statutory requirements nevertheless is necessary to allow
administrability, the variance must be limited as much as possible.

To apply the statutory PSD and title V applicability thresholds to
sources of GHG emissions would bring tens of thousands of small sources
and modifications into the PSD program each year, and millions of small
sources into the title V program.  These extraordinary increases in the
scope of the permitting programs, coupled with the resulting burdens on
the small sources and on the permitting authorities, would be several
hundred-fold more than what Congress contemplated in enacting the PSD
and title V programs.  Moreover, the great majority of additional
sources brought into the PSD and title V programs would be small sources
that Congress did not expect would need to undergo permitting.  Further,
the administrative strains would lead to multi-year backlogs in the
issuance of PSD and title V permits, which would undermine the purposes
of those programs.  Sources of all types – whether they emit GHGs or
not – would face long delays in receiving PSD permits, which Congress
intended to allow construction or expansion.  Similarly, sources would
face long delays in receiving title V permits, which Congress intended
to promote enforceability.  For both programs, the addition of enormous
numbers of additional sources would provide little benefit.  In the case
of PSD, the large number of small sources that would be subject to
control constitute a relatively small part of the environmental problem.
 In the case of title V, a great many of the sources that would be newly
subject to permit requirements would have “empty” permits, that is,
permits that do not include any applicable requirements, and that
therefore serve little purpose.  For these reasons, the “absurd
results” doctrine applies to avoid a literal application of the
thresholds.  By the same token, the impossibility of administering the
permit programs brings into play the “administrative necessity”
doctrine.  This doctrine also justifies EPA to avoid a literal
application of the threshold provisions.

The situation presented here is exactly the kind that the “absurd
results,” “administrative necessity,” and “step-at-a-time”
doctrines have been developed to address.  They authorize EPA to tailor
the PSD and title V applicability provisions through a phased program as
set forth in this rule, and to use the initial period of phase-in to
develop streamlining measures that would facilitate applying PSD and
title V on a broader scale without overburdening sources and permitting
authorities.  In this manner, the phased approach reconciles the
language of the statutory provisions with the results of their
application and with congressional intent.

2. Data Concerning Costs to Sources and Administrative Burdens to
Permitting Authorities

	This final action concerning applicability of PSD and title V to
GHG-emitting sources, including the decisions on timing for the selected
permitting thresholds, is based on our assessments of both the costs to
the regulated sources to comply with PSD and title V permitting
requirements and the administrative burdens to the permitting
authorities to process PSD and title V permit actions for GHG-emitting
sources.  This section provides a summary of our cost and administrative
burden assessments of permitting that would be required in the absence
of any tailoring as well as under various tailoring options.

Our estimates of costs to the sources and administrative burdens to the
permitting authorities from PSD and title V applicability for GHG
emissions are based on labor and cost information from the existing
Information Collection Requests (ICRs) for PSD and title V programs.  We
applied the same basic methodology used for the proposal, which
incorporates information on numbers and types of affected sources and
estimated permitting actions.  We evaluate administrative burdens in
terms of staffing needs, time for processing permits, and monetary
costs, and we make some judgments about how those burdens would affect
the permitting authorities’ ability to effectively manage and
administer their programs with the addition of GHG emission sources.  We
present the administrative burden data for applying PSD and title V
requirements at the literal statutory thresholds -- that is, the 100/250
tpy levels for PSD and the 100 tpy level for title V – as well as at
other thresholds, which range from 25,000 tpy CO2e to 100,000 tpy CO2e.
We have significantly revised upwards our assessments of costs to
sources and administrative burdens since proposal, and we summarize
below our reasons for doing so.  We also present significant comments
concerning administrative burdens, and our responses to those comments.

	In the next section, concerning legal and policy rationale for our
actions, we discuss how these data on costs to the sources and
administrative burdens to the permitting authorities informed our
decisions that PSD and title V requirements should not, at present, be
applied to GHG-emitting sources under the literal terms of the statutory
thresholds as well as our decisions concerning what thresholds to apply
for Steps 1 and 2 of the applicability phase-in approach and the
applicability floor of 50,000 tpy CO2e.

a. Costs to sources

	As we did at proposal, we have estimated costs to the sources of
complying with PSD and title V starting from the data in the ICR.  We
recognize that the sizes of the sources, as measured by their emissions,
that would be swept into the PSD and title V programs would vary
greatly, and that their permitting costs would vary as well.  For
example, their PSD permitting costs would depend on the amount and types
of their emissions and their control requirements.  Accordingly, we have
determined average costs, as described below.

For PSD, at proposal, we estimated that on average, an industrial source
would incur costs of $84,500 to prepare the PSD application and receive
the permit, and on average, a commercial or residential source would
incur costs of 20 percent that amount, or $16,900.  74 FR at 55,337 col.
3 to 55,339 col. 3.  For this action, we retain the same burden
estimates for an average industrial source:  This type of source would
need 866 hours, which would cost $84,500, to prepare the application and
the PSD permit.  However, based on comments received, we have determined
that a more accurate estimate for an average commercial or residential
source is 70 percent of that amount of time that an industrial source
would need, up from our proposal of 20 percent.  Thus, an average
commercial or residential source would need 606 hours, which would cost
$59,000, to prepare the PSD application and receive the permit.  We are
increasing this time over what we proposed because we now recognize that
virtually all commercial and residential will have no experience with
the PSD permitting process, and therefore will face a significant
learning curve that will entail more time to complete the application,
develop control recommendations, and take the other required steps.  We
believe this learning period could extend from two to possibly four
years or more from the date that the sources become subject to PSD
requirements, depending on the type and actual number of new sources
that come in for permitting.  In addition, we expect that in many cases,
draft PSD permits for GHGs will receive comments from various
stakeholders, from citizens groups to equipment vendors, who will seek
to participate in the permit process, and that all this could add to the
hours that the permittee will need to invest in the process.  The actual
costs to sources to install BACT controls, while still uncertain at this
point, would likely add additional costs across a variety of sources in
a sector not traditionally subject to such permitting requirements.

For title V, at proposal, we estimated that on average, an industrial
source would incur costs of approximately $46,400 to prepare the title V
application and receive the permit, and on average, a commercial or
residential source would incur costs of 10 percent that amount, or
almost $5,000.  74 FR at 55,338 col. 1 to 55,339 col. 3.  For this
action, we retain the same burden estimates for an average industrial
source:  This type of source would need 350 hours, which would cost
$46,400, to prepare the application and the title V permit.  However, we
have determined that a more accurate estimate for an average commercial
or residential source is 50 percent of that amount of time that an
industrial source would need, up from our proposal of 10%.  Thus, an
average commercial or residential source would need about 175 hours,
which would cost $23,200, to prepare the title V application and receive
the permit.  This increase is due to the same reasons as with the PSD
program just discussed:  we now recognize that virtually all commercial
and residential sources will have no experience with the title V
permitting process, and therefore will face a significant learning curve
that will entail more time to, for the first time, assess their GHG
emissions (because such sources are not covered by EPA’s mandatory
reporting rule) , complete the application, respond to permitting
authority comments, meet other title V administrative requirements, and
respond to interested stakeholders.

 b. Administrative Burdens to Permitting Authorities

(1) Estimated Permitting Authority Burden at Proposal

As at proposal, we estimated the administrative burdens to the
permitting authorities at the various threshold levels for PSD or title
V applicability as follows:  First, for a particular threshold level, we
estimated the number of GHG-emitting sources that would be subject to
PSD requirements because they would undertake new construction or
modification, and the number of existing sources that would be subject
to title V requirements,  Second, we estimated the average additional
administrative burden and cost of each PSD permitting action and each
title V permitting action for the GHG- emitting sources.  Third, we
multiplied those two estimates, and the product is the additional
administrative burden at the particular threshold level.  We employed
the same methodology for this final rule, but, as discussed below, and
described in more detail in our final burden analysis,  we have updated
several key assumptions since the proposal as a result of our
consideration of comments received

First, we present the administrative burdens at the statutory levels for
PSD and title V applicability.  At proposal, for the PSD program, we
estimated the administrative burdens that would result from applying PSD
at the 100/250 tpy major emitting facility threshold levels in two ways,
as described in this section.  We stated that at present, 280 sources
are subject to PSD each year, both for new construction and
modifications.  This figure served as the baseline from which to
calculate increases in administrative burdens due to permitting
GHG-emitting sources.

The first method that we used to calculate the administrative burdens to
the permitting authorities was in terms of workload hours, which we then
converted to monetary costs.  To make the workload calculation, we first
estimated the number of GHG-emitting sources that would become subject
to PSD through new construction and modification.  Based on our GHG
threshold data analysis, we estimated that almost 41,000 new and
modified sources per year would become subject to PSD review.  We first
calculated the number of new sources that would become subject to PSD.
To do this, we estimated growth rates for the various sectors, and then
applied those growth rates to the numbers of sources in those sectors.
We then calculated the number of modifications.  To do this, we first
assumed that each year, two percent of sources that meet or exceed the
threshold levels for PSD applicability due to their conventional
pollutants undertake modifications.  We then calculated the number of
sources that would meet or exceed the threshold levels for PSD
applicability due to their GHG emissions, and applied the same
assumption that two percent of them would undertake modifications.  In
this manner, we estimated the number of modifications of GHG-emitting
sources that would become subject to PSD.

  We noted that currently, 280 PSD permits are issued each year, but
that applying PSD to GHG-emitting sources at the 100/250 tpy statutory
threshold levels would cause an increase in permits of more than
140-fold.  The reason for the extraordinary increase in PSD
applicability lies simply in the fact that it takes a relatively large
source to generate emissions of conventional pollutants in the amounts
of 100/250 tpy or more, but many sources combust fossil fuels for heat
or electricity, and the combustion process for even small quantities of
fossil fuel produces quantities of CO2 that are far in excess of the
sources’ quantities of conventional pollutants and that, for even
small sources, equals or exceeds the 100/250 tpy levels.

 Based on the 140-fold increase in permits, we then estimated the
per-permit burden on permitting authorities.  As we stated in the
proposal:

We estimated the number of workload hours and cost a permitting
authority would expend on each new source and each modification.  We
based these estimates on the workload hours and cost for processing
permits for new sources of non-GHG emissions, which we derived from
labor and cost information from the existing [Information Collection
Requests (“ICRs”)] for PSD programs.  The ICRs show that permitting
authorities expend 301 hours to permit a new or modified industrial
source….

We then made assumptions for number of workload hours and costs for new
sources of GHG emissions.  We assumed that permitting new industrial GHG
sources that emit in excess of the 250-tpy threshold would be of
comparable complexity to permitting non-GHG emitting industrial sources
that are subject to PSD.  Thus, for these sources, we assumed that
permitting authorities would expend the same number of workload hours
and costs, on a per-permit basis, as they do for non-GHG emitting
industrial sources.  On the other hand, for commercial and residential
GHG sources that emit GHGs above the 250-tpy threshold (and as a result
would be subject to the requirements of the PSD permitting program at
this threshold level), we assumed that the workload hours and cost for
permitting these sources would be significantly less than—only 20
percent of—the hours and cost necessary to prepare and issue initial
PSD permits or permit modifications for industrial GHG sources.  This
20-percent estimate amounts to 60 hours of permitting authority time per
residential or commercial permit.

Based on these assumptions, the additional annual permitting burden for
permitting authorities, on a national basis, is estimated to be 3.3
million hours at a cost of $257 million to include all GHG emitters
above the 250-tpy threshold.

74 FR at 55,301 col. 2.  Note that at the proposal, in calculating the
PSD administrative burdens that would occur each year due to GHG
emissions, we did not undertake separate calculations for the
administrative burdens associated with permitting obligations stemming
from the GHG emissions of the 280 sources already subject to PSD
permitting requirements due to their conventional pollutants.  In
effect, we treated these 280 sources are part of the over 40,000 sources
that would become subject to PSD due to their GHG emissions.

The second way that we evaluated the burden on permitting authorities
was by reviewing a study conducted by state and local air permitting
agencies.  As we said in the preamble:

In addition to conducting our burden analysis, we also reviewed summary
information from state and local air permitting agencies regarding
additional resources and burden considerations if GHG sources that emit
above the 100/250-tpy thresholds were subjected to the PSD and title V
programs.  This information covered 43 state and local permitting
agencies, representing programs from different regions of the country
and various permitting program sizes (in terms of geographic and source
population coverage)….  This information showed significant burdens
projected by permitting agencies with adding sources of GHG emissions in
terms of staffing, budget, and other associated resource needs.
Importantly, the agencies based their analysis on the assumption that,
for purposes of determining whether a source is major, its emissions
would be calculated on an actual emissions ("actuals") basis, and not on
a PTE basis.  On an actuals basis, the agencies estimated a 10-fold
increase in the number of permits.

Specifically, the agencies estimated that:

Assuming, again, that number of permits was to increase by 10-fold
(based on actual emissions), the resulting workload would require an
average of 12 more FTEs per permitting authority at an estimated cost of
$1 million/year;

Without the additional FTEs, the average processing time for a permit
would increase to 3 years, which is three times the current average
processing time;

Permitting authorities would need 2 years on average to add the
necessary staff;

Permitting authorities would also need, on average, eight additional
enforcement and judicial FTEs;

Ninety percent of the permitting agencies indicated that their staff
would need training in all aspects of permitting for sources of GHG
emissions.

A quarter of the permitting agencies reported that they were currently
under a hiring freeze.

              We went on to explain that this state survey significantly
underestimated the administrative burdens:

It is important to reiterate that the state and local permitting
information on burden was based on the number of additional facilities
subject to PSD because their emissions of GHGs exceed the 100/250-tpy
thresholds at actual emissions rates, not PTE-based emissions rates.
However, the PSD applicability requirements are based on PTE.  By
adjusting the increase in number of permits to account for GHG sources
that exceed the 100/250-tpy applicability thresholds based on their PTE
emissions, EPA estimated a 140-fold increase in numbers of PSD permits,
much more than the 10-fold increase estimated by the states based on
actual emissions.

74 FR at 55,301 col. 2-3.

In addition to PSD, we also estimated title V burdens at the statutory
threshold.  At proposal, for the title V program, we estimated the
administrative burdens that would result from applying title V
requirements at the 100 tpy major source threshold level in the same two
ways as for PSD, as follows:  The first method was to calculate the
administrative burdens in terms of workload hours, which we then
converted to monetary costs.  To make the workload calculation, we first
estimated the number of existing GHG-emitting sources that would become
subject to title V.  Based on our GHG threshold data analysis, we
estimated that approximately 6 million sources would become subject to
title V.  Compared to the 14,700 title V permits currently issued per
year, this would be an increase in permits of more than 400-fold.  We
noted, in addition, that most of the 14,700 sources already subject to
title V also emit GHGs and may be affected as well.

We then described the type of work that the permitting authorities would
need to do for these GHG-emitting sources – the six million that would
become newly subject to title V and most of the 14,700 that are already
subject to title V – as follows.  Note at the outset that the
permitting authorities’ workload is greater for sources newly subject
to title V than for existing sources that seek a revised or renewed
permit.  As EPA noted in the preamble:

[T]he[] permits [for the six million new sources] would need to include
any requirements for non-GHGs that may apply to the source, such as
provisions of an applicable State Implementation Plan (SIP).  For any
such requirements, permitting authorities would also need to develop
terms addressing the various compliance assurance requirements of title
V, including monitoring, deviation reporting, six-month monitoring
reports, and annual compliance certifications.

Adding to the burden described above would be the burden to add GHG
terms to the 14,700 existing title V permits.  While, in general,
existing title V permits would not immediately need to be revised or
reopened to incorporate GHG (because as noted above, there are generally
not applicable requirements for GHGs that apply to such sources),
permitting authorities may face burdens to update existing title V
permits for GHG under two possible scenarios: (1) EPA promulgates or
approves any applicable requirements for GHGs that would apply to such a
source, which would generally require a permit reopening or renewal
application, or (2) the source makes a change that would result in an
applicable requirement for GHGs to newly apply to the source, such as
PSD review, which would generally require an application for a permit
revision.  Permitting authorities will also need to process permit
renewal applications, generally on a five-year cycle, and such renewals
would need to assure that the permit properly addresses GHG.  Finally
they would have to process title V applications for new sources
(including all the PSD sources previously discussed).

74 FR at 55,302 cols. 2-3.

In light of those demands, we estimated the per-permit burden on
permitting authorities as follows.  Note, at the outset, that as with
PSD, we based the workload hours on information in ICRs for industrial
sources, and we then assumed that the workload for commercial and
residential sources would be the indicated percentage of the workload
for industrial sources:

As with PSD, we have quantified the extent of the administrative problem
that would result in workload hours and cost on the basis of information
concerning hours and costs for processing existing title V permits that
is indicated on ICRs.  However, we recognize that more than 97 percent
of these new sources would be commercial and residential sources.  We
estimate that for permitting authorities, the average new commercial or
residential permit would require 43 hours to process, which is 10
percent of the time needed for the average new industrial permit.  For
an average existing permit, which permitting authorities would need to
process through procedures for significant revisions and permit
renewals, adding GHG emissions to the permit would result in, we
estimate, 9 additional hours of processing time, which is 10 percent of
the amount of time currently necessary for processing existing permits.
We estimate that the total nationwide additional burden for permitting
authorities for title V permits from adding GHG emissions at the 100-tpy
threshold would be 340 million hours, which would cost over $15 billion.

74 FR at 55,302 col. 3.

As with PSD, the second way that we evaluated the burden on permitting
authorities at the statutory threshold was by reviewing a study
conducted by state and local air permitting agencies of the burden of
applying title V to existing GHG-emitting sources at the 100 tpy
statutory threshold level.  As we said in the preamble to the proposed
rule:

[W]e also reviewed summary information from state and local permitting
agencies, which showed significant burdens associated with adding GHGs
in their title V programs in terms of staffing, budget, and other
associated resource needs.  Again, note that the permitting agencies
based their estimates on numbers of permits that would be required from
sources subject to the 100-tpy title V applicability threshold on an
actuals—not PTE—basis.  Based on that level, the agencies assumed a
40-fold increase in numbers of permits, and estimated that:

The resulting workload would require an average of 57 more FTEs per
permitting agency at an estimated cost of $4.6 million/year;

Without the additional FTEs, the average processing time for a permit
would increase to almost 10 years, which is 20 times the current average
permit processing time;

Permitting authorities would need 2 years on average to add the
necessary staff;

On average, permitting authorities would need 29 additional enforcement
and judicial staff;

Eighty percent of the permitting authorities indicated that their staff
would need training in all aspects of permitting for sources of GHG
emission.

A quarter of the permitting agencies reported that they were currently
under a hiring freeze.

     As with PSD, we added that this state survey significantly
underestimated the administrative burdens:

It is important to reiterate that, as with PSD, the state and local
information on projected permitting burden is based on the number of
additional facilities subject to title V because their emissions of GHGs
exceed the 100-tpy thresholds at actual emissions rates, not the
PTE-based emissions rates.  However, the title V applicability
requirements are based on PTE.  As noted elsewhere in this preamble, the
state and local agencies estimated a 40-fold increase in numbers of
title V permits based on the amount of GHG sources' actual emissions.
By adjusting the summary estimates provided by the state and local
agencies to account for GHG sources that exceed the 100-tpy threshold
based on their PTE emissions, EPA estimated that the average permitting
authority would need 570 more FTEs to support its title V permitting
program.

74 FR at 55,302 col. 3 – 55,303 col. 1.

(2)  Revisions to Proposal Estimates of Permitting Authority Burden

We received numerous comments from state and local authorities pointing
out how EPA had underestimated the administrative burden on the
permitting authorities in the proposal.  State and local authorities
stated that in particular, EPA underestimated the number of
modifications and the amount of time it would take permitting
authorities to process permits, particularly for commercial and
residential sources.  Based on the comments and additional analysis that
we have conducted, we are revising in several respects our estimates of
the administrative burdens for applying PSD and title V at the statutory
threshold levels.

First we present revisions to our analysis regarding the burdens at the
statutory levels.  Before we present those changes, we want to note a
revision to our methodology that affected our estimate of the number of
permits currently issued under existing programs.  We are revising
upwards the number of sources that are already subject to PSD permitting
requirements anyway for their conventional pollutants (“anyway”
sources).  This revision has implications both for (i) the number of
sources that would become subject to PSD due to their GHG emissions; and
also (ii) the baseline number of sources already subject to PSD, which
we use to compare the amount of increases in administrative burden due
to permitting GHG sources.  At proposal, we stated that 280 sources each
year are subject to PSD due to their new construction or modifications.
However, upon further analysis, we have realized that this figure is too
low because it includes only sources that have emissions of one or more
NAAQS pollutants at the 100/250 tpy thresholds and that are located in
areas of the country that are designated attainment or unclassifiable
for all of those pollutants, and thus are not designated nonattainment
for any of those NAAQS pollutants.  We estimate that another 520 sources
have emissions of one or more NAAQS pollutants at the 100/250 tpy
thresholds and are located in areas of the country that are
nonattainment for at least one of those NAAQS pollutants.  Some of these
520 sources may also emit one or more pollutants at the 100/250 tpy
level for which their area is designated attainment or unclassifiable,
and therefore may be subject to PSD for those pollutants.  Accordingly,
the correct number of “anyway” sources subject to PSD each year is
the 280 sources that are located in areas that are attainment or
unclassifiable for each pollutant that the sources emits at the 100/250
tpy level, plus at least some of the 520 sources that are located in
areas that are nonattainment for at least one of the NAAQS pollutants
that the sources emit at or above the 100/250 tpy threshold.  In the
absence of data on the number of nonattainment NSR permits that do not
have a PSD component, and because we expect this to be a small number,
we have assumed for purposes of this action, that each of the 520
sources is subject to PSD for at least one pollutant, so that we will
consider all 800 sources as subject to PSD.  Of this number, we estimate
that 80 percent, or 688 sources, would become subject to additional
requirements due to their GHG emissions because those sources have
combustion-related activities that would likely emit GHGs in the
requisite quantities.  Our estimate of 80 percent of permitting
activities significantly involving combustion activities is based on a
review of a random sample of PSD permits.

We should also note that in this rulemaking we are justifying our
conclusions about permitting authority administrative burdens on the
basis of their PSD and title V cost as calculated on both a separate
basis and a combined basis.  That is, we believe that the administrative
burdens of the PSD program justify our tailoring approach for the PSD
requirements, and the administrative burdens of the title V program
justify our tailoring approach for the title V requirements, but
addition, the administrative burdens of both programs on a combined
basis justify the tailoring approaches.  Viewing the administrative
burdens on a combined basis provides a useful perspective because most
permitting authorities have a single organizational unit that is
responsible for both the PSD program and the title V program, and in
many cases, the same employees work on both programs.  In addition, in
some jurisdictions, permitting authorities issue a single, merged permit
that includes both PSD and title V requirements.  For these reasons,
considering administrative burdens on a combined PSD and title V basis,
offers a more accurate picture of the issues these agencies will face in
transitioning to GHG permitting.

Turning to the revisions to our burden estimates that we made as a
result of public comment, we begin by noting that many commenters
believed that we significantly underestimated the administrative burdens
associated with the proposed thresholds or that the administrative
burden under the proposed thresholds would still overwhelm the states
and result in significant permitting delays and uncertainty for sources.
 Many of these commenters indicate that our estimate of the number of
sources that would be subject to permitting is too low, and some add
that we have underestimated the per-permit effort required.  (More
detail on these comments is given elsewhere on the methodology used in
the analysis.)  Several state and local agencies provided estimates of
the increased number of permits and/or staff that would be required
under the thresholds we proposed that were higher than our original
estimates.  Specifically, commenters recommended that we increase the
estimated administrative burdens for PSD permits from 100 percent to
over 2,000 percent; and that we increase the burdens for title V permits
from 29 percent to 240 percent.  Many commenters indicated that EPA has
not adequately accounted for “synthetic minor” sources or
modification projects, stating that many such sources and projects will
not be able to keep GHGs below the proposed thresholds, and those who
could do so may not be able to establish enforceable synthetic minor
limits.  Numerous commenters also stated that the EPA has underestimated
the rate of major modifications for GHGs under PSD.  Some commenters
assert that we underestimated the number of permits required for
specific industry sectors, including the oil and gas production
industry, the natural gas transmission industry, the semiconductor
industry, the wood products industry, the brick industry, and landfills.
 Some of the state and local commenters also believe that we have
overestimated their ability to hire and train sufficient staff to
administer GHG permitting.

We are persuaded by the data and arguments provided by the many
commenters who believe EPA underestimated the number of permitting
actions and the burdens of each action, and thus the overall
administrative burdens associated with permitting GHG sources.
Accordingly, we have reevaluated our assessment of these administrative
burdens, for both the PSD and title V programs.  In conducting this
re-evaluation, we considered arguments made by the commenters, as well
as any actual data they provided, and then we determined whether and how
to modify various aspects of our detailed assessment of the burdens.
Based on this consideration we have substantially revised upwards our
estimate of administrative burdens, based on the analysis included in
the final docket for this rulemaking,  The revisions affect two elements
of our analysis:  (1) a substantial increase the number of PSD and title
V permits that will occur at the statutory thresholds, and (2) an
increase in the average burden estimate for each such permit.

	Regarding the increase in our estimate of the number of projects that
will occur, we estimated an increase in both PSD and title V permit
actions, though the greatest changes were for PSD.  At proposal, we
estimated that, were PSD requirements to apply to GHG sources at the
100/250 tpy statutory levels, 40,496 projects -- consisting of 3,299
projects at industrial sources and 37,197 projects at commercial or
residential sources -- would need PSD permits each year.  Some of these
projects involve the construction of an entirely new source, but the
majority of these are modifications.  We now estimate that at the
100/250 tpy levels, 81,598 projects would become subject to PSD each
year.  These projects include 26,089 actions at industrial sources and
55,509 at commercial and residential sources.  We describe our
calculation of this 81,598 amount in a technical support document.  The
great majority of these 81,598 projects that would become subject to PSD
are modifications.  We base these estimates on the assumption that the
significance levels would be 100 tpy regardless of category.

Our estimate of the number of PSD modifications is where we made our
most significant upward revisions from our proposal, based on comments.
Our doubling of the estimated PSD permitting actions – from 40,496 at
proposal to 81,598 -- results from three separate adjustments we made to
our estimates at proposal of the number of permit actions that would
result from applying PSD to GHG sources.  Two of these increased the
number of major modifications, and one of these increased the number of
major sources and modifications.  The most significant adjustment, and
one that was raised by multiple commenters, was that we undercounted the
number of major modification projects at existing major sources because
we did not include the existing projects that avoid major PSD review by
either taking “synthetic minor” limits or by netting out for
conventional pollutants, but that would not be able to avoid PSD through
those mechanisms for GHGs.  The ability and procedures for sources to
achieve reductions, or minimize increases, due to GHGs through adoption
of enforceable limits or through netting out have not be well
established at this point. We believe that there will numerous
instances, particularly for combustion-related projects, where it will
not be possible for sources to achieve the same level of reductions for
CO2 emissions as they do for NOx emissions, for example, simply because
there are not as many proven control techniques that can reduce CO2
emissions to the same degree as NOx.  Also, more research will be
necessary in the type of emission units and processes resulting in GHG
emissions, and how they operate over a wide range of utilization
patterns at a variety of source categories, before permitting
authorities will be able to establish procedures and rules for
developing minor source permit limitations.  Therefore, we adjusted our
count of major modification permits under PSD upward to account for
this.

The second change to the number of permits concerns the general
modification rate of 2 percent that we applied at proposal, based on
historical experience across all pollutant types.  Commenters provided
information [should cite RTC document in the docket that shows comments
regarding modifications estimate)] that suggest that this 2 percent
figure is an underestimate for GHG sources because their emissions of
CO2 are high and accumulate quickly from various changes involving
combustion units.  Therefore, a greater percentage of their physical or
operational changes will result in GHG emissions in excess of the
significance levels that we identified at proposal.  In light of these
comments, we reviewed the source populations and pollutant mix within
the various populations, and determined that we should revise our
general modification rate to 4 percent for GHG sources.  This 4% rate
was obtained by dividing the current annual major NSR permit actions
involving modifications by the 14,700 existing sources.  We have revised
our burden analysis accordingly.  Again, the burden analysis in the
docket describes our basis for these calculations in more detail.

The third adjustment to the number of permits involves our estimate of
the number of sources with potential to emit that is greater than the
various thresholds considered.  This affects the number of major sources
at the statutory thresholds, which we used to estimate the number of PSD
and title V major sources, but also has an effect on the number of major
modifications because the number of modifications depends on the size of
the population of major sources.  Commenters provided evidence that our
estimates of capacity utilization (which, as described above, we use for
estimating potential-to-emit based on data for actual emissions) for the
general manufacturing source category (referred to as “unspecified
stationary combustion” in our analysis) and for the oil and gas
industry were not accurate.  In our proposal, our estimated range for
capacity utilization for ‘unspecified stationary combustion” varied
from 70 to 90 percent depending on manufacturing category.  For the oil
and gas industry, our estimate was 90 percent.  We received comments
indicating that these utilization rates are higher than what is normally
achieved in real-world conditions, particularly for smaller
manufacturing type facilities.  Accordingly, in this action, we are
using a 50 percent capacity utilization rate for both of these source
categories, which better reflects what can be deemed reasonable
operation under normal conditions for facilities in these source
categories.  This adjustment increased the overall number of affected
facilities at various threshold levels and we have revised our burden
analysis accordingly.

	A few commenters asserted that we underestimated the number of
residential homes, commercial buildings, and retail stores that would be
subject to permitting requirements because these commenters believed the
estimate in EPA’s TSD was based on actual emissions from space heating
equipment rather than PTE.  We wish to clarify that our threshold
analysis estimates for the number of residential and commercial sources
(as well as all other sources) did use a PTE basis.  To calculate the
PTE amount for these sources, we extrapolated from the actual emissions
data for the residential and commercial sources.  Specifically, we
assumed that a typical residential facility operates its fuel combustion
sources at only 10 percent of its capacity and a typical commercial
facility operates at only 15 percent of its capacity.  Based on these
assumptions, we multiplied residential actual emissions by a factor of
10, and commercial actual emissions by a factor of 6.6 to obtain
PTE-based estimates.  There is very little information available on the
capacity utilization rates of fuel combustion equipment at different
types of residential and commercial facilities, but we believe our
methodology was reasonable for these types of sources and we did not
adjust it in response to this comment.  Information on the development
of these estimates is provided in our Technical Support Document for
Greenhouse Gas Emissions Thresholds Evaluation.

 The second source of upward revisions to our administrative burden
estimate is that we are increasing the estimated average cost to
permitting authorities of issuing each PSD and title V permit at the
statutory thresholds.  At proposal, we estimated that for PSD permits,
permitting authorities would expend, on average, 301 hours to permit an
industrial source of GHG emissions, and 20 percent of that time, or 60
hours to permit a commercial or residential source.  After estimating
that amount of workload, we went on to estimate the monetary cost to
permitting authorities of that workload.  Similarly, for title V
permits, we estimated at proposal that permitting authorities would
expend 10 percent of the number of hours needed to process an industrial
permit in order to process a commercial or residential permit for GHG
sources.

We received comments from both permitting authorities and sources
asserting that our methodology underestimated the administrative burden
on grounds that (1) our methodology fails to recognize that when a
source triggers PSD for conventional pollutants, additional labor hours
would be required to issue BACT for GHGs; (2) our estimate of 60 hours
(versus 301 hours) to issue PSD permits to commercial and residential
sources of GHGs is unrealistically low; (3) our estimate failed to
account for the increase in the complexity of permits for criteria
pollutants due to (i) increases in criteria pollutant emissions becoming
newly subject to BACT at sources that are major only for GHGs, which
will result in increased permitting and (ii) BACT controls for criteria
pollutants (e.g., an oxidizer for VOC) may result in significant GHG
emissions, triggering an additional BACT determination.; and (4) our
methodology failed to account for the significant additional PSD and
title V burdens due to sources that obtain federally enforceable permit
limits on GHGs in order to become “synthetic minors” and thereby
avoid PSD (and possibly also title V).

	Based on these comments and our own reassessment of permitting actions
created by the addition of GHGs, we have revised upwards in several ways
our estimate of the additional per-permit costs of applying PSD and
title V to GHG sources, including the following:  First we have added an
estimate of the additional permitting cost for adding a GHG component to
“anyway” PSD and title V permitting actions for conventional
pollutants.  We estimated this burden based on information in the
comments together with our own judgment about how to adjust the burden
numbers contained in the current supporting statements for our approved
permitting Information Collection Requests (ICR’s).  These adjustments
are found in our revised burden estimate document

Second, we have raised the per-permit burden hours for commercial and
residential sources for PSD and title V.  At proposal, our estimates
were based on the fact that many of these permits will be technically
simpler due to such factors as a lower number of emissions points,
simpler processes, and less required modeling.  However, commenters
pointed out that, until EPA streamlines its permitting procedures, there
are many permitting activities that represent a fixed cost, such as
public notice, hearing, and response to comment activities.  In
addition, we agree, as commenters pointed out, that many of these
sources will need significantly more permitting-authority staff time to
assist them in the permit application and preparation process because of
their lack of experience with these requirements.  In addition,
permitting authorities will have little, if any, experience in
permitting commercial and residential sources, and therefore will face a
learning curve that will entail more time to take permitting action.
In addition, we expect that in many cases PSD and title V permit
applications for GHGs will receive comments from various stakeholders,
from citizens groups to equipment vendors, who will seek to participate
in the permit process, and responding and revising permits accordingly
will add to the hours that the permitting authority will spend.

As a result, we raised the PSD per-permit hours for various steps in the
permitting process, as described in the burden estimate document. While
we continue to estimate that permitting authorities will expend, on
average, 301 hours to issue a PSD permit to an industrial source, and
that this would cost $23,243, we now recognize that a permitting
authority would expend 70 percent of that time or 210 hours, to permit a
commercial or residential source, which would cost $16,216.  Similarly,
for title V, while we continue to estimate that permitting authorities
will expend, on average, 428 hours to issue a title V permit to an
industrial source, and that this would cost $19,678, we now recognize
that a permitting authority would expend 50 percent of the time, or 214
hours, to permit a commercial or residential source, which would cost
$9,839.

We disagree with commenters who suggested that by basing our estimates
on the numbers of newly constructing and modifying sources with high
enough emissions to qualify as major emitting facilities, we failed to
account for the costs of sources that seek “synthetic minor” permits
to avoid PSD, and possibly title V, requirements.  In fact, our
methodology includes sources that might take such limits as newly-major
sources for their GHG emissions; and therefore we count the full
administrative burden associated with a PSD permit and a title V permit
for those sources.  In effect, we assume that such sources would go
through PSD or title V permitting, rather than take “synthetic
minor” limits. We take this approach because although we suspect that
there may, in fact, be significant synthetic minor activity, we do not
have data that would allow us to determine whether, and how many of,
these sources will be able to adopt “synthetic minor” limits or
restrict their operations to obtain minor source permitting status.  Nor
do we have data on the amount of the administrative burden that would
fall on any particular permitting authority to establish a “synthetic
minor” limit, except that we understand that the amount varies widely
across states.  As a result, we opted to include these sources in our
analysis as sources receiving a PSD or title V permit.  Therefore, to
the extent that synthetic minor activity occurs, our estimate would
already have included the burden for that activity.  In fact, our
estimate would have overestimated the burden to the extent that a
permitting authority would have less administrative costs to issuing a
“synthetic minor” permit, as compared to a PSD or title V permit.

(3)  Revised Burden Estimates at Statutory Thresholds

Based on the revisions just described, we estimate that in all, if
sources that emit GHGs become subject to PSD at the 100/250 tpy levels,
permitting authorities across the country would face over $1.5 billion
in additional PSD permitting costs each year.  This would represent an
increase of 130 times the current annual burden hours under the NSR
major source program for permitting authorities.  The permitting
authorities would need a total of almost 10,000 new full time employees
(FTEs) to process PSD permits for GHG emissions.

In addition, we estimate that in all, if sources that emit GHGs become
subject to title V at the 100 tpy level, permitting authorities across
the country would incur about 1.4 billion additional work hours, which
would cost $63 billion.  We estimate that most of this work would be
done over a three year period, which would amount to 458 million in
additional work hours, and $21 billion in additional costs, on an annual
basis over that 3-year period.

We also note that the survey of state and local permitting authorities
described in the proposed rulemaking continues to shed light on the
extent of the administrative burdens, including staffing, budget, and
other associated resource needs, as projected by the permitting
authorities.  As noted above, that survey concluded that application of
the PSD requirements to GHG-emitting sources at the level of 100/250 tpy
or more of actual emissions would, without additional FTEs, increase the
average processing time for a PSD permit from one to three years.  The
survey further concluded that application of the title V requirements to
GHG-emitting sources at the level of 100 tpy or more of actual emissions
would, without additional FTEs, increase the average processing time for
a title V permit from six months to 10 years.  As we noted at proposal,
this survey assumed a ten-fold increase in the number of PSD permits and
a 40-fold increase in the number of title V permits due to GHG-emitting
sources, but those assumptions were severely underestimated because
based on actual emissions.  At proposal, our calculations, which were
based on potential emissions, indicated a 140-fold increase in PSD
permits and a more than 400-fold increase in title V permits.  In this
rulemaking, we recognize that even our estimates at proposal were
severely underestimated.  We now recognize that the number of PSD
permits will be about twice what we estimated at proposal, and the
average processing time for both PSD and title V permits will be two or
three times greater than what we estimated at proposal.  The survey of
state and local permitting authorities provided other useful information
as well, including the fact that it would take the permitting
authorities two years, on average, to hire the staff necessary to handle
a ten-fold increase in PSD permits and a 40-fold increase in title V
permits, and that 90 percent of their staff would need additional
training in all aspects of permitting for GHG sources.

(4)  Revised Estimates of Administrative Burdens at Various Threshold
Levels

In order to determine the appropriate PSD and title V applicability
level for GHG sources, we not only estimated the burden at the statutory
thresholds, as described above, but we also estimated the number of
sources, number of permitting actions, and amount of administrative
burden at various applicability levels for both PSD and title V, based
on the revised methodology described above, that we used to estimate the
administrative burdens of applying PSD and title V at the statutory
levels.  This information is summarized in Table VI.-1, below.  Note
that Table VI-1 also includes, in the last column, the administrative
burdens, described above, associated with the 100/250 tpy
thresholds.Table 1 Coverage and Burden Information

	Current program

	“Anyway” Source Approach 75k Major Mod

	100k Major Source

100k Major Mod.	100k Major Source

75k Major

Mod 	100k Major Source

50k Major

Mod	50k Major

 Source

50 k Major

Mod	25k Major Source

25k Major

Mod	100/

250

Major,

100

 Mod

Number of  major sources	15,000	15,000	15,550         	15,550
15,550         	18,500

	22,500         	6,118,252

Number of newly major GHG sources	N/A	0	550	550	550	3,500	7,500
6,105,913

Number of PSD new construction actions	240	240	242	242	242	243	250
19,889

Number of PSD modification actions at covered major sources	448	448	468
1,363	2,257	2,354	9,645	62,284

Permitting Authority Cost to Run PSD programs	$12M/yr.	$15M/yr.	$15M/yr.
$36M/yr.	$57M/yr.	$59M/yr.	$229M/yr.	$1.5B/yr

Permitting Authority Work Hours to Run PSD programs

150,795

185,195

192,055

461,450

730,544

764,781

2.97 M

19.7 M

Permitting Authority Cost to Run Title V Programs	$62M/yr. 	$63M/yr.
$67M/yr. 	$69M/yr. 	$70M/yr. 	$88M/yr. 	$126M/yr. 	$21 B/yr

Permitting Authority Work Hours to Run Title V Programs 	1.35 M	1.38 M
1.46 M	1.49 M	1.53 M	1.92 M	2.74 M	460 M

Annual Total Cost to Run PSD and Title V Programs and % increase in cost
over current program

	$74M/yr.	$78M/yr.

5% increase (once states adopt)	$82M/yr.

11% increase	$105M/yr

42% increase	$127M/yr

 72% increase	$147M/yr.

 99% increase	$355M/yr.

380% increase	$22.5 B/yr

28,278% increase

% GHG emissions covered	-0-	65%	67%	67%	67%	70%	75%	78%

As described in the [cite to TSD], we considered several different major
source/major modification threshold combinations.  We chose the
combinations to reflect representative, incremental steps along the
possible range.  Because it is time- and resource- intensive to develop
estimates for a given step, we chose intervals that best reflect
representative points within the range, given those time and resource
constraints.  Here, we discuss key observations about some of the
combinations that we assessed.  As the table indicates, under the
current PSD and title V programs, approximately 15,000 sources qualify
as major PSD sources for at least one pollutant and therefore meet the
applicability thresholds.  Of these, approximately 668 sources are
subject to PSD requirements each year for at least one pollutant -- 240
because they undertake new construction, and 448 because they undertake
modifications.  The permitting authorities’ administrative burdens for
the NSR program are 153,795 work hours, and $12 million. For the title V
program, the 15,000 sources are, for the most part already permitted,
and therefore need revised permits as required and renewal permits on a
five-year schedule.  The permitting authorities’ title V
administrative burdens on an annual basis are 1,349,659 work hours and
$62 million.

The first threshold Table 1 describes – and which, as discussed below,
we are adopting for Step 1 – is the “anyway” source approach.
Under this approach, (i) PSD applies to the GHG emissions from projects
that are subject to PSD anyway as new sources or major modifications due
to their emissions of non-GHG pollutants and that result in an increase
(or, in the case of modifications, a net increase) of at least 75,000
tpy CO2e; and (ii) title V applies to what we will call “anyway”
title V sources, that is, sources that are subject to title V anyway due
to their emissions of non-GHG pollutants.  Under this approach, the
number of sources subject to PSD each year – including new
construction and modifications -- is the same as under the current
program, but the permitting authorities will need to address GHG
emissions as part of those permitting actions each year and, to do so,
will require, each year, 34,400 additional workload hours costing an
additional $3 million.  For title V, we estimate that the number of
title V sources that require permitting actions will, on average, be the
same each year, but permitting authorities will need to address GHG
requirements for some of them; as a result, permitting authorities will
need, each year, 27,468 additional work hours costing $1 million in
additional funding.

	Another threshold described in Table VI-1 is the one we are adopting
under Step 2, as described below, under which  (i) sources will be
subject to PSD on account of their GHG emissions if they newly construct
and emit at least 100,000 tpy CO2e, or if they are existing sources that
emit at least 100,000 tpy CO2e of GHGs and make a modification that
results in a net emissions increase of at least 75,000 tpy CO2e; and
(ii) existing sources will be subject to title V due to their GHG
emissions if they emit 100,000 tpy CO2e in GHG emissions.  Under this
approach, which we will call the 100,000/75,000 approach, we estimate
that each year, the permitting authorities will need to issue GHG
permits to two additional sources that newly construct and 915 that
undertake modifications above current permitting levels.  Doing so will
require 310,655 additional workload hours costing an additional $24
million, compared to the current program.  For title V, an additional
180 sources will require new title V permits each year, and the
permitting authorities’ associated costs will be 160,572 work hours
and $7 million more than the current program.

The last approach we will describe here may be called the 50,000/50,000
approach, which, as discussed below, we adopt as the floor for
thresholds during the first 6 years after promulgation.  Under this
approach, (i) sources will be subject to PSD on account of their GHG
emissions if they newly construct and emit at least 50,000 tpy CO2e, or
if they are existing sources that emit at least 50,000 tpy CO2e of GHGs
and make a modification that results in a net emissions increase of at
least 50,000 tpy CO2e; and (ii) existing sources will be subject to
title V on account of their GHG emissions if they emit 50,000 tpy CO2e
in GHG emissions.  Under this approach, each year, the permitting
authorities will need to issue GHG permits to 3 additional sources that
newly construct and 1,900 that undertake modifications above current
permitting levels.  Doing so will require 613,986 additional workload
hours costing $47 million, compared to the current program.  For title
V, an additional 1,189 sources will require new title V permits each
year and the permitting authorities’ associated costs will be 568,017
work hours and $26 million more than the current program.

We present the remaining entries in the table to illustrate how the cost
and burden estimates vary with increasing or decreasing thresholds
relative to those selected in this rule.  These variations are important
in understanding how alternative thresholds would compare to the ones
selected.  We also include entries reflecting the baseline (current
program without GHG permitting) and the burdens if we immediately
implemented the full statutory thresholds on January 2, 2011 without
tailoring or streamlining.

3.  The Chevron framework and the “absurd results,”
“administrative necessity,” and “step-at-a-time” legal doctrines

a. Introduction and summary

Having described the factual underpinnings of our action, which are the
costs to sources and administrative burdens to permitting authorities,
we now describe the legal underpinnings, which are Chevron framework,
taking account of the “absurd results,” “administrative
necessity,” and “step-at-a-time” doctrines.  We believe that each
of these doctrines provides independent support for our action, but in
addition, the three doctrines are directly intertwined and can be
considered in a comprehensive and interconnected manner.  Moreover,
although the three doctrines may pre-date Chevron U.S.A. Inc. v. NRDC,
467 U.S. 837, 842-43 (1984), in which the U.S. Supreme Court established
the framework for construing agency-administered statutes, each of the
three doctrines fits appropriately into the Chevron framework.

To reiterate, for convenience, the statutory provisions at issue:
Congress, through the definition of “major emitting facility,”
applied the PSD program to include “any … source[ that] emit[s], or
ha[s] the potential to emit, one hundred [or, depending on the source
category two hundred fifty] tons per year or more or more of any air
pollutant.”  CAA §§ 165(a), 169(1).  Similarly, Congress, through
the definition of “major source,” specified that the title V program
includes “any stationary facility or source of air pollutants which
directly emits, or has the potential to emit, one hundred tons per year
or more of any air pollutant.”  CAA §§ 502(a), 501(2)(B), 302(j).
EPA, through long-established regulatory action, in the case of PSD, and
long-established interpretation, in the case of title V, has narrowed
these definitions so that they apply only with respect to air pollutants
that are subject to regulation under the CAA.

Applying these definitions by their terms, as narrowed by EPA, to
greenhouse gas sources at the present time would mean that the PSD and
title V programs would apply to an extraordinarily large number of small
sources, the sources would incur unduly high compliance costs, and
permitting authorities would face overwhelming administrative burdens.
As a result, we decline to follow this literal reading, and instead,
with this action, we chart a course for tailoring the applicability
provisions of the PSD program and the title V program by phasing them in
over time to the prescribed extent.

For our authority to take this action, we rely on the “absurd
results” doctrine, which applies because applying the PSD and title V
requirements literally (as previously narrowed by EPA) would not only be
inconsistent with congressional intent concerning the applicability of
the PSD and title V programs, but in fact would severely undermine
congressional purpose for those programs.  We also rely on the
“administrative necessity” doctrine, which applies because
construing the PSD and title V requirements literally (as previously
narrowed by EPA) would render it impossible for permitting authorities
to administer the PSD provisions.  The tailoring approach we promulgate
in this action is consistent with both doctrines.  It is also consistent
with a third doctrine, the “step-at-a-time” doctrine, which
authorizes administrative agencies under certain circumstances to
address mandates through phased action.

	Our discussion of the legal bases for this rule is organized as
follows:  In this section V.B.3, we provide an overview of three
doctrines and describe how they fit into the Chevron framework for
statutory construction.  In section V.B.4, we discuss the PSD and title
V programs, including each program’s relevant statutory provisions,
legislative history, and regulatory history.  In sections V.B.5 and
V.B.6 we discuss the “absurd results” approach for PSD and title V,
respectively, that we are finalizing in our action.  In section V.B.7,
we discuss the legal and policy rationale for the phase-in schedule that
we are adopting for applying PSD and title V to GHG sources.  In section
V.B.8 we discuss the “administrative necessity” approach for PSD and
title V, respectively.  In section V.B.9, we discuss the third legal
basis for our action, the “step-at-a-time” doctrine.

a. The “absurd results” Doctrine

Turning first to the “absurd results” doctrine, we note at the
outset that we discussed the doctrine at length in the notice of
proposed rulemaking, and we incorporate by reference that discussion.
The starting point for EPA's interpretation of the PSD and title V
applicability provisions and reliance on the “absurd results”
doctrine is the familiar Chevron two-step analysis.  We discuss this
analysis in greater detail below, but in brief, in interpreting a
statutory provision, an agency must, under Chevron step 1, determine
whether Congress's intent on a particular question is clear; if so, then
the agency must follow that intent.  If the intent of the provision is
not clear, then the agency may, under step 2, fashion a reasonable
interpretation of the provision.  Chevron U.S.A. Inc. v. NRDC, 467 U.S.
837, 842-43 (1984).

The courts consider the best indicator of congressional intent to be the
plain meaning of the statute.  However, the U.S. Supreme Court has held
that the plain meaning of a statutory provision is not conclusive “in
the ‘rare cases [in which] the literal application of a statute will
produce a result demonstrably at odds with the intentions of the
drafters’ … [in which case] the intention of the drafters, rather
than the strict language, controls.”  United States v. Ron Pair
Enterprises, 489 U.S. 235, 242 (1989).  This doctrine of statutory
interpretation may be termed the “absurd results” doctrine.

Although, as just noted, the U.S. Supreme Court has described the
“absurd results” cases as “rare,” in that case the Court seemed
to be referring to the small percentage of statutory-construction cases
that are decided on the basis of the doctrine.  The D.C. Circuit, in
surveying the doctrine over more than a century of jurisprudence,
characterized the body of law in absolute numbers as comprising
“legions of court decisions.”   In re Franklyn C. Nofziger, 925 F.2d
428, 434 (D.C. Cir. 1991).  Indeed, there are dozens of cases, dating
from within the past several years to well into the 19th century, in
which the U.S. Supreme Court has applied the “absurd results”
doctrine to avoid the literal application of a statute, or if not so
holding, has nevertheless clearly acknowledged the validity of the
doctrine.  Some of the more recent of these cases include:  Logan v.
United States, 552 U.S. 23, 36-37 (2007) ( “[s]tatutory terms, we have
held, may be interpreted against their literal meaning where the words
‘could not conceivably have been intended to apply’ to the case at
hand [citation omitted]”); Nixon v. Missouri Municipal League, 541
U.S. 125, 132-33 (2004)  TA \l "Nixon v. Missouri Municipal League, 541
U.S. 125 (2004)" \s "Nixon v. Missouri Municipal League, 541 U.S. 125
(2004)" \c 1   (“any entity” includes private but not public
entities); Raygor v. Regents of Univ. of Minn., 534 U.S. 533, 542-45
(2002)  TA \l "Raygor v. Regents of Univ. of Minn., 534 U.S. 533, 542-45
(2002)" \s "Raygor v. Regents of Univ. of Minn., 534 U.S. 533, 542-45
(2002)" \c 1    (“implying a narrow interpretation of … ‘any claim
asserted’ so as to exclude certain claims dismissed on Eleventh
Amendment grounds”); United States v. X-Citement Video, Inc., 513 U.S.
64, 69 (1994) (rejecting a literal interpretation of the statutory term
“knowingly” on grounds that Congress could not have intended the
“positively absurd” results that some applications of such an
interpretation would produce, “[f]or instance, a retail druggist who
returns an uninspected roll of developed film to a customer “knowingly
distributes” a visual depiction and would be criminally liable if it
were later discovered that the visual depiction contained images of
children engaged in sexually explicit conduct”); and Rowland v. Cal.
Men’s Colony, 506 U.S. 194, 200 (1993) (finding that an artificial
entity such as an association is not a “person” under the statute,
and describing the absurdity doctrine as a “common mandate of
statutory construction”). Other cases are included, for reference, in
section V.B.10.

	The D.C. Circuit has also handed down numerous decisions that applied
the absurd results doctrine to avoid a literal interpretation or
application of statutory provisions, or that have acknowledged the
doctrine.  Some of the most recent ones include:  Arkansas Dairy
Cooperative Ass’n, Inc., v. U.S. Dep’t of Agriculture, 573 F.3d 815
(D.C. Cir. 2009) (rejecting the canon of construction that presumes that
Congress is aware of existing law pertinent to the legislation that it
enacts, when in this case, the presumption that Congress was aware of
the Departments definition of “hearing” would lead to “the absurd
result that Congress intended to impose a requirement with which the
Secretary could not comply;” stating: “Courts, ‘in interpreting
the words of a statute, [have] some scope for adopting a restricted
rather than a literal or usual meaning of its words where acceptance of
that meaning would lead to absurd results . . . or would thwart the
obvious purpose of the statute . . . .’” (quoting In re Trans Alaska
Pipeline Rate Cases, 436 U.S. 631, (1978));   Buffalo Crushed Stone,
Inc. v. Surface Transportation Board, 194 F.3d 125, 129-30 (D.C. Cir.
1999) (regulation of Surface Transportation Board providing that if a
notice of exemption “contains false or misleading information, the use
of the exemption is void ab initio” does not apply to a notice
containing false information when declaring the notice void ab initio
would undermine the goals of the governing statute; a conflict between
the “literal application of statutory language” and maintaining the
integrity of the regulatory scheme should be resolved by construing the
text in accordance with its purpose);  Mova Pharm. Corp. v. Shalala, 140
F.3d 1060, 1068 (D.C. Cir. 1998); U.S. v. Stewart, 104 F.3d 1377, 1388
(D.C. Cir. 1997) Environmental Defense Fund v. EPA, 82 F.3d 451, 468-69
(D.C. Cir. 1996) (although Act requires that a federal action conform to
the state implementation plan that is currently in place, EPA may
instead require conformity to a revised implementation plan that state
commits to develop; “[t]his is one of those rare cases * ** [that]
requires a more flexible, purpose-oriented interpretation if we are to
avoid ‘absurd or futile results.’”); American Water Works Ass’n
v. EPA, 40 F.3d 1266, 1271 (D.C. Cir. 1994) (holding that EPA’s
interpretation of the term “feasible” so as to require a treatment
technique instead of an MCL for lead is reasonable; the court stated:
“Indeed, where a literal reading of a statutory term would lead to
absurd results, the term simply ‘has no plain meaning . . . and is the
proper subject of construction by the EPA and the courts.’  If the
meaning of ‘feasible’ suggested by the NRDC is indeed its plain
meaning, then this is such a case; for it could lead to a result
squarely at odds with the purpose of the Safe Drinking Water Act.”)
(quoting Chem. Mfrs. Ass’n v. Natural Res. Def. Council, Inc., 470
U.S. 116, 126 (1985)) (citation omitted); In re Nofziger, 925 F.2d 428,
434-35 (D.C. Cir. 1991) (provision authorizing payment of attorney fees
to the subject of an investigation conducted by an independent counsel
of the Department of Justice only if “no indictment is brought”
against such individual does not preclude payment of attorney fees when
an indictment is brought but is determined to be invalid).

b. The “administrative necessity” doctrine

In the proposed rulemaking, we also described in detail the
“administrative necessity” doctrine, 74 FR 55311 col. 3 to 55318
col. 3, and we incorporate that discussion by reference into this
notice.  Under this doctrine, if a statutory provision, however clear on
its face, is impossible for the agency to administer, then the agency is
not required to follow the literal requirements, and instead, the agency
may adjust the requirements in as refined a manner as possible to assure
that the requirements are administrable, while still achieving
Congress's overall intent.  The D.C. Circuit set out the doctrine of
"administrative necessity" in a line of cases that most prominently
includes Alabama Power v. Costle, 636 F.2d 323 (D.C. Cir. 1980).  The
Court cited the doctrine most recently in New York v. EPA, 443 F.3d 880,
884, 888 (D.C. Cir. 2006).

In addition, as we stated in the proposed rulemaking, “We believe that
the administrative necessity case law establishes a three-step process
under which an administrative agency may, under the appropriate
circumstances, in effect revise statutory requirements that the agency
demonstrates are impossible to administer so that they are
administrable.”  74 FR 55315 col. 1.  Specifically:

[T]he three steps are as follows:  When an agency has identified what it
believes may be insurmountable burdens in administering a statutory
requirement, the first step the agency must take is to evaluate how it
could streamline administration as much as possible, while remaining
within the confines of the statutory requirements.  The second step is
that the agency must determine whether it can justifiably conclude that
even after whatever streamlining of administration of statutory
requirements (consistent with those statutory requirements) it conducts,
the remaining administrative tasks are impossible for the agency because
they are beyond its resources, e.g., beyond the capacities of its
personnel and funding.  If the agency concludes with justification that
it would be impossible to administer the statutory requirements, as
streamlined, then the agency may take the third step, which is to phase
in or otherwise adjust the requirements so that they are administrable.
However, the agency must do so in a manner that is as refined as
possible so that the agency may continue to implement as fully as
possible Congressional intent.

74 FR 55315 cols. 1-2.

	It should also be noted that we believe the administrative burdens
encountered by the state and local permitting authorities are fully
relevant under the “administrative necessity” doctrine.  Although
the caselaw that discusses the doctrine focuses on federal agencies, see
74 FR 55312-14, under the CAA, state and local agencies are EPA’s
partners in implementing provisions of the CAA, and have primary
responsibility for implementing the PSD program.  They generally adopt
EPA’s PSD requirements in their SIPs, which EPA approves.  They
generally adopt EPA’s title V requirements in their title V programs,
which EPA approves.  They issue the PSD and title V permits and are
responsible in the first instance for enforcing the terms of the
permits.  In all these respects, the law that the state and local
permitting authorities administer is both federal and state law.  Under
certain circumstances, EPA may become responsible for permit issuance
and enforcement in the first instance, but even then, EPA may, and
frequently has, delegated those duties to a state, in which case, the
state implements federal law directly.  Thus, although the PSD and title
V programs are federal requirements, for the most part, it is the states
that implement those programs.  For this reason, the administrative
burdens that the states face in implementing the programs are relevant
in determining the applicability of the “administrative necessity”
doctrine.

c. “Step-at-a-time” doctrine

In addition to the “absurd results” and “administrative
necessity” doctrines, another judicial doctrine supports at least part
of EPA’s tailoring rule, and that is the doctrine that agencies may
implement statutory mandates one step at a time, which we will call the
“step-at-a-time” doctrine.  In the notice of proposed rulemaking, we
also described this doctrine and recent case law that set it forth.  74
FR 55,319 col. 1-3.  There, we noted that the U.S. Supreme Court
recently described the doctrine in Massachusetts v. EPA, 549 U.S. 497,
524 (2007), as follows: “Agencies, like legislatures, do not generally
resolve massive problems in one fell regulatory swoop;” and instead
they may permissibly implement such regulatory programs over time,
“refining their preferred approach as circumstances change and as they
develop a more nuanced understanding of how best to proceed.”   We
also described two recent D.C. Circuit cases that upheld partial agency
compliance with a statutory dictate “if [such partial compliance] were
a first step towards a complete solution.”  City of Las Vegas v.
Nevada Dev. Comm’n, 891 F.3d 927, 935 (D.C. Cir. 1989); see Grand
Canyon Air Tour Coalition v. F.A.A., 154 F.3d 455, 477-78 (D.C. Cir.
1998) (statute required agency to develop plan to implement statutory
requirements within 120 days after enactment, and report to Congress
within two years after the date of the plan as to the plan’s success;
Court upheld partial agency plan promulgated 10 years after enactment
when agency intended to develop rest of plan within another 10 years).

d. Consistency with Chevron Framework

Although the “absurd results,” “administrative necessity,” and
“step-at-a-time” doctrines generally pre-date the Chevron two-step
analysis for construing statutes that Congress has authorized an agency
to administer, we believe that the doctrines can be considered very much
a part of that analysis.  Under Chevron step 1, an agency must
determine whether “Congress has directly spoken to the precise
question at issue.”  If so, “the court, as well as the agency, must
give effect to the unambiguously expressed intent of Congress.”
However, if “the statute is silent or ambiguous with respect to the
specific issue, the question for the court is whether the agency’s
answer is based on a permissible construction of the statute.”

Chevron U.S.A. Inc. v.NRDC, 467 U.S. 837, 842-42 (1984).

Thus, step 1 under Chevron is to determine congressional intent for the
relevant statutory directive on the specific issue presented .  To
determine Congress’s intent, the agency must look first to the
statutory terms in question, and generally interpret them according to
their plain meaning, within the overall statutory context, and perhaps
with reference to the legislative history.  If the plain meaning of the
statutory requirements is clear then, absent indications to the
contrary, the agency must take it to indicate congressional intent and
must implement it.  Even if the plain meaning of the statutory
requirements is not clear, if the agency can otherwise find indications
of clear congressional intent, such as in the legislative history, then
the agency must implement that congressional intent.

The D.C. Circuit has indicated that the “absurd results” doctrine
fits into the Chevron step 1 analysis in the following way:  Recall that
in the cases in which the courts have invoked this doctrine, the plain
meaning of the statutory requirements has been clear, but has led to
absurd results.  This can occur when the plain meaning, when applied to
the specific question, conflicts with other statutory provisions,
contradicts congressional purpose as found in the legislative history
– and, in particular, undermines congressional purpose – or
otherwise produces results so illogical or otherwise contrary to
sensible public policy as to be beyond anything Congress would
reasonably have intended.  See United States v. Ron Pair Enterprises,
489 U.S. 235, 242-43 (1989); Griffin v. Oceanic Contractors, Inc., 458
U.S. 564, 571 (1982).

Under these circumstances, the agency must not take the plain meaning to
indicate congressional intent.  As the D.C. Circuit has explained,
“where a literal reading of a statutory term would lead to absurd
results, the term ‘simply has no plain meaning . . . and is the proper
subject of construction by the EPA and the court.’”  American Water
Works Assn v. EPA, 40 F.3d 1266, 1271 (D.C. Cir. 1994) (quoting Chemical
Manufacturers’ Association v. NRDC, 470 U.S. 116, 126 (1985)).  Under
these circumstances, if the agency can find other indications  of clear
congressional intent, then the agency must implement that intent.  See
United States v. Ron Pair Enterprises, 489 U.S. 235, 242-43 (1989).
This may mean implementing the statutory terms, albeit not in accordance
with their literal meaning, in a way that achieves a result that is as
close as possible to congressional intent.  As the D.C. Circuit said in
Mova Pharm. Corp. v. Shalala, 140 F.3d 1060 (D.C. Cir. 1998):

The rule that statutes are to be read to avoid absurd results allows an
agency to establish that seemingly clear statutory language does not
reflect the ‘unambiguously expressed intent of Congress,’ … and
thus to overcome the first step of the Chevron analysis. But the agency
does not thereby obtain a license to rewrite the statute.  When the
agency concludes that a literal reading of a statute would thwart the
purposes of Congress, it may deviate no further from the statute than is
needed to protect congressional intent.  . . .  [T]he agency might be
able to show that there are multiple ways of avoiding a statutory
anomaly, all equally consistent with the intentions of the statute’s
drafters . . . . In such a case, we would move to the second stage of
the Chevron analysis, and ask whether the agency’s choice between
these options was ‘based on a permissible construction of the
statute.’  Otherwise, however, our review of the agency’s deviation
from the statutory text will occur under the first step of the Chevron
analysis, in which we do not defer to the agency’s interpretation of
the statute.”

Id. at 1068 (quoting Chevron U.S.A. Inc. v. NRDC, 467 U.S. 837, 842, 843
(1984) (citations omitted)).

The “administrative necessity” doctrine is not as well developed as
the “absurd results” doctrine, so that the courts have not had
occasion to explicitly describe how the doctrine fits into the Chevron
analytical framework.  However, we think that a reasonable approach, in
line with the D.C. Circuit’s approach to the “absurd results”
doctrine as just described, is as follows:  Recall that under the
“administrative necessity” doctrine, a agency is not required to
implement a statutory provision in accordance with the literal
requirements when doing so would be impossible, but the agency must
nevertheless implement the provision as fully as possible.  Placed in
the context of the Chevron framework, we think that that the
“administrative necessity” doctrine is based on the premise that
inherent in the statutory design is the presumption that Congress does
not intend to impose an impossible burden on an administrative agency.
See Alabama Power v. Costle, 636 F.2d 323, 357 (D.C. Cir. 1980)
(describing the “administrative necessity” approach as one of the
“limited grounds for the creation of exemptions [that] are inherent in
the administrative process, and their unavailability under a statutory
scheme should not be presumed, save in the face of the most unambiguous
demonstration of congressional intent to foreclose them”).

Therefore, if the plain meaning of a statutory directive would impose on
an agency an impossible administrative burden, then either the statutory
directive should not be considered to have that plain meaning, or that
plain meaning should not be considered to be indicative of congressional
intent.  Rather, in this case, congressional intent should be considered
to be to achieve as much of the statutory directive as possible.  As a
result, the agency must adopt an approach that implements the statutory
directive as fully as possible.  This is consistent with the D.C.
Circuit’s holding in Mova Pharm. Corp that if congressional intent is
clear, but the plain meaning of a statute does not express that intent,
then the agency must, under Chevron step 1, select an interpretation
that most closely approximates congressional intent.  Mova Pharm. Corp,
140 F.3d at 1068.

	The “step-at-a-time” doctrine fits into the Chevron framework in
much the same manner that the “administrative necessity” doctrine
does.  That is, inherent in the statutory design is the presumption that
Congress intended an agency to implement that statutory requirements in
a  step-at-a-time fashion, as long as the agency stays on a path towards
full implementation.

Under all of the circumstances described above, congressional intent is
clear – whether it is indicated by the plain language or otherwise –
and as a result, the agency must follow that  intent under Chevron step
1.  On the other hand, the agency may determine that congressional
intent on the specific issue is not clear.  In these cases, the agencies
should proceed to Chevron step 2 and select an interpretation or an
application that is a permissible construction of the statute.  This
situation generally occurs when the statutory provisions are ambiguous
or silent as to the specific issue, and there are no other indications
of clear congressional intent.  Under these circumstances, the agency is
authorized to develop and implement a construction of the statute that
the courts will uphold as long as it is reasonable.

As noted above, the D.C. Circuit, has pointed out that this situation
may also occur when the plain language leads to an absurd result, and,
in attempting to implement congressional intent, the agency is “able
to show that there are multiple ways of avoiding a statutory anomaly,
all equally consistent with the intentions of the statute’s drafters .
. . . In such a case, we would move to the second stage of the Chevron
analysis, and ask whether the agency’s choice between these options
was ‘based on a permissible construction of the statute.’”  Mova
Pharm. Corp, 140 F.3d at 1068.  As the U.S. Supreme Court has recently
said, although in a context different than “absurd results,” “ In
the end, the interpretation applied by EPA "governs if it is a
reasonable interpretation of the statute -- not necessarily the only
possible . . . interpretation, nor even the interpretation deemed most
reasonable by the courts."  Entergy Corp. v. Riverkeeper, Inc., 129
S.Ct. 1498. 1505 (2009).

e. Interconnectedness of the Legal Doctrines

Although we believe that each of the “absurd results,”
“administrative necessity,” and “step-at-a-time” doctrine
provides independent support for our action, we also believe that in
this case, the three doctrines are intertwined and form a comprehensive
basis for EPA’s tailoring approach.  As just discussed, each of the
three doctrines is tied into Chevron analytical framework because each
is designed to give effect to underlying intent.  Each of the three
doctrines comes into play in this case because a literal reading of the
PSD and title V applicability provisions results in insurmountable
administrative burdens.  Those administrative burdens -- along with the
undue costs to sources -- must be considered “absurd results” that
would undermine congressional purpose for the PSD and title V programs.
Under the “absurd results” doctrine, EPA is authorized not to
implement the applicability provisions literally, but instead to tailor
them in a manner consistent with congressional intent.  By the same
token, the insurmountable administrative burdens bring into play the
“administrative necessity” doctrine, which also supports the
tailoring approach.  Finally, the “step-at-a-time” doctrine provides
further support for the tailoring approach.

f. Application of Chevron approach

The Chevron analytical approach, and the three legal doctrines at issue
here, apply to this action in the following manner:  To reiterate, for
convenience, the statutory provisions at issue:  Congress, through the
definition of “major emitting facility,” applied the PSD program to
include “any … stationary sources of air pollutants which emit or
have the potential to emit, one hundred  tons per year or more or more
of any air pollutant…. [or] any other source with the potential to
emit two hundred fifty tons per year or more of any air pollutant.”
CAA §§ 165(a), 169(1).  Similarly, Congress, through the definition of
“major source,” specified that the title V program includes “any
stationary facility or source of air pollutants which directly emits, or
has the potential to emit, one hundred tons per year or more of any air
pollutant.”  CAA §§ 502(a), 501(2)(B), 302(j).  EPA, through
long-established regulatory action, in the case of PSD, and
long-established interpretation, in the case of title V, has interpreted
these definitions so that they apply only with respect to air pollutants
that are subject to regulation under the CAA.

For each of these two applicability provisions, the approach under
Chevron is as follows:  Under Chevron step 1, we must determine whether
Congress expressed an intention on the specific question, which is
whether the PSD or T-V applicability provisions apply to GHG sources.
Said differently, the specific question is whether, in the case of PSD,
Congress intended that the definition of major emitting facility applies
to GHG sources that emit at least 250 CO2e; and, in the case of title V,
whether,  the definition of “major source” applies to GHG sources
that emit at least 100 tpy or more CO2e.

To determine intent, we must first examine the terms of the statute in
light of their plain meaning.  Here, the plain reading of each provision
covers GHG sources.  For PSD, a GHG source that emits at least 250 tpy
CO2e plainly qualifies as “any … other source with the potential to
emit two hundred fifty tons per year or more of any air pollutant
[subject to regulation under the CAA].”  CAA § 169(1).  Similarly,
for title V, a GHG source that emits at least 100 tpy CO2e plainly
qualifies as “any stationary facility or source of air pollutants
which directly emits, or has the potential to emit, one hundred tons per
year or more of any air pollutant [subject to regulation under the
CAA].”  CAA §§ 502(a), 501(2)(B), 302(j).

However, applying each definition in accordance with its plain meaning
to GHG sources at the specified levels of emissions and at the present
time (i) would produce absurd results, that is, results that are not
consistent with other provisions of the PSD and title V requirements and
that are inconsistent with – and, indeed, undermine – congressional
purposes for the PSD and title V provisions; and (ii) would create
impossible administrative burdens for the permitting authorities.
Accordingly, under the “absurd results” doctrine, neither the PSD
nor the title V definitions of “major emitting facility” or “major
source,” should be considered to have a plain meaning with respect to
their application to GHG sources.

In parsing the provisions of each definition more closely, we believe
that each has three terms, any one of which could be considered not to
have its plain meaning, in this respect.  Specifically, each provision
includes (i) the term “any … source,” and that term could be
considered not to refer literally to all of the GHG sources; (ii) the
term “two hundred fifty tons per year” or “100 tons per year,”
and those terms could be considered not to refer literally to the
tonnage amount of emissions from all of the GHG sources; and (iii) the
term “any air pollutant [subject to regulation under the CAA],” and
that term could be considered not to refer literally to the emissions
from all of the GHG sources.  As long as any one of those three terms
should be considered not to have its plain meaning as applied to GHG
sources, then the definition as a whole – again, for PSD, the term
“major emitting facility,” and for title V, the term “major
source” – cannot be considered to apply to GHG sources.  Because we
read the terms together, as integral parts of each definition as a
whole, we do not think that the choice of which of those three terms
within each definition cannot be considered to apply literally to GHG
sources has substantive legal effect.  In other words, we believe that
any one of the three terms, or all three together as part of each
definition as a whole, should be considered not to apply literally in
the case of GHG sources.

Having determined that each definition does not have a plain meaning on
the specific question of whether PSD or title V applies to GHG sources,
we must next inquire as to whether Congress has nevertheless expressed
an intent on that question through other means.  We believe that there
are two possible views about congressional intent.  The first is that
Congress did express an intent, and that was that if a type of source
– such as GHG sources – cannot be included in the PSD program or
title V program in accordance with the literal terms of the
applicability provisions, then, nevertheless, as many of those sources
should be included in the programs at as close to the statutory
thresholds as possible, and as quickly as possible.  This view about
congressional intent could be considered to be a logical inference from
the fact that Congress wrote the applicability provisions broadly.

Under this first view, EPA would be required at Chevron step 1 to adopt
the Tailoring Rule because it most closely gives effect to Congress’s
intent that PSD and title V each apply to GHG sources at emission levels
as close to the statutory thresholds as possible and as quickly as
possible.  Even so, EPA is authorized to exercise its expert judgment as
to the best approach for phasing in the application of PSD and title V
to GHG sources.  In addition, even under this view, we believe there may
be uncertainty as to whether congressional intent to apply PSD and title
V to GHG sources extends to very small GHG sources, that is, those at or
near the statutory thresholds or whether congressional intent to apply
title V to GHG sources extends to GHG sources that would have empty
permits.

The second possible view is that Congress did not express an intent as
to the applicability of PSD and title V to GHG sources.  The lack of
plain meaning in the definitional provisions, and silence elsewhere in
the statutory provisions and legislative history, could be considered to
support this conclusion.  Under this second view, EPA has the discretion
at Chevron step 2 to adopt the Tailoring Rule because it is a reasonable
interpretation of the statutory requirements.  Here, too, EPA is
authorized to exercise its expert judgment as to the best approach for
phasing in the application of PSD and title V to GHG sources.

We do not believe it necessary to choose between these two differing
views as to congressional intent.  Although each leads to a different
analytical approach under Chevron, each also supports the Tailoring
Rule.  It should also be noted that although EPA has concluded that
applying the PSD and title V applicability provisions literally in the
case of GHG sources would produce “absurd results” and therefore is
not required, this conclusion has no relevance for applying other CAA
requirements – such as the requirements concerning endangerment and
contribution findings  under CAA section 202(a) (1) or emission
standards for new motor vehicles or new motor vehicle engines under CAA
section 202 -- to GHGs or GHG sources.  EPA’s conclusions with respect
to the PSD and title V applicability requirements are based on the
specific terms of those requirements, other relevant PSD and title V
provisions, and the legislative history of the PSD and title V programs.

Within the context of the Chevron framework, the “administrative
necessity” doctrine applies as follows:  Under the doctrine, Congress
is presumed to intend that the PSD and title V applicability
requirements  be administrable.  Here, those applicability requirements,
if applied to GHG sources in accordance with their plain meaning, would
be impossible to administer.  Accordingly, under Chevron step 1, it is
consistent with congressional intent that EPA and the permitting
authorities be authorized to implement the applicability requirements in
a manner that is administrable, that is, through the tailoring approach.
  The “step-at-a-time” doctrine applies within the Chevron framework
in much the same manner as the “administrative necessity” doctrine.
That is, Congress is presumed to intend that EPA and the permitting
authorities may administer the PSD and title V applicability
requirements to GHG sources on a step-by-step basis, as appropriate.  .

4.  The PSD and Title V programs

Having discussed both the factual underpinnings and, immediately above,
the legal underpinnings for our tailoring approach, we now discuss the
PSD and title V programs themselves, including, for each program, the
key statutory provisions, their legislative history, and the relevant
regulations and guidance documents through which EPA has implemented the
provisions.  We start with the PSD program.

a. The PSD program

(1)  PSD provisions

Several PSD provisions are relevant for present purposes because of the
specific requirements that they establish and the window that they
provide into congressional intent.  These provisions start with the
applicability provisions, found in CAA sections 165(a) and 169(1), which
identify the new sources subject to PSD, and CAA §111(a)(4), which
describes the modifications of existing sources that are subject to PSD.
 CAA §165(a) provides:

	No major emitting facility on which construction is commenced after
August 7, 1977, may be constructed in any area to which this part
applies unless—

	(1) a permit has been issued for such proposed facility in accordance
with this part setting forth emission limitations for such facility
which conform to the requirements of this part;

	(2) the proposed permit has been subject to a review in accordance with
this section * * *, and a public hearing has been held with opportunity
for interested persons including representatives of the Administrator to
appear and submit written or oral presentations on the air quality
impact of such source, alternatives thereto, control technology
requirements, and other appropriate considerations;

* * *

	(4) the proposed facility is subject to the best available control
technology for each pollutant subject to regulation under this chapter
emitted from, or which results from, such facility * * * *.

The term "major emitting facility" is defined, under CAA §169(1) to
include:

* * * stationary sources of air pollutants which emit, or have the
potential to emit, one hundred tons per year or more of any air
pollutant from [28 listed] types of stationary sources.  * * *   Such
term also includes any other source with the potential to emit two
hundred and fifty tons per year or more of any air pollutant.  This term
shall not include new or modified facilities which are nonprofit health
or education institutions which have been exempted by the State.

As for modification of existing sources, CAA section 169(1)(C)  provides
that the term "construction," as used in CAA section 165(a) (the PSD
applicability section) "includes the modification (as defined in section
111(a)(4)) of any source or facility."  Section 111(a)(4), in turn,
provides:

The term "modification" means any physical change in, or change in the
method of operation of, a stationary source which increases the amount
of any air pollutant emitted by such source or which results in the
emission of any air pollutant not previously emitted.

As interpreted by EPA regulations, these provisions, taken together,
provide that new stationary sources are subject to PSD if they emit at
the 100/250-tpy thresholds air pollutants that are subject to EPA
regulation, and that existing stationary sources that emit such air
pollutants at the 100/250-tpy thresholds are subject to PSD if they
undertake a physical or operational change that increases their
emissions of such air pollutants by any amount.

Other provisions of particular relevance are the requirements for timely
issuance of permits.  The permitting authority must “grant[] or den[y]
[any completed permit application] not later than one year after the
date of filing of such completed application.”  CAA §165(c).

In addition, the PSD provisions articulate ‘the purposes of [the PSD
program],” which are to balance environmental protection and growth.
CAA §160.  One of the purposes, in subsection (1), is specifically
“to protect public health and welfare,” and another, in subsection
(3), is “to insure that economic growth will occur in a manner
consistent with the preservations of existing clean air resources.”

The PSD provisions also include detailed procedures for implementation.
Most relevant for sources of GHG are the provisions that the proposed
permit for each source must be the subject of a public hearing with
opportunity for interested persons to comment, CAA §165(a)(2), and each
source must be subject to best available control technology, as
determined by the permitting authority on a source-by-source basis, CAA
§165(a)(4), 169(3).

(2)  PSD legislative history

The legislative history of the PSD provisions, enacted in the 1977 Clean
Air Act Amendments, makes clear that Congress was focused on sources of
criteria pollutants: primarily sulfur dioxide (SO2), particulate matter,
nitrogen oxides (NOx), and carbon monoxide (CO).  This focus stems from
the basic purpose of the PSD program, which is to safeguard maintenance
of the national ambient air quality standards (NAAQS), combined with the
limited awareness at that time of the problem of climate change.  See S
95-127 (95th Cong., 1st Sess.), at 27.

	Congress designed the PSD provisions to impose significant regulatory
requirements, on a source-by-source basis, to identify and implement
BACT and, for criteria pollutant, to also undertake certain studies.
Congress was well aware that because these requirements are
individualized to the source, they are expensive.  Accordingly, Congress
designed the applicability provisions to apply these requirements to
industrial sources of a certain type and a certain size – sources
within 28 specified source categories and that emit at least 100 tpy --
as well as all other sources that emit at least 250 tpy, and, by the
same token, to exempt other sources from these requirements.

	Although Congress required that CAA requirements generally apply to
“major emitting facilities,” defined as any source that emits or has
the potential to emit 100 tpy of any pollutant, Congress applied PSD to
only sources at 100 tpy or higher in 28 specified industrial source
categories, and at 250 tpy or more in all other source categories.  This
distinction was deliberate:  According to Sen. McClure, Congress
selected the 28 source categories after reviewing an EPA study
describing 190 industrial source categories.  122 Cong. Rec. 24521 (July
29, 1976) (statement by Sen. McClure).

	Congress also relied on an EPA memorandum that identified the range of
industrial categories that EPA regulated under its regulations that
constituted the precursor to the statutory PSD program, and listed both
the estimated number of new sources constructing each year and the
amount of pollution emitted by the “typical plant” in the category.
The memorandum was prepared by B.J. Steigerwald, Director of the Office
of Air Quality Planning and Standards and Roger Strelow, EPA’s
Assistant Administrator for Air and Waste Management
(“Steigerwald-Strelow  memorandum).  The Steigerwald-Strelow
memorandum makes clear that the 100 tpy cut-off for the 28 listed
sources categories, and the 250 tpy cut-off for all other sources, was
meaningful; that is, there were a large number of sources below those
cut-offs that Congress explicitly contemplated would not be included in
PSD.  Id. at 24548-50.

Consistent with this, the legislative history on the Senate side also
specifically identified certain source categories that Senators believed
should not be covered by PSD.  The Senate bill language limited PSD to
sources of 100 tpy or more in 28 listed source categories, and to any
other categories that the Administrator might add.  Sen. Muskie stated
that the Senate bill excluded “houses, dairies, farms, highways,
hospitals, schools, grocery stores, and other such sources.”  123
Cong. Rec. 18021 (June 8, 1977) (statement of Sen. Muskie).  Sen.
McLure’s list of excluded source categories were ”[a] small gasoline
jobber, or a heating plant at a community college, [which] could have
the potential to emit 100 tons pf pollution annually.”  122 Cong. Rec.
24548-49 (July 29, 1976) (statement of Sen. McClure).  The Senate
Committee Report included a comparable list, and in describing it,
concisely articulated the cost-conscious basis for the line-drawing:
“[the PSD] procedure … must include an effective review-and-permit
process.  Such a process is reasonable and necessary for very large
sources, such as new electrical generating plants or new steel mills.
But the procedure would prove costly and potentially unreasonable if
imposed on construction of storage facilities for a small gasoline
jobber or on the construction of a new heating plant at a junior
college, each of which may have the potential to emit 100 tons of
pollution annually.”  S. Rpt. 95-127 at 96-97.

The enacted legislation differs from the Senate bill by replacing the
authorization to EPA to include by regulation source categories in
addition to the listed 28 source categories with an inclusion of all
other sources if they exceed 250 tpy, and with an authorization for the
states to exempt hospitals and educational institutions.   But
Congress’s overall intention remains clear, as the D.C. Circuit
described in Alabama Power:.  "Congress's intention was to identify
facilities which, due to their size, are financially able to bear the
substantial regulatory costs imposed by the PSD provisions and which, as
a group, are primarily responsible for emissions of the deleterious
pollutants that befoul our nation's air….[With respect to] the heating
plant operating in a large high school or in a small community college .
. . [w]e have no reason to believe that Congress intended to define such
obviously minor sources as 'major' for the purposes of the PSD
provision."  636 F.2d at 353-54.

	A particularly important indication of congressional intent to limit
PSD to larger sources comes in considering the emissions profile of the
small-sized boilers.  Congress focused closely on identifying which
sources with emissions in excess of 100 tpy should not be subject to PSD
even though they are subject to Clean Air Act requirements generally.
But Congress viewed a large set of sources as emitting below 100 tpy and
therefore not included in the PSD program and, indeed, not even subject
to debate as to whether they should be included in the PSD program.
Chief among these sources, in terms of absolute numbers of sources, were
small boilers.  The Steigerwald-Strelow memorandum identified two
categories of these boilers, differentiated by size.  The first ranges
in size from 10 to 250 x 106 Btu/hr, and has a “typical plant” size
of 107 Btu/hr, with “BACT emissions from typical plant” of 53 tpy,
and a total of 1,446 sources in the category.  The second category
ranges in size from 0.3 to 10 x 106 Btu/hr, and has a “typical
plant” size of 1.3 x x 106 Btu/hr, with “BACT emissions from typical
plant” of 2 tpy, and a total of 11,215 sources in the category.  The
memorandum discusses these two categories in the context of explaining
which source categories exceed a size of 100 tpy -- and therefore would
be subject to PSD if a 100 tpy threshold were set -- by stating,
“Fortunately, most truly small boilers and typical space heating
operations would not be covered.”  122 Cong. Rec. 24549 (July 29,
1976).

	 The legislative history also provides a window into the scope of the
program that Congress anticipated and related administrability concerns.
 According to the Steigerwald-Strelow memorandum, the number of new
sources each year whose “BACT emissions from typical plant” exceed
100 for the 28 listed source categories and 250 for all other source
categories is less than 100 per year.  Although the Steigerwald-Strelow
memorandum does not attempt to estimate the number of modifications, it
appears that based on this information, Congress had reason to expect
the total size of the PSD program to be measured in the hundreds of
permits each year.  A program of this size would be manageable by EPA
and the permitting authorities.

	For convenience, the Steigerwald-Strelow memorandum is included in the
docket as docket number ______.

(3)  PSD regulatory history:  Regulations concerning the definition of
“major stationary source”

EPA’s initial rulemaking implementing the PSD program was proposed and
finalized in 1977-1978, immediately after enactment of the PSD program.
This rulemaking made explicit that the entire PSD program – including
the permitting component (with air quality review) – applied to only
pollutants regulated under the Act.  EPA accomplished this by requiring
each “major stationary source” to obtain a PSD permit, and by
defining a “major stationary source” as a source that is included in
a specified source category or that is of a specified size and that
emits at least a specified amount of “any air pollutant regulated
under the Clean Air Act.”  43 FR 26,380, 26,403/3, 26,406 (June 19,
1978) (promulgating 40 CFR 51.21(b)(1)(i) ).  See 42 FR 57,479, 57,480,
57,483 (Nov. 3, 1977) (proposing 40 CFR 51.21(b)(1)(i)).  Similarly, the
regulations required each “major stationary source” to apply “best
available control technology”  for “each pollutant subject to
regulation under the act.” 43 FR at 26,406 (promulgating 40 CFR
51.21(j), 52.21(b)(10)).  EPA acknowledged that for regulatory purposes,
it was replacing the term that appears in the statute –  “major
emitting facility,” CAA § 169(l) – with the term “major
stationary source,” and explained that it was doing so in order “to
reflect current EPA terminology.”  42 FR at 57,480 (Nov. 3, 1977).
EPA did not discuss that the statutory term “major emitting
facility” – which refers to “any air pollutant” – differs from
EPA’s regulatory term “major stationary source” – which refers
more narrowly to “any air pollutant regulated under the [CAA].”  In
the preamble to the final rule, EPA did not indicate that it had
received any comments on the issue.  See 43 FR 26,388 (June 19, 1978).

In 1979-1980, EPA revised the PSD program to conform to Alabama Power v.
Costle, 636 F.2d 323 (D.C. Cir. 1980).  44 FR 51,924 (Sept. 5, 1979)
(proposed rule); 45 FR 52,676 (Aug. 7, 1980) (final rule).  In this
rulemaking, EPA did not disturb the pre-existing provisions (including
the definitions of “major stationary source” and BACT) that limited
the applicability of the PSD program to regulated air pollutants.  In
addition, EPA did not discuss – or indicate that commenters had raised
– any issues concerning the difference between the narrower definition
of “major stationary source” in the regulations and the statutory
definition that could be broader under a literal reading.

In 1996 EPA proposed, and in 2002 finalized, a set of amendments to the
PSD (and nonattainment NSR) provisions that included revisions to
conform with the 1990 Act Amendments, which, in relevant part, exempted
hazardous air pollutants from PSD, under CAA § 112(b)(6).  See 61 FR
38,250 (July 23, 1996), 67 FR 80,186 (Dec. 31, 2002).  In the preamble
to the final rule, EPA noted that based on a request from a commenter,
EPA was amending the regulations to “clarify which pollutants are
covered under the PSD program.”  EPA accomplished this by promulgating
a definition for “regulated NSR pollutant,” which listed categories
of pollutants regulated under the Act, and by substituting that defined
term for the  phrase “pollutants regulated under the Act” that was
previously used in various parts of the PSD regulations.   67 FR at
80,240.    The definition of “regulated NSR pollutant” includes
several categories of pollutants (including, in general, NAAQS
pollutants and precursors, pollutants regulated under CAA §111 new
source performance standards, Class I or II substances regulated under
CAA title VI) and a catch-all category, “[a]ny pollutant that
otherwise is subject to regulation under the Act.”  E.g., 40 CFR
52.21(b)(50).  EPA again did not address the difference between the
definition of “major emitting facility” and its regulatory approach
or indicate that it had received comments on this issue.

b. Title V program

Having reviewed the key statutory provisions, their legislative history,
and the relevant administrative interpretations for the PSD program, we
now do the same for the title V program.

i. Title V provisions

The key title V provisions for present purposes start with the
applicability provisions, which are found in CAA §§502(a), 501(2)(B),
and 302(j).  These provisions provide that it is unlawful for any person
to operate a "major source" without a title V permit, §502(a), and
define a "major source" to include "any major stationary facility or
source of air pollutants which directly emits, or has the potential to
emit, one hundred tons per year or more of any air pollutant."  CAA
§501(2)(B) and §302(j).  As noted elsewhere, these provisions, taken
together and as interpreted by EPA, provide that stationary sources are
subject to title V if they emit at the 100-tpy threshold air pollutants
that are subject to EPA regulation.

In addition, although title V does not have a set of provisions
describing its purpose, it is clear from its provisions and its
legislative history, discussed below, that its key goal is to gather
into one permitting mechanism the Clean Air Act requirements applicable
to a source and impose conditions necessary to assure compliance with
such requirements, and thereby promote the enforceability of CAA
requirements applicable to the covered sources.  CAA §503(b)(1)
requires that the source’s permit application contain a compliance
plan describing how the source will ”comply with all applicable
requirements” of the CAA, and §504(a) requires that “[e]ach permit
issued under [title V] shall include  * * *  such * * * conditions as
are necessary to assure compliance with applicable requirements of [the
Clean Air Act].”  See H.R. Rep. No. 101–490, at 351 (1990) (‘‘It
should be emphasized that the operating permit to be issued under this
title is intended by the Administration to be the single document or
source of all of the requirements under the Act applicable to the
source.’’).

Importantly, title V is replete with provisions designed to make the
permitting process as efficient and smooth-running as possible,
including the expeditious processing of permit applications and the
timely issuance of permits.  CAA §503(c) requires that “the
permitting authority shall approve or disapprove a completed application
* * * and shall issue or deny the permit, within 18 months after the
date of receipt thereof * * * *”  CAA §502(b)(6) requires the
permitting authority to develop “adequate, streamlined, and reasonable
procedures for expeditiously determining when applications are complete,
for processing such applications, for public notice * * * and for
expeditious review of permit actions, including * * * judicial review in
State court of the final permit action by [specified persons].”  CAA
§502(b)(7)

includes a “hammer” provision designed to reinforce timely permit
issuance, which is that the permitting authority’s program must
include:

To ensure against unreasonable delay by the permitting authority,
adequate authority and procedures to provide that a failure of such
permitting authority to act on a permit application or permit renewal
application (in accordance with the time periods specified in [CAA
§503] * * *) shall be treated as a final permit action solely for
purposes of obtaining judicial review in State court of an action
brought by any person referred to in paragraph (6) to require that
action be taken by the permitting authority on such application without
additional delay.

CAA §502(b)(8) requires the permit program to include “[a]uthority
and reasonable procedures consistent with the need for expeditious
action by the permitting authority on permit applications and related
matters, to make available to the public [certain permit-related
documents]”. CAA §502(b)(9) requires a permit revision to incorporate
requirements promulgated after issuance of the permit, but only if the
permit is for a major source and has a term of three or more years
remaining.  In addition, the revision must occur “as expeditiously as
practicable.”  CAA §502(b)(10) requires the permit program to include
operational flexibility provisions that “allow changes within a
permitted facility . . . without requiring a permit revision, if the
changes are not modifications . . . and . . . do not exceed the
emissions allowable under the permit. . . .”

In addition, title V includes a comprehensive and finely detailed
implementation schedule that mandates timely issuance of permits while
building in EPA and affected state review, public participation, and
timely compliance by the source with reporting requirements.  Following
the date that sources become subject to title V, they have one year to
submit their permit applications.  CAA §503(c).  As noted above, the
permitting authority then has 18 months to issue or deny the permit.
CAA §503(c).  Permitting authorities must provide an opportunity for
public comment and a hearing.  CAA §502(b)(6).  If the permitting
authority proposes to issue the permit, the permitting authority must
submit the permit to EPA, and notify affected states, for review.  CAA
§505(a)(1).  EPA then has 45 days to review the permit and, if EPA
deems it appropriate, to object to the permit. CAA §505(b)(1).  If EPA
does object, then the permitting authority must, within 90 days, revise
it to meet the objections, or else EPA becomes required to issue or deny
the permit.  CAA §505(c).  If EPA does not object, then, within 60 days
of the close of the 45-day review period, any person may petition EPA to
object, and EPA must grant or deny the petition within 60 days.  CAA
§505(b)(2).  If a permit is issued, it must include a permit compliance
plan, under which the permittee must “submit progress reports to the
permitting authority no less frequently than every 6 months,” and must
“periodically (but no less frequently than annually) certify that the
facility is in compliance with any applicable requirements of the
permit, and [] promptly report any deviations from permit requirements
to the permitting authority.”  CAA §503(b).

ii.. Title V legislative history

(I). Scope of title V

The legislative history of title V, enacted by Congress in the 1990 CAA
Amendments, indicates the scope of the program that Congress expected:
Congress expected the program to cover some tens of thousands of
sources, which would approximate the scope of the permit program under
the Clean Water Act.  The Senate Committee on Environment and Public
Works stated:

EPA estimates that the new permit requirements will cover about 8,200
major sources that emit 100 tons per year or more of criteria pollutants
(which are regulated under SIPs). In addition, many smaller sources are
(or, as EPA promulgates additional regulations, will be) covered by new
source performance standards under section 111 of the Act, hazardous air
pollutant standards under section 112 of Act, and nonattainment
provisions of this legislation. By comparison, under the Clean Water
Act, some 70,000 sources receive permits, including more than 16,000
major sources. Although many air pollution sources have more emission
points than water pollution sources, the additional workload in managing
the air pollution permit system is estimated to be roughly comparable to
the burden that States and EPA have successfully managed under the Clean
Water Act.

S. Rep. 101–228, at 353 (1990).   Sen. Mitchell, the Senate Majority
Leader, stated that he expected “over 10,000 permits [to] . . . be
issued under this program.” 136 Cong. Rec. S3233-03 (March 27, 1990).
Others in Congress had similar estimates.  See, e.g., 136 Cong. Rec.
S3162-04 (“thousands and thousands of permit applications … will be
required to be submitted”) (statement of Sen. Nickles)..

Furthermore, the legislative history indicates that Congress did not
contemplate that large numbers of very small sources would be subject to
title V’s requirements.  This becomes clear by reviewing the
legislative history of a companion piece of legislation to the operating
permits provisions that Congress enacted into CAA section 507, which is
the “Small business stationary source technical and environmental
compliance assistance program.” CAA section 507.  Under this
provision, sources that, among other things, “are not [] major
stationary source[s]” and that emit less than 50 tpy of any regulated
pollutant, as well as less than 75 tpy or all regulated pollutants, are
eligible for assistance under CAA section 507. CAA section 507(c)(1).
The House Committee Report described this provision – including what
types of sources it expected this provision to benefit -- as follows:

New section [507] is a small source/small business provision added by
the Committee. It seeks to help small businesses to comply with the
problems that are likely to occur under the Act as amended by this bill.
For purposes of this section, small businesses or small emitters are
defined as sources that are emitting 100 tons or less per year and that
have a number of employees that would qualify them for assistance from
the Small Business Administration (SBA).  As we look to the future of
environmental protection under the Act, we take special steps here to
ensure that it is possible for these small businesses to comply with
minimum hassle and in recognition of the problems that are unique to
them. Such small businesses include printers, furniture makers, dry
cleaners, and millions of other small businesses in this country.

House Committee Report, H.R. 101-590, at 354.  In this manner, the House
Committee Report made clear that it expected “millions of … small
businesses” -- including “furniture makers, dry cleaners” and many
others -- to benefit from the CAA section 507 small source/small
business program, but Congress did not expect them to become subject to
the operating permit requirements of title V because their emissions
fell below 100 tpy, which is, in general, the threshold for title V
applicability.

The legislative history of title V confirms that Congress viewed a
principal purpose of title V as providing a vehicle to compile the
requirements applicable to the source.  As the report of the House
Committee on Energy and Commerce (“House Committee Report”) stated,
‘‘It should be emphasized that the operating permit to be issued
under this title is intended by the Administration to be the single
document or source of all of the requirements under the Act  applicable
to the source.” H.R. Rep. No. 101–490, at 351 (1990).  Combined with
the source’s reporting requirements, this compilation of applicable
requirements would facilitate public awareness of a source’s
obligations and compliance and would facilitate compliance and
enforcement.

On the Senate side, Sen. Chafee, one of the floor managers of the bill,
made a similar point:

The permits will serve the very useful function of gathering and
reciting in one place -- the permit document itself -- all of the duties
imposed by the Clean Air Act upon the source that holds the permit. This
would clearly be an improvement over the present system, where both the
source and EPA must search through numerous provisions of state
implementation plans and regulations to assemble a complete list of
requirements that apply to any particular plant….

Once these permits are in place, plant managers will be better able to
understand and to follow the requirements of the Clean Air Act. At the
same time, EPA will be better able to monitor how well each plant is
complying with those requirements. This is a highly sensible approach
for all concerned.

136 Cong. Rec. S2030-02 (March 5, 1990) (statement of Sen. Chafee).
Sen. Lieberman made a similar statement.  136 Cong. Rec. 3162-04 (March
26, 1990) (statement of Sen. Lieberman).  Thus, a central purpose of the
title V permit program is to compile all the requirements applicable to
the source into a single place, the permit.  Implicit in this purpose is
that the sources subject to title V will have applicable requirements to
be compiled.  As Sen. Chafee directly stated, “[T]he vast majority of
these permit applications will … , in all likelihood, only codify the
existing requirements of the applicable State implementation plan.”
136 Cong. Rec. S2715-04 (March 20, 1990) (statement of Sen. Chafee).

More broadly, the legislative history also indicates congressional
concern about the costs of permitting for small businesses, and a
determination to minimize those costs to the extent possible.  This
concern is reflected in several provisions of title V.  For example,
section 502(a) authorizes EPA to exempt all or part of a source category
– except for any major source -- from the title V permit program if
EPA “finds that compliance with [title V] requirements is
impracticable, infeasible, or unnecessarily burdensome on such
categories.”  Similarly, the permit fee provisions include a
presumptive minimum fee amount, but authorize an exemption from that
presumptive amount upon a showing that a lesser amount will meet overall
fee requirements, CAA section 502(b)(3)(B)(iv).  One of the drafters of
this provision, Rep. Wyden, explained that its purpose was to preserve
the flexibility of states to impose lower fees of small businesses:

I note that the provision on fees allows reductions for small sources
where appropriate. The state has some flexibility, under the general
permit fee provisions, to adjust fee levels for any source so long as
the average fee charged meets the statutory minimum.

136 Cong. Rec. H12883 (Oct. 26, 1990) (statement of Rep. Wyden).  See
e.g., 136 Cong. Rec.  H2511-02 (May 212, 1990) (statement of Rep. Wyden)
(discussing need to “help small businesses through the air permit
labyrinth”).

	The legislative history also indicates that Congress was deeply
concerned both about the need not to burden sources with undue costs and
to assure the administrability of the title V program, and as a result,
was determined to make the program as smooth-running as possible.  These
goals are reflected in many of the title V requirements, as discussed
above.  See, e.g.,

CAA §502(b)(6) (requiring “adequate, streamlined, and reasonable
procedures for expeditiously determining when applications are complete,
for processing such applications, for public notice * * * and for
expeditious review of permit actions); CAA §502(b)(7) (includes a
“hammer” provision designed to reinforce timely permit issuance);
CAA §502(b)(9)-(10) (limiting circumstances under which permit revision
is required; requiring revision to occur “as expeditiously as
practicable;” including operational flexibility provisions).

The legislative history confirms that these provisions were designed to
reduce costs to sources and promote administrability.  The
“Chafee-Baucus Statement of Senate Managers” for the bill  explained
the purpose of the CAA section 502(b)(6) requirement for “[a]dequate,
streamlined, and reasonable procedures for expeditious[]” permit
actions as follows:

[M]uch concern has been expressed that this new permitting process will
unduly delay the proper functioning of many sources, and we intend to
mitigate any delay by directing that the process be expeditious.

 In addition to this general directive for expeditious processing, we
mandate in new section 503 that permitting authorities approve or reject
permit applications within certain specified time periods following
filing. In this fashion, we have taken explicit steps to protect against
undue delays.

136 Cong. Rec. S16895-01 [S16938?] (statement of Sen. Chafee).  The same
statement explained that the permit revision procedures of CAA section
502(b)(9) reflect a –

careful effort to ensure that the permit program works effectively and
efficiently. Succinctly, this provision accommodates two competing
concerns. On the one hand, it is important to ensure that permit
requirements remain up-to-date as the provisions of the Clean Air Act
are developed and new requirements are imposed. On the other hand, it
also is important to be sure that we do not reduce the permit program to
a shambles by requiring sources to engage in a continuous process of
revising their permits as these new requirements are imposed.

136 Cong. Rec. 16895-01 (Oct. 27, 1990) (Chafee-Baucus statement of
Senate Managers) (statement of Sen. Chafee).

	In addition, these concerns were at the bottom of the following
statement by Sen. Chafee, in which he described how the bill’s
drafters had revised it in response to a concern by industry that an
earlier version of the bill would have put undue costs on industry:

We have also heard concerns from industry that S. 1630 would burden
sources unduly by requiring them to submit-along with their permit
applications-plans explaining how they intend to comply with all