Responses to Public Comments for the Notice of Proposed Rulemaking: The
2008 Critical Use Exemption from the Phaseout of Methyl Bromide

U.S. ENVIRONMENTAL PROTECTION AGENCY

OFFICE OF AIR AND RADIATION

DECEMBER 19, 2007TABLE OF CONTENTS

Section	Page

1. PROPOSED CRITICAL USES
……………………….............................	3

1.1 Approved Critical
Uses………………………………………….	3

1.1.1. Pre-Plant Approved Critical Uses…………………….	3

           1.1.1.A.  Golf Courses and Turf Producers..................	3

1.1.2. Post-Harvest Approved Critical Uses………………...	4

1.2 Approved Critical Users and Locations of Use…………………	5

1.3 Limiting Critical
Conditions…………………………………….	6

1.3.1. Pre-plant Limiting Critical Conditions……………….	6

1.3.2. Post-Harvest Limiting Critical Conditions…………...	6

2. PROPOSED CRITICAL USE AMOUNTS……………………………...	8

3. PROPOSED CALCULATION OF AVAILABLE STOCKS………........	12

3.1 The Supply Chain
Factor………………………………………..	12

4. PROPOSED TREATMENT OF CARRYOVER MATERIAL…………..	23

4.1 The Petition Submitted By Chemtura Corporation……………...	26

4.2 Reporting Requirements to Calculate Carryover Amounts……..	28

5. CRITICAL USE METHYL BROMIDE FOR RESEARCH PURPOSES.	30

6. METHYL BROMIDE ALTERNATIVES………………………………..	31

6.1 Post-Harvest
Alternatives……………………………………….	31

6.2 Pre-Plant
Alternatives…………………………………………...	34

7. THE CRITERIA IN DECISIONS IX/6 and EX.I/4……………………...
40

8. EMISSIONS
MINIMIZATION…………………………………………..	41

9. PROPOSED CRITICAL USE ALLOWANCE ALLOCATIONS……….	43

10. PROPOSED CRITICAL STOCK ALLOWANCE ALLOCATIONS AND TOTAL VOLUMES OF
CRITICAL USE METHYL BROMIDE…..	46

11. STOCKS OF METHYL BROMIDE……………………………………
48

11.1 Treatment of
Stocks……………………………………………	48

11.2 Confidentiality of Aggregate Pre-Phaseout Inventory Data…...	49

12. RULEMAKING AND THE REGULATORY PROCESS……………...	51

Appendix. Commenters at the Public Hearing for This Rulemaking……….
54

1. Comments Relating to the SECTION V.C. PROPOSED CRITICAL USES

What We Proposed:

	The comments in this section correspond to Section V.C. of the preamble
to the proposed rule and address approved critical uses, approved
critical users and locations of use and limiting critical conditions as
listed in Table I of the preamble.

Comments relating to this section

Commenter	Organization	Document ID #

Gene Harrington	National Pest Management Association	OAR-2006-1016-0137

David Mueller	Fumigation Service & Supply, Inc.	OAR-2006-1016-0144

Bruce Houtman	Dow AgroSciences, LLC	OAR-2006-1016-0152

Dan Haley	Walnut, Prune, and Fig Industry	Hearing 1

Joel Jackson	Florida Golf Course Superintendents Association	Hearing 8

Bryan Unruh	University of Florida	Hearing 10

1.1 Approved Critical Uses

1.1.1. Pre-Plant Approved Critical Uses

1.1.1.A. Golf Courses and Turf Producers

Comment:

	At the public hearing for this action, the Florida Golf Course
Superintendents Association (FGCSA) and a researcher from the University
of Florida noted that the golf and turf industry has been identified as
a critical user of methyl bromide in Caribbean and Latin American
countries, but not in the U.S.  The commenters asserted that golf and
turf uses are unfairly judged as frivolous, but that they are legitimate
businesses and deserve consideration under the Protocol.  The commenters
stated that golf and turf was an approved Critical Use Exemption (CUE)
user during the initial cycle of the CUE review process, since which the
state of alternatives has not changed for the industry. [Document ID:
Hearing 8, Hearing 10]

Our Response:

	As the commenter correctly noted, EPA nominated turf as a critical user
of methyl bromide in every nomination up to and including the 2008
Critical Use Nomination (CUN).  In 2006, the Parties to the Protocol did
not include golf or turf as a critical use in table C of the annex to
Decision XVIII/13, which set forth the agreed critical-use categories
for 2008.  EPA did not submit a nomination for turf or golf uses in 2007
for the 2009 growing season.  EPA however, notes its disagreement with
the categorization that the golf and turf industries are critical users
in Caribbean and Latin American countries.  The Protocol establishes
2015 as the date by which Article 5 countries must phase out the use of
methyl bromide. Thus, as of yet, there is no critical use exemption
process for Article 5 countries.

Comment:

	At the public hearing for this rulemaking, FGCSA commented that golf
and turf is the only sector to have shown actual market disruption
figures (in an amended CUE application).  The commenter further stated
that without a supply of pre-plant methyl bromide, the golf industry has
to use larger quantities of traditional pesticides to fight weeds,
diseases, and insects, which runs counter to EPA’s mission to protect
the environment. [Hearing 8]

Our Response:

	The Methyl Bromide Technical Options Committee (MBTOC) did not
recommend turf as an approved critical use for 2008 in its report
published September 2006.  MBTOC’s rationale for not recommending turf
as an approved critical use was that effective alternatives are
available, and that alternatives such as dazomet provide comparable
control of off-type grasses.  Furthermore, recent research presented at
the 2006 Methyl Bromide Alternatives Outreach conference by Robert
Walker and Jason Belcher of Auburn University suggests that there are
effective alternatives to methyl bromide for sod production.  This
presentation is available online at   HYPERLINK
"http://www.mbao.org/2006/06Proceedings/mbrpro06.html"
http://www.mbao.org/2006/06Proceedings/mbrpro06.html , or upon request
from the contact listed for this rulemaking.  While EPA is concerned
about the environmental effects of alternatives, EPA does not believe
that the environmental effects of using traditional pesticides,
especially when used in accordance with their FIFRA labeling, is a
technical barrier to their adoption.

1.1.2. Post-Harvest Approved Critical Uses

Comment:

	Fumigation Service & Supply, Inc. (FSS) noted that post harvest
application requests by North American Millers Association (NAMA), NPCA,
Pet Food Institute, and U.S. Rice Millers Association were for
applications for which methyl bromide is not necessary, and stated that
they should not receive CUE allocations. [OAR-2006-1016-0144]

Our Response:

	EPA is aware that sulfuryl fluoride is a feasible alternative for some
post-harvest applications in the sectors mentioned by the commenter.
However, in assessing the need for methyl bromide for these applicants,
the U.S. Government (USG) and the Parties to the Montreal Protocol on
Substances that Deplete the Ozone Layer (Parties) have agreed that given
certain limiting critical conditions, sulfuryl fluoride is not currently
a feasible alternative for all applications in these post-harvest
sectors.  In the 2008 CUN, USG included annual transition rates for
sulfuryl fluoride between 12-18% for the sectors that the commenter
referred to.  These transition rates were applied because EPA’s
analysis suggests that more time will be needed for these sectors to
fully transition.

	The 2008 U.S. CUN assessed the feasibility of methyl bromide
alternatives for each of these uses, and found that the specific uses
listed in column B of Table I in the preamble to the proposed rule, with
limiting critical conditions listed in Column C, should qualify for
critical use methyl bromide in 2008.  Section V.C. of the preamble to
the proposed rule explained that those uses were also approved by the
Methyl Bromide Technical Options Committee (MBTOC), an advisory body to
the Parties, and were agreed to by the Parties in Decision XVIII/13.
With the exception of NPMA cocoa bean fumigation, discussed more in
Section V.D.6. of the proposed rule, the approved critical uses that the
commenter objected to were also recommended for critical use methyl
bromide in the 2009 U.S. CUN, which EPA considers the best available
assessment of methyl bromide alternatives.  Furthermore, in September
2007 the Parties agreed, in Decision XIX/9, that these uses should
qualify for critical use methyl bromide in 2009.

	As demonstrated by the case of NPMA cocoa bean fumigation, EPA
continues to assess the feasibility of alternatives, and will adjust
critical use nominations and allocations accordingly, based on the best
available information.

1.2 Approved Critical Users and Locations of Use

Comment:

	The National Pest Management Association (NPMA) requested that EPA
revise the description of NPMA’s use pattern in Column B of Appendix L
on page 48980.  The commenter stated that the following language more
accurately describes the NPMA use patterns, and is also consistent with
the language from the final allocation rules in the 2005 supplemental
rule and the 2006 and 2007 allocation rules:

“Members of the National Pest Management Association treating cocoa
beans in storage and associated spaces and equipment and processed food,
cheese, dried milk, herbs and spices and spaces and equipment in
associated processing facilities.” [OAR-2006-1016-0137]

Our Response:

	EPA agrees with the commenter and has incorporated this suggestion in
the Final Rule, because it clarifies that commodities shall be fumigated
as part of space fumigations.

1.3 Limiting Critical Conditions

1.3.1. Pre-plant Limiting Critical Conditions

Comment:

	Dow AgroSciences, Inc. (Dow) requested that some of the pre-plant
limiting critical conditions be removed or modified in the final rule.
For example, the commenter stated that with the availability of
1,3-Dichloropropene (1,3-D) as a nematicide, “nematode infestations”
should not qualify as a limiting critical condition.
[OAR-2006-1016-0152]

Our Response:

	The 2008 CUN explains that 1,3-D is effective against nematodes, but
1,3-D is not a feasible alternative for many growers.  For example, the
2008 CUN states that approximately 40% of Florida tomato land has karst
geology, which precludes the use of 1,3-D because of groundwater
contamination that could result.  For many growers that can not use
1,3-D, nematode infestation is a condition for which methyl bromide is
the only feasible treatment option.  Therefore, nematode infestation
remains a legitimate limiting critical condition for many growers.  As
discussed more below, EPA has adjusted pre-plant critical use exemption
amounts to account for the fact that 1,3-D is often a feasible
alternative for land without karst geology.  As a result, EPA assumes
that market forces will dictate that critical use methyl bromide will
not be used against nematodes for growers that can use 1,3-D instead.

1.3.2. Post-Harvest Limiting Critical Conditions

Comment:

	Dow commented that some post-harvest use limiting critical conditions
are no longer relevant and should be removed.  The commenter also noted
that sufluryl fluoride has superseded phosphine and heat as the
preferred alternative in post-harvest use categories.  The conditions
that the commenter requested for removal were: 1) Time to transition to
an alternative; 2) older structures that cannot be properly sealed; 3)
presence of sensitive electronic equipment subject to corrosion by
phosphine; and 4) rapid fumigation. [OAR-2006-1016-0152]

Our Response:

	EPA addresses the transition rate and overall feasibility of sulfuryl
fluoride for post-harvest sectors in Section V.D.6. of the preamble to
the final rule.  Section V.C. of the preamble to the final rule explains
that EPA has removed “the inability to seal older structures” as a
limiting critical condition from the rule text.  As discussed in the
2008 CUN, research is still ongoing regarding the efficacy of sulfuryl
fluoride for the post-harvest critical uses listed in Table I of the
preamble, and EPA must ensure that post-harvest sectors have sufficient
time to validate and adopt the new technology.  Therefore, the presence
of sensitive electronic equipment remains a proper limiting critical
condition for critical use applications that would otherwise use
phosphine, which corrodes electronic equipment.

	Regarding the rapid fumigation limiting critical condition for certain
post-harvest sectors, the United States Department of Agriculture (USDA)
Agriculture Research Service (ARS) is currently conducting research on
the efficacy and practicality of using alternative fumigants, including
sulfuryl fluoride, to control post-harvest pests of durable commodities
such as nuts and dried fruit.  While acknowledging that sulfuryl
fluoride appears to have the potential to provide effective and rapid
vacuum fumigation of nuts and dried fruit, the Agency must ensure that
the tree nut and dried fruit industry has sufficient time to validate
and adopt the new technology.  Therefore, rapid fumigation remains a
valid limiting critical condition for the sectors where it is listed in
Table I of the preamble.

2. Comments Relating to Section V.D. PROPOSED CRITICAL USE AMOUNTS

What We Proposed:

	The comments in this section correspond to Section V.D. of the preamble
to the proposed rule and address proposed critical use amounts.  EPA
proposed 4,816,515 kg of methyl bromide to satisfy critical uses in
2008, with 3,101,075 kg from new production or import, and 1,715,438 kg
supplied from existing pre-phaseout inventory.  In Section V.D. EPA
proposed to reduce the amount of 2008 new production agreed to by the
Parties to account for: the amount of stocks available for critical
uses, the amount of methyl bromide for research purposes, carryover
critical use material from 2006, and new information about the
feasibility of alternatives.

Comments relating to this section

Commenter	Organization	Document ID

Daniel Botts	Florida Fruit & Vegetable Association	OAR-2006-1016-0134

Edward Ruckert	Crop Protection Coalition	OAR-2006-1016-0135

Steven Hensley	USA Rice Federation	OAR-2006-1016-0136

James Bair	North American Millers’ Association	OAR-2006-1016-0143

David Mueller	Fumigation Service & Supply, Inc.	OAR-2006-1016-0144

David Doniger	Natural Resources Defense Council	OAR-2006-1016-0145

Charles Hall	Georgia Fruit and Vegetable Growers Assoc.
OAR-2006-1016-0146

Charles Franklin and Paul Gutterman	Chemtura Corporation
OAR-2006-1016-0147

Shawn Crocker	Florida Strawberry Growers Association	Hearing 7

Reggie Brown	Florida Tomato Exchange	Hearing 9

Comment:

	Seven commenters objected to EPA’s proposed maximum allowable amount
of methyl bromide to be used for critical uses in 2008 on the grounds
that it is lower than required by the Parties to the Montreal Protocol
and that it underestimates the actual methyl bromide need for crops.
[OAR-2006-1016-0134, 0135, 0136, 0143, 0146, 147, Hearing7, Hearing9]

Our Response:

	EPA is implementing reductions to the total amount of methyl bromide
authorized for critical uses by the Parties in Decision XVIII/13 for two
reasons.  First, EPA is making reductions of 27,769 kg to account for
new information about the feasibility of iodomethane and sulfuryl
fluoride, as discussed in Section V.D.6. of the preamble to the final
rule.  Second, EPA is making reductions of 499,234 kg to account for
carryover critical use material from 2006, as discussed in Section
V.D.4. of the preamble to the final rule.

	In the preamble to the proposed rule, EPA sought new information about
the feasibility of alternatives and stated that such information had the
potential to alter EPA’s determination as to what amounts of methyl
bromide qualify for the critical use exemption in 2008 (72 FR 48960).
As discussed in Section V.D. of the preamble to the final rule, EPA
received new information about alternatives after the proposed rule was
published, and is making appropriate adjustments in the final rule to
account for that information.  New information justifying increased
uptake of methyl bromide alternatives warrants reductions in the overall
amount authorized by the Parties because it reduces the overall need for
methyl bromide to satisfy critical needs in 2008.

	In the Framework Rule (69 FR 76982), EPA established a system to reduce
critical use amounts to account for unused carryover amounts of critical
use methyl bromide from previous years.  The implementation of this
policy is discussed in detail in Section V.D.4. of the preamble to the
final rule.  It is appropriate to reduce the total critical use amount
to account for carryover, because the pool of critical use material
unused in previous years is available for critical uses in subsequent
years.  Therefore, carryover amounts can offset the need for a certain
amount of new production, import or supplies from pre-phaseout
inventory.

Comment:

	Two commenters stated that the methyl bromide allocations are reduced
at each stage of the review process and should not be further reduced by
the Agency. [OAR-2006-1016-0135, 0136]

Our Response:

	The commenters are correct that methyl bromide amounts for critical
uses are adjusted as EPA prepares nominations, the Parties approve
critical use amounts, and EPA allocates CUEs in a notice-and-comment
rulemaking.  Each of these steps in the exemption process represents an
independent assessment of the critical need for methyl bromide, and
adjustments are made accordingly.  2008 requests for critical use methyl
bromide were 62.4% of the 1991 baseline.  After thorough technical and
economic analysis described in the 2008 CUN, the USG nominated 23.1% of
baseline for 2008.  As described in more detail in the preamble of the
final rule, the Parties to the Montreal Protocol authorized the
equivalent of 21.0% of baseline for 2008 critical uses.  For reasons
described in the preamble of the final rule, further reductions were
taken to account for new information about the feasibility of
alternatives and carryover critical use methyl bromide not used in 2006.
 The final rule allocation amounts of critical use methyl bromide are
equivalent to 18.8% of baseline (with 6.7% coming from pre-phaseout
inventory).  While the USG endeavors to allow the private sector to
supply adequate levels of methyl bromide for critical users by
nominating and negotiating for adequate amounts of critical use methyl
bromide, it will not allocate to uses for which there are feasible
alternatives.  Reductions are informed by the best available
information, and recommendations from relevant technical experts.

Comment:

	The commenter believes that the Agency should not change the amounts of
CUE methyl bromide approved by the Parties because this allocation is
the amount that U.S. economic competitors believe is necessary.  The
commenter believes that only substantial changes in the technical and
economic feasibility of potential alternatives should cause the Agency
to alter the Parties’ allocations.  [OAR-2006-1016-0143]

Our Response:

	EPA explains the reasons for reducing the amount of methyl bromide
authorized by the Parties in the preamble to the final rule.  The Agency
reiterates that critical use exemptions are only for those areas where
technically and economically feasible alternatives are not available,
and thus EPA changes the amount authorized by the Parties based upon new
information about the technical and economic feasibility of
alternatives.  For example, in this final rule, EPA is altering the
amounts authorized by the Parties due to additional information about
the feasibility of the alternatives sulfuryl fluoride and iodomethane.
See Section V.D.6 of the preamble for further discussion.  EPA is also
making adjustments based on the amount of carryover critical use methyl
bromide from previous years, as discussed in Section V.D.4. of the
preamble to the final rule, because that material, which can be used for
critical uses, offsets the need for additional critical use allowances
(CUAs) or critical stock allowances (CSAs).

Comment:

	At the public hearing for this action, a representative of the Florida
Strawberry Growers Association commented that foreign markets that have
access to methyl bromide will out-compete the U.S. as U.S. methyl
bromide users lose access.  Therefore, the commenter requested that EPA
approve larger amounts of methyl bromide under the critical use
exemption. [Hearing 7]

Our Response:

	The Parties to Protocol agreed to phase out use of methyl bromide in
industrialized countries and ultimately set 2005 as the date for
completion of that phaseout.  The Parties set 2015 as the date for the
phaseout in Article 5 (developing) countries.  Therefore, the Parties to
the Protocol recognized that developing countries may have access to
methyl bromide for a longer period of time.

	When the Parties negotiated the definition of the CUE they included
economic feasibility as a major criterion, which should limit some of
the competitive disadvantage that could result from the 10-year methyl
bromide phaseout lag for Article 5 countries.  Concerns about the
competitiveness of U.S. specialty crop growers may be tempered because
U.S. acreage for crops affected by the methyl bromide phaseout, such as
strawberries, continues to grow.

Comment:

	Fumigation Service & Supply, Inc. (FSS) commented that the Copenhagen
Amendment was signed by the U.S. to phaseout methyl bromide 14 years
ago, and believes that this time period has been adequate for all users
of methyl bromide to switch to alternative fumigation methods.  The
commenter believes that no methyl bromide CUEs should be allocated, and
that such allocations penalize companies that already phased out methyl
bromide. [OAR-2006-1016-0144]

Our Response:

	While EPA continues to support the transition to methyl bromide
alternatives it does not support an artificial deadline for the
phase-out of critical use methyl bromide.  The Montreal Protocol
continues to allow for methyl bromide use when there are no technically
or economically feasible alternatives.  This is emblematic of the
pragmatic nature of the Protocol, which has contributed to its great
success.  However, the USG continues to support research and adoption of
alternatives.  In an effort to speed adoption of alternatives, the USG
has invested over $150 million in research on potential methyl bromide
substitutes and alternatives. Promotion of alternatives through
education and extension, and robust testing and assessment of
alternatives continue to be USG priorities.

Comment:

	One commenter requests that EPA make a reduction in the 2008 CUE
allocations of at least 1,275 metric tons (5% of the baseline), and by
larger amounts in 2009 due to advancements in using sulfuryl fluoride
and iodomethane. [OAR-2006-1016-0145]

Our Response:

	As discussed above, EPA is reducing the total 2008 CUE allocations by
17,690 kg to account for the increased uptake of sulfuryl fluoride for
cocoa bean fumigation and by 14,472 kg to account for the uptake of
iodomethane in 2008.  It would be inappropriate, at this time, to
estimate whether additional reductions will be made for either of these
alternatives in the 2009 CUE allocation rulemaking.

3. Comments Relating to the Section V.D.2. CALCULATION OF AVAILABLE
STOCKS

What We Proposed:

	The comments in this section correspond to Section V.D.2. of the
preamble to the proposed rule and address EPA’s proposed refined
method for determining available stocks.  In this section EPA proposed
to include a supply chain factor (SCF) in its determination of the
amount of pre-phaseout inventory available for critical uses in 2008.

Comments relating to this section

Commenter	Organization	Document ID

Pamela Peckman	The Industrial Fumigant Company	OAR-2006-1016-0133

Edward Ruckert	Crop Protection Coalition	OAR-2006-1016-0135

Steven Hensley	USA Rice Federation	OAR-2006-1016-0136

James Bair	North American Millers’ Association	OAR-2006-1016-0143

David Mueller	Fumigation Service & Supply, Inc.	OAR-2006-1016-0144

David Doniger	Natural Resources Defense Council	OAR-2006-1016-0145

Charles Hall	Georgia Fruit and Vegetable Growers Assoc.
OAR-2006-1016-0146

Charles Franklin and Paul Gutterman	Chemtura Corporation
OAR-2006-1016-0147

Bruce Houtman	Dow AgroSciences, LLC	OAR-2006-1016-0152

Jim McBriarty	Ameribrom Inc.	Hearing 2

Comment:

	One commenter noted that EPA made a mathematical error in its
calculation of available stocks in the proposed rule by listing existing
stocks as 7,671,091 kg, which is the correct value, but using the value
7,671,000 kg in its calculation.  As a result, EPA underestimated
available stocks by 91 kg. [OAR-2006-1016-0149]

Our Response:

	As discussed in Section V.D.2. of the preamble to the final rule, EPA
has corrected the calculations in the final rule.

3.1 The Supply Chain Factor

Comment:

	One commenter believes that EPA’s proposal to draw down stocks
jeopardizes the U.S.’s ability to address a catastrophic supply
disruption. [OAR-2006-1016-0149]

Our Response:

	EPA proposed a SCF in its analysis of available stocks to accommodate a
catastrophic supply disruption such as the one mentioned by the
commenter.  EPA used conservative assumptions in the scenario analyzed
for the SCF estimate, which is described in the Technical Support
Document (TSD) on the docket.  EPA believes that this final rule
provides suppliers with the opportunity to maintain an adequate supply
buffer to satisfy critical needs in the event of such an emergency.

Comment:

	Seven commenters supported the creation of an SCF, but asserted that
the 15 week SCF suggested for use in the event of a supply disruption is
inadequate and recommend a one-year supply instead.
[OAR-2006-10106-0135, 0136, 0143, 0146, 0147, 0149, Hearing2]

Our Response:

	The commenters may have misunderstood EPA’s analysis as described in
the TSD.  We found that it would take up to 15 weeks for adequate
amounts of methyl bromide imports to reach the U.S. if there is a
domestic production failure.  However, we also considered the
variability of production volumes throughout the year, and proposed an
SCF that would provide insurance against a production failure during the
peak production season (i.e. the beginning of the calendar year).  The
Agency’s proposed SCF is actually equivalent to about 51% of the
5,355,946 kg authorized for U.S. critical uses in 2008, or roughly a
six-month supply if demand were constant throughout the year.  Section
V.D.2. of the preamble to the final rule explains EPA’s justification
for this SCF size, as opposed to the one-year supply that the commenters
requested.

Comment:

	Four commenters stated that the SCF should be a one year supply because
of (1) the global ramifications that the supply disruption from the
U.S.’s one plant would have and (2) concerns about the ability of the
Israeli plant to divert methyl bromide to the U.S., especially in light
of the conflicts occurring in the Middle East. [OAR-2006-1016-0135,
0136, 0143, 0146]

Our Response:

	EPA agrees that a supply disruption in the U.S. could have important
global ramifications.  The Agency considered international factors in
its SCF analysis, which is described in the TSD.  For example, after
close scrutiny, EPA estimated that foreign production capacity is
capable of meeting global demands for all methyl bromide.  EPA also
found that, given the conservative assumptions of the production failure
scenario, existing shipping containers would be sufficient to maintain
the global distribution system for methyl bromide.  Therefore, based on
the assumptions described in the TSD, EPA estimates that the proposed
SCF would be large enough to mitigate the global ramifications that the
commenters raised for concern.

	Regarding the commenters’ second concern, EPA’s analysis, described
in the TSD, found that based on previous production levels, and also
considering current conditions, the Israeli production facility would be
able to ramp-up production rapidly enough to provide significant amounts
of methyl bromide to the U.S. in 15 weeks or less.  EPA also estimates
that existing container capacity would be sufficient to transport that
methyl bromide to the U.S. and other destinations.  The Agency’s
analysis found that Israel would not be forced to divert methyl bromide
from any previous customers in order to satisfy increased demand from
North America following a U.S. production failure.

	The TSD requires a determination about which contingencies to use as
the basis for the analysis.  Contingencies that are too speculative,
such as a simultaneous U.S. and Israeli production failure, or whose
effects cannot readily be quantified, were not included in the SCF
analysis described in the TSD.  However, EPA adopted a conservative
approach in recognition that its analysis could not address all possible
contingencies.  EPA believes that its analysis addresses the
commenters’ concerns and that therefore, the size of the SCF that EPA
is finalizing for 2008 is sufficient to serve its stated purpose.

Comment:

	The North American Millers’ Association commented that the U.S. would
not be sacrificing environmental goals by maintaining a one-year SCF
because stockpiled methyl bromide that is not in use can do no harm to
the environment. [OAR-2006-1016-0143]

Our Response:

	EPA notes that using existing methyl bromide can displace the need for
new production, with corresponding environmental benefits.

Comment:

	Chemtura and MBIP requested that EPA ensure a one-year methyl bromide
SCF that is capable of supporting all methyl bromide uses. The
commenters contended that EPA’s technical analysis does not accurately
estimate assumptions regarding the time required to import methyl
bromide.  The commenters stated that EPA should have considered QPS,
feedstock, and Article V methyl bromide uses in addition to critical
uses, which account for only 50 percent of U.S. methyl bromide use.  The
commenters also stated that importing the methyl bromide necessary to
meet U.S. demand would take far longer than 15 weeks due to 1) an
inflexible shipping system, 2) limited storage capacity and
unavailability of ISO shipping containers, 3) inability to ramp up
production in a short time period, 4) the need to receive government
approval before a foreign producer may increase production.  Finally,
the commenters quoted the technical limitations discussed in EPA’s
analysis and argued that these limitations render EPA’s final
calculation invalid. [Document ID: OAR-2006-0147, 0149]

Our Response:

	We do not believe that the technical limitations in our estimate, as
described in the TSD, render the final SCF calculation invalid, or
instead support a one-year supply chain factor.  Our SCF determination
is an estimate, and we think it is appropriate to be candid about the
limitations of our calculations.  To account for the uncertainties in
our estimate, we are using the conservative end of our technical
estimate.

	EPA believes that methyl bromide for quarantine and pre-shipment (QPS),
feedstock, and exempted Article 5 country (developing country) uses
would not have to be supplied from pre-phaseout inventory after a supply
disruption, because, as explained in the proposed rule, existing
regulations allow manufacturers and distributors to manage inventories
of methyl bromide designated for those purposes (72 FR 48968).

	In response to the concerns regarding the flexibility of the shipping
system, the possibility that methyl bromide distributors have not
conducted emergency response planning does not invalidate the SCF
estimate described in the TSD.  The Agency carefully considered physical
shipping constraints that dictate how rapidly methyl bromide
distribution patterns can shift, including ISO container capacity, the
length and timing of shipping routes, and the volume of methyl bromide
that would be shipped internationally to maintain the global
distribution system following a U.S. production failure.  However, the
TSD does not assume that distributors will need long periods of time to
redesign their distribution patterns in order to respond.  Since each
shipping route takes weeks to complete, the Agency believes that
industry would have ample planning time to re-route containers as
necessary.

	In response to concerns regarding storage capacity and capacity of the
existing ISO container fleet, EPA disagrees that the current fleet of
ISO containers would be unable to maintain the global distribution
system for methyl bromide within the 15-week period estimated by the
Agency.  The conclusions described in the TSD are based, in part, on a
detailed analysis of the capacity of the existing ISO container fleet,
and other shipping logistics.  EPA can not reconcile the differences
between the Agency’s estimate and MBIP’s estimate, because MBIP did
not provide details about how it concluded that the existing fleet of
containers would be inadequate.

	Chemtura, on the other hand, submitted diagrams to support their claim
that the existing ISO container fleet would be insufficient.  In their
public comments Chemtura stated, “To assist the Agency further in
understanding the logistical challenges raised by a shut-down of U.S.
production, Chemtura is submitting, as business-confidential exhibits,
two diagrams showing its estimates of the current global distribution
map, and how the distribution map would change if U.S. production were
suddenly disrupted.”  After close analysis, EPA found a number of
points of disagreement with the assumptions in Chemtura’s confidential
submission.  In general, these disagreements are related to concerns
that Chemtura raised in its public comments, which EPA addresses in the
preamble for the final rule.  For confidentiality reasons, the Agency is
unable to elaborate on how Chemtura’s submission conflicts with the
analysis explained in the TSD.  The Agency closely analyzed Chemtura’s
confidential submissions and did not find a specific reason therein to
revise the TSD, or the size of the proposed SCF.  EPA’s detailed
response to Chemtura’s confidential comments has been placed on a
confidential docket because it includes information claimed as
confidential business information.

	In response to concerns about time and approvals required to ramp-up
foreign production, EPA built in a certain amount of time —starting
from the time of disruption of the U.S. supply chain—for foreign
producers to make arrangements and adjustments to their production
schedules before they would need to ramp-up production.  EPA’s
analysis assumed that the first container carrying methyl bromide from
Israel to the U.S. would leave Israel approximately 45 days after a
hypothetical U.S. production failure.  This would give Israel a number
of weeks to produce or make available extra methyl bromide to ship to
the U.S. EPA considers the ability of foreign producers to ramp-up
production, including gaining access to raw materials and storage
capacity, and estimates that this timeframe would be adequate.

	Regarding governmental approval for extra production, foreign producers
could increase production and exports to the United States without
approval from the Parties to the Montreal Protocol, so long as U.S.
entities holding CUA allowances are willing to expend their CUAs to
import that material.  The commenters did not provide specific
information about other governmental approvals that may be necessary, or
whether there are steps that foreign producers could take in advance as
contingency measures that would alleviate these concerns.

	In conclusion, EPA’s analysis, in combination with information
provided from comments, finds that the SCF that the Agency is finalizing
(2,717,051 kg) is sufficient to alleviate shortages in the scenario that
EPA analyzed.  The Agency is not persuaded that a one-year SCF, as the
commenters requested, would be necessary.

Comment:

	Chemtura commented that the U.S. delegation requested a six month SCF
from the Parties in September, thus acknowledging the need for a larger
SCF than is now suggested. This commenter stated that EPA needs to
acknowledge methyl bromide’s role as a tool in responding to
catastrophic events such as widespread re-fumigation after a natural
disaster.  The commenter also stated that methyl bromide has security as
well as economic importance. [OAR-2006-1016-0147]

Our Response:

	EPA acknowledges methyl bromide’s role in responding to the
situations described by the commenter.  Methyl bromide’s role in
responding to such challenges is one of the reasons EPA proposed a SCF
in its analysis of available stocks, and based its estimate of the SCF
on conservative assumptions.  EPA, though, disagrees with Chemtura’s
characterization of the events at the September 2007 Meeting of the
Parties (MOP), and with Chemtura's assertion that the events at the MOP
contradict this rulemaking.  A negotiating position does not constitute
a factual basis for a rulemaking, or a specific policy or technical
finding of the USG.  Furthermore, as explained in the proposed rule (72
FR 48966), EPA's proposed SCF provides a technical basis for calculating
available stocks that is consistent with the Montreal Protocol, and
clearly within EPA's authority under Section 604(d)(6) of the Clean Air
Act.

Comment:

	MBIP and Industrial Fumigant Company (IFC) commented that chloropicrin
is premixed in “virtually the entire” U.S. inventory of existing
stocks.  The commenter stated that this is problematic for post-harvest,
QPS, and feedstock methyl bromide users because these uses require pure
methyl bromide.  Therefore, an SCF comprising existing stocks would not
be useful to these sectors. Additionally, regulations regarding the
import, export, and labeling of chloropicrin could delay the import of
methyl bromide to the U.S. following a supply disruption.
[OAR-2006-1016-0133, 0149]

Our Response:

	MBIP did not provide detailed information to support their claim about
the prevalence of chloropicrin in the remaining pre-phaseout inventory,
and EPA’s current reporting requirements do not request information
about all of the characteristics, or composition, of that inventory.
Just prior to publishing the proposed rule, the Agency received
anecdotal information suggesting that a large percentage of the
remaining inventory is mixed with chloropicrin, and therefore unsuitable
for post-harvest uses.  EPA has also heard conflicting reports stating
that a substantial portion of the pre-phaseout inventory is pure methyl
bromide.

	The Agency is currently considering options to obtain more information
about the characteristics of the pre-phaseout inventory, including but
not limited to, requesting information from holders of pre-phaseout
inventory using its information-gathering authority under section 114 of
the Clean Air Act.  If the prevalence of chloropicrin in the
pre-phaseout inventory becomes a serious problem for post-harvest
critical users, and because the CUA amount in today’s final rule is
less than the production amount authorized by the Parties, EPA may
consider allowing the conversion of some CSAs to CUAs in appropriate
circumstances.

	The Agency also recognizes that if pre-phaseout inventories contain
very small amounts of pure methyl bromide, then allowing for a larger
supply buffer, or SCF, composed of that inventory would not remedy the
commenters’ concerns.

Comment:

	Ameribrom and MBIP commented that the distribution system for methyl
bromide in the U.S. is complex and expressed concern that imports would
not reach all repackaging locations in the same timeframe.  MBIP stated
that 500,000 kilograms of methyl bromide must remain in the system (a
minimum of 3,231 metric tons of pre-phaseout stocks) to keep the
domestic distribution system functional. [OAR-2006-1016-0149, Hearing 2]

Our Response:

	EPA specifically accounted for this concern in the proposed SCF
analysis.  The SCF would replace lost production for 15 weeks until
imports arrive.  Assuming these imports are all shipped to the location
where methyl bromide is currently produced in the U.S., imported methyl
bromide could be expected to reach repackaging locations in the same
amount of time as if there were no production failure.  EPA recognizes
that the timely distribution of pre-phaseout stocks after a domestic
production failure would depend upon business decisions made by
suppliers.  However, the proposed SCF is large enough to give suppliers
the opportunity to provide uninterrupted distribution in the analyzed
scenario.

Comment:

	MBIP asserted that EPA’s assumption that all of the pre-2005
inventory of methyl bromide would be available for critical uses in the
event of a production failure is inaccurate.  The commenter stated that
companies holding stocks are permitted to sell them for any use and that
critical users that do not have contracts with inventory holders could
have a difficult time obtaining methyl bromide from stocks.
[OAR-2006-1016-0149]

Our Response:

	The commenter is correct that EPA lets firms respond to market
conditions, instead of requiring them to sell methyl bromide to critical
users.  In the December 24, 2004, Framework Rule (69 FR 76989), EPA
finalized a system that allows for market forces to dictate the
distribution of pre-phaseout inventory to specific end-users.  EPA chose
this approach, at least in part, to promote market flexibility and
efficiency.  Based on EPA’s estimate that there are significant
amounts (approximately 1,729 metric tons) of pre-phaseout inventory
available for critical uses in 2008, the Agency expects that holders of
pre-phaseout inventory will be able to expend the full amount of 2008
CSA allocations in order to satisfy the needs of critical users.

Comment:

	MBIP commented that EPA did not consider regulatory obstacles under
FIFRA that may delay the availability of alternate supply.  This
commenter asserted that if production is shifted to another location,
the source information, manufacturing process data, and labels for all
affected products would have to be updated before the products could be
imported or distributed in the U.S. [OAR-2006-1016-0149]

Our Response:

	Data about sales of critical use methyl bromide shows that imported
methyl bromide is used in the U.S.  This suggests that at least some
foreign production practices, formulations and locations are registered
with the USG.  EPA does not obligate producers to register their
products for all U.S. critical uses, but the Agency expects that firms
will respond to market conditions, and undertake appropriate emergency
response planning (e.g. seeking amendments to registrations to allow for
alternative production processes/production locations in the event of a
supply disruption).  A firm’s decision about whether to register its
product for critical uses is similar to business planning decisions
under the established critical stock allowance policy noted above; in
which EPA let firms respond to market conditions, instead of requiring
them to sell methyl bromide to critical users (69 FR 52376).  The Agency
believes that the added transparency of the SCF approach will help
companies respond to market conditions more rapidly and appropriately.

Comment:

	Dow commented that the SCF should be based on the actual 2008 methyl
bromide demand (4,816,514 kg) as determined by the USG and as proposed
in the rule rather than the amount approved by the Parties (5,355,946
kg).  The commenter stated that a SCF calculated upon a methyl bromide
volume that exceeds the critical need for 2008 renders the SCF value and
basis for the calculation nonsensical.  The commenter concluded that
this simple recalculation would reduce overall new MB production demand
in 2008 by more than 250,000 kg. [OAR-2006-1016-0150]

Our Response:

	It appears that the commenter’s figure for “actual methyl bromide
demand” is derived by subtracting the proposed 539,432 kg carryover
amount (72 FR 48969), from the 2008 critical use amount agreed to by the
Parties (5,355,946 kg) in Decision XVIII/13.  EPA reduces new production
to account for carryover critical use material in order to prevent
companies from building inventories of newly produced critical use
methyl bromide.  EPA reduces new production amounts to account for carry
over, but in doing so the Agency is not reopening the issue of the
overall amount of total critical need.  EPA expects that critical users
will satisfy the remainder of their critical needs by using the critical
use methyl bromide that was unused in previous control periods.  EPA
only considers valid, for the purposes of determining the total critical
need, those reductions that account for new information about the
feasibility of alternatives.  Accordingly, for the reasons explained in
Section V.D.6. of the preamble to the final rule, EPA is reducing the
total 2008 CUE by 27,769 kg to account for the increased uptake of
sulfuryl fluoride and iodomethane.  The Agency has re-calculated the SCF
with a total 2008 demand for critical uses of 5,338,256 kg.  This
adjustment reduces the SCF by 14,161 kg.

	To clarify, EPA proposed that the SCF should represent about 51% of the
total critical need in 2008.  In the proposed rule, the Agency assumed
that the total critical need in 2008 would be 5,355,946 kg, as agreed to
by the Parties in Decision XVIII/13.  Therefore, EPA proposed an SCF of
2,731,211 kg (5,355,946 kg * 50.994% = 2,731,211 kg).  As explained in
Section V.D.6. of this preamble, EPA now estimates that the total
critical need in 2008 will be 27,769 kg less than the Parties authorized
in Decision XVIII/13, because EPA is making further reductions to
account for the uptake of sulfuryl fluoride for cocoa bean fumigation,
and for the newly registered fumigant iodomethane.  Therefore, in this
final rule EPA estimates that the total critical need in 2008 will be
5,328,177 kg.  Accordingly, EPA now calculates an SCF of 2,717,051 kg
(5,328,177 kg * 50.944% = 2,717,051 kg).

Comment:

	Dow, FSS and NRDC objected to EPA’s proposal to create an SCF and
stated that the methyl bromide in question should be used to reduce or
eliminate the need for new production and import allocations for 2008.
[OAR-2006-1016-0144, 0145, 152]

Our Response:

	The supply chain factor is intended to provide a transparent analytical
tool that will foster greater understanding of the Agency’s process in
determining CSA amounts. By including a supply chain factor in its
calculation of available stocks, EPA is considering the drawdown of
pre-phaseout inventory and allocating critical use amounts that reflect
the size of the remaining pre-phaseout inventory.  EPA expects
pre-phaseout inventory to be used to “fill the distribution chain”
and simultaneously provide some buffer in case of a major supply
disruption. Given the small number of methyl bromide production
facilities around the world, and the continued drawdown of pre-phaseout
inventory, a major supply disruption is an important issue for Agency
consideration.

Comment:

	FSS commented believes that the SCF will be equivalent to existing
stockpiles and will be easy to get and use by those with restricted use
pesticide licenses.  The commenter stated that stockpiles or SCFs are
counterproductive to the phase out of methyl bromide and offer
disincentives to companies to invest in using alternatives.
[OAR-2006-1016-0144]

Our Response:

	The commenter is correct that this supply buffer would be composed of
methyl bromide produced before the January 1, 2005, phaseout.  The
commenter is also correct that non-critical users are not barred from
purchasing the pre-phaseout stocks of methyl bromide.  In the Final
Framework Rule, EPA explained its rationale and authority for allowing
non-critical users to access stocks (69 FR 76988).  EPA is not
revisiting that issue in this rulemaking.

	The Agency does not believe that the fact that producers and
distributors may sell stocks to non-critical users invalidates the
proposed SCF, or EPA’s proposed estimation of the amount of available
stocks in 2008.  The commenter is speculating about what suppliers will
do given the opportunity to maintain a buffer, which is something that
has not yet been tested.  Information on stock drawdown during 2008 will
inform EPA’s future CUE rulemakings.

	While EPA did not propose to require that distributors keep the SCF
amount as a supply buffer for critical users, Section V.D.3. of the
proposed rule laid out an approach in which the Agency would stop
drawing down stocks faster than the minimum agreed by the Parties, if
EPA determines that available stocks will be less than the SCF amount.
By considering a SCF in its analysis of the amount of stocks that are
available for critical uses, EPA is giving producers and distributors
the opportunity to provide a reasonable supply buffer to satisfy
critical needs.

Comment:

	NRDC objected to the SCF because the commenter believes that (1) the
Parties and Congress did not intend for EPA to designate stocks as
“unavailable;” (2) there is not a basis for the assumed risk of
catastrophic loss at the U.S. methyl bromide production plant, as no
such even has ever occurred at this location; (3) the chance of such an
event happening right after the first of the year is even less likely;
(4) no chemical company keeps more than a two or three month supply of a
chemical, yet the SCF is nearly a four month supply; (5) temporary
adjustments at a manageable cost can be made by methyl bromide users in
the event of a supply disruption, such as the use of alternatives or a
shift in fumigation schedules; and (6) the Parties rejected the U.S.
proposal to allow maintenance of a half-year supply chain reserve at the
19th Meeting of the Parties. [OAR-2006-1016-0145]

Our Response:

	First, EPA did not propose to designate any amount of stocks, or any
specific holdings, as “unavailable.”  EPA proposed to recognize the
amount of existing stocks that is available.  As discussed above and in
the proposed rule, in paragraph 4 of Decision XVIII/13, and similar
Decisions, the Parties indicated that each individual Party has
discretion to recognize the amount of existing stocks that are available
for critical uses.  Most recently, Table D of the Annex to Decision
XIX/9 explicitly indicated that the United States should reduce
authorized new production levels to account for the amount of available
stocks.  Thus, EPA’s proposed approach is consistent with the practice
under the Montreal Protocol.  It is also an appropriate exercise of the
discretion granted by Congress under Section 604(d)(6) of the Clean Air
Act.

	Second, the methyl bromide industry is unlike many others because there
is only one active production facility in the United States.  EPA
recognizes that a catastrophic loss is unlikely, but this does not
obviate the need to plan for such a scenario.  While EPA expects private
entities to take prudent steps to protect themselves, EPA does not wish
to render them incapable of maintaining a reasonable supply buffer.

	Third, though unlikely that a disruption will occur at the beginning of
the year, EPA adopted a conservative approach in recognition that its
analysis can not address all possible contingencies.

	Fourth, the commenter provides no evidence for its assertion that no
chemical company keeps more than a two to three month supply of a
chemical.  As stated above, the methyl bromide industry is unusual
because there is only one production facility in the United States,
which is also the lone production facility in the Western Hemisphere.
EPA proposed that the SCF for 2008 should be 2,731,211 kg, or roughly a
six-month supply of critical use methyl bromide if demand were constant
throughout the year.

	Fifth, EPA agrees that depending on when a supply disruption occurs, it
is possible that a limited number of entities might be able to delay
scheduled fumigations.  It is also possible that some non-critical users
might need to access the pre-phaseout inventory for security or other
emergency purposes.  We do not know whether these effects would occur or
to what extent they would offset each other.  Such speculation does not
change the validity of EPA’s proposal that 2,731,211 kg is a
reasonable supply buffer for 2008.  EPA disagrees with the commenter’s
assertion that critical users could readily switch to alternatives
following a supply disruption.  By definition, and as confirmed by
several rounds of expert review, entities that qualify for critical use
methyl bromide do not have access to technically and economically
feasible alternatives.

	Sixth, EPA disagrees with the assertion that the Parties at the
Nineteenth MOP rejected a half-year supply chain reserve because the
Parties neither adopted nor rejected the creation of such a reserve.
Furthermore, as mentioned above, a negotiating position does not
constitute a factual basis for a rulemaking, or a specific policy or
technical finding of the USG.  More information about the 2007 MOP is
provided in the Report of the Nineteenth MOP, available on the docket
for this action.

Comment:

	At the public hearing for this rulemaking Ameribrom commented that the
SCF needs to be held by manufacturers and importers because
distributors, who hold most of the current stocks, do not distribute the
methyl bromide when it is needed. [Hearing2]

Our Response:

	The supply of pre-phaseout inventories to critical users is based upon
private business decisions that the Agency does not control. However,
EPA expects all holders of methyl bromide to respond to market
conditions to distribute methyl bromide to users as needed.

4. Comments Relating to Section V.D.4. PROPOSED TREATMENT OF CARRYOVER
MATERIAL

What We Proposed:

	The comments in this section correspond to Section V.D.4. of the
preamble to the proposed rule and address the proposed treatment of
carryover critical use methyl bromide from 2006.  EPA proposed to reduce
the total amount of the 2008 CUE allocation by 539,433 to account for
that carryover material.  EPA also sought detailed comments on a
petition submitted by Chemtura, and subsequently made available on the
docket, that proposed several changes to EPA’s calculation and
implementation of carryover amounts.

Comments relating to this section

Commenter	Organization	Document ID

Pamela Peckman	The Industrial Fumigant Company	OAR-2006-1016-0133

Daniel Botts	Florida Fruit & Vegetable Association	OAR-2006-1016-0134

Edward Ruckert	Crop Protection Coalition	OAR-2006-1016-0135

Steven Hensley	USA Rice Federation	OAR-2006-1016-0136

David Doniger	Natural Resources Defense Council	OAR-2006-1016-0145

Charles Franklin and Paul Gutterman	Chemtura Corporation
OAR-2006-1016-0147

David Markert	American Chemistry Council’s Methyl Bromide Industry
Panel	OAR-2006-1016-0149

Jim McBriarty	Ameribrom Inc.	Hearing 2

Comment:

	IFC expressed dissatisfaction with the method by which carryover is
calculated and supported alternative measures for assessing carryover.
This commenter stated that increased transparency of the supply chain
would allow EPA to better understand where reporting is incomplete and
allow for production reductions (i.e. CUA reductions) to be more fairly
assessed. [OAR-2006-1016-0133]

Our Response:

	We respond to specific proposals to change the way carryover is
calculated in the preamble to the final rule, and below in this
document.  The Agency agrees that increased transparency of the supply
chain, through supplemental information collection, would probably help
EPA obtain more definitive information about whether there is
underreporting, and could allow EPA to respond more quickly to specific
instances of potential underreporting.  In early 2008 EPA intends to use
its information gathering authority under section 114 of the Clean Air
Act to ask all entities that sell critical use methyl bromide to report
the names of all non-end user entities (i.e. producers, importers,
distributors and third-party applicators) to which they sold critical
use methyl bromide during the 2007 control period.  Collecting the names
of these entities would facilitate Agency follow-up with non-reporters,
allowing collection of necessary information in a more targeted manner
than collecting detailed information from all entities.

Comment:

	Ameribrom commented that a significant amount of methyl bromide
reported as carryover was in fact sold to end users but not reported.
The commenter stated that larger suppliers and distributors should be
able to take more responsibility for reporting the critical sales of
smaller distributors, because these smaller entities struggle to keep-up
with their own paperwork. [Hearing2]

Our Response:

	The commenter did not provide specific, verifiable information to
support the claim that 80 percent of the carry over is actually
unreported sales.  The Agency is concerned with the commenter’s
statement that some small distributors are not reporting.  EPA continues
to educate stakeholders about critical use exemption reporting
requirements through outreach programs.  For example, EPA posts
instructional material on its website, holds informational sessions
about reporting at the annual Methyl Bromide Alternatives Outreach
Conference, and provides staff contacts to assist with reporting
requirements. Most recently, EPA provided a letter template to members
of MBIP that explains the importance of full reporting, provides
information about how to acquire official reporting forms, and a contact
person to answer questions.  EPA encouraged MBIP’s members to
customize the letter and send it to all of their customers; especially
entities that larger suppliers claim to know did not file a sales
report.

	The current recordkeeping and reporting system does not preclude larger
distributors from working closely with smaller distributors in their
distribution chains to ensure that the reporting requirements are fully
and accurately discharged.  In fact, EPA has encouraged more cooperation
between regulated entities that would all benefit from full and accurate
reporting.  One example of this was a letter template, mentioned above,
that EPA sent to members of MBIP to send to their customers.

Comment:

	MBIP commented that EPA should have been aware of the underreporting of
critical use sales and that EPA’s data set for calculating the
carryover set is deficient.  The commenter claimed that information it
received in response to its FOIA request of May 2007 clearly showed that
some companies filed reports in 2005 and not in 2006.  Nonetheless, MBIP
stated, EPA has mistakenly assumed that 100 percent of the unreported
sales of critical use methyl bromide are held in inventory.  According
to the commenter, an independent auditor found that approximately 20
methyl bromide suppliers failed to provide EPA with sales reports, which
accounted for approximately 80 percent of EPA’s calculated carryover.
[OAR-2006-1016-0149]

Our Response:

	Though commenters have raised the issue of underreporting, they have
not provided EPA with verifiable information that we can use to
recalculate the proposed carryover amount.  MBIP has not provided the
results of its audit, or the names of the suppliers that it stated did
not fulfill reporting obligations in 2006.  As a result, EPA can not
confirm the veracity of the commenter’s claims.  Therefore, at this
time and for purposes of this rulemaking, EPA is relying on the
information that it has collected through the official reporting
process.  As explained further in the preamble of the final rule, the
Agency is unwilling to revise its methodology for determining the
previously calculated 2006 carry over amount, which was reported
internationally on March 16, 2007.  EPA has taken a number of steps to
work with MBIP and other stakeholders to encourage full reporting.  Full
reporting is in everyone’s interest, and the Agency will continue to
work with industry with outreach and educational programs toward that
end.

Comment:

	Chemtura commented that Ameribrom acknowledged that the majority of the
2008 carryover originated within Ameribrom’s supply chain in the form
of unreported sales.  The commenter stated that Ameribrom suggested that
it had failed to reach users with portions of its 2006 allocation,
citing an inability to move product through its supply chain during
2006.  The commenter also stated that Ameribrom has suggested that
distributors in its supply chain are “probably never going to be able
to comply” with EPA’s reporting requirements.  [OAR-2006-1016-0147]

Our Response:

	A careful reading of the transcript from the public hearing does not
confirm Chemtura’s assertion that Ameribrom claimed that 80 percent of
the 2006 carryover originated from Ameribrom’s supply chain.  The
commenter from Ameribrom said that he “ma[d]e a couple of calls
around,” and found that, “of our 539 metric tons carryover…80
percent of it, approximately, was not reported as sold, even though it
was sold.”  When the commenter said “of our 539 metric tons carry
over,” he was clearly not referring to carryover solely from his
company, because the total carryover amount in the proposed rule was 539
metric tons.  Therefore, EPA reads the commenter’s statement to mean
that his understanding is that of the total carryover reported in the
proposed rule, 80 percent was the result of unreported sales.  This is
very similar to the comments submitted by MBIP, of which Ameribrom is a
member, which also claimed that 80 percent of the 2006 carry over was
the result of unreported sales.  The Agency suspects that the commenter
from Ameribrom was restating results from MBIP’s audit.  We respond to
MBIP’s audit in the preamble to the final rule and in above in this
document.

	We are concerned by the notion that distributors of critical use methyl
bromide are somehow unable to comply with EPA’s reporting
requirements, as the commenter from Ameribrom suggested at the public
hearing for this action.  At every step in the development of the CUE
program, EPA has complied with Paperwork Reduction Act (PRA)
requirements, and designed the reporting requirements in a manner that
minimizes the overall burden on respondents.  We will continue our
efforts to provide outreach and education to entities that may be
struggling to meet the reporting requirements for this program.
However, as mentioned above, the CUE program does not preclude larger
suppliers from assisting smaller entities in meeting their requirements.
 This kind of cooperation is in everyone’s interest if it ensures full
and accurate reporting.  Furthermore, MBIP was consulted when the
framework for the CUE program was established, and they were fully aware
of, and had a chance to comment on, the reporting regime that was
adopted.  This is to say that they were aware of the key role that
distributors would play in this reporting system.

Comment:

	Chemtura commented that EPA lacks authority to reduce the 2008 CUE
amount based on carryover from a previous year. [OAR-2006-1016-0147]

Our Response:

	In the December 23, 2004, Framework Rule (69 FR 76997), EPA announced
its determination that it would not permit entities to build stocks of
methyl bromide produced or imported after January 1, 2005, under the
critical use exemption.  We believe this is a reasonable policy approach
for a need-based exemption to a phaseout.  The carryover amounts reduce
the amount that is needed from new production and stocks in a subsequent
year.  We also believe this approach is consistent with the Montreal
Protocol, and an appropriate exercise of EPA’s authority under Section
604(d)(6) of the Clean Air Act.

4.1 The Petition Submitted By Chemtura Corporation

Comment:

	Six commenters supported Chemtura’s petition that proposes to
strengthen the current accounting framework and recordkeeping process to
prevent underreporting of methyl bromide use.  These companies stated
that the critical use material calculated as carryover for 2006 is
actually unaccounted sales rather than inventory held at the end of the
year.  Chemtura’s petition requested that EPA:

Use the best data available to calculate the carryover subtracted from
the critical use production allocation to ensure that only actually
carryover is counted;

Apportion carryover penalties to hold accountable only the producer(s)
responsible for the carryover originating in its supply chain;

Rigorously enforce compliance with supplier reporting requirements; and

Modify carryover penalties assessed to reflect actual responsibility for
supply-chain carryover.

These requests were based on assertions that:

EPA’s contention that “carryover increased while allocations and
stocks have plummeted is not credible.”  The commenters pointed to the
reductions between the quantities of methyl bromide in original CUE
applications and the EPA allocations, as well as declines in methyl
bromide stocks, as proof that carryover is unlikely.

“EPA’s reporting data is incomplete.”  The commenters stated that
an independent auditor found that approximately 20 end-use suppliers
failed to provide EPA with sales-to-user reports, which accounted for
approximately 80% of EPA’s calculated carryover.

“Cutting the CUE allocation is not a substitute for enforcement.”
The commenters contended that EPA should not alter CUE allocations based
on noncompliance in reporting, but rather increase reporting
enforcement.

“EPA must adjust its methodology for calculating carryover.”  The
commenters stated that EPA should use the best data available for
calculating carryover.  They asserted that this data is the quantities
of methyl bromide that companies report as being held in inventory on
the Sales to Critical Users forms.  The calculations would thus be based
on data from the suppliers.  A conservative margin for error could be
achieved by calculating the average carryover for all reported sales and
applying the average to any remaining unreported volume.

	The petition further stated that “EPA’s process for apportioning
carryover penalties among producers is unfair and perpetuates poor
stewardship.”  This statement was supported by the following points:

“Apportioning carryover penalties based on 1991 consumption share is
arbitrary and capricious.”  The commenters stated that critical use
production allocation penalties due to carryover are distributed among
the four U.S. methyl bromide producers based on their 1991 consumption
baseline market shares.  The commenters stated that an equal allocation
of the penalties would be fairer and that using the 1991 data is now
inconsistent with the available supply chain information and would
maximize future distortions in the critical use market.

“EPA can not ignore relevant data in making carryover decisions.”
The commenters stated that the U.S. methyl bromide suppliers have
documented the compliance of their supply chains and have provided this
information to EPA.  The information does not support using the 1991
baseline market shares for penalty allocation.

“EPA has received ample notice of the flaws in the framework.”  The
commenters stated that EPA has received multiple past comments regarding
the issues surrounding carryover calculation and should therefore be
equipped to address the reporting and penalty apportioning issues in the
final 2008 rule.

“The opt-out system proposed [in the petition] provides an appropriate
method for apportioning carryover penalties.”  The commenters referred
to an “opt-out” system previously provided to EPA that would allow
producers to voluntarily submit supply chain data in exchange for
EPA’s removal of the individual producer from the default penalty
pool. [Document ID: OAR-2006-1016-0134, 0135, 0136, 0145, 0147, 0149]

Our Response:

	We appreciate Chemtura’s thoughtful petition and the commenters that
provided feedback on the proposals it presented.  In general, the
petition proposed a number of policies that would significantly increase
reporting requirements, and thus administrative burden hours, for the
respondent community and EPA.  Generally speaking, we prefer to continue
programs that facilitate full and accurate reporting under the current
requirements at 40 CFR 82.3.  This approach would not increase
administrative burdens for entities that routinely file complete and
accurate reporting.  In order to focus and streamline our outreach and
follow-up efforts, in early 2008 EPA intends to use its information
gathering authority under section 114 of the Clean Air Act to ask all
entities that sell critical use methyl bromide to report the names of
all non-end user entities (i.e. producers, importers, distributors and
third-party applicators) to which they sold critical use methyl bromide
during the 2007 control period.

	For a complete discussion of Chemtura’s petition, see Section V.D.4.
of the preamble to the final rule.

4.2 Reporting Requirements to Calculate Carryover Amounts

Comment:

	NRDC commented that EPA should require the reporting of the names of
distributors and third-party applicators to which they have sold any
methyl bromide, including pre-2005 stocks, in order to get accurate data
to track amounts sold for all purposes (including non-critical
purposes).  The commenter stated that the costs of such reporting would
be minimal and would be justified by the benefits of better tracking of
CAA and Protocol compliance. [OAR-2006-1016-0145]

Our Response:

	In 2008 we will be renewing our recordkeeping and reporting
requirements, as required by the PRA.  As we move forward with that
process we intend to give further consideration to the commenter’s
suggestion that EPA collect the names of distributors and applicators
that buy pre-phaseout inventory.  However, because the Agency did not
specifically seek comment on this additional requirement in the proposed
rule, EPA would like to gather more input before deciding whether to
implement the commenter’s proposal.

Comment:

	MBIP suggested two methods for calculating carryover: (1) as the sum of
all critical use methyl bromide that companies report as being held in
inventory, though this would not completely solve the underreporting
issue, or (2) modify the reporting system in a manner that would allow
it to identify non-reporting companies and the amount of critical use
sales attributable to each non-reporting company.  The second option
could be achieved by requiring each entity in the supply chain—from
the manufacturer to the company that sells to the end user—to file a
report stating who that entity sold critical use material to and how
much material it sold.  This commenter additionally believes that any
material that stays in the distribution system past the end of a control
period should be considered part of the SCF rather than carryover, and
that no carryover should be subtracted from CUEs in 2008 and beyond.
[OAR-2006-1016-0149]

Our Response:

	We respond to the first suggestion, that EPA use an “inventory
method” to calculate the carryover amount, in detail in the preamble
of the final rule.

	EPA does not agree that it should require information that would allow
the Agency to quantify the amount of critical use sales attributable to
each non-reporting company.  Instead of imposing additional burden on
entities that do report in order to obtain detailed information about
non-reporters, a more straightforward and practical approach is to
encourage full reporting.  EPA, though, believes it would be beneficial
to acquire the names of all distributors and third-party applicators
with critical use exemption reporting requirements under 40 CFR 82.13.
Collecting the names of these entities will facilitate Agency follow-up
with non-reporters, and thus diminish any advantages of collecting more
detailed information from all entities.  Therefore, in early 2008 EPA
intends to use its information gathering authority under section 114 of
the Clean Air Act to ask all entities that sell critical use methyl
bromide to report the names of all non-end user entities (i.e.
producers, importers, distributors and third-party applicators) to which
they sold critical use methyl bromide during the 2007 control period.

5. Comments Relating to Section V.D.5. CRITICAL USE METHYL BROMIDE FOR
RESEARCH PURPOSES

What We Proposed:

	The comments in this section correspond to Section V.D.5. of preamble
to the proposed rule, which discussed the treatment of critical use
methyl bromide for research purposes.  EPA proposed to “allow sale of
15,491 kg of existing stocks for research purposes in 2008 to account
for the amount authorized for those purposes” (72 FR 48970).  In other
words, EPA proposed to reduce the amount of allowable new production and
import by 15,491 kg and to encourage researchers to purchase critical
use methyl bromide from pre-phaseout inventory to meet their needs.

Comments relating to this section

Commenter	Organization	Document ID #

David Markert	American Chemistry Council’s Methyl Bromide Industry
Panel (MBIP)	OAR-2006-1016-0149

Comment:

	MBIP objected to EPA’s proposal to issue CSAs for sale of
pre-phaseout stocks for exempted research purposes.  The commenter
stated that the stockpile is too low to warrant further drawdown for
research purposes and that new production should be increased by 15,491
kilograms to account for research needs. [OAR-2006-1016-0149]

Our Response:

	We do not agree that the remaining pre-phaseout inventory is too low to
warrant its use for exempted research purposes.  The Agency estimates
that more than 1,700,000 kg of pre-phaseout inventory is available for
critical uses whereas EPA is allowing the sale of 15,491 kg of methyl
bromide from existing stocks for research purposes, and adjusting new
production accordingly. Decision XVII/9(7) “request[ed] Parties to
endeavor to use stocks, where available, to meet any demand for methyl
bromide for the purposes of research and development.”  EPA believes
pre-phaseout inventory is available in sufficient quantity to continue
to encourage researchers to procure methyl bromide from inventory.

6. Comments Relating to Section V.D.6. METHYL BROMIDE ALTERNATIVES

What We Proposed:

	The comments in this section correspond to Section V.D.6. of preamble
to the proposed rule, which discussed the technical and economic
feasibility of methyl bromide alternatives.  In particular, EPA sought
comment on whether the Agency should reduce allowable new production and
import levels to account for new information about the feasibility of
sulfuryl fluoride for post-harvest cocoa bean fumigations.  In addition,
EPA sought comments on whether the Agency should make any other
reductions to account for the uptake of feasible alternatives.

List of comments relating to Section V.D.6.

Commenter	Organization	Document ID #

Gene Harrington	National Pest Management Association	OAR-2006-1016-0137

David Mueller	Fumigation Service & Supply, Inc.	OAR-2006-1016-0144

David Doniger	Natural Resources Defense Council	OAR-2006-1016-0145

Charles Hall	Georgia Fruit and Vegetable Growers Assoc.
OAR-2006-1016-0146

Charles Franklin and Paul Gutterman	Chemtura Corporation
OAR-2006-1016-0147

Suresh Prabhakaran	Dow AgroSciences, LLC	OAR-2006-1016-0150

Bruce Houtman	Dow AgroSciences, LLC	OAR-2006-1016-0152

Dan Haley	Walnut, Prune, and Fig Industry	Hearing 1

John Tipton	Florida Farmer	Hearing 3

Lynn Gayle	Virginia Tomato Farmer	Hearing 5

D.C. McClure	West Coast Tomato	Hearing 6

Bryan Unruh	American Farm Bureau	Hearing 10

6.1 Post-Harvest Alternatives

Comment:

	The National Pest Management Association (NPMA) commented that an
Oklahoma State University study has shown that the cost of using
sulfuryl fluoride to treat post-harvest cocoa is not substantially
greater than the cost of using methyl bromide.  However, the commenter
stated that some transition time is needed for smaller companies in the
industry to transition to sulfuryl fluoride.  This transition time
includes the completion of a manufacturer’s stewardship program as
well as an education process with customers to receive their consent to
a different treatment.  Additionally, while most states in which cocoa
is processed have a special 24(C) label to allow for higher
Concentration and Time (CT) dosage allocations for use of sulfuryl
fluoride on cocoa, New York has not obtained that label.  Therefore, the
commenter requested that at least 75% of the 53.188 metric tones of
critical use methyl bromide authorized by the Parties for cocoa
fumigation be allocated for 2008.  The commenter stated that its
application to use critical use methyl bromide in 2009 for cocoa bean
fumigations had been withdrawn, as the transition to sulfuryl fluoride
should be complete by that time. [OAR-2006-1016-0137]

Our Response:

	The Agency appreciates NPMA for voluntarily coming forward to agree to
a more rapid transition to methyl bromide alternatives for cocoa
fumigation.  With this final rule, EPA is approving 39,891 kg of
critical use methyl bromide for this sector, or 75 percent of the amount
agreed to by the Parties in Decision XVIIII/13.  Therefore, EPA is
reducing the total amount authorized for 2008 critical uses by 13,297 kg
to account for increased uptake of sulfuryl fluoride for cocoa
fumigation.  EPA’s response to this comment is discussed further in
Section V.D.6. of the preamble to the final rule.

Comment:

	A representative of the walnut, prune and fig industry commented that
the numbers in 2008 NPRM incorrectly assume that ProFume is an
alternative for methyl bromide for use with dried fruit and walnuts.
The commenter stated that ProFume is not effective against eggs,
resulting in the need for multiple applications and therefore
significant cost. [Hearing1]

Our Response:

	The proposed allocation amounts in the NPRM for dried fruit and walnut
fumigations were based on the 2008 U.S. CUN, and the Decision XVIII/13,
which authorized 58,921 kg for fumigations of commodities such as
walnuts and dried fruits.  The 2008 CUN, and the 2006 Report of the
MBTOC, which both assessed the efficacy of sulfuryl fluoride for
commodity fumigations, considered the concerns that the commenter
raised.  In order to revise the proposed numbers for commodity
fumigations, EPA would need new information about the critical need for
that sector.

Comment:

	Three commenters stated that sulfuryl fluoride is a viable and
affordable fumigant alternative for all post-harvest structural
fumigations.  These commenters stated that methyl bromide allocations
for these applications should therefore be significantly reduced or
eliminated. [OAR-2006-1016-0144, 0145, 0150]

Our Response:

	The Agency believes that some efficacy and validation issues remain
that need to be adequately addressed before sulfuryl fluoride can be
fully adopted by the food processing industry.  Sulfuryl fluoride
fumigation integrates temperature (requires less product as temperature
increases), dosages (choice of only post-embryonic stages or all life
stages), and exposure time.  Sulfuryl fluoride efficacy on insect eggs
requires higher concentrations, except at optimal temperatures.  Its use
also requires extensive training of applicators to proficiently use the
computerized fumigation guide.  Although many flour and rice mills have
indeed fumigated their facilities with sulfuryl fluoride in 2006, the
food processing industry is still learning how to incorporate sulfuryl
fluoride fumigation into its pest management strategies.  We appreciate
the commenters’ input, and we will continue to closely monitor
developments in the post-harvest fumigation industry and adjust our
transition rates for sulfuryl fluoride accordingly.

Comment:

	FSS commented that nearly 50% of the 220 flour mills in the U.S. are
fumigated with sulfuryl fluoride.  The commenter stated that the 15%-20%
transition of new technology stated by EPA may apply to farm
applications but believes that it is too low for structural
applications. Additionally, the commenter noted that sulfuryl fluoride
has proved successful even after multiple applications with no return to
methyl bromide, and that fumigation failures can happen with all
materials, including methyl bromide. [OAR-2006-1016-0144]

Our Response:

	We appreciate this input and refer to the commenter to our response
above.

Comment:

	NRDC requested that EPA reduce the proposed CUE amount for all
structural uses by at least half for 2008 and eliminate exemptions for
such uses in 2009. The commenter stated that CUEs for post-harvest cocoa
uses in particular should be reduced. [OAR-2006-1016-0145]

Our Response:

	We appreciate this input, and refer to the commenter to our response
above.

Comment:

	Dow commented that sulfuryl fluoride (ProFume) is registered in all 50
states as well as in key countries outside the U.S., and provides broad
spectrum, all life stage pest control without depleting the ozone layer.
 The commenter states that ProFume is technically and economically
viable as a methyl bromide alternative, and provides 19 documents
containing data to support this assertion. [OAR-2006-1016-0150]

Our Response:

	We appreciate Dow’s continued efforts to develop and market methyl
bromide alternatives, and its willingness to provide EPA with valuable
data about the technical and economic viability of those alternatives.
This is not the first time EPA has reviewed information very similar to
the documents provided by the commenter.  We refer the commenter to our
response above, and to the most recent U.S. critical use nominations,
available on EPA’s website at   HYPERLINK
"http://www.epa.gov/ozone/mbr/2009_nomination.html"
http://www.epa.gov/ozone/mbr/2009_nomination.html , which contain the
USG’s most recent assessment of the feasibility of sulfuryl fluoride
as a methyl bromide alternative.

Comment:

	One commenter expresses support for EPA’s proposal not to make
further reductions in 2008 to account for the uptake of methyl bromide
alternatives.  The commenter notes that some fumigation companies need
more time to transition to sulfuryl fluoride, including the purchase of
new equipment and training in its use.  Specifically, the commenter
believes that allowing CUEs for cocoa in 2008 will enable a smoother
transition to sulfuryl fluoride and would help to guarantee methyl
bromide availability to guard against unforeseen problems with the
transition. [OAR-2006-1016-0149]

Our Response:

	Besides the issues regarding post-harvest cocoa fumigation, and the
newly registered pre-plant fumigant iodomethane, EPA is not making any
additional reductions in critical use allowances to account for the
uptake of alternatives. Uptake of alternatives was already considered in
the 2008 U.S. CUN, adopted by MBTOC, and reflected in the 2008 CUE
authorization amounts that EPA is finalizing with this action.  However,
for the reasons explained in Section V.D.6. of the preamble to the final
rule, EPA is reducing the total 2008 CUE by 27,769 kg to account for the
increased uptake of sulfuryl fluoride for cocoa bean fumigation.

6.2 Pre-Plant Alternatives

Comment:

	One commenter notes that USDA and CSREES are funding research into
alternatives for golf and turf purposes, but that EPA is not.
[Hearing10]

Our Response:

	EPA’s primary role is to lead the assessment of methyl bromide
alternatives, the development of annual U.S. critical use nominations,
and to administer the critical use exemption.  EPA often meets with
researchers and developers of alternatives, and provides guidance about
the critical use exemption.  EPA also provides financial assistance to
the annual Methyl Bromide Alternatives Outreach Conference, which brings
together researchers and growers from around the world to share the
latest findings from methyl bromide alternatives research.

Comment:

	NRDC commented notes that EPA recently approved the use of iodomethane
for field uses, which will reduce the need for methyl bromide CUE
allocations.  The commenter stated that iodomethane is a drop-in
substitute for methyl bromide and that while it is more costly per
kilogram; less of it is require to achieve the same efficacy.  The
commenter also stated that while iodomethane poses direct toxicity
issues, the toxicity issues associated with methyl bromide are worse.
[OAR-2006-1016-0145]

Our Response:

	After considering new information about iodomethane, EPA estimates that
11,578 to 17,367 kg of methyl bromide will be replaced by iodomethane in
2008.  As discussed in Section V.D.6. of the preamble to the final rule,
EPA is taking the midpoint of this technical range and reducing the
overall allocation of CUAs by 14,472 kg to account for the increased
uptake of iodomethane.  EPA’s technical estimate is described in a
memorandum on the docket for this action.  In its technical estimate,
the Agency considered the best available information as of December 11,
2007, the last day that EPA could reasonably consider information for
this rulemaking.  As of December 11, 2007, 14 states had registered
iodomethane.  If more states register after that date, EPA will consider
that information in next year’s CUE allocation rulemaking.

	EPA has information that suggests that in general iodomethane will be
more expensive than methyl bromide on a per pound basis, but that
application rates of iodomethane will be lower on a pound per acre
basis.  While it is difficult to estimate exactly how these factors will
offset each other, the Agency expects that through 2008 the overall cost
of iodomethane for growers will remain higher than the overall cost of
using methyl bromide.  This notion is corroborated by the observation
that of the 1,000 acres eligible for experimental use permits granted as
part of the registration process, only 200 acres, or 20% of the
available area, actually used them, in part this limited uptake was due
to economic feasibility.  Given the limited time between registration
decisions and publication of the final allocation for 2008, for this
year EPA is using this 20% uptake rate as a proxy for the share of
“eligible’ acres where it will be economically feasible to use
iodomethane to replace methyl bromide.  In future years, EPA may conduct
an economic feasibility assessment for iodomethane in a crop and
regional specific manner taking into account pricing data from the most
recent calendar year.

	At this time, and for the purposes of this rulemaking, it would be
inappropriate for EPA to comment on the relative toxicity of methyl
bromide and iodomethane.  EPA is currently re-assessing a group or soil
fumigants, including methyl bromide and iodomethane.  More information
about that process is available at the following website,   HYPERLINK
"http://www.epa.gov/pesticides/reregistration/soil_fumigants/"
http://www.epa.gov/pesticides/reregistration/soil_fumigants/ , or from
the contact person for this action.

Comment:

	Four commenters stated that while significant research efforts into
methyl bromide alternatives are underway, long term tests are needed to
know if an alternative will hold up over a multiple-year period without
any methyl bromide treatments. [0146, Hearing3, Hearing4, Hearing7]  The
Georgia Fruit and Vegetable Growers Association expressed concern about
adverse economic and operational impacts of implementing these
alternatives too quickly. [OAR-2006-1016-0146]

Our Response:

	We recognize that agricultural pest pressures can build over
multiple-year periods.  The annual CUE process, which includes the
submission of CUE applications, development of the nomination, and the
CUE allocation rulemaking, provides EPA with many opportunities to
adjust the CUE program to account for changes in the status or efficacy
of alternatives.  To track agricultural developments, including pest
pressures and economic conditions, EPA often meets with stakeholders and
works closely with USDA.

Comment:

	Chemtura requested that EPA assess the technical and economic
feasibility of iodomethane for no fewer than two years before factoring
its availability into future CUE decisions.  The commenter stated that
the controversial nature of the registration combined with the proximity
of the registration timing to the end of the comment period on the CUE
rule provide reason to delay considering this alternative when
allocating CUEs.  The commenter also stated that iodomethane is not yet
registered in California because of safety questions and that there is
anecdotal evidence of efficacy problems with the chemical. The commenter
expressed the opinion that at least two growing seasons are necessary to
review and assess viability. [OAR-2006-1016-0147]

Our Response:

	In the proposed rule EPA sought “information regarding changes to the
registration or use of alternatives that may have transpired after the
2008 U.S. nomination was written.”  The Agency stated that, “Such
information has the potential to alter…EPA’s determination as to
which uses and what amounts of methyl bromide qualify for the critical
use exemption.”  In this final rule, EPA is following through with
that statement, and reducing pre-plant critical use amounts by 14,472 kg
to account for new information about the uptake of iodomethane.  EPA’s
estimate of feasible 2008 iodomethane uptake is described in a
memorandum on the docket for this action.

	We recognize the time constraints of our analysis, and may seek
additional information in the future that will provide a more accurate
and complete picture of the technical and economic feasibility of
iodomethane.  Based on this information, additional analysis may be
performed to assess the potential for iodomethane to serve a viable
alternative to methyl bromide for future critical use exemption
nominations and allocations.

Comment:

	Three tomato growers from Florida and Virginia commented that
alternatives are not yet effective enough to replace methyl bromide.
The commenters stated that without methyl bromide many farmers will be
forced out of business. The commenters noted that new plastics are not
yet useful and that impermeable films are non-recyclable, and that
alternatives in production can reduce production by 15%-25%.  The
commenters also stated that alternatives can only be used if soil
conditions are optimal (not too wet or dry) and often for only one or
two crop cycles before methyl bromide is needed again. [Hearing3,
Hearing5, Hearing6]

Our Response:

	EPA appreciates the commenters’ input, and will continue to consider
these concerns in future critical use nominations (CUNs).  We refer the
commenters to the 2009 CUN chapter on tomatoes, available on the docket
for this action, which found that there are alternatives such as
1,3-Dichloropropene (1,3-D), chloropicrin and metam-sodium that are
technically and economically feasible alternatives for southeastern
tomato growers under certain conditions.

Comment:

	Dow provided extensive comments objecting to EPA’s assessment of the
label restriction on 1,3-D product use near karst topographical features
in Florida.  The Agency’s assessment of those restrictions was part of
the basis for the 2008 and 2009 CUN for pre-plant critical uses in
Florida.  The commenter asserted that EPA’s karst impact assessment
represents an unnecessarily simplified, regional assessment
inappropriate to assess a site-specific restriction. The commenter
asserted that EPA’s 2007 assessment is not an accurate reflection of
the current 1,3-D product label restrictions which specifies that a
particular field is not impacted unless there is a karst surface feature
within 100’ of the edge of that field, independent of the percentage
of the surrounding area which may contain karst surface features.

f ≤100’ can be expected to have an impact on agricultural ranging
from 1% to 5.5% compared to the proposed impact of up to 93% that is
assigned to the 1,3-D karst restriction in the 2007 U.S. assessment. The
commenter also mentioned that additional information on this further
characterization of the karst impact was presented to EPA by Dow at a
meeting on July 25, 2007 and submitted that information as separate
documents into the public docket associated with this rule.

	Dow also stated that the 2007 USG assessment concluded that the soils
restriction causes 23% to 100% of agricultural land in Florida to be
unsuitable for 1,3-D uses due to the state-specific (“Special Local
Need” registrations for 1,3-D products) soil requirements. The
commenter stated that the USG included agricultural land (in Alachua,
Gadsden, and Jackson counties) in their assessment that is not subject
to the specific Florida soil restrictions. In addition, the commenter
stated that the 2007 soils assessment relies on a simplified soil
assessment that characterizes the percentage of soil areas, by county,
which are non-suitable for 1,3-D applications. The county-specific
percentage values are then used to determine the percentage of
agricultural land within that county that is unsuitable for 1,3-D uses.
The commenter asserted that this represents a significant overestimation
of impact, in the commenter’s opinion, because non-agricultural land
is considered into the assessment. The commenter said that a more
refined assessment utilizing GIS and land-use data, provided by Dow
AgroSciences in 2002, indicates that the southern Florida soil
restriction has the potential to impact up to only 24.6% of agricultural
land in the key south Florida counties. The commenter mentioned that
this information was shared with EPA in 2002 and 2007 and is placed in
separate documents into the public docket that is associated with this
proposed rule. [OAR-2006-1016-0152]

Our Response:

	EPA agrees with the commenter on one point: Three counties that the
commenter states are not subject to the second “seepage irrigation”
SLN restriction should be removed from this portion of the analysis done
for the CUNs. These counties would be Alachua, Gadsden and Jackson
counties.

	Even completely removing these counties from our analysis of soil
restrictions would remove only a relatively small amount of crop
acreage.  Our analysis only considered the strawberry crop in that
county, a total of 22 acres harvested, and a total of 2,513 acres of
tomato in Gadsden and Jackson counties (out of a total of 43,790 acres
harvested in the state). Crop acreage information is taken from Appendix
B of the 2006 CUN for tomatoes, eggplants, peppers, and strawberry
fruit.

Note, however, that these three counties are still affected by the
‘karst’ restriction on 1,3-D (Telone ®)use.

	EPA disagrees with other aspects of the commenter’s statements or
finds those statements to be inadequately supported by information
provided to the Agency.  First, regarding the statements on the karst
portion of our analysis:

	Dow said that occupied structures can be used as a proxy for karst
surface features, and that therefore analyses that examine the presence
of occupied structures as a restriction to fumigant use are appropriate
to use for estimates of the karst impact. However, this seems to presume
that karst features will occur with a frequency and distribution similar
to that of occupied structures in all agricultural counties of Florida.
Unless Dow has data to support this presumption, information which they
have not presented, we do not see how using occupied structures as a
proxy for karst topological features is valid. Therefore, we believe
that our methodology of using geological maps which identify
“sensitive karst areas” is superior. Furthermore, according to the
label 1,3-D also cannot be applied within 100 feet of an occupied
structure. This suggests that even EPA’s analysis underestimates areas
affected by regulatory restrictions on 1,3-D, since it did not account
for the additional prohibition near occupied structures.

	Second, regarding Dow’s comments on the technical aspects of the
Florida-specific “seepage irrigation” portion of EPA’s soils
analysis described:

	EPA examined information supplied by Dow at its meeting with Agency
staff in July 2007. EPA presumes that this is the information that Dow
indicates was submitted in 2002 and again in 2007.

	In addition to the differences in methods for estimating the impact of
the karst restriction that are discussed above, a major difference
between the Dow analysis of seepage irrigation restrictions and the EPA
analysis is that EPA’s analysis assumes that the agricultural land is
distributed within the county in proportion to its overall percentage
rather than looking at the specific location of agricultural land used
in the production of row crops.

	Dow is correct in stating that using the actual location of
agricultural land would provide a refined estimate of potential Telone®
use. However, this refinement would change the overall assessment very
little.

	Particularly in counties which are largely agricultural, the difference
between the EPA and Dow estimates is very small.  The fact that the
estimates of karst-restricted areas must be overlaid on the areas
affected by seepage irrigation restrictions reduces the differences
still further.  The county where the difference is the most pronounced
is Palm Beach, a county where agricultural use makes up a relatively
small proportion of land use.  Palm Beach County is approximately the
5th most important tomato-producing county in Florida, producing 7-8% of
the 2002 tomato crop (2002 is the most recent year for which such data
were available and thus the year used for the analysis).  Palm Beach
County is not a significant producer of strawberries.  Strawberries and
tomatoes are the Florida crops for which the largest methyl bromide
request is put forward in the critical use nominations.  Thus, changing
the estimate of the proportion of land in Palm beach County that is
eligible to use Telone®  will make very little difference to the
overall assessment  of the proportion of Florida cropland where Telone®
can be used in place of methyl bromide.

	EPA emphasizes that it is very interested in refining its estimates of
the impact of soil related restrictions on 1,3 D use in Florida, and is
open to working with Dow to do so for future methyl bromide CUE
assessments.

7. Comments Relating to Section V.E. the CRITERIA IN DECISIONS IX/6 and
EX.I/4

What We Proposed:

	The comments in this section correspond to Section V.E. of preamble to
the proposed rule, which discussed the criteria in consensus Decisions
IX/6 and Ex. I/4 of the Parties to the Montreal Protocol.  In this
section the Agency explained how its proposals are in accordance with
the criteria in those Decisions.

Comments relating to this section

Commenter	Organization	Document ID

David Doniger	Natural Resources Defense Council	OAR-2006-1016-0145

Comment:

	NRDC expressed support for EPA’s decision to reduce the
production/import authorization below the 18% of baseline maximum to
12.2%.  However, the commenter stated that EPA should dedicate the
entire pre-phaseout inventory to CUEs as set forth in Section 604(d)(6)
of the Protocol for the following reasons: (1) Decision IX/6 of the
Protocol allows production and import of critical use methyl bromide
only after using up stocks; and (2) Neither the Parties nor Congress
would support EPA’s designation of “unavailable” stocks that can
be used by persons without CUEs, despite the Protocol’s use of the
term “available stocks.” [OAR-2006-1016-0145]

Our Response:

	In response to the commenter’s first concern, the Agency has
responded to the first part of this comment in the Final Framework Rule
(69 FR 76988), the Final 2007 CUE Rule (71 FR 75400), and in response to
NRDC’s late submission of supplemental comments on the Proposed 2007
CUE Rule.  EPA also addresses this comment in Section V.E. of the
preamble to the final rule.  In this rulemaking, EPA is not revisiting
the issue of whether Decision IX/6 obligates EPA to allocate the
entirety of the remaining pre-phaseout inventory for CUEs before
allowing new production.

	In response to the commenter’s second concern, EPA did not propose to
designate any amount of pre-phaseout inventory, or any specific
holdings, as “unavailable.”  EPA proposed to recognize the amount of
existing stocks that is available.  As discussed above and in the
proposed rule, in paragraph 4 of Decision XVIII/13, and similar
Decisions, the Parties indicated that each individual Party has
discretion to recognize the amount of existing stocks that is available
for critical uses.  Most recently, Table D of the Annex to Decision
XIX/9 explicitly indicates that for the 2009 control period the United
States will reduce authorized new production levels to account for the
amount of available stocks.  Thus, EPA’s proposed approach is
consistent with the practice under the Montreal Protocol.  It is also an
appropriate exercise of the discretion granted by Congress under Section
604(d)(6) of the Clean Air Act.

8. Comments Relating to Section V.F. EMISSIONS MINIMIZATION

What We Proposed:

	The comments in this section correspond to Section V.F. of preamble to
the proposed rule, which discussed the use of technologies that minimize
emissions from the use of methyl bromide for critical uses.  In
particular, the preamble discussed EPA’s response to paragraph 8 of
Decision XVIII/13, which states that Parties shall request critical
users to employ emissions minimization technologies whenever technically
and economically feasible.

Comments relating to this section

Commenter	Organization	Document ID #

David Doniger	Natural Resources Defense Council	OAR-2006-1016-0145

David Markert	American Chemistry Council’s Methyl Bromide Industry
Panel	OAR-2006-1016-0149

Rick Tomlinson	California Strawberry Commission	Hearing 4

D.C. McClure	West Coast Tomato	Hearing 6

Comment:

	NRDC commented that the most effective way to achieve further emission
minimization is to require the use of emission minimization techniques
such as virtually impermeable films (VIF), barrier films, and deep shank
injection.  The commenter stated that these techniques offer the
concurrent benefit of reducing the amount of methyl bromide needed for
fumigations. [Document ID: OAR-2006-1016-0145]

Our Response:

	EPA encourages the use of emissions reduction techniques and agrees
that utilizing these techniques can result in needing less methyl
bromide for efficacious fumigations.  As the supply of critical use
methyl bromide is reduced, the Agency expects that use minimization
techniques and thus emissions limitation techniques will be adopted.

Comment:

	MBIP commented that (1) applications for future CUEs submitted to EPA
by growers and (2) the CUNs are good repositories of information on the
current status of various emission minimization techniques.
[OAR-2006-1016-0149]

Our Response:

	EPA appreciates this comment and recommends users to review these
sources for emission reduction practices.  We also point-out that
research presented at the annual MBAO Conference is also a strong source
of information about emissions minimization technologies.

Comment:

	At the public hearing for this action, a representative of the
California Strawberry Commission commented that EPA should create a
regulatory incentive for emissions reduction. [Hearing4]

Our Response:

	We believe that by restricting the supply of methyl bromide available
for critical uses, the phaseout and the critical use exemption provide
regulatory incentives for the adoption and diffusion of emissions
reduction technology.  This is because emissions minimization
technologies, such as tarps, reduce the amount of methyl bromide needed
per fumigation.  To the extent that the phaseout increases the price of
methyl bromide, it also provides an economic incentive for these
technologies.

Comment:

	At the public hearing for this action, a representative of West Coast
Tomato commented VIF keeps the methyl bromide applied in the soil longer
so it is metabolized in the soil rather than escaping into the
atmosphere.  The commenter stated that methyl bromide that is used in
this way should not be decreased since it is not reaching the ozone.
[Hearing6]

Our Response:

	In compiling annual critical use nominations, the USGconsiders the
feasibility of VIF, and other more permeable tarps, because the use of
these technologies can reduce required dosage rates and the critical
need for methyl bromide to treat certain crops.  The commenter may be
proposing a different type of exemption for methyl bromide use that does
not result in emissions to the stratosphere, but this would require a
change in the Montreal Protocol, which is outside the scope of the
present rulemaking.  Until EPA fully reviews the research that the
commenter refers to, it would be inappropriate for the Agency to respond
further.

9. Comments Relating to Section V.G. PROPOSED CRITICAL USE ALLOWANCE
ALLOCATIONS

What We Proposed:

	The comments in this section correspond to Section V.G. of preamble to
the proposed rule, which proposed company-specific critical use
allowance allocations (CUAs) for 2008.  CUAs grant their holders the
privilege of producing or importing critical use methyl bromide during
the control period in question.  EPA also discussed the allocation
system established in the December 2004, Framework Rule (69 FR 76982).
EPA did not propose to change the established allocation system which
includes distinct caps for pre-plant and post-harvest uses.  However,
EPA did indicate that it would consider additional comment on the
Agency’s existing allocation framework.

Comments relating to this section

Commenter	Organization	Document ID

Daniel Botts	Florida Fruit & Vegetable Association	OAR-2006-1016-0134

Gene Harrington	National Pest Management Association	OAR-2006-1016-0137

David Markert	American Chemistry Council’s Methyl Bromide Industry
Panel	OAR-2006-1016-0149

Dan Haley	Walnut, Prune, and Fig Industry	Hearing 1

Rick Tomlinson	California Strawberry Commission	Hearing 4

Comment:

	NPMA and MBIP commented that the universal system is working well and
stated that the concept of the pre-plant/post-harvest allocations is
simple and easy for stakeholders to understand.  The commenters also
stated that the system has not disrupted the supply chain and has been
easy for distributors to implement.  The commenters discouraged the
Agency from switching to a sector-by-sector allocation system. [Document
ID: OAR-2006-1016-0137, 0149]

Our Response:

	EPA determined in the final Framework Rule (69 FR 76989) that a
lump-sum, or universal, allocation, modified to include distinct caps
for pre-plant and post-harvest uses, was the most efficient and least
burdensome approach that would achieve the desired environmental
results, and that a sector-specific approach would pose significant
administrative and practical difficulties.  EPA appreciates these
comments, and is maintaining the existing allocation system in the final
rule.

Comment:

	The Florida Fruit and Vegetable Association (FFVA) and a representative
of the Walnut, Fig and Prune Industry commented that the geographical
distribution of methyl bromide has created shortfalls resulting in the
inability of individual growers to access or afford material to fumigate
their fields in accordance with their production schedules. FFVA stated
that this was particularly noticeable during the 2005 and 2006 fall
fumigation periods.  [0134, Hearing1]

Our Response:

	EPA appreciates this input about regional and local critical use methyl
bromide shortages.  The current allocation system, which does not place
distinct use caps on geographical regions, allows suppliers flexibility
to determine how much critical use methyl bromide to sell in each
geographic region.  We think this remains the most desirable system
because it is a simple approach that allows suppliers to respond to
market signals and agricultural circumstances that may arise, such as
shifting pest-pressures across regions.  We will continue to seek more
information about the geographic distribution of critical use methyl
bromide, and to consider options for addressing the issue of regional
shortages.

Comment:

	At the public hearing for this action, a representative of the Walnut,
Fig and Prune Industry commented that the universal system does not work
well because of regional and local shortages, but believes that a
sector-by-sector allocation system would be equally flawed due to
insufficient allocations in certain sectors and unequal holding of
pre-phaseout inventory. [Hearing1]

Our Response:

	In the Framework Rule EPA determined that a universal allocation
system, modified to include distinct caps for pre-plant and post-harvest
uses, was the most efficient and least burdensome approach that would
achieve the desired environmental results, and that a sector-specific
approach would pose significant administrative and practical
difficulties.  A summary of the options analysis conducted by EPA is
available on the docket for this rulemaking.  We have monitored the
operation of this allocation system, and believe that the benefits of
this system outweigh the concerns that have been raised about it.

Comment:

	At the public hearing for this action, the California Strawberry
Commission (CSC) commented that EPA should explore a hybrid between a
regional and a lump-sum allocation system.  Specifically, the commenter
suggested that EPA consider creating several large regional areas (such
as the EPA regions) that combine all of the sectors within each region
to create a regional lump-sum.  The commenter further stated that the
methyl bromide users who most frequently face difficulty obtaining
methyl bromide are small, minority growers, making the harm caused by
the allocation of methyl bromide disproportionately distributed.
[Hearing 4]

Our Response:

	In the Framework Rule, EPA did not consider a regional allocation
approach.  EPA may consider and seek comment on such an approach in a
future proposed CUE rule.  It would be inappropriate for EPA to adopt
such an approach in this rulemaking, as other interested parties have
not had an opportunity to comment on it.

	Our initial reaction to the commenter’s proposal for a geographic
allocation system is that it would restrict the flexibility and
efficiency of the current system.  Placing geographic or other
artificial restrictions on the operation of the market for critical use
methyl bromide is likely to reduce the efficiency of the system, and
create additional administrative burden for affected entities.
Furthermore, we are not convinced at this time that geographic
restrictions would alleviate the economic impacts on the small and
minority growers to which the commenter refers.  We will continue to
seek more information about these issues, and to consider options for
addressing them.

10. Comments Relating to Section V.H. PROPOSED CRITICAL STOCK ALLOWANCE
ALLOCATIONS AND TOTAL VOLUMES OF CRITICAL USE METHYL BROMIDE

What We Proposed:

	The comments in this section correspond to Section V.H. of preamble to
the proposed rule, which proposed to allocate 1,715,438 kg of critical
stock allowances (CSAs), which give their holders the privilege of
selling pre-phaseout inventory for critical uses.  In this section EPA
also invited CSA holders, on a voluntary basis, to permanently
relinquish their allowances through written notification to EPA.

List of comments relating to Section V.H.

Commenter	Organization	Document ID #

Pamela Peckman	The Industrial Fumigant Company	OAR-2006-1016-0133

Edward Ruckert	Crop Protection Coalition	OAR-2006-1016-0135

Steven Hensley	USA Rice Federation	OAR-2006-1016-0136

James Bair	North American Millers’ Association	OAR-2006-1016-0143

Charles Hall	Georgia Fruit and Vegetable Growers Assoc.
OAR-2006-1016-0146

David Markert	American Chemistry Council’s Methyl Bromide Industry
Panel	OAR-2006-1016-0149

Jim McBriarty	Ameribrom Inc.	Hearing 2

Rick Tomlinson	California Strawberry Commission	Hearing 4

Comment:

	At the public hearing for this action, Ameribrom and the CSC commented
that private companies that own pre-phaseout methyl bromide inventory
have no obligation to sell it.  The commenters stated that stocks are
not available when needed because distributors hold these stocks so that
the price will rise.  Therefore, the commenters asserted, some entities
with critical needs are unable to get the methyl bromide they need.
[Hearing2, Hearing4]

Our Response:

	EPA lets firms respond to market conditions, instead of requiring them
to sell pre-phaseout inventory to critical users.  In the December 24,
2004 Framework Rule (69 FR 76989), EPA finalized a system that allows
for market forces to operate in the distribution of inventory.  EPA
chose this approach, at least in part, to promote market flexibility and
efficiency.  Based on EPA’s estimate that there will be significant
amounts (approximately 1,729 metric tons) of pre-phaseout inventory
available for critical uses in 2008, the Agency expects that holders of
pre-phaseout inventory will be able to expend the full amount of 2008
CSA allocations in order to satisfy the needs of critical users.

Comment:

	Seven commenters expressed concern about the proposed level of critical
stock allowances of methyl bromide for 2008.  The commenters stated that
the proposed increase in the amount of methyl bromide to come from
pre-phaseout inventory is beyond the level authorized by the Parties in
Decision XVIII/13 and that an adequate emergency stockpile must be
maintained. [OAR-2006-1016-0133, 0135, 0136, 0143, 0146, 0149, Hearing4]

Our Response:

	Section V.D. of the preamble to the proposed rule provided a complete
discussion of EPA’s rationale for proposing to allow more methyl
bromide to come from pre-phaseout inventory than the minimum levels
agreed to by the Parties in Decision XVIII/13.  Section V.D. of the
preamble to the final rule addresses comments on this issue and provides
EPA’s justification for issuing 1,729,689 kg of CSAs with this action.
 EPA believes its approach is consistent with the Montreal Protocol and
an appropriate exercise of the Agency’s authority under Section
604(d)(6) of the Clean Air Act.

	With regard to maintaining an “adequate emergency stockpile,” we
refer the commenters to Section V.D.4.2. of the preamble to proposed
rule, and Section V.D.2. of the preamble to the final rule, which
explain the Agency’s use of a SCF to estimate the amount of
pre-phaseout inventory available in 2008.  By including the SCF in this
estimate, the Agency is using a transparent analytical tool to determine
allocation amounts that gives suppliers an opportunity to maintain an
adequate supply buffer to respond to a severe supply disruption, such as
a domestic production failure.

11. Comments Relating to the Section V.I. STOCKS OF METHYL BROMIDE

What We Proposed:

	The comments in this section correspond to Section V.H. of preamble to
the proposed rule, which discussed EPA’s treatment of the inventory of
pre-phaseout methyl bromide.  This section also discussed the
confidentiality of aggregated data about the size of the remaining
pre-phaseout inventory.

Comments relating to this section

Commenter	Organization	Document ID

Daniel Botts	Florida Fruit & Vegetable Association	OAR-2006-1016-0134

James Bair	North American Millers’ Association	OAR-2006-1016-0143

David Markert	American Chemistry Council’s Methyl Bromide Industry
Panel	OAR-2006-1016-0149

11.1 Treatment of Stocks

Comment:

	Two commenters questioned EPA’s understanding of stocks. At the
public hearing for this action, a representative of the American Farm
Bureau (AFB) commented that EPA does not know how to measure existing
stocks, where the stocks are held, or how the stocks exist. [Hearing11]
The North American Millers Association (NAMA) stated that the mechanisms
for reporting stocks and usage are imprecise, and therefore the
Agency’s calculations of stock levels are likely inaccurate.
[OAR-2006-1016-0143]

Our Response:

	Through the record keeping and reporting requirements at 40 CFR 82.13,
EPA annually collects company-specific information about the amount of
remaining pre-phaseout inventory.  EPA has collected that information
for each year starting with 2003.  Aggregate inventory data, which is
available on the docket for this action, shows a fairly steady decline
in the amount of pre-phaseout inventory at the beginning of each year.
EPA is unaware of any specific reasons to question the accuracy of the
data it has collected about the size of that inventory.  It is correct
that the Agency does not require information about where the inventory
is held geographically.  We do not believe it is necessary to collect
that information, because suppliers are allowed great flexibility with
regard to where they distribute their inventory holdings in order to
respond to market forces.

Comment:

	The Florida Fruit and Vegetable Association commented that as existing
stocks are depleted, companies with large CUEs will be
disproportionately affected.  The commenter stated that a timely and
accurate accounting system for use during the control period for both
new production and CSAs should be developed and should be available to
CUE holders.  This accounting system would be important as CSAs decrease
and would allow the Agency flexibility to shift from CSA’s to new
production during the control period if necessary.  The commenter
asserted that without this flexibility the Agency should authorize the
total quantity approved for the 2008 control period as new production
with the understanding that the portion of material not used as a result
of the use of pre-existing stocks during 2008 would be deducted from
future authorizations as the current practice for unused new production
authorized as CUAs. [OAR-2006-1016-0134]

Our Response:

	If EPA understands correctly, the commenter is concerned that at some
point existing stocks will not be able to satisfy all of the CSAs issued
by EPA for a given control period, and that if this happens during a
control period, EPA should convert CSAs to CUAs.  We believe that the
proposed approach for determining CUA and CSA amounts, which accounts
for the amount of available stocks, is a major step towards decreasing
the probability that EPA would issue more CSAs than existing stocks are
able to satisfy in a given control period.  Currently, EPA collects
annual data about critical sales of new production and stocks.  EPA
agrees with the commenter that collecting this data more often,
quarterly for example, could have certain benefits related to monitoring
stockpile information.  As the commenter stated, more timely data could
help EPA more rapidly determine if it would be appropriate to allow the
conversion of some CSAs to CUAs.  However, by increasing the repetition
of reporting, the commenter’s proposal would impose extra
administrative burden upon the regulated community.  Considering the
approach that EPA is finalizing in this rule, which should decrease the
likelihood of impractically large CSA allocations, we do not believe the
benefits of the commenter’s proposal would justify the additional
costs it would impose.

11.2 Confidentiality of Aggregate Pre-Phaseout Inventory Data

Comment:

	MBIP commented that it does not object to EPA’s proposal to release
aggregate stockpile data in future years without first notifying
entities by letter.  However, the commenter stated that it reserves the
right to object in the future should the number of competitors in the
industry dwindle to two or fewer in order to protect confidentiality.
[Document ID: OAR-2006-1016-0149]

Our Response:

	As long as there are a sufficient number of competitors in the
industry, EPA will not treat the aggregate of methyl bromide stockpile
data collected under the reporting requirements at 40 CFR 82.13 as
confidential information and may release such data in the future without
further notice.  However, if the number of competitors in the industry
were to dwindle appreciably, EPA would revisit the question of whether
the aggregate is entitled to treatment as confidential information and
would not release the aggregate without notice.

12. Comments Relating to RULEMAKING AND THE REGULATORY PROCESS

Comments relating to this section

Commenter	Organization	Document ID #

Gene Harrington	National Pest Management Association	OAR-2006-1016-0137

Charles Franklin and Paul Gutterman	Chemtura Corporation
OAR-2006-1016-0147

Dan Haley	Walnut, Prune, and Fig Industry	Hearing 1

Jim McBriarty	Ameribrom Inc.	Hearing 2

Rick Tomlinson	California Strawberry Commission	Hearing 4

Rebecca Adcock	American Farm Bureau	Hearing 11

Comment:

	NPMA suggested the use of a chart tracking the process from the
allocation by the Parties to the allocation by the Agency.  The
commenter stated that the current process is confusing, and points to a
technical correction in the 2006 CUE Allocation rule as an example.
[OAR-2006-1016-0137]

Our Response:

	Consistent with previous years, EPA has made its calculations available
on the docket in a spreadsheet entitled Allowance Allocation Calculation
for Proposed 2008 CUE Rule (Document ID: OAR-2006-1016-0105).  In
addition, to enhance the transparency of this rulemaking, EPA is
including an extra spreadsheet on the docket that compares the
allocation amounts proposed in the NPRM with the amounts that EPA is
allocating in the final rule, and provides an itemized breakout of each
reduction taken as compared to the Parties’ authorization in Decision
XVIII/13 (Insert Document ID).

Comment:

	NPMA and Chemtura commented that the Agency should be more transparent
in the CUE allocation process and explain in detail how each allocation
reduction is made.  [OAR-2006-1016-0137, 0147]

Our Response:

	We appreciate this comment, as we strive to make these CUE rulemakings
as transparent as possible.  To enhance the transparency of this
year’s rulemaking EPA is placing an extra spreadsheet on the docket
which compares the allocation amounts proposed in the NPRM with the
amounts that EPA is allocating in the final rule.

Comment:

	At the public hearing for this action a representative of the Walnut,
Prune, and Fig Industry commented that the CUE process is an exemption
to the Montreal Protocol that does not have quantity or time limits.
The commenter stated that methyl bromide needs in certain sectors
increase and decrease based on crop success each year and objects to the
continuous decrease of methyl bromide allocated. [Hearing1]

Our Response:

	The commenter is correct that Article 2H(5) of the Montreal Protocol
authorizing the Critical Use Exemption to the phaseout of methyl bromide
does not have quantity or time limits written into it.  However, the
Parties stated in Decision XV/54 and reiterated it again in Decision
Ex.I/3 that “exemptions must fully comply with decision IX/6, and are
intended to be limited, temporary derogations from the phase-out of
methyl bromide.”  Decision Ex.I/3 further stated that “each Party
should aim at significantly and progressively decreasing its production
and consumption of methyl bromide for critical uses with the intention
of completely phasing out methyl bromide as soon as technically and
economically feasible alternatives are available.”  EPA continues to
work with USDA and the U.S. State Department to nominate and negotiate
for critical use methyl bromide where no technically and economically
feasible alternatives exist.

Comment:

	At the public hearing for this action, Ameribrom commented that when
the CUE approvals come in “late in the season” obtaining and
distributing the full amount is difficult.  The commenter also stated
that the rulemaking framework assumes that everybody involved has access
to the Federal Register and knows what reports to file and how to file
them.  The commenter asserted that this is not the case for many small
distributors. [Hearing 2]

Our Response:

	EPA recognizes that critical use allowances allocated for 2008 can only
be expended in the 2008 calendar year and that stakeholders have a need
to produce and distribute their methyl bromide promptly. EPA endeavors
to allocate CUE methyl bromide as expeditiously as possible while
ensuring adequate time for stakeholders to provide comments.

	EPA recognizes the need to educate stakeholders, including small
distributors, to ensure full compliance with the recordkeeping and
reporting requirements of the rule.  In collaboration with major methyl
bromide producers and distributors, the reporting forms were updated,
simplified, and posted on EPA’s website in 2006.  EPA included
instructional materials with the updated forms, and held compliance
assistance meetings to teach stakeholders how to use the new forms,
including sessions at the Methyl Bromide Alternatives Outreach
conferences in 2006 and 2007.  Most recently, EPA provided a letter
template to members of MBIP that explains the importance of full
reporting, provides information about how to acquire official reporting
forms, and a contact person to answer questions.  EPA encouraged
MBIP’s members to customize the letter and send it to all of their
customers.

	The current recordkeeping and reporting system does not preclude larger
distributors from working closely with smaller distributors in their
distribution chains to ensure that the reporting requirements are fully
and accurately discharged.  In fact, EPA has encouraged more cooperation
between regulated entities that would all benefit from full and accurate
reporting.  One example of this was a letter template, mentioned above,
that EPA sent to members of MBIP to send to their customers.

Comment:

	At the public hearing for this action, CSC commented that the
California Department of Pesticide Regulation is currently issuing a VOC
regulation that could restrict all fumigants, therefore affecting methyl
bromide and its alternatives. [Hearing4]

Our Response:

	EPA’s 2008 CUE rule does not preempt other federal, state, or local
laws or regulations governing actions including, but not limited to, the
sale, distribution, transfer, and use of methyl bromide.  If such a rule
is enacted by the State of California, EPA will study the impacts, and
may adjust the CUE program as appropriate with a notice and comment
rulemaking.

Comment:

	At the public hearing for this action, ABF commented that the
international process is “fatally flawed, both in the scientific
review and the transparency and in fairness,” and that these flaws
filter down to the EPA.  The commenter further stated that, at the
international level, EPA should focus on safe handling of fruit and
vegetable imports rather than on methyl bromide reduction. [Hearing11]

Our Response:

	EPA supports the CUE process to allow continued methyl bromide
production to satisfy critical needs beyond the phaseout agreed to under
the Montreal Protocol.  We appreciate the commenters’ concerns about
the international process.  We will continue to work with our colleagues
at USDA and especially the U.S. Department of State to maintain
scientific integrity, transparency and fairness in the international
implementation of the Montreal Protocol.

Appendix. Commenters at the Public Hearing for This Rulemaking

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