[Federal Register Volume 82, Number 110 (Friday, June 9, 2017)]
[Notices]
[Pages 26820-26823]
[FR Doc No: 2017-11961]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-80856; File No. SR-NASDAQ-2017-051]

Self-Regulatory Organizations; The NASDAQ Stock Market LLC;
Notice of Filing and Immediate Effectiveness of Proposed Rule Change To
Amend the Exchange's Fees at Rule 7046

June 5, 2017.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given
that, on May 23, 2017, The NASDAQ Stock Market LLC (``Nasdaq'' or
``Exchange'') filed with the Securities and Exchange Commission
(``SEC'' or ``Commission'') the proposed rule change as described in
Items I, II, and III below, which Items have been prepared by the
Exchange. The Commission is publishing this notice to solicit comments
on the proposed rule change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change

    The Exchange proposes to amend the Exchange's fees at Rule 7046 to:
(i) Introduce a new fee structure that would allow members to sponsor
their customers to receive Nasdaq Trading Insights for a $1,000 per
month sponsorship fee to be paid by the member, and fees based on the
number of ports to be paid by the sponsored firm; and (ii) extend a
free trial offer period from 14 to 30 days. The changes are described
in further detail below.
    The text of the proposed rule change is available on the Exchange's
Web site at http://nasdaq.cchwallstreet.com, at the principal office of
the Exchange, and at the Commission's Public Reference Room.

II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change

    In its filing with the Commission, the Exchange included statements
concerning the purpose of and basis for the proposed rule change and
discussed any comments it received on the proposed rule change. The
text of these statements may be examined at the places specified in
Item IV below. The Exchange has prepared summaries, set forth in
sections A, B, and C below, of the most significant aspects of such
statements.

A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The purpose of the proposed rule change is to amend the Exchange's
fees at Rule 7046 to: (i) Introduce a new fee structure that would
allow members to sponsor their customers to receive Nasdaq Trading
Insights for a $1,000 per month sponsorship fee to be paid by the
member, and fees based on the number of ports to be paid by the
sponsored firm; and (ii) extend a free trial offer period from 14 to 30
days.
Nasdaq Trading Insights
    Nasdaq Trading Insights is an optional market data service that
employs advanced analytics and machine learning to analyze order
activity. It is comprised of three active market data components: (a)
Missed Opportunity--Liquidity; (b) Missed Opportunity--Latency; and (c)
Peer Benchmarking. The initial filing for this product had also
proposed a fourth component--a Liquidity Dynamics Analysis--which, as
reported in a prior filing,\3\ has been delayed in development.
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    \3\ See Securities Exchange Release No. 79119 (October 19,
2016), 81 FR 73157 (October 24, 2016) (SR-NASDAQ-2016-138).
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    The Missed Opportunity--Liquidity component identifies when an
order from a market participant could have been increased in size,
resulting in the execution of additional shares. This component is
designed to provide information to a market participant interested in
gaining insight into hidden pockets of liquidity.
    The Missed Opportunity--Latency component identifies the amount of
time by which an otherwise marketable order missed execution. This
component is designed to provide information to market participants
interested in optimizing their models and trading patterns.
    The Peer Benchmarking component ranks the quality of a market
participant's trading performance against its peers, allowing market
participants to view their relative trading performance by port,\4\
with each port ranked independently by each metric against the ports of
peer firms trading on the Exchange.
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    \4\ A port is a means by which a member firm connects to
Nasdaq's systems.
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    Each market participant is eligible to receive information
regarding only its own data for each Trading Insights component. That
data is provided on a T+1 basis.
    The initial proposal to create Trading Insights, filed in August of
2016,\5\ included a Liquidity Dynamics Analysis component, which was to
help market participants identify pockets of accessible liquidity. In
October of 2016, the Exchange announced that this component would be
delayed and unavailable to subscribers.\6\
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    \5\ See Securities Exchange Act Release No. 78462 (August 2,
2016), 81 FR 52486 (August 8, 2016) (SR-NASDAQ-2016-101).
    \6\ See Securities Exchange Release No. 79119 (October 19,
2016), 81 FR 73157 (October 24, 2016) (SR-NASDAQ-2016-138).
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    A subscription to Nasdaq Trading Insights is currently available
for a monthly fee based on the number of ports for which the market
participant subscribes to such information: $1,500 for 1-5 ports;
$2,000 for 6-15 ports; $2,500 for 16-25 ports; and $3,500 for 26 ports
or more. There is no current fee structure that would allow members to
sponsor their customers to receive Nasdaq Trading Insights.
Proposed Changes
    The Exchange proposes two changes to the Trading Insights product:
(i) Introduce a new fee structure that would allow members to sponsor
their customers to receive Nasdaq Trading Insights for a $1,000 per
month sponsorship fee to be paid by the member, and fees based on the
number of ports to be paid by the sponsored firm; and (ii) extend a
free trial offer period from 14 to 30 days.
a. Sponsorship Fee
    The Exchange proposes to introduce a new fee structure that would
allow members to sponsor an unlimited number of their customers to
obtain access to Trading Insights' analytics for a $1,000 per month
sponsorship fee to

be paid by the member, as well as standard fees based on the number of
ports to be paid by the sponsored firm(s) set forth in Rule 7046(b)(2).
Standard fees for both members and sponsored firms will be at the
current rates: $1,500 for 1-5 ports; $2,000 for 6-15 ports; $2,500 for
16-25 ports; and $3,500 for 26 ports or more. A sponsoring member may
receive data from the same port as a sponsored firm, but only the
sponsored firm would be charged a fee for that data. The sponsoring
member will be charged a Standard Fee for Trading Insights on all ports
transmitting the proprietary data of that member, but the sponsoring
member will not be charged for any data on ports subscribed by a
sponsored firm.\7\
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    \7\ For example, a member firm that subscribes to Trading
Insights information on six ports, and sponsors a firm to subscribe
to Trading Insight information on one of those six ports, will be
charged Standard Fees for five ports, while the sponsored firm will
be charged Standard Fees for one port.
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    A member will only be able to view data concerning ports that
contain information related to its own proprietary trading or its
customers' trading.\8\ A sponsored firm will only be able to view data
on ports that contain its own trading information. A member will not be
able to view data concerning the ports of other members or the
customers of other members. A customer will not be able to view data
concerning the ports of other customers.
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    \8\ In Securities Exchange Act Release No. 78462 (August 2,
2016), 81 FR 52486 (August 8, 2016) (SR-NASDAQ-2016-101), the
Exchange stated that it would ensure that each market participant
receives only its own unique data and would not be able to obtain
any other market participant's unique data. As a narrow exception to
this general proposition, it is appropriate for a member to have
access to its customer's information because the customer itself
discloses trading activity to the member, and the Trading Insights
information will enable the member to act more effectively on its
customer's behalf.
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    This proposed change will increase market transparency by creating
a fee structure designed to encourage the dissemination of Trading
Insights information to non-members by setting a sponsorship fee that
remains flat notwithstanding the number of non-members receiving that
information. As such, the proposed change is fair and reasonable.
b. Trial Offers
    The Exchange proposes to extend the current 14 day free trial offer
to 30 days. The trial may be repeated if the Exchange elects to release
a new version of the product. The Exchange has found that the
additional time is necessary for potential subscribers to thoroughly
test the product, and the Exchange believes that such enhanced testing
will lead to more subscriptions to the product. The Exchange will offer
additional free trials if Nasdaq elects to release a new version of the
product that warrants new testing. The Exchange will report the release
of any new version of the product on the Nasdaq Trader Web site
(www.nasdaqtrader.com), or a successor Web site.
    There is also a technical change to Rule 7046(b)(1), the paragraph
including the trial offer provision, to delete a sentence stating that
the product will not be pro-rated. This sentence is unnecessary because
it is repeated in Rule 7046(b)(2).
    Fees for Trading Insights are optional in that they apply only to
firms that elect to purchase the product. The proposed changes do not
impact the cost of any other Nasdaq product.
2. Statutory Basis
    The Exchange believes that its proposal is consistent with Section
6(b) of the Act,\9\ in general, and furthers the objectives of Sections
6(b)(4) and 6(b)(5) of the Act,\10\ in particular, in that it provides
for the equitable allocation of reasonable dues, fees and other charges
among members and issuers and other persons using any facility, and is
not designed to permit unfair discrimination between customers,
issuers, brokers, or dealers.
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    \9\ 15 U.S.C. 78f(b).
    \10\ 15 U.S.C. 78f(b)(4) and (5).
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    This proposal creates a fee structure designed to encourage the
dissemination of Nasdaq Trading Insights to non-members by setting a
sponsorship fee that remains flat notwithstanding the number of non-
members receiving that information. Lengthening trial periods for new
potential subscribers will also increase distribution by allowing
potential subscribers to become more familiar with the benefits of the
product, which may lead to additional subscriptions.
    The proposal provides for the equitable allocation of reasonable
dues, fees and other charges among members and issuers and other
persons using any facility because the proposed fee structure
reasonably reflects the value that members and sponsored customers
receive for their service. The new $1,000 per month sponsorship fee for
members enables them to distribute Trading Insights information to an
unlimited number of customers for a flat fee, and provides the member
with an opportunity to view customer port data without paying the
Standard Fees paid by their customers. The Standard Fees paid by
customers will allow them to obtain port information at exactly the
same rates that would be paid by members. The fee structure therefore
reflects the value of Trading Insights to both customers and members,
respectively.
    Moreover, all similarly-situated persons will be charged the same
fee for the same service. All members that opt to purchase the service
or sponsor a customer for that service will be charged the same
standard and sponsorship fees. All customers that are sponsored by a
member and opt to purchase the service will be charged the same
standard fees for information on their ports. The service is not
available to non-members and customers not sponsored by a member
because the information provided by this service pertains only to ports
used by members and their customers.
    In adopting Regulation NMS,\11\ the Commission granted SROs and
broker-dealers increased authority and flexibility to offer new and
unique market data to the public. It was believed that this authority
would expand the amount of data available to consumers, and also spur
innovation and competition for the provision of market data. Nasdaq
believes that Nasdaq Trading Insights--which employs advanced analytics
and machine learning to analyze order activity--is precisely the sort
of market data product that the Commission envisioned when it adopted
Regulation NMS. The Commission concluded that Regulation NMS--
deregulating the market in proprietary data--would further the Act's
goals of facilitating efficiency and competition:
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    \11\ See Securities Exchange Act Release No. 51808 (June 9,
2005), 70 FR 37496 (June 29, 2005) (``Regulation NMS Adopting
Release'').

    [E]fficiency is promoted when broker-dealers who do not need the
data beyond the prices, sizes, market center identifications of the
NBBO and consolidated last sale information are not required to
receive (and pay for) such data. The Commission also believes that
efficiency is promoted when broker-dealers may choose to receive
(and pay for) additional market data based on their own internal
analysis of the need for such data.\12\
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    \12\ Id.

    By removing unnecessary regulatory restrictions on the ability of
exchanges to sell their own data, Regulation NMS advanced the goals of
the Act and the principles reflected in its legislative history.
    In NetCoalition v. Securities and Exchange Commission \13\
(``NetCoalition'') the D.C. Circuit upheld the Commission's use of a
market-based

approach in evaluating the fairness of market data fees against a
challenge claiming that Congress mandated a cost-based approach.\14\ As
the court emphasized, the Commission ``intended in Regulation NMS that
`market forces, rather than regulatory requirements' play a role in
determining the market data . . . to be made available to investors and
at what cost.'' \15\ ``No one disputes that competition for order flow
is `fierce.' . . . As the SEC explained, `[i]n the U.S. national market
system, buyers and sellers of securities, and the broker-dealers that
act as their order-routing agents, have a wide range of choices of
where to route orders for execution'; [and] `no exchange can afford to
take its market share percentages for granted' because `no exchange
possesses a monopoly, regulatory or otherwise, in the execution of
order flow from broker dealers'. . . .'' \16\
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    \13\ NetCoalition v. SEC, 615 F.3d 525 (D.C. Cir. 2010).
    \14\ See NetCoalition, at 534-535.
    \15\ Id. at 537.
    \16\ Id. at 539 (quoting Securities Exchange Act Release No.
59039 (December 2, 2008), 73 FR 74770, 74782-83 (December 9, 2008)
(SR-NYSEArca-2006-21)).
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    Data products such as Nasdaq Trading Insights are a means by which
exchanges compete to attract order flow. To the extent that exchanges
are successful in such competition, they earn trading revenues and also
enhance the value of their data products by increasing the amount of
data they provide. The need to compete for order flow places
substantial pressure upon exchanges to keep their fees for both
executions and data reasonable.\17\
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    \17\ See Sec. Indus. Fin. Mkts. Ass'n (SIFMA), Initial Decision
Release No. 1015, 2016 SEC LEXIS 2278 (ALJ June 1, 2016) (finding
the existence of vigorous competition with respect to non-core
market data).
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    The proposed changes are consistent with Section 6(b)(5) of the Act
because they increase transparency by promoting the distribution of
sophisticated trading analyses to sponsored firms and providing longer
trial periods to allow potential subscribers to become more familiar
with the benefits of the product. The proposed changes would not permit
unfair discrimination because the Exchange will apply the same fee to
all similarly-situated members.
    Fees for Trading Insights are optional in that they apply only to
firms that elect to purchase the product, which, like all proprietary
data products, they may cancel at any time.

B. Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange does not believe that the proposed rule change will
impose any burden on competition not necessary or appropriate in
furtherance of the purposes of the Act. Indeed, the Exchange believes
that the Nasdaq Trading Insights product enhances competition by
providing new options for analyzing market data.
    The market for data products is extremely competitive and firms may
freely choose alternative venues and data vendors based on the
aggregate fees assessed, the data offered, and the value provided.
Numerous exchanges compete with each other for listings, trades, and
market data itself, providing virtually limitless opportunities for
entrepreneurs who wish to produce and distribute their own market data.
Transaction execution and proprietary data products are complementary
in that market data is both an input and a byproduct of the execution
service. In fact, market data and trade execution are a paradigmatic
example of joint products with joint costs. The decision whether and on
which platform to post an order will depend on the attributes of the
platform where the order can be posted, including the execution fees,
data quality and price, and distribution of its data products. Without
trade executions, exchange data products cannot exist. Moreover, data
products are valuable to many end users only insofar as they provide
information that end users expect will assist them or their customers
in making trading decisions.
    The costs of producing market data include not only the costs of
the data distribution infrastructure, but also the costs of designing,
maintaining, and operating the exchange's transaction execution
platform and the cost of regulating the exchange to ensure its fair
operation and maintain investor confidence. The total return that a
trading platform earns reflects the revenues it receives from both
products and the joint costs it incurs. Moreover, the operation of the
exchange is characterized by high fixed costs and low marginal costs.
This cost structure is common in content distribution industries such
as software, where developing new software typically requires a large
initial investment (and continuing large investments to upgrade the
software), but once the software is developed, the incremental cost of
providing that software to an additional user is typically small, or
even zero (e.g., if the software can be downloaded over the internet
after being purchased).\18\ In Nasdaq's case, it is costly to build and
maintain a trading platform, but the incremental cost of trading each
additional share on an existing platform, or distributing an additional
instance of data, is very low. Market information and executions are
each produced jointly (in the sense that the activities of trading and
placing orders are the source of the information that is distributed)
and are each subject to significant scale economies.
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    \18\ See William J. Baumol and Daniel G. Swanson, ``The New
Economy and Ubiquitous Competitive Price Discrimination: Identifying
Defensible Criteria of Market Power,'' Antitrust Law Journal, Vol.
70, No. 3 (2003).
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    Competition among trading platforms can be expected to constrain
the aggregate return each platform earns from the sale of its joint
products. The level of competition and contestability in the market is
evident in the numerous alternative venues that compete for order flow,
including SRO markets, as well as internalizing BDs and various forms
of alternative trading systems (``ATSs''), including dark pools and
electronic communication networks (``ECNs''). Each SRO market competes
to produce transaction reports via trade executions, and two FINRA-
regulated TRFs compete to attract internalized transaction reports. It
is common for BDs to further and exploit this competition by sending
their order flow and transaction reports to multiple markets, rather
than providing them all to a single market. Competitive markets for
order flow, executions, and transaction reports provide pricing
discipline for the inputs of proprietary data products. The large
number of SROs, TRFs, BDs, and ATSs that currently produce proprietary
data or are currently capable of producing it provides further pricing
discipline for proprietary data products. Each SRO, TRF, ATS, and BD is
currently permitted to produce proprietary data products, and many
currently do or have announced plans to do so, including Nasdaq, NYSE,
NYSE MKT, NYSE Arca, and the BATS exchanges.
    In this competitive environment, an ``excessive'' price for one
product will have to be reflected in lower prices for other products
sold by the Exchange, or otherwise the Exchange may experience a loss
in sales that may adversely affect its profitability.
    In this instance, the proposed rule change enhances competition by
creating a fee structure that encourages the dissemination of Nasdaq
Trading Insights to non-members and expanding free trial offers to
allow members and non-members to become more familiar with the product.
If Nasdaq Trading Insights were to become unattractive to members and
sponsored firms, those

firms would opt not to purchase the product

C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others

    No written comments were either solicited or received.

III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action

    The foregoing rule change has become effective pursuant to Section
19(b)(3)(A)(ii) of the Act.\19\
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    \19\ 15 U.S.C. 78s(b)(3)(A)(ii).
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    At any time within 60 days of the filing of the proposed rule
change, the Commission summarily may temporarily suspend such rule
change if it appears to the Commission that such action is: (i)
Necessary or appropriate in the public interest; (ii) for the
protection of investors; or (iii) otherwise in furtherance of the
purposes of the Act. If the Commission takes such action, the
Commission shall institute proceedings to determine whether the
proposed rule should be approved or disapproved.

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Act. Comments may be submitted by any of
the following methods:

Electronic Comments

     Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to<EMAIL_ADDRESS>Please include
File Number SR-NASDAQ-2017-051 on the subject line.

Paper Comments

     Send paper comments in triplicate to Brent J. Fields,
Secretary, Securities and Exchange Commission, 100 F Street NE.,
Washington, DC 20549-1090.

All submissions should refer to File Number SR-NASDAQ-2017-051. This
file number should be included on the subject line if email is used. To
help the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, all
written statements with respect to the proposed rule change that are
filed with the Commission, and all written communications relating to
the proposed rule change between the Commission and any person, other
than those that may be withheld from the public in accordance with the
provisions of 5 U.S.C. 552, will be available for Web site viewing and
printing in the Commission's Public Reference Room, 100 F Street NE.,
Washington, DC 20549 on official business days between the hours of
10:00 a.m. and 3:00 p.m. Copies of such filing also will be available
for inspection and copying at the principal office of the Exchange. All
comments received will be posted without change; the Commission does
not edit personal identifying information from submissions. You should
submit only information that you wish to make available publicly. All
submissions should refer to File Number SR-NASDAQ-2017-051, and should
be submitted on or before June 30, 2017.
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    \20\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\20\
Robert W. Errett,
Deputy Secretary.
[FR Doc. 2017-11961 Filed 6-8-17; 8:45 am]
 BILLING CODE 8011-01-P


UNITED STATES ENVIRONMENTAL PROTECTION AGENCY

REGION III

	1650 Arch Street

	Philadelphia, Pennsylvania  19103

DATE:	July 14, 2011

SUBJECT:	Technical Support Document – State of Maryland – Adhesives
and Sealants Rule

		/s/

FROM:	Rose Quinto, Environmental Engineer

		Office of Air Program Planning

TO:	File

			/s/

THRU: 	Cristina Fernandez, Associate Director

Office of Air Program Planning

A.  BACKGROUND

On April 18, 2008, the Maryland Department of the Environment (MDE)
submitted revisions to its State Implementation Plan SIP (Maryland SIP
#08-02) to the Environmental Protection Agency (EPA).  These SIP
revisions pertain to the control of volatile organic compound (VOC)
emissions from Polytetrafluoroethylene (PTFE) operations (amending
Regulation .30 under COMAR 26.11.19) and from adhesives and sealants
operations (adding Regulations .01 - .07 under a new chapter, COMAR
26.11.35).  On May 28, 2009, MDE submitted another revision to its SIP
(Maryland SIP #09-01) amending Regulation .01 under COMAR 26.11.35.  In
addition, on April 23, 2010, EPA received a SIP revision (Maryland SIP
#10-06) amending the control of VOC emissions from paint, resin, and
adhesive manufacturing and adhesive and sealant application (Regulation
.15A and C(4) under COMAR 26.11.19).

B.  STATE SUBMITTAL

The SIP revisions consist of the following:

I.  Amendments to COMAR <IP_ADDRESS> - Control of Volatile Organic
Compounds from Chemical Production and Polytetrafluoroethylene
Operations.

Minor changes were made to headings of subsections to capitalize the
first letter of one or more words to sections <IP_ADDRESS>B (3-2),
“Inorganic Chemical Production Installation” and (5) “Product
Condenser.”  Also under section <IP_ADDRESS>B, the definition of
“Polytetrafluoroethylene (PTFE)” was changed to “Fluoropolymer
material (FPM),” therefore, replacing the abbreviation “PTFE” to
“FPM” throughout COMAR <IP_ADDRESS>.  In addition, under
<IP_ADDRESS>B, recodification of several definitions were changed to
achieve uniformity in the numbering.

Section <IP_ADDRESS>C(2) was amended to specify that a person who owns or
operates an installation subject to the requirements of COMAR
<IP_ADDRESS> will not be subject to COMAR 26.11.35 (Control of VOC
Emissions from Adhesives and Sealants) provided that monthly records are
maintained which demonstrate that VOC emissions from the application of
all adhesives, sealants, adhesive primers, and sealant primers do not
exceed 400 pounds per year; and adhesive manufacturing do not exceed 200
pounds per year.  Section <IP_ADDRESS>C(2) is also subject to some minor
editorial amendments which do not change its meaning and to accommodate
the addition of the exemption from COMAR 26.11.35 into the paragraph
structure of this section.

II.  New Regulation - COMAR 26.11.35 - Control of VOC Emissions from
Adhesives and Sealants.

Adhesives, sealants, adhesive primer, and sealant primer are used in
manufacturing, packaging, construction, and installation of disparate
materials such as metal, wood, rubber, plastic, ceramics, fiberglass and
composites.  An adhesive is any material used to bond two surfaces. A
sealant is a material with adhesive properties that is used primarily to
fill and seal durably, openings between two surfaces.  VOC emissions
result from evaporation of solvents during surface preparation,
transfer, application, drying, and cleaning operations.  The solvents
are mostly needed to solubilize the adhesive, sealant, or primer
material for application.  The solvents prepare the surface to provide a
stronger bond.  In plastic pipe bonding, the solvent dissolves the
polyvinyl chloride pipe and reacts with the pipe to form a bond.
Solvents used to clean the surface before bonding and to clean the
application equipment after bonding also contribute to VOC emissions.
VOC emissions from adhesives and sealants are primarily from industrial
and commercial operations such as general manufacturing, wood product
manufacturing, upholstery shops, adhesives retailers and architectural
trades, such as building construction, floor covering installation and
roof repair.

The Ozone Transport Commission (OTC) States developed a Model Rule
“OTC Model Rule For Adhesives and Sealants” dated 2006 which was
based on the 1998 California Air Resources Board (CARB) reasonably
available control technology (RACT) determination.  This RACT
determination applied to both the manufacture and use of adhesives,
sealants, adhesive primers or sealant primers, in both industrial and
manufacturing facilities and in the field.  California Air Districts
used this determination to develop regulations for this category.  EPA
addressed this source category with a Control Techniques Guideline (CTG)
document for Miscellaneous Industrial Adhesives dated September 2008.
This CTG was developed in response to section 183(e) of the Clean Air
Act (CAA) requirement for EPA to study and regulate consumer and
commercial products, which is included in EPA’s Report to Congress,
“Study of Volatile Organic Compound Emissions from Consumer and
Commercial Products – Comprehensive Emissions Inventory.”  The
section 183(e) miscellaneous industrial adhesives category was limited
to adhesives and adhesive primers used in industrial and manufacturing
operations and did not include products applied in the field.
Therefore, the OTC Model Rule and State efforts in developing individual
regulations preceded EPA’s CTG for this source category and were
broader in applicability.  The OTC Model Rule for adhesives and sealants
and Maryland’s COMAR 26.11.35 provisions compared to the CTG document
for Miscellaneous Industrial Adhesives dated September 2008 are
discussed in Attachment A (see page 6 below).

COMAR 26.11.35 is a new regulation based on the OTC model rule that in
turn was based on the CARB model rule.  COMAR 26.11.35 addresses
adhesive, sealants, adhesive primers and sealant primers that are sold
in larger containers and used primarily in commercial and industrial
applications, that includes residential applications of these products,
such as carpet, flooring and roofing installations.  COMAR 26.11.35 is
also applicable to those who sell, supply, offer for sale or manufacture
for sale in Maryland; and any adhesives, sealants, adhesive primer or
sealant primer for use in Maryland.  In addition, it is also applicable
to any person who uses or applies any adhesive, sealant, adhesive primer
or sealant primer for compensation within Maryland.  This rule will not
apply to homeowners who may be using these products for home repair and
renovations.  The VOC limits apply to those products manufactured for
sale and used, on and after January 1, 2009 in Maryland and allows for
the unlimited sell-through and use of non-compliant products
manufactured before January 1, 2009 provided they contain a date or date
code when they were manufactured.  These limits are identical to those
in the OTC and CARB model rules.

As an alternative to the VOC limits established in Table 1 of COMAR
26.11.35, operators of stationary sources that use or apply adhesives,
sealants, or adhesive or sealant primers have the option of using add-on
pollution control equipment rather than complying with the Table 1
limits.  Requirements applying to air pollution control equipment
include:  an overall capture and control efficiency of at least 85
percent, by weight; the continuous monitoring of combustion temperature,
inlet and exhaust gas temperatures and control device efficiency,
depending upon the type of add-on controls used; and the maintenance of
operation records to demonstrate compliance.  COMAR 26.11.35 contains
requirements for work practices, surface preparation and cleanup solvent
composition.  COMAR 26.11.35 also includes specific exemptions, as well
as registration and product labeling requirements, recordkeeping
requirements, and test methods and compliance procedures.

EPA evaluates that COMAR 26.11.35 contains the required elements for a
federally enforceable rule:  emission limitations, compliance procedures
and test methods, compliance dates and record keeping provisions.  In
comparison to the CTG, the OTC model rule and COMAR 26.11.35 are
applicable to all stationary sources including those applications that
occur outside of the factory setting, that is, applied in the field.  In
addition, there are provisions that apply to the selling, supplying,
offering for sale or manufacture for sale in Maryland of adhesives,
sealants, adhesive primers and sealant primers along with container
labeling requirements and product registrations.  The VOC content
restrictions for these products apply to both their manufacture and
application.  Stationary sources also have the option of using add-on
control equipment that achieves 85 percent control.  The OTC model rule
and COMAR 26.11.35 also regulates the VOC content and vapor pressure of
surface-preparation and clean-up solvents for which the CTG did not make
recommendations for other than including work practices.

EPA recommends that when the States evaluate RACT as required by section
182(b) when implementing a revised 8-hour ozone standard, that they
review the VOC content limits for wood adhesives and evaluate the
benefit of requiring improved methods for applying coatings regulated by
COMAR 26.11.35.

Overall, the OTC model rule and COMAR 26.11.35:  (1) Regulate the same
adhesives and adhesive primers as the CTG with the addition of
regulating sealants and sealant primers,

(2) Apply to additional stationary sources and (3) Provide for similar
exemptions as the CTG recommends.  Therefore, COMAR 26.11.35 meets the
requirement of a RACT rule for the miscellaneous industrial adhesives
CTG category.

III.  Amendments to Regulation .01 under COMAR 26.11.35.

Amendments to Regulation .01 limits the applicability of VOC standards
for single-ply roof membrane installation and repair adhesives,
single-ply roof membrane sealants, and single-ply roof membrane
adhesives primers according to the following schedules:  (1) for the
year 2009, from May 15 through September 15; (2) for the years 2010 and
2011, from May 1 through September 30; and (3) on and after January 1,
2012.  These amendments affect manufacturers, suppliers, installers and
users of single-ply roofing materials.  These amendments provide
additional time for training and adaption to the use of new roofing
adhesive materials.  Roofing operations are performed at a lower rate
during the non-ozone season.

IV.  Amendments to Regulation .15A and .15C(4) under COMAR 26.11.19. 15
“Paint, Resin, and Adhesive Manufacturing and Adhesive and Sealant
Application.”

The SIP revision adds “sealant” to the title of Regulation .15.  The
SIP revision also adds definitions and terms to Regulation .15A used in
the substantive provisions of this SIP revision:

sealant, sealant application, and specialty electronic systems and
subsystems for defense and homeland security.  Amendments to Regulation
.15C(4) repeal the general emission standard for adhesives, and
replacing it with the source-specific VOC RACT emission limitation for
the application of adhesives and sealants to specialty electronic
systems and subsystems for defense and homeland security, therefore,
this source category is exempt from the requirements under COMAR
26.11.35.  The amendments limit the discharge into the atmosphere to not
more than 25 pounds per day of VOC from adhesive and sealant
application, averaged over a monthly period.

D.  CONCLUSIONS AND RECOMMENDED AGENCY ACTION

The amendments to Regulation .30 (COMAR <IP_ADDRESS>) “Control of
Volatile Organic Compounds from Chemical Production and
Polytetrafluoroethylene Operations” meets the applicable requirements
of the CAA, and the applicable EPA regulations, guidance and policy and
can be approved.

COMAR 26.11.35 “Control of VOC Emissions from Adhesives and
Sealants” adopted by Maryland will result in the reduction of VOC
emissions from the affected sources and meets the applicable
requirements of the CAA, and the applicable EPA regulations, guidance
and policy and can be approved.

Amendments to Regulation .01 under COMAR 26.11.35, and Regulation .15A
and C(4) under COMAR 26.11.19, will result in the reduction of VOC
emissions from the affected sources and meets the applicable
requirements of the CAA, and the applicable EPA regulations, guidance
and policy and can be approved.

EPA’s approval of the SIP revisions is recommended.

ATTACHMENT A

OTC Model Rule for Adhesives and Sealants and Maryland’s COMAR
26.11.35

Provisions Compared to the Control Technique Guidelines for
Miscellaneous Industrial Adhesives, September 2008

OTC Model Rule

The Ozone Transport Commission (OTC) developed a model rule as part of a
regional effort to attain and maintain the eight-hour ozone standard and
reduce eight-hour ozone levels.  States opting to promulgate rules based
on this model rule will utilize State-specific administrative
requirements and procedures.  Maryland’s adopted COMAR 26.11.35
“Control of Volatile Organic Compound (VOC) Emissions from Adhesives
and Sealants” is based on the OTC model rule.

A reasonably available control technology (RACT) determination prepared
by the California Air Resources Board (CARB) in 1998 forms the basis of
the OTC model rule.  In the years 1998-2001, the provisions of the CARB
determination were adopted in regulatory form in various air pollution
control districts in California including the Bay Area, Ventura County,
Sacramento Metropolitan and San Joaquin Valley.

The provisions of this model rule limit emissions of VOCs from
adhesives, sealants, adhesive primers and sealant primers.  The model
rule achieves VOC reductions through two basic components:  (1) sale and
manufacture restrictions that limit the VOC content of specified
adhesives, sealants, adhesive primers and sealant primers sold in the
state; and (2) use restrictions that apply primarily to commercial and
industrial applications.  By reducing the availability of higher VOC
content adhesives and sealants within the State, the sales prohibition
is also intended to address adhesive and sealant usage at area sources.
Emissions from residential use of regulated products are addressed
through the sales restrictions and simple use provisions.

The associated emissions reductions will be used as part of the
State’s plan to attain and maintain the 8-hour ozone national ambient
air quality standard (NAAQS).

Control Techniques Guideline

The Environmental Protection Agency (EPA) addressed a portion of this
category, adhesives and adhesive primers, in a Control Techniques
Guideline (CTG) document - “Control Techniques Guidelines for
Miscellaneous Industrial Adhesive, EPA-453/R-08-005” in September
2008.  (See Docket number EPA-HQ-OAR-2008-0460.)

“This CTG is intended to provide State and local air pollution control
authorities information that should assist them in determining RACT for
VOCs from miscellaneous industrial adhesive application processes.  In
developing this CTG, EPA, among other things, evaluated the sources of
VOC emissions from miscellaneous industrial adhesives application
processes and the available control approaches for addressing these
emissions, including the costs of such approaches.  Based on available
information and data, EPA provides recommendations for RACT for
miscellaneous industrial adhesives.  States can use the recommendations
in this CTG to inform their own determination as to what constitutes
RACT for VOCs for miscellaneous industrial adhesive application
processes in their particular nonattainment areas.  The information
contained in this document is provided only as guidance.  This guidance
does not change, or substitute for, requirements specified in applicable
sections of the CAA or EPA’s regulations; nor is it a regulation
itself.  This document does not impose any legally binding requirements
on any entity.  It provides only recommendations for State and local air
pollution control agencies to consider in determining RACT.  State and
local pollution control agencies are free to implement other
technically-sound approaches that are consistent with the CAA and
EPA’s implementing regulations” (CTG page 1).

“When State and local pollution control agencies develop RACT rules,
they may elect to adopt control approaches that differ from those
described in this document and/or promulgate applicability criteria that
differ from those recommended here [in this CTG].”  (CTG page 3).

EPA issued the CTG pursuant to the authority and to meet a requirement
set by section 183(e) of the CAA.  Section 183(e) directed EPA to list
for regulation, those categories of products that account for at least
80 percent of the VOC emissions from consumer and commercial products in
ozone nonattainment areas, and to schedule those categories for
regulation in four groups.  Section 183(e)(3)(C) further provides that
we may issue a CTG in lieu of a national regulation for a product
category where we determine that the CTG will be “substantially as
effective as regulations” in reducing emissions of VOC in ozone
nonattainment areas.  See for example, 64 FR 13422, March 18, 1999.  EPA
has revised the list several times.  See 70 FR 69759, November 17, 2005;
64 FR 13422, March 18, 1999; and most recently, 71 FR 28320, May 16,
2006.

Under section 183(e), a regulation for consumer or commercial products
is limited to measures applicable to manufacturers, processors,
distributors, or importers of the solvents, materials, or products
supplied to the consumer or industry.  Section 183(e) does not authorize
EPA to issue national regulations that would directly regulate end-users
of these products.  By contrast, CTG are guidance documents that
recommend RACT measures that States can adopt and apply to the end-users
of products.  See 73 FR 58481 at 58483, October 7, 2008.  However,
section 183(e) does not impose the same restrictions upon States, upon
regulation of end-users and manufacturers, processors, distributors, or
importers.  Therefore, a State can regulate manufacturers, processors,
distributors, or importers and end-users of a product category for which
EPA has issued a CTG.

I.  Applicability

(1)  The scope of the CTG is focused on industrial adhesive application
processes at facilities, i.e., stationary sources.  The limits and
requirements apply to facilities where the total actual VOC emissions
from all miscellaneous industrial adhesive application processes,
including related cleaning activities, at that facility are equal to or
exceed 6.8 kg/day (15 lb/day), or an equivalent level such as 3 tons per
12-month rolling period, before consideration of controls.

The OTC model rule is broader than the CTG and applies to processes
below the 6.8 kg/day recommendation.  It also applies outside of
stationary source facilities when the adhesives are applied in the
field.

(2)  The OTC model rule is also applicable to any person who: sells,
supplies for sale, offers for sale or manufactures for sale any
adhesive, sealant, adhesive primer or sealant primer.  The CTG is not
applicable to these people.

II.  Definitions

Generally the OTC model rule and CTG use the same terms and definitions
for those terms.  The OTC model rule contains additional definitions to
address sealants and sealant primers and additional types of products.
There are minor differences with some terms because the CTG focuses on
the processes at a facility while the OTC model rule also incorporates
prohibitions on selling, offering for sale and using products that can
occur outside of a facility.  There are some instances where the CTG and
the OTC model rule use different terms for the same process/product, but
these are substantively the same.

Specific examples:

There appears to be an inconsistency in the CTG with the category of
tire repair and tire retread.  Tire repair generally would not occur at
a manufacturing facility, but at smaller operations in the field.  The
draft CTG used a term “tire retreading” which would be a process
that occurs at a manufacturing facility.  The OTC model rule and COMAR
26.11.35 regulate “tire retread” and defines the category in terms
of manufacture and not the repair of a puncture.  COMAR 26.11.35’s
definition is consistent with South Coast Air Quality Management
District (SCAQMD) rule 1168’s definition of “tire tread adhesive.”
 The CTG was developed based upon SCAQMD rule 1168 and similar rules.
Therefore, with regards to “tire retread” and “tire repair”
processes, the OTC model rule and COMAR 26.11.35 are consistent with
those rules upon which the CTG founded its recommendations.

The CTG does not distinguish between cleaning materials used for surface
preparation and those used for cleaning application equipment, but the
OTC model rule does make this distinction.

The recommendations for roof membranes in the CTG do not extend to field
applied materials, because:  (1) field-applied adhesives are not part of
the miscellaneous industrial adhesives category and are therefore not
covered by this CTG, and (2) nonmembrane roof installation and repair
adhesive, and ethylene propylene diene monomer (EPDM) described in the
comments received on the draft CTG are field applied products and are
therefore not included in the miscellaneous industrial adhesives
category.  To the extent the recommendations in the OTC model rule sets
limits for EPDM single-ply roof membranes it makes a recommendation
beyond those in the CTG.  It appears that the inclusion of “motor
vehicle glass bonding primer” in the CTG covers a slightly broader
class of adhesives primers than “automotive glass adhesive primer.”

The OTC model rule includes wood in the definition of “porous
material” while the CTG does not and has a separate limit for wood.
The CTG’s recommended definition was made in the absence of limits for
sealants and sealant primers and specifically excludes wood from being
considered a porous material.

III.  Requirements

(1)  The OTC model rule applies to any person who sells, supplies or
offers for sale any adhesive, sealant, adhesive primer or sealant primer
manufactured on or after January 1, 2009, or manufacture for sale any
adhesive, sealant, adhesive primer or sealant primer in excess of the
applicable VOC content limits specified in Table 1.  The CTG does not
apply to people who sell or manufacture these coatings.

(2)  The OTC model rule applies to any person who uses or applies (for
compensation) any adhesive, sealant, adhesive primer or sealant primer
that has an applicable VOC content limit specified in Table 1 that is
not otherwise exempted.  The CTG only recommends application of the
limits and requirements to facilities where the total actual VOC
emissions from all miscellaneous industrial adhesive application
processes, including related cleaning activities, at that facility are
equal to or exceed 6.8 kg/day (15 lb/day), or an equivalent level such
as 3 tons per 12-month rolling period, before consideration of controls.
 The OTC model rule covers “field applied adhesives” which the CTG
does not cover.

(3)  Both the CTG and the OTC model rule have a table of content limits
for the regulated products.  See the comparison of table limits and
discussion below.

(4)  The CTG did not propose recommendations for VOC content or VOC
composite vapor pressure limits for cleaning materials.  The OTC model
rule and COMAR 26.11.35 contained the following limits for cleaning
materials:

a.  Limits the VOC content of the surface preparation solvent to less
than 70 grams per liter;

b.  Limits the VOC content of surface preparation solvent  used in
applying single-ply roofing to a composite vapor pressure, excluding
water and exempt compounds, not exceeding 45 mm Hg at 20 degrees
Celsius;

c.   Limits materials containing VOCs used to remove adhesives,
sealants, or adhesive or sealant primers from surfaces unless the
composite vapor pressure of the solvent used is less than 45 mm Hg at 20
degrees Celsius;

d.  Requires spray application equipment be cleaned in enclosed cleaning
systems using cleaning solvents with less than or equal to 70 grams of
VOC per liter of material, or by soaking parts in closed systems using
and a solvent if the composite vapor pressure of the solvent, excluding
water and exempt compounds, is less than or equal to 9.5 mm Hg at 20
degrees Celsius.

(5)  Both the CTG and OTC model rule provide for the use of add-on air
pollution control equipment instead of meeting the solvent content
limits.  Both require that controls reduce VOC emissions by an overall
capture and control efficiency of at least 85% by weight.  The OTC model
rule includes additional provisions to insure that the control equipment
is operated properly.

(6)  Both the CTG and OTC model rule require work practices to minimize
emissions from cleaning operations.  The CTG recommendations are more
detailed while the OTC model rule is more general.

(7)  The OTC model rule prohibitions the specification of non-complying
adhesives, sealants, adhesive primers, sealant primers, surface
preparation or clean-up solvents.

(8)  The CTG also recommends that adhesive and adhesive primers be
applied using application methods with good transfer efficiency in
conjunction with the use of low-VOC content adhesives.  Specifically,
the CTG recommends the following application methods: electrostatic
spray, HVLP spray, flow coat, roll coat or hand application including
non-spray application methods similar to hand or mechanically powered
caulking gun, brush, or direct hand application), roll coat, dip coat
(including electrodeposition), airless spray, air-assisted airless
spray, or other coating application method capable of achieving good
transfer efficiency. (Final CTG, Section VI.B., page 19).  The CTG
recommends application methods with good transfer efficiencies for
stationary facilities and does not make recommendations for field
applied adhesives and sealants.  The OTC model rule does not address
application methods.

IV.  Exemptions and Exceptions

(1)  CTG and OTC model rule have similar exemptions for the following:

a.  Adhesives, sealants, adhesive primers or sealant primers being
tested or evaluated in any research and development, quality assurance
or analytical laboratory.

b.  Cyanoacrylate adhesives.

c.  Adhesives, sealants, adhesive primers or sealant primers that are
sold or supplied by the manufacturer or supplier in containers with a
net volume of 16 fluid ounces or less, or a net weight of one pound or
less, except plastic cement welding adhesives and contact adhesives.

d.  Processes using polyester bonding putties to assemble fiberglass
parts at fiberglass boat manufacturing facilities and at other
reinforced plastic composite manufacturing facilities.

	e.   In the assembly, repair and manufacture of aerospace or
undersea-based weapon 	systems.

	f.   Solvent welding operations used in the manufacture of medical
devices.

(2)  OTC model rule exemptions not in CTG:

a.  Adhesives, sealants, adhesive primers and sealant primers that are
subject to State consumer product regulation.  State consumer product
regulations generally regulate the same categories as the Federal
Regulation (of 40 CFR Part 59).  Under section 183(e) the consumer
products regulated by 40 CFR Part 59 cannot be the same adhesive
products and adhesive primers as those covered by the CTG, and,
therefore this provision of the OTC model rule merely clarifies that
here is no double regulation.

b.  Adhesives and sealants that contain less than 20 grams of VOC per
liter of adhesive or sealant, less water and less exempt compounds, as
applied.  This limit is less than any limit recommended by the CTG.

c.  Contact adhesives that are sold or supplied by the manufacturer or
supplier in containers with a net volume of one gallon or less.  Some
California Air Districts have a similar size exemption but with
additional conditions.

d.  Tire repair operations, provided the label of the adhesive states
"For tire repair only."

e.  Plaque laminating operations in which adhesives are used to bond
clear, polyester acetate laminate to wood with lamination equipment
installed prior to July 1, 1992.  Any person claiming exemption pursuant
to this subparagraph shall record and maintain monthly operational
records sufficient to demonstrate compliance with this exemption and in
accordance with section (V) of this rule.

In addition, the CTG recommends that these sources be subject to the
work practices recommendation.

(3) The OTC model rule exempts total VOC emissions from all adhesives,
sealants, adhesive primers and sealant primers used at a facility that
are less than 200 pounds per calendar year, or an equivalent volume.
Any person claiming exemption pursuant to this subparagraph shall record
and maintain monthly operational records sufficient to demonstrate
compliance.

(4)  The OTC model rule exempts adhesives, sealants, adhesive primers,
sealant primers, cleanup solvents and surface preparation solvents
provided the total volume of noncomplying adhesives, sealants, primers,
cleanup and surface preparation solvents applied facility-wide does not
exceed 55 gallons per calendar year.  Any person claiming exemption
pursuant to this subparagraph shall record and maintain monthly
operational records sufficient to demonstrate compliance.  This is
equivalent to 400 pound per year, while the CTG applicability starts at
6.8 kg/day (15 lb/day) or an equivalent level such as 3 tons (6000
pound) per 12-month rolling period.

(5) The OTC model rule exempts adhesive, sealant, adhesive primer or
sealant primer intended for shipment and use outside of OTC States or in
COMAR 26.11.35.

(6)  The OTC model rule exempts any adhesive, sealant, adhesive primer
or sealant primer that is controlled by add-on air pollution control
equipment.

V.  Administrative Requirements

The OTC model rule contains detailed record keeping requirements for
demonstrating compliance with the VOC content limits and recording the
key operating parameters for the control equipment that must be
maintained for five years.  Any State rule for a CTG must contain
monitoring and recordkeeping requirements.

VI.  Compliance Procedures and Test Methods

Both the CTG and OTC model rule contain the same primary test methods
and compliance procedures.  The OTC model rule contains additional
references to other relevant standard test methods for both solvent
analysis and for determining compliance of add-on control equipment.

Any State rule for a CTG must contain test methods for determining
compliance.

VII.  Container Labeling

The OTC model rule requires labeling of product container with the
maximum or actual VOC content of the product along with information
concerning thinning of the product.

VIII.  Emission Limit Table

The table below provides an analysis of the CTG recommended VOC emission
limits for general and specialty adhesive application processes compared
to the OTC model rule VOC content limits for adhesives, sealants,
adhesive primers sealant primers and adhesives applied to particular
substrates.  Where there is no comparable limit the column is left
blank.  In the CTG recommendation column, categories with brackets {   }
around them indicates there is a difference in a definition or provision
which differs from the OTC model rule.  Below the table are series of
“Notes” which discuss some of the differences between the OTC model
rule and the CTG and refer back to some of the California adopted rules
(CARB model rule) for which the OTC model rule was based on.

Both the CTG and the OTC model rule were based on the California
rulemaking efforts for this category and the CTG also bases its
recommended emission limits on the OTC model rule (see CTG page 16, last
paragraph).  The CTG also states “we consider the limits in the OTC
model rule to be representative of what sources in nonattainment areas
nationwide can achieve technically and economically and have therefore
adopted these VOC limits as our recommendations in the CTG.”

OTC Model Rule 	CTG Recommendation

Category	VOC content limit

(grams VOC per liter*)	 Category	Recommended VOC Emission Limit1

(g/l)

Adhesives

Specialty Adhesive Application Processes

	ABS welding	400	{Plastic Solvent Welding (ABS)}	400

Ceramic tile installation	130	Ceramic Tile Installation	130

Computer diskette jacket manufacturing	850

Contact bond  [Note C]	250	{Contact Adhesive} [Note C]	250

Cove base installation	150	Cove Base Installation	150

CPVC welding	490	{Plastic Solvent Welding (Except ABS)}	{500}

Indoor floor covering installation	150	Floor Covering Installation
(Indoor)	150

Metal to urethane/rubber molding or casting	850	Metal to Urethane/Rubber
Molding or Casting	850

Motor Vehicle Adhesive [Note H]	250

Motor Vehicle Weatherstrip Adhesive  [Note H]	750

Multipurpose construction	200	Multipurpose Construction	200

Nonmembrane roof installation/repair	300

Other plastic cement welding	510	{Plastic Solvent Welding (Except ABS)}
{500}

Outdoor floor covering installation	250	Floor Covering Installation
(Outdoor)	250

PVC welding	510	{Plastic Solvent Welding (Except ABS)}	{500}

Single-ply roof membrane installation/repair  [Note G]	250	Single-Ply
Roof Membrane Installation/Repair (Except EPDM)	250

Structural glazing	100	Structural Glazing	100

Thin metal laminating	780	Thin Metal Laminating	780

Tire Repair  [Note A]	100

Tire retread  [Note A]	100

Perimeter bonded sheet vinyl flooring installation	660	{Floor Covering
Installation (Perimeter Bonded Sheet Vinyl)}  [Note C]	660

Waterproof resorcinol glue	170	Waterproof Resorcinol Glue	170

Sheet-applied rubber installation	850	{Sheet Rubber Lining Installation}
 [Note C]	850

Sealants

Architectural	250

Marine deck	760

Nonmembrane roof installation/repair	300

Roadway	250

Single-ply roof membrane	450

Other	420

Adhesive Primers	 	Adhesive Primer Application Processes

	Automotive glass  [Note G]	700

Motor Vehicle Glass Bonding Primer  [Notes B and G]	900

Plastic cement welding	650	{Plastic Solvent Welding Adhesive Primer}
[Note C]	650

Single-ply roof membrane	250	Single-Ply Roof Membrane Adhesive Primer
[Note B]	250

Traffic marking tape	150

Other  	[Note G]   250	Other Adhesive Primer [Note B]	250

Sealant Primers

Non-porous architectural	250

Porous architectural	775

Marine deck	760

Other	750

Adhesives Applied to the Listed Substrate	  [Notes E and H]	General
Adhesive Application Processes 2	 [Note E]

Flexible vinyl	  [Note H]  250	Flexible vinyl	250

Fiberglass	[Notes F & H]  200

Reinforced plastic composite  [Note F]	[Note F]  200

Metal	        [Note H]  30	Metal	30

Porous material (Including wood)	        [Note H]  120	Porous Material
(Excluding Wood)	120

Rubber	[Note H]  250	Rubber	250

Other substrates	[Note H]  250	Other Substrates	250

 	 	Wood	30

* The VOC content is determined as the weight of volatile compounds,
less water and exempt compounds as specified in Section VI of this rule.

1 Emission limits are mass of VOC per volume of adhesive or adhesive
primer, excluding water and exempt compounds.

2 If an adhesive is used to bond dissimilar substrates together, then
the applicable substrate category with the highest VOC emission limit is
recommended as the limit for such application.  The analogous provision
in the OTC Model Rule is found in Section III. (3) of that rule.

Notes:

A.  The CTG is inconsistent with the State rules cited in Appendix B in
that none of these rules set a limit for “tire repair” adhesives (as
that term is defined in each of these rules) but rather set a limit for
“tire retread(ing) adhesives” which is the same as the 100 g
VOC/liter limit in the OTC model rule (which is as expected since this
rule is based upon one or more of the California rules).

B.  The CTG has the words “Adhesive Primer” in its table whereas in
the OTC model rule this is to be understood from the sub-heading.

C.  The CTG and OTC Model Rule use slightly different terms to cover the
same processes or products.

The CTG uses the term “Floor Covering Installation (Perimeter Bonded
Sheet Vinyl)” to cover what the OTC Model Rule covers as “Perimeter
Bonded Sheet Vinyl.”

The term “Sheet-applied rubber installation” in the OTC Model Rule
means the same thing as “Sheet Rubber Lining Installation” in the
CTG.

“Contact bond” adhesive and ““Contact adhesive” would appear
to be the same thing.  Both the OTC Model Rule and the CTG definitions
for “Contact bond adhesive” are the same and both use “Contact
adhesive” within this definition to refine its scope.

The OTC Model Rule uses “Plastic Cement Welding Adhesive Primer”
where the CTG uses “Plastic Solvent Welding Adhesive Primer” for the
same product/process.

D.  The inclusion of the category “plastic adhesive primer” in the
Draft CTG was an error.  This category has been removed from the final
CTG.

E.  The OTC model rule uses the term “Adhesives Applied to the Listed
Substrate” where the CTG uses the term “General Adhesive Application
Processes.”

F.  The CTG covers more materials with the broader definition of
“Reinforced plastic composite” than the OTC model rule if the latter
considers “fiberglass” to means fine glass fibers in a plastic
resin.   But the OTC rule defines “fiberglass” as a material
consisting of extremely fine glass fibers; thus, a “fiberglass
substrate adhesive” could be interpreted as meaning an adhesives used
to bond glass fibers together or to another listed substrate.  The OTC
definition is consistent with several California AQMD rules such as
SCAQMD Rule 1168, Sacramento Metropolitan AQMD Rule 460; other
California AQMDs do not define “fiberglass” – e.g., San Diego
County AQMD rule 67.21; however, Ventura County AQMD Rule 74-20 defines
fiberglass as “…any fiber reinforced plastic (FRP) surface that has
fiber material set in a binding substance of plastic resins” which
appears to be the functional equivalent of the final CTG’s definition
of “Reinforced plastic composite.”

G.  To the extent the OTC Model Rule limit for “Automotive glass
adhesive primers” and the recommendation in the final CTG for “Motor
Vehicle Glass Bonding Primer” both cover the same material or process
the recommendation in the OTC model rule is more stringent.  To the
extent that the definition of recommendation in the final CTG for
“Motor Vehicle Glass Bonding Primer” covers more processes or
operations the recommendation in the final CTG would be more stringent
except the OTC model rule may cover any additional products under the
other primer category.  The recommendation in the OTC model rule for
applying an “Automotive glass adhesive primer” to automotive glass
is clearly more stringent.  However, recommendation in the CTG for
“Motor Vehicle Glass Bonding Primer” would cover primers applied to
“body openings” prior to the application of glass bonding adhesives
or the installation of adhesive bonded glass.  Body openings may include
substrates such as bare metal or plastic as well as the glass itself.
To the extent the limit for “other adhesive primers” covers “Motor
Vehicle Glass Bonding Primers” other than those when applied to
automotive glass, the recommendation in the OTC model rule would seem to
be more stringent.

H.  Whether the recommendation in the OTC model rule is equal to, less
stringent or more stringent than the recommendations in the CTG for
these categories depends upon whether the OTC model rule covers these
applications under the “Adhesives Applied to the Listed Substrate”
and which limit applies.  The applicable limit depends upon what
substrates are involved.   The OTC model rule allows compliance to the
higher of two applicable substrate limits when bonding dissimilar
substrates.  In no case is an OTC limit for any “listed substrate”
greater than that recommended in the CTG for “Motor Vehicle
Adhesives” and “Motor Vehicle Weatherstrip Adhesives;”as such, the
OTC model rule would seem to be more stringent.

I.  The OTC Model rule applies a limit to ethylene propylene diene
monomer (EPDM) roof membranes.  The CTG excluded EPDM membranes from the
VOC recommendation for “Single-Ply Roof Membrane
Installation/Repair” specialty adhesives based upon comment that such
limits could not be met for field applied EPDM.  Some OTC States have
limited the CTG recommendation for May 1 to September 30 for two years
and then set the limit year-round after that.

IX.  Conclusions

The OTC Model rule and specifically, COMAR 26.11.35, for adhesives and
sealants and the 2008 CTG for miscellaneous industrial adhesives were
developed to address the emissions of VOC from adhesives.  The CTG was
developed with a restriction that it only applies to larger sources with
manufacturing operations that use these types of products.  Whereas, the
OTC model rule includes these sources as well as smaller operations,
operations performed in the field and also regulation of the
manufacture, distribution and sale of the products themselves.  The OTC
model rule also regulates sealants and sealant primers which are not
included in the CTG because they were not categorized with miscellaneous
industrial adhesives under section 183(e).

The CTG and the OTC model rule exemption categories are very similar
though some differences exist, but the CTG recommends that exempted
operations be subject to work practices.  The OTC model rule does not
include work practices.  The work practices benefit cannot be quantified
and in these instances, generally apply to lower usage source categories
so very few emission reductions are missed by not including these
requirements.  The OTC model rule contains an exemption provision which
is in fact a de facto applicability level that equates to 400 pounds per
year of VOC emissions which is less than the CTG’s yearly limit of 3
tons per year.  The model rule’s 400 pounds per year exclusion
includes emissions from sealants and sealant primers and not just
adhesives and their primers and therefore sets a lower numerical limit
and includes more emissions subject to the applicability threshold.

The CTG recommended work practices for cleaning materials included more
activities than the OTC model rule.  However, some of the OTC clean-up
provisions are more stringent, i.e. limiting clean-up solvent vapor
pressure and VOC content, and cleaning of spray application equipment;
overall, the OTC requirements in terms of emission reductions are at
least equivalent to or result in more emission reductions than the CTG.

The CTG makes recommendations for application methods be used in
conjunction with the use of low-VOC content adhesives and adhesive
primers to improve transfer efficiency.  The OTC rule does not specify
application methods.  The CTG recommendation goes to “stationary
sources” above a cut-off level only.  The OTC model rule was based on
the CARB 1998 RACT and best available retrofit control technology
(BARCT) determination for adhesives and sealants which did not include
the requirement for application methods.  Maryland’s proposed
rulemaking states that 96 percent of the adhesive and sealant VOC
emissions in the OTC States fall into the area source category.  This
would appear to limit the benefit from improved transfer equipment.
However, EPA recommends that when the States evaluate RACT as required
by section 182(b) when implementing a revised 8 hour ozone standard,
that they review and evaluate the benefit of requiring improved methods
for applying coatings regulated by the OTC model rule and specifically,
COMAR 26.11.35.

Overall, the CTG and the OTC model rule emission limits are similar with
the exception of general adhesive for wood applications.  The CTG
recommends a 30 g/liter limit for the wood substrate category whereas
the OTC model rule covers wood under the “porous material” substrate
category with a limit of 120 g/liter.  It is recommended that when the
States evaluate RACT as required by section 182 (b) when implementing a
revised 8-hour ozone standard, that they review the VOC content limit
for wood adhesives.

The CTG does not require State rules to match the line-by-line,
item-by-item because it stated:  “When State and local pollution
control agencies develop RACT rules; they may elect to adopt control
approaches that differ from those described in this document and/or
promulgate applicability criteria that differ from those recommended
here.”  (CTG page 3.)  For the most part the OTC Model rule and
specifically, COMAR 26.11.35, match the CTG’s recommendations item by
item.  The OTC Model rule and specifically, COMAR 26.11.35, requires the
emission limitations apply to a wider universe of sources and to
manufacturers and distributors of adhesives and primers.  The OTC Model
rule and specifically, COMAR 26.11.35, sets standards for clean-up and
surface preparation solvents in lieu of the application methods and all
work practice recommendations in the CTG.  Overall, EPA can conclude the
OTC Model rule and specifically, COMAR 26.11.35, meets the requirement
for RACT in this source category.

   See 75 FR 2938, January 19, 2010.  In this proposed rule, March 2008,
based upon reconsideration of the primary and secondary ozone standards,
EPA proposed to set different primary and secondary standards than those
promulgated in March 2008 to provide requisite protection of public
health and welfare, respectively.

 The latest listing of product categories regulated under section 183(e)
of the CAA was published on May 16, 2006 (71 FR 28320).

   See 75 FR 2938, January 19, 2010;  In this proposed rule, March 2008,
based upon reconsideration of the primary and secondary ozone standards,
EPA proposed to set different primary and secondary standards than those
promulgated in March 2008 to provide requisite protection of public
health and welfare, respectively.

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