy efficiency policies
include:
---------------------------------------------------------------------------

    \71\ For more information, go to: http://www.recovery.gov/Pages/default.aspx.
    \72\ For more information, go to: http://www.rggi.org/.
---------------------------------------------------------------------------

     Minimum efficiency requirements for new homes and
buildings (building energy codes) or appliances (appliance standards).
     Requirements for utilities (or other program
administrators) to deliver a specified amount of energy savings by
developing energy efficiency programs to increase market adoption of
energy efficiency technologies and practices (i.e., energy efficiency
resource standards (EERS), also known as Energy Efficiency Portfolio
Standards (EEPS)). Some states have incorporated EERS to function
alongside or as part of their RPS.
     Specified funding levels collected via ratepayer electric
bills or other sources and dedicated to implementing energy efficiency
programs (e.g., public benefits funds, air pollution allowance auction
revenue).
    EE/RE policies and programs can help reduce electricity generation
from fossil-fueled sources resulting in lower emissions of
NOX (as well as other criteria pollutants, hazardous air
pollutants and greenhouse gases) from power generation. Many renewable
energy sources such as wind, solar and hydro power have no associated
NOX and other emissions. Other renewable energy sources,
such as landfill gas combustion used to power electrical generators, do
produce some air emissions but generally less NOX emissions
than coal-fired EGUs. Energy efficiency is achieving the same or better
level of service or performance with lower energy consumption. Examples
include high-efficiency appliances; efficient lighting; high-efficiency
heating, ventilating and air conditioning systems or control
modifications; efficient building design; advanced electric motor
drives; combined heat and power; and heat recovery systems.
    The EPA encourages states to consider adopting EE/RE policies and
programs to benefit nonattainment areas in their own state, as well as
to reduce the impact of ozone transport on downwind states. In July
2012, the EPA made available the first version of clarifying guidance
on the incorporation of EE/RE measures in SIPs.\73\ Specifically, the
EPA made available a document titled, ``Roadmap for Incorporating
Energy Efficiency/Renewable Energy Policies and Programs into State and
Tribal Implementation Plans'' to encourage state, tribal and local
agencies to consider incorporating EE/RE policies and programs into
SIPs/tribal implementation plans (TIPs). The manual is a ``living''
document, and it will be updated periodically as new information
becomes available.
---------------------------------------------------------------------------

    \73\ See http://www.epa.gov/airquality/eere.html.
---------------------------------------------------------------------------

    The manual describes four pathways for considering air pollution
reductions from EE/RE policies and programs in SIPs and TIPs. They can
be included in the attainment year projected baseline, factored into a
``weight of evidence'' attainment demonstration, incorporated as
emerging/voluntary measures, or adopted as control measures and modeled
in the attainment demonstration. When reviewing air pollution
reductions from EE/RE policies and programs for the purpose of SIPs and
TIPs, it is important to consider how the EE/RE policies and programs
and their associated emission reductions best fit within one or more of
the four SIP pathways. Valid EE/RE policies and programs that meet the
applicable requirements of section 182(c)(9) can also be used as
contingency measures.
    The EPA is providing additional assistance to state, tribal and
local agencies, including tools for quantifying the emissions impacts
of EE/RE policies and programs, training and technical assistance, and
energy savings information for state-level EE policies

and programs. The EPA is also working with states on developing
examples to illustrate how reductions from specific EE/RE policies and
programs could be quantified and considered in their SIPs. The EPA
encourages states to continue to work with each other and with the EPA
to incorporate emission reductions from their EE/RE policies and
programs into SIPs.
2. Land Use Planning
    States may also wish to consider strategies that foster more
efficient urban and regional development patterns as another effective
long-term air pollution control measure. For example, land use
strategies consistent with the principles endorsed by the HUD DOT EPA
Sustainable Communities Partnership \74\ can reduce mobile source
emissions by providing a broader range of transportation and housing
choices. Strategies that achieve such results include: increased
residential development in major employment centers, transit-oriented
development, redevelopment of underutilized land in existing
communities and making pedestrian and transit access key design
features of new communities. Specific activities that support such
strategies include: changing local zoning codes to accommodate mixed
use development and more walkable neighborhoods; greenway corridors;
complete streets ordinances; increasing street connectivity; creating
more flexible parking standards; transit station area planning; and
funding or policy incentives to support redevelopment. EPA studies have
concluded that development patterns that enable people to live closer
to work, and that allow people to walk, bike or use transit, will
reduce VMT, thereby decreasing automobile emissions and improving
regional air quality.\75\ Several studies conducted by metropolitan
planning organizations have also found significant reductions in VMT
associated with accommodating more growth though redevelopment in
existing communities rather than greenfields development.
---------------------------------------------------------------------------

    \74\ Sustainable Communities Principles: 1. Provide more
transportation choices. 2. Promote equitable, affordable housing. 3.
Enhance economic competitiveness. 4. Support existing communities.
5. Coordinate and leverage federal policies and investments. 6.
Value communities and neighborhoods. See http://www.epa.gov/smartgrowth/partnership/index.html.
    \75\ ``Our Built and Natural Environments'' (EPA 231-R-01-002,
January 2001). ``Measuring the Air Quality and Transportation
Impacts of Infill Development'' (EPA 231-R-07-001, November 2007).
---------------------------------------------------------------------------

    The EPA has issued guidance on how to include emissions reductions
from such growth strategies in SIPs. This guidance document,
``Improving Air Quality Through Land Use Activities,'' is available at:
http://www.epa.gov/otaq/stateresources/policy/transp/landuse/r01001.pdf.
    The guidance provides communities experiencing air quality problems
with the information they need to better understand the link between
air quality, transportation and land use activities, and how certain
land use activities have the potential to help local areas meet and
maintain healthy air quality. The document also includes methods to
help communities account for the air quality benefits of their local
land use activities in their air quality plans. The EPA will provide
additional guidance as needed, and will continue to work with states on
incorporating these types of programs into their SIPs.
3. Travel Efficiency
    In addition to land use strategies, areas should consider
incorporating travel efficiency strategies in their SIPs. Travel
efficiency strategies may include land use strategies, but also include
new or expanded mass transit options, commuter strategies, system
operations (e.g., eco-driving, ramp metering), pricing (e.g., parking
taxes, congestion pricing, intercity tolls), speed limit restrictions
and multimodal freight strategies.
    In July 2009, the Urban Land Institute released a report titled,
Moving Cooler: An Analysis of Transportation Strategies for Reducing
Greenhouse Gas Emissions,\76\ which the EPA and the DOT helped to fund.
The report analyzed the potential levels of emissions reductions
achievable from light-duty travel efficiency strategies. Moving Cooler
included six different bundles of strategies to reflect different
potential groups of strategies that could be implemented.
---------------------------------------------------------------------------

    \76\ Cambridge Systematics, Inc. (2009). Moving Cooler: An
Analysis of Transportation Strategies for Reducing Greenhouse Gas
Emissions. Urban Land Institute: Washington, DC (http://www.uli.org/
).
---------------------------------------------------------------------------

    We believe that the ``Low Cost'' bundle of measures represents the
most appropriate combination of strategies for states to consider based
on cost, likelihood of success and accuracy of the research results.
This bundle of measures includes the strategies listed above. We have
conducted a preliminary national emissions modeling analysis using the
data in the report and estimate that between 2010 and 2020 the low cost
bundle of measures could reduce NOX and VOC emissions
between approximately 2 and 5 percent depending on how aggressively the
strategies are implemented. Additional reductions are possible in later
years.
    The Moving Cooler report makes assumptions about the geographic
scope for which each strategy could be implemented. For example,
certain strategies like increased transit are dependent on high
population density, while other strategies like telecommuting could be
implemented in both urban and rural areas. The percent reductions for
such measures would be larger in urban areas, where VMT reductions
would be concentrated. The EPA believes that states should consider
these types of strategies as they develop SIPs for the 2008 ozone
NAAQS.
    In March of 2011, the EPA released two documents that we believe
will prove to be useful to states that want to evaluate emissions
reductions that may be available from travel efficiency strategies. The
first document is titled, ``Potential Changes in Emissions Due To
Improvements In Travel Efficiency.'' \77\ This report provides
information on the effectiveness of travel efficiency measures for
reducing emissions of NOX, VOCs and PM2.5 at the
national scale. The report describes an approach that uses regionally
derived travel model data and other travel activity information, and
sketch-planning analysis to estimate potential emission reductions from
urban areas of varying size and characteristics. The results are
applied to other urban areas in the U.S. of similar characteristic to
estimate potential national emission reductions.
---------------------------------------------------------------------------

    \77\ EPA-420-R-11-003, March 2011, http://epa.gov/otaq/stateresources/policy/420r11003.pdf.
---------------------------------------------------------------------------

    The second document is titled, ``Transportation Control Measures:
An Information Document for Developing and Implementing Emission
Reduction Programs.'' \78\ This document provides information on
transportation control measures that have been implemented across the
country for a variety of purposes, including reducing emissions related
to criteria pollutants. The document describes the processes used to
develop and implement the strategies and, where available, their
effectiveness.
---------------------------------------------------------------------------

    \78\ EPA-430-R-09-040, March 2011, http://www.epa.gov/otaq/stateresources/policy/430r09040.pdf.
---------------------------------------------------------------------------

P. Efforts To Encourage a Multi-Pollutant Approach When Developing 2008
Ozone SIPs

1. In General
    From a planning and resource perspective, the EPA believes that it
can

be efficient for states to develop integrated control strategies that
addresses multiple pollutants rather than separate strategies for each
pollutant or NAAQS individually. An integrated air quality control
strategy that reduces multiple pollutants can help ensure that
reductions are efficiently achieved and produce the greatest overall
air quality benefits. For example, we know that certain control
measures that reduce emissions of the ozone precursors NOX
and VOC, and thus reduce ambient ozone levels, can also result in
reduced emissions and ambient concentrations of PM2.5 \79\
and also can improve visibility. Many VOCs are also HAP, so an ozone
control strategy may provide the additional benefit of reducing air
toxics. We also know that many sources of PM2.5 also emit
toxic metals as particulates, so controlling directly emitted
PM2.5 emissions from these sources would also reduce the
emissions of toxic metals. In addition, due to expected changes in
meteorology resulting from climate change, the EPA encourages states to
assess climate change and air pollution together and account for the
potential effects of climate change in their multi-pollutant planning
efforts.
---------------------------------------------------------------------------

    \79\ For a list of potential control measures for
PM2.5 precursors, see http://www.epa.gov/airquality/particlepollution/measures/pm_control_measures_tables_ver1.pdf.
---------------------------------------------------------------------------

    In June 2007, the EPA's CAA Advisory Committee (CAAAC) recommended
that the agency allow states to integrate SIP requirements and other
air quality goals into a comprehensive plan.\80\ The recommended plan
would demonstrate attainment/maintenance of multiple NAAQS, accomplish
sector-based reductions, realize risk reductions of HAPs and make
improvements in visibility. It could also be structured to integrate
programs addressing land use, transportation, energy and climate.
---------------------------------------------------------------------------

    \80\ Recommendations to the Clean Air Act Advisory Committee:
Phase II, June 2007, http://epa.gov/air/caaac/aqm/phase2finalrept2007.pdf.
---------------------------------------------------------------------------

    The EPA has encouraged states to take a multi-pollutant approach to
managing air quality.\81\ Specifically, we have encouraged states to
involve all stakeholders when planning to meet air quality standards
and to provide a basic outline for how local jurisdiction(s) could
address air pollutants in an integrated manner.
---------------------------------------------------------------------------

    \81\ Memo from Stephen D. Page to Regional Air Division
Directors, Aug. 10, 2005, ``Consideration of Multiple Pollutants in
Control Strategy Development.'' http://epa.gov/air/caaac/aqm/aqm-page-memo.pdf.
---------------------------------------------------------------------------

    While the agency encourages states to develop multi-pollutant
plans, we recognize that the requirement for the EPA to review and, as
necessary, revise NAAQS every 5 years, which can trigger new statutory
SIP submission and attainment dates, as well as the ever-evolving
understanding of pollutants and the myriad control programs that may be
available to reduce emissions, can sometimes make such efforts
challenging. For example, under the current law, the 2007 submission
date for Regional Haze SIPs has already passed while the December 2012
submittal date for attainment demonstrations for the 2006
PM2.5 NAAQS is more than 2 years before the proposed
submittal date for attainment demonstrations for the 2008 ozone NAAQS.
Although it is thus not feasible to integrate fully the planning
requirements for regional haze, the 2006 PM2.5 NAAQS and the
2008 ozone NAAQS, states could use common databases and modeling tools
for all three programs and rely on similar control measures as
appropriate. Furthermore, as states develop plans to meet the 2008
ozone NAAQS, they may wish to modify existing plans for other NAAQS or
for regional haze as they consider strategies more comprehensively.
However, it is important to note that all the CAA mandated planning and
program elements for individual standards must continue to be met. We
are specifically requesting comments on other approaches to integrating
the planning requirements for multiple NAAQS and other CAA programs
that are promulgated at different times.
2. What is the EPA doing beyond encouraging states to integrate their
air quality planning activities to the extent feasible?
    Ideally, an air quality management plan (AQMP) is a set of
pollution reduction strategies/planning activities for an area
demonstrating: attainment/maintenance of one or more NAAQS; risk
reductions from HAPs; improvements in visibility and ecosystem health;
and integration of land use, transportation, energy and climate
activities in the area. Three areas in the country--North Carolina, New
York and the city of St. Louis (involving both Missouri and Illinois)--
participated in an EPA-led pilot effort to develop multi-pollutant
AQMPs. The pilots provided lessons regarding AQMP development that
should prove useful to other areas interested in better integrating
their air quality planning. The areas' initial AQMPs and other
materials are available on the EPA's Web site.\82\
---------------------------------------------------------------------------

    \82\ http://www.epa.gov/air/aqmp/.
---------------------------------------------------------------------------

    Implementation of the 2008 ozone NAAQS provides an opportunity for
states to consider how to use a multi-pollutant approach from the
beginning of their planning process. We recommend that states and
tribes wishing to take a comprehensive approach consider the following
activities.
     Develop models for the attainment demonstration that
include previously implemented or planned measures to reduce ozone
precursors, secondary fine particles, pollutants that contribute to
regional haze and, where appropriate, air toxics and any potential
negative impacts on ecosystems.
     Conduct an integrated assessment of the impact controls
have on ambient levels of ozone, PM2.5, regional haze and,
where applicable, air toxics, greenhouse gases, ecosystem protection
and environmental justice.
     Use common data bases and analytical tools, where
possible.
    EPA is requesting comment on what incentives or assistance we might
be able to provide to encourage states to integrate their planning
activities.
3. Multi-pollutant Assessments/One-atmosphere Modeling
    A multi-pollutant assessment, or one-atmosphere modeling, is
conducted with a single air quality model that is capable of simulating
transport and formation of multiple pollutants simultaneously.\83\ For
example, this type of model can simulate formation and deposition
involving pollutants associated with ozone, PM2.5 and
regional haze, and it can include algorithms simulating gas phase
chemistry, aqueous phase chemistry, aerosol formation and acid
deposition. This type of model could also include the formation and
deposition of key air toxics and the chemical interactions that occur
with these individual toxic species to produce ozone and
PM2.5.
---------------------------------------------------------------------------

    \83\ Depending on the context, ``multi-pollutant'' can be
defined in different ways. In this context we are defining multi-
pollutant modeling as simultaneous modeling of ozone,
PM2.5, key air toxics, and regional haze. Future multi-
pollutant models may include the ability to model a broader array of
air toxics as well as greenhouse gases.
---------------------------------------------------------------------------

    Multi-pollutant assessments are recommended for ozone attainment
demonstrations because the formation and transport of ozone is closely
related to the formation of both PM2.5 and regional haze.
There is often a positive correlation between measured ozone and
secondary particulate matter. Many of the same factors affecting
concentrations of ozone also affect concentrations of secondary
particulate matter because similarities exist in

sources of precursors for both pollutants. For example, emissions of
NOX may lead to formation of nitrates, which affect both
ambient ozone and PM2.5 levels and impair visibility. Many
VOCs (such as toluene) are air toxics and may also be sources or
precursors for both ozone and organic particles. In addition, the
presence of ozone itself may be an important factor affecting secondary
particle formation.
    Because of these relationships, models and data analysis intended
to address ozone could be beneficial for use in addressing
PM2.5 and visibility impairment. When performing a multi-
pollutant assessment, the modeling should take into account previously
implemented or planned measures to reduce ozone, PM2.5 and
regional haze. States that undertake multi-pollutant assessments as
part of their attainment demonstration should consider assessing the
impact of their ozone strategies on PM2.5 and visibility
impairment to ensure that optimal emission reduction strategies are
developed for the three programs to the extent possible. This could
facilitate addressing all of these pollutants in a more cost effective
manner.
    States may also find it desirable to assess the impact of ozone,
PM2.5 and/or regional haze control strategies on toxic air
pollutants regulated under the CAA or under state air toxic
initiatives. Given the relationships that exist between air toxics and
the formation of ozone and PM2.5, states may find that
controls can be selected to meet goals for ozone and/or
PM2.5 attainment as well as those of specific air toxic
programs.

Q. How does this proposed rule apply to tribes?

    Section 301(d) of the CAA authorizes the EPA to approve eligible
Indian tribes to implement provisions of the CAA on Indian reservations
and other areas within the tribes' jurisdiction. The Tribal Authority
Rule (TAR) (40 CFR part 49), which implements section 301(d) of the
CAA, sets forth the criteria and process for tribes to apply to the EPA
for eligibility to administer CAA programs. Among the programs that
tribes may seek to administer are Tribal Implementation Plans
(TIP),\84\ which are submitted to the EPA for approval. However, unlike
states, tribes are not required to develop implementation plans.\85\
Under the TAR, the EPA determined that tribes are not required to meet
plan submittal and implementation deadlines in the CAA, e.g., the
deadlines specified in CAA sections 110(a)(1), 172(a)(2), 182, 187 and
191.\86\
---------------------------------------------------------------------------

    \84\ Not to be confused with Transportation Improvement Programs
(also abbreviated ``TIPs''); the context will determine the meaning.
    \85\ 70 FR 71666 (November 29, 2005).
    \86\ See 40 CFR 49.4(a).
---------------------------------------------------------------------------

    Where tribes do seek to develop and administer TIPs, the TAR
provides flexibility for tribes in the preparation of a TIP to address
the NAAQS. See, e.g., 40 CFR 49.7(c). The TAR also states that the EPA
has authority to promulgate federal implementation plan (FIP)
provisions, as necessary and appropriate, to protect air quality if
tribes choose not to implement those provisions. The EPA may find it
necessary and appropriate to develop a FIP to reduce emissions from
sources in Indian country where the tribe has not developed a TIP to
address an air quality problem.
    It is important for states and tribes to work together to
coordinate planning efforts where nonattainment areas include both
Indian country and state land. Coordinated planning in these areas will
help ensure that the planning decisions made by the states and tribes
complement each other and that the nonattainment area makes reasonable
progress toward attainment and ultimately attains the 2008 ozone NAAQS.
In reviewing and approving individual TIPs and SIPs, we will determine
if together they are consistent with the overall air quality needs of
an area.
    States have an obligation to notify other states in advance of any
public hearing(s) on their state plans if such plans will significantly
impact such other states. 40 CFR 51.102(d)(5). Under section 301(d) of
the CAA and the TAR, tribes may become eligible to be treated in a
manner similar to states (TAS) for this purpose. Affected tribes with
this status must also be informed of the contents of such state plans
and given access to the documentation supporting these plans. In
addition to this mandated process, we encourage states to extend the
same notice to all affected tribes, regardless of their TAS status.
    Executive Orders and the EPA's Indian policies generally call for
the EPA to coordinate and consult with tribes on matters that affect
tribes. Executive Order 13175, titled, ``Consultation and Coordination
with Indian Tribal Governments'' requires the EPA to develop a process
to ensure ``meaningful and timely input by tribal officials in the
development of regulatory policies that have Tribal implications.'' In
addition, the EPA's policies include the agency's 1984 Indian Policy
relating to Indian tribes and implementation of federal environmental
programs, the April 10, 2009, Office of Air Quality Planning and
Standards guidance ``Consulting with Indian Tribal Governments,'' and
the ``EPA Policy on Consultation and Coordination With Indian Tribes.''
\87\
---------------------------------------------------------------------------

    \87\ For a copy of this 2011 policy, see http://www.epa.gov/tribal/pdf/cons-and-coord-with-indian-tribes-policy.pdf.
---------------------------------------------------------------------------

    Consistent with these policies, the EPA intends to meet with tribes
on activities potentially affecting the attainment and maintenance of
the 2008 ozone NAAQS in Indian country, including our actions on SIPs.
As such, it would be helpful for states to work with tribes with land
that is part of the same air quality area during the SIP development
process and to coordinate with tribes as they develop their SIPs.

R. What are the requirements for the Ozone Transport Region (OTR)?

    The Phase 2 Rule codified the requirements applicable to the OTR
for the 1997 ozone NAAQS in 40 CFR 51.916. The EPA is proposing to
adopt the same requirements for the 2008 ozone NAAQS, except that the
submission date for OTR RACT SIPs would be the same as proposed under
the RACT section of this preamble for nonattainment areas. That is, we
are proposing to require that states submit the RACT SIPs required
under section 182(b)(2) within the final timeline we adopt based on the
two SIP submittal options detailed in section III.A of today's
proposal. (See section III.D of this preamble for additional
information on RACT timeframes.)

S. Are there any additional requirements related to compliance and
enforcement?

    The EPA is not proposing any specific regulatory provisions related
to compliance and enforcement. Section 172(c)(6) requires nonattainment
SIPs to ``include enforceable emission limitations, and such other
control measures, means or techniques . . . as well as schedules and
timetables for compliance, as may be necessary or appropriate to
provide for attainment . . .'' The EPA's current guidance, ``Guidance
on Preparing Enforceable Regulations and Compliance Programs for the 15
Percent Rate-of-Progress Plans (EPA-452/R-93-005, June 1993)'' is still
relevant to rules adopted for SIPs under the 2008 ozone NAAQS and
should be consulted for purposes of developing appropriate enforceable
nonattainment plan provisions under section 172(c)(6).

T. What are the requirements for addressing emergency episodes?

    The EPA proposes that the existing requirements for emergency
episodes (40 CFR part 51, subpart H) would also apply to the 2008 ozone
NAAQS. Subpart H requires SIPs to identify areas by priority
classification and to contain contingency plans to prevent pollutant
concentrations from reaching levels that would cause significant harm
to the health of persons. The significant harm level for ozone had been
established as 0.6 ppm, 2-hour average (40 CFR 51.151). This level
remains appropriate for the 2008 ozone NAAQS.

U. How does the ``Clean Data Policy'' apply to the 2008 ozone NAAQS?

    The EPA, in its Phase 1 Rule, codified its long-standing
interpretation under the Clean Data Policy in a regulation. Under 40
CFR 51.918, a determination of attainment suspends the obligation to
submit attainment planning SIP elements for the 1997 ozone NAAQS. An
EPA determination that the area attained the 1997 ozone NAAQS suspended
the obligation to submit any attainment-related SIP elements not yet
approved in the SIP, for so long as the area continued in attainment.
    The EPA in this rulemaking is proposing to apply this same approach
with respect to determinations of attainment for the 2008 ozone NAAQS.
Moreover, in order to reflect the intended ongoing status of the Clean
Data Policy and to consolidate in one regulation a comprehensive
provision applicable to determinations of attainment for the current
and former ozone NAAQS, the EPA proposes, after revocation of the 1997
ozone NAAQS, to replace 40 CFR 51.918 with proposed 40 CFR 51.1118.
Section 51.1118 applies essentially the same language as 51.918. If
finalized, 40 CFR 51.1118 will apply to a determination of attainment
that is made with respect to any revoked or current ozone NAAQS--the 1-
hour, the 1997 or the 2008 ozone NAAQS. The new section 51.1118, like
section 51.918, will set forth the regulatory consequences of an EPA
determination, made after notice-and-comment rulemaking, that an area
designated nonattainment for an ozone standard has air quality
attaining that standard. Upon such a determination by the EPA, the
requirements for the area to submit an attainment demonstration,
associated reasonably available control measures, reasonable further
progress plans, contingency measures and other attainment-related SIP
elements for that NAAQS, shall be suspended until such time as the area
is redesignated to attainment, at which time the requirements no longer
apply, or until the EPA determines that the area has again violated
that ozone NAAQS, in which case the requirements are again applicable.
The EPA intends to apply the provision for the 2008 ozone NAAQS in a
similar manner as it did for the 1997 ozone NAAQS. Because the proposed
section 51.1118 merely incorporates the continuation of the EPA's long-
held interpretation (Clean Data Policy) for the 1-hour ozone NAAQS,
which was embodied in regulation 51.918 for the 1997 ozone NAAQS, it is
appropriate to apply it in the context of the 2008 ozone NAAQS as well
as the 1997 and 1-hour ozone NAAQS. On July 10, 2009, the U.S. Court of
Appeals for the District of Columbia upheld the section 51.918
regulatory provision. (NRDC v. EPA, 571 F.3d 1245 (D.C. Cir. 2009))

V. What assistance programs is the EPA considering for implementation
of the 2008 ozone NAAQS?

    For purposes of the 1997 ozone NAAQS, the EPA established the Early
Action Compact (EAC) program. Under the EAC program, certain areas that
were violating the 1997 ozone NAAQS at the time of designation were
allowed to enter into an EAC agreement, and were given a deferred
effective date for their area designation in order to allow time for
the area to meet the terms of the agreement. The EPA does not have
plans to proceed with an EAC program for the 2008 ozone NAAQS.
    Nevertheless, the EPA believes there are significant advantages for
states, tribes and local agencies to take steps to reduce emissions as
early as possible. First and foremost, early reductions help to achieve
cleaner air sooner, and help to ensure continued health protection.
Secondly, early steps could help an area avoid a nonattainment
designation in the first place, or for an area eventually designated as
nonattainment, early reductions could result in a lower nonattainment
classification. In addition, early action to improve air quality can
help an eventual nonattainment area, particularly an area that has
never been designated nonattainment before, establish working
relationships between key stakeholders. Our expectation is that early
actions to reduce emissions in such areas would be less resource-
intensive than actions taken once a nonattainment designation has been