The State may rely on national and regional controls for purposes of meeting this increment of reduction and the 9% 9 percent should be calculated using the 1990 baseline. ( The STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 188 1 hour ROP requirement is calculated from a 1990 baseline,

not a 2002 baseline, as is the 8 hour RFP requirement.) We have clarified the language in the final regulation to make clear that the requirement to submit the plan for additional emission reductions applies only to the extent that an area had not met its prior planning obligations. For example, if an area was classified as serious for the 1 hour standardNAAQS and had an approved 15% 15 percent ROP plan and an approved 9% 9 percent ROP plan for 1996 1999, then the area does not have any outstanding ROP obligation that must be met under this provision. However, if the same area only had an approved 15% 15 percent ROP plan, but not an approved 9% 9 percent ROP plan for 1996 1999, then the area has an outstanding 9% 9 percent ROP plan for the 19996 1999 period.

If the State had submitted the ROP plan to EPA, but EPA had not yet acted on the submission, the State may notify EPA that it wishes to rely on the previously submitted SIP or it may elect to submit a new or revised SIP.

We believe this approach makes sense as it ensures that the level of emission reduction that the area was required to achieve, but was not yet enforceable under the SIP, will be achieved expeditiously after a violation of the 8 hour standardNAAQS occurs. STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 189 ( ii2) Attainment Demonstration. For an outstanding 1

hour attainment demonstration, the final rule requires the State to either: ( 1) submit an 8 hour maintenance plan that addresses the violation and demonstrates maintenance through EPA approved modeling; or ( 2) submit a plan to achieve a 3 percent increment of progress within 3 years after the EPA determines the area has violated the standardNAAQS. The 3 percent increment of progress must be in addition to measures ( or enforceable commitments to measures) in the SIP at the time of the effective date of designation and in addition to national or regional measures.

This approach differs from both the June 2003 proposal and the draft regulatory text in that we do not establish the precisely the same requirement for these areas that we establish for areas designated nonattainment for the 8 hour NAAQS. For areas designated nonattainment for the 8 hour NAAQSthat are 8 hour NAAQS nonattainment/ 1 hour NAAQS nonattainment. For areas that are 8 hour NAAQS nonattainment/ 1 hour NAAQS nonattainment, section 51.905( a)( 1)( ii) provides three options for the State. The first option available is that States may choose to submit their 1 hour SIP. If such an area, subsequent to designation under the 8 hour standard, experiences a STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 190 violation of the 8 hour standard, wWe do not believe itthis option makes good policy sense for thean area atdesignated attainment for that timee 8 hour NAAQS to spend resources to develop a plan to achieve the 1 hour standardNAAQS ( which is likely to have been revoked by that time), when the area will already be in the process of developing the section 110( a)( 1) maintenance plan for the area discussed elsewhere in this preamble. We believe there will be few if any areas in this situation that would experience a violation much above the level of the 8 hour standard since such areas have recently been attaining that standard.

The second and third options under section 51.905( a)( 1)( ii) available to areas designated nonattainment for the 8 hourthat are 8 hour NAAQS nonattainment/ 1 hour NAAQS nonattainment are analogous but not identical to the two options we provide for areas designated attainment for the 8 hour NAAQS. Both types of areas are provided with the option of achieving a specified increment of progress. For areas designated nonattainment for the 8 hourthat are 8 hour NAAQS nonattainment/ 1 hour NAAQS nonattainment, we established an increment of 5 percent and for those designated attainment for the 8 hour NAAQS, we established a 3 percent increment. In general, we believe that those STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 191 areas initially designated attainment for the 8 hour NAAQS will have a less significant 8 hour problem   these areas tend to record values within a few parts per millionbillion of the standardNAAQS. Thus, since the increment of progress is limited to controls not already adopted into the SIP or required by federal or regional controls, the 5 percent reduction requirement would likely be excessive for purposes of addressing that small deviation from the standardNAAQS.

The third option available to areas designated nonattainment for the 8 hourthat are 8 hour NAAQS nonattainment/ 1 hour NAAQS nonattainment is to submit an early 8 hour attainment demonstration. Since areas designated attainment for the 8 hour standardNAAQS are not required to develop attainment demonstrations, it did not make sense to carry this option over. Rather, we determined it made more sense to haveallow the area to address the violation in the context of the obligation that it does have, i. e., to develop a maintenance plan for the 8 hour standardNAAQS. Thus, for these areas, we created the option of performing a more rigorous maintenance demonstration   a demonstration based on EPA approved modeling.

c. ( C) Comments and Rresponses.

COMMENT: Some commenters on draft regulatory text STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 192 objected to continuing the obligation for areas to submit ROP plans and/ or attainment demonstrations for the 1 hour standardNAAQS after the 1 hour standardNAAQS is revoked.

Some of the comments reflected the fact that the regulatory text may have been unclear regarding what the requirement entailed and which areas were affected.

RESPONSE: We have designed the final rule such that an area with an unmet planning obligation would still be required to submit and implement a rate of progress plan and an attainment demonstration ( or substitute plan) under the 1 hour standardNAAQS if the area violates the 8 hour standardNAAQS before it has an approved maintenance plan.

These are areas that have historically had an ozone problem and, in general, are close to the 8 hour standard.

Consistent with our Clean Data Policy, we do not believe these planning obligations should apply for so long as the area is in attainment with the standardhave 8 hour design values within a few parts per billion of the 8 hour NAAQS.

Once these areas have an approved 1010( a)( 1) maintenance plan with contingency measures, that plan will address future violations of the 8 hour standardNAAQS and the 1 hour obligations will no longer apply. However, until that plan is in place, we believe that Congress would have intended STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 193 these requirements to still have significance if the area violates the health based standardNAAQS.

The final regulatory text was modified to clarify that the provision applies to areas that do not have approved ROP plans and/ or attainment demonstrations under the 1 hour standardNAAQS and that violate the 8 hour NAAQS before having an approved 8 hour maintenance plan under section 110( a)( 1). The regulatory text also clarifies the obligation that will apply.

5. ( v) Maintenance Plans for the 8 hour NAAQS. ( Section VI. C. 3. b( iii) of proposed rule; see 68 FR 32823; Section 51.905( a)( 3)( iii) of draft regulatory textand final rules)

a. ( A) Background In the June 2003 proposal, we proposed that areas designated attainment for the 8 hour NAAQS and designated nonattainment for the 1 hour NAAQS on or after November 15,

1990, must adopt and submit a maintenance plan consistent with section 110( a)( 1) within 3 years of designation as attainment for the 8 hour NAAQS. The maintenance plan should provide for continued maintenance of the 8 hour standardNAAQS for 10 years following designation for the 8

hour NAAQS and must include contingency measures. Areas with approved 1 hour maintenance plans under section 175A STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 194 would be able to modify those maintenance plans consistent with their obligation to have a maintenance plan for the 8

hour NAAQS under section 110( a)( 1). Such areas could remove from their maintenance SIPs ( a) the obligation to submit a maintenance plan for the 1 hour standardNAAQS 8 years after approval of their initial 1 hour maintenance plan; and ( b)

the requirement to implement contingency measures upon a violation of the 1 hour ozone standardNAAQS.

The draft regulatory text reflected the description in the June 2003 proposal.

b. ( B) Summary of Ffinal Rrule We are adopting the approach we proposed. However, as noted above, we have now created separate subsections in the rule addressing areas that were designated nonattainment for the 1 hour NAAQS at the time of designation for the 1 hour NAAQS and areas that were maintenance areas for the 1 hour standardNAAQS at the time of designation for the 8 hour NAAQS. Section 51.905( a)( 3)( iii) applies only to areas designated nonattainment for the 1 hour NAAQS at the time of designation for the 8 hour NAAQS. Section 51.905( a)( 4)( ii)

establishes the same requirement for areas that are maintenance for the 1 hour NAAQS at the time of designation for the 8 hour standardNAAQS. Under t These two provisions, STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 195 areas designated attainment for the 8 hour NAAQS and designated nonattainment for the 1 hour NAAQS ( provide that 1 hour NAAQS nonattainment/ 8 hour NAAQS attainment ( section 51.905( a)( 3)( iii)) or that areand 8 hour NAAQS attainment/ 1

hour NAAQS maintenance areas for the 1 hour NAAQS (( section 51.905( a)( 4)( ii)) at the time of designation for the 8 hour NAAQSareas must adopt and submit a maintenance plan consistent with section 110( a)( 1) within 3 years of designation as attainment for the 8 hour NAAQS. The maintenance plan should provide for continued maintenance of the 8 hour standardNAAQS for 10 years following designation for the 8 hour NAAQS and should include contingency measures. We provide additional detail below regarding maintenance areas for the 1 hour standardNAAQS.

Section 110( a)( 1) requires all areas to demonstrate that they will attain and maintain the relevant NAAQS. Most of the areas addressed by this provision of the regulation have historically had problems meeting andand/ or remaining in attainment of the ozone standardNAAQS. We think it is important for States to ensure that these areas will continue to have clean air so that the health of citizens will be protected.

c.( C) Comments and Rresponses STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 196 The majorityCOMMENT: A number of commenters who addressed this issue in comments on the June 2, 2003 proposal did not support the section 110( a)( 1) maintenance plan requirement. Some commenters believed the 1 hour standardNAAQS should remain in effect and with it any existing 1 hour SIP requirements, including section 175A maintenance plan requirements ( which would require conformity determinations). One commenter objected to the proposed requirement, alleging the requirement was unnecessary and not required. Two commenters agreed with the requirement.

In commenting on the draft regulatory text one commenter supported this provision. One commenter recommended that we provide more specific guidance on preparation of section 110( a)( 1) maintenance plans and also not require modeling for them. Two commenters objected to maintenance plans under section 110( a)( 1) because they would not require conformity ( as would maintenance plans under section 175A) for areas that currently have maintenance plans under the 1 hour standardNAAQS. The commenters believed the maintenance planning should be done under section 175A. Another commenter believed that section 110( a)( 1) of the CAA requires neither contingency measures STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 197 nor a 10 year plan; the commenter suggested that the section 110( a)( 1) maintenance plan merely be a continuation of the provisions of the existing maintenance plan.

RESPONSE: Because the 1 hour standardNAAQS would be revoked, the requirements of section 175A would not apply to these areas ( areas initially designated attainment for the 8 hour standardNAAQS but that were designated nonattainment for the 1 hour standardNAAQS at the time of enactment of the 1990 CAA Amendments.) Section 175A applies to redesignations, not to initial designations. After the 1 hour standardNAAQS is revoked, we believe that an area   that was previously designated nonattainment for the 1 hour standardNAAQS or was designated attainment with a maintenance plan   and that initially is designated attainment for the 8 hour ozone standardNAAQS, should be required to demonstrate maintenance only for the 8 hour standardNAAQS at that point. The area was not " redesignated" attainment for the 8 hour standardNAAQS, and therefore the section 175A maintenance plan requirement does not apply. We believe that the section 110( a)( 1)

maintenance provisions   as required in section 51.905   will provide adequate assurance of maintenance of the standard8 hour NAAQS. The EPA always retains the authority STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 198 to require a State that fails to maintain the standardNAAQS to revise its SIP to provide additional maintenance measures or to redesignate the area nonattainment and require an attainment demonstration.

We do not agree with commenters that opposed a provision requiring a maintenance plan under section 110( a)( 1) for these areas. We do believe that the ActCAA requires that SIPs continue to provide for maintenance of the applicable standardNAAQS under section 110( a)( 1).

Because these areas have historically experienced ozone problems and generally are close to violating the 8 hour standardNAAQS, we believe it is prudent to require a demonstration of how they will maintain the 8 hour standard.

NAAQS. We think this requirement will benefit citizens by providing better assurance that the air will remain clean and will benefit industry by minimizing the likelihood the area will violate the standard and be redesignated to nonattainment.

f. Section 51.905( a)( 4): 8 Hour NAAQS Attainment/ 1 Hour Attainment withNAAQS Maintenance Plan As noted above, in the preamble to the proposed rule,

EPA addressed in the same section 1 hour nonattainment areas and 1 hour maintenance areas that are designated STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 199 nonattainment for the 8 hour standardNAAQS. Comments on the proposed regulatory text noted that section 51.905( a)( 3)

only addressed 8 hour attainment areas that were designated nonattainment for the 1 hour ozone standardNAAQS and not areas that were maintenance for that standardNAAQS. Thus,

the draft rule did not address all aspects of the proposal since it did not include provisions for areas that are maintenance for the 1 hour standardNAAQS at the time of designations.

We considered revising paragraph 51.905( a)( 3) to include 1 hour maintenance areas. However, that subsection included certain requirements not relevant for 1 hour maintenance areas, such as requirements concerning outstanding attainment demonstration and ROP plans. Thus,

in the final rule, we created section 51.905( a)( 4) to apply to areas designated attainment for the 8 hour standardNAAQS and that were maintenance areas for the 1 hour standardNAAQS at the time of designation for the 8 hour standardNAAQS.

1. ( i) Obligations in an approved SIP. ( 51.905( a)( 4)( i)).

This subsection is identical in structure to section 51.905( a)( 3)( i). Our reasons are explained in our discussion of section 51.905( a)( 3)( i), above.

2. ( ii) Maintenance plan. ( 51.905( a)( 4)( ii). As STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 200 provided above in the discussion of section 51.905( a)( 3)( iii), we are adopting in our final rule our proposed interpretation regarding maintenance plans for areas designated nonattainment for the 1 hour NAAQS on or after November 15, 1990 ( i. e., areas that remain designated nonattainment for the 1 hour NAAQS as well as maintenance areas for the 1 hour NAAQS at the time of designation for the 8 hour NAAQS). Specifically, these areas must adopt a maintenance plan under section 110( a)( 1) within three3 years of designation for the 8 hour NAAQS. The provision for maintenance areas is the same as for areas designated nonattainment for the 1 hour standardNAAQS. However, for maintenance areas, section 51.905( e), discussed below,

cross references this provision and addresses the relationship between the existing 1 hour maintenance plan and the 8 hour maintenance plan.

Our reasons for adopting this provision are discussed above. Although these areas already have maintenance plans,

those plans only address maintenance of the 1 hour standardNAAQS. It is important for these areas to ensure that they have a plan addressing maintenance of the 8 hour standardNAAQS. These areas may evaluate their existing plan and demonstrate how it will ensure maintenance of the 8 hour STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 201 standardNAAQS, or may modify their existing plan, or may adopt a new plan, as appropriate.

CommentCOMMENT: One commenter argued that it makes little sense to require the State to continue to expend the effort and resources to update and extend these maintenance plans.

The commenter questioned why a newly designated marginal area under the 8 hour standardNAAQS should be exempt from implementation plan requirements, while an area previously nonattainment for the 1 hour standardNAAQS, but now in attainment for both standardsNAAQS, should be required to continue with 8 additional years of maintenance plan requirements.

RESPONSE: The final rule ( section 51.905( a)( 4)) clarifies that for these areas ( areas that are initially designated attainment for the 8 hour standardNAAQS but were attainment areas under the 1 hour standardNAAQS with approved maintenance plans) that they are relieved of the requirement to update their maintenance plan under section 175( A), but must submit a maintenance plan under section 110( a)( 1) that provides for maintenance for 10 years. It should be noted that marginal areas under the 8 hour standardNAAQS are not " exempt" from implementation plan requirements; they are still subject to nonattainment new source review and STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 202 conformity requirements, for instance. Furthermore, if a marginal area does not attain the NAAQS by its attainment date, the ActCAA requires that the area be bumped up in classification, which would require the area to submit a revised SIP with an attainment demonstration and including control measures required under subpart 2 for the area's new classification.

Section 51.905( b): Does attainment of the ozone standard affect the obligations under paragraph ( a) of this section?

In addition, once the area attains the 8 hour NAAQS, it will be subject to the more stringent maintenance plan provision in section 175A, which requires the areas to demonstrate maintenance for 20 years.

3. For how long do these obligations continue to apply?

( Section VI. C. 4 of proposed rule; see 68 FR 32824; section 51.905( b) of draft and final rules)

1a. Background . In the June 2, 2003 proposed rule, we proposed two options for when the State would no longer be required to continue implementing SIP approved control obligations required for an area's 1 hour classification. At that time,

these requirements could be relegated to the contingency measures portion of the SIP if the State demonstrated that STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 203 implementation of the controls was not necessary to attain or maintain the 8 hour NAAQS ( consistent with section 110( l)). For simplification, we refer to this as the time control obligations may be shifted to the contingency measures. We clarified that the term " control obligations"

was intended to refer to the obligations which we determined would continue to apply under the preceding sections of the proposal, including the NOx transport rules. Under Option 1, control obligations could be shifted to contingency measures when the area achieves the level of the 1 hour ozone standardNAAQS ( even if the area has not yet attained the 8 hour standardNAAQS). Under Option 2, control obligations could be shifted to contingency measures once the area attains and is redesignated to attainment for the 8 hour NAAQS ( regardless of when, if ever, the area attains the 1 hour standardNAAQS). The draft regulatory text was developed using Option 1 ( when the area achieves the level of the 1 hour ozone standardNAAQS).

2b. Summary of Ffinal Rrule . We are adopting Option 2   control obligations an area is required to retain in the approved SIP for an area's 1 hour classification must continue to be implemented under the SIP until the area attains and is redesignated to STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 204 attainment for the 8 hour standardNAAQS. At that time, the State may relegate such controls to the contingency measure portion of the SIP if the State demonstrates in accordance with section 110( l) that doing so will not interfere with maintenance of the 8 hour NAAQS or any other applicable requirement of the ActCAA. If at the time the area is redesignated to attainment for the 8 hour NAAQS the State has an outstanding obligation to adopt a control requirement under the 1 hour NAAQS, it remains obligated to do so, but may adopt it as a contingency measure. As discussed above,

under EPA's Clean Data Policy, certain obligations such as the requirement to submit ROP plans and attainment demonstrations may be suspended based on a determination that the area has attained the 8 hour NAAQS and will no longer apply if the area is redesignated to attainment.

However, if an area experiences a violation of the 8 hour standardNAAQS prior to being redesignated to attainment the requirements would once again apply.

We are adopting this option because, as noted in the June 2, 2003 proposal, the 8 hour standardNAAQS is the standardNAAQS that we have determined will protect public health and the environment. Only once an area demonstrates it has met and can maintain the health protective STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 205 standardNAAQS do we believe it will be appropriate to shift these obligations to the contingency measures portion of the SIP. This scheme is consistent with what Congress intended.

The CAA contemplates under subpart 2 that States must implement certain mandated requirements. Under the maintenance plan provision of the CAA ( section 175A), such requirements may be shifted to the contingency measure portion of the SIP upon or after redesignation to attainment. Since the relevant NAAQS is now the 8 hour NAAQS, we believe it is appropriate to require these mandated controls to remain as part of the implemented SIP until an area attains the 8 hour NAAQS and is redesignated to attainment. On or after that date, a State may move such obligation to the contingency measures portion of the SIP consistent with sections 175A and 110( l). Moreover, we believe it is appropriate to use attainment of the 8 hour NAAQS rather than attainment of the 1 hour NAAQS because, as provided elsewhere in this rulemaking, EPA will no longer be making determinations of whether an area has attained the 1

hour NAAQS and areas will not be required to demonstrate attainment or maintenance of the 1 hour NAAQS. Some areas may never attain the 1 hour NAAQS, as there will be no obligation to do so once it is revoked. STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 206 The final rule covers the continued applicability of the NOx transport rules under section 51.905( f), rather than as an " applicable requirement" for purposes of section 110( l) because the NOx rules apply regardless of an area's attainment or nonattainment status for the 8 hour ( or the 1

hour) standardNAAQS.

3c. Comments and Rresponses:

COMMENT: Of the few commenters who addressed this issue in response to the June 2, 2003 proposal, several favored oOption 1, and several favored oOption 2. Of those who commented on the draft regulatory text, one commenter opposed the provision, and one comment was unclear as to the commenter's concerns. One other commenter supported the provision. Several commenters had clarifying questions.

RESPONSE: Our rationale for the choice of Option 2 is presented above. A more detailed discussion ofresponse to these and other comments and responses appears in the response to commentRTC document.

4. Section 51.905( c) Which portions of an area designated for the 8 hour NAAQS remain subject to the 1 hour NAAQS obligations identified in paragraph ( a) of this section??

( Section VI. C. 2 and 3 of proposal; see 68 FR 3282032820

32821; 51.905( c) of the draft regulatory text. and final STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 207 rules)

1a. Background.

In the June 2, 2003 notice, we proposed that the obligation to retain or to adopt and retain a mandatory control obligation applies only to the part of the 8 hour ozone nonattainment area that was designated nonattainment for the 1 hour ozone NAAQS. The proposal also provided an example of how this would work.

The draft regulatory text provided additional specificity concerning geographic applicability of the antibacksliding provisions. The draft text provided that with two exceptions only the portion of the designated area for the 8 hour NAAQS that was required to adopt the applicable requirements in 51.900( f) for purposes of the 1 hour NAAQS is subject to the obligations identified in paragraph ( a) of this section with several exceptions. The first exception is an area that is designated attainmentnonattainment for the 8 hour standardNAAQS but that was nonattainment for the 1 hour standardNAAQS with an unmet obligation to submit an attainment demonstration; for these areas, the draft regulatory text provided that the entire area designated nonattainment for the 8 hour ozone NAAQS would be subject to the 10 percent advance increment of reduction. The second STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 208 exception is an area that is attainment for the 8 hour standardNAAQS but that was nonattainment under the 1 hour standardNAAQS with an unmet obligation to submit an attainment demonstration; for these areas, the 110( l)

maintenance plan would have to demonstrate maintenance for the entire 8 hour ozone attainment area.

2b. Summary of Ffinal Rrule.

The final rule incorporates most aspects of the approach as that contained in the proposal and in the draft regulatory text. The final rule provides that only the portion of the designated area for the 8 hour NAAQS that was designated nonattainment for the 1 hour NAAQS is required to comply with the obligations in subparagraph 51.905( a),

except in one circumstance if the State elects to provide an early increment of progress or an early 8 hour attainment demonstration in lieu of an outstanding 1 hour attainment demonstration ( for an 8 hour NAAQS nonattainment area/ 1 hour NAAQS nonattainment area under 51.905( a)( 1)( ii)( B) and ( C)),

the increment of progress or early 8 hour attainment plan must apply for purposes of the entire 8 hour nonattainment area.

The final rule does not follow the approach in the proposal for the maintenance plan requirement for 8 hour STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 209 attainment areas. The maintenance plans required under section 51.905( a)( 3)( iii) and ( 4)( ii) must demonstrate maintenance only for the area designated nonattainment for the 1 hour NAAQS at the time of designation of the 8 hour standardNAAQS. We received comment that recommended this obligation apply only to the area that was originally designated nonattainment for the 1 hour standardNAAQS.

After considering this comment and our discussion in the preamble to the proposed rule, we agree with the commenter.

In many States, attainment areas are identified county by county rather than identifying a group of counties as an attainment area. Thus, a State may have one or more groups of counties listed as a nonattainment area and then the remaining counties in the State are each identified individually as " attainment." See e. g., 40 CFR 81.311 ( Georgia); 81.329 ( Nevada). Because the area that has historically had a problem attaining the ozone standardNAAQS is the area that was previously designated nonattainment for the 1 hour standardNAAQS, we believe it makes the most sense to require the maintenance plan for the area previously designated nonattainment for the 1 hour standardNAAQS. By the time we revoke the 1 hour standard, wWe will set forth in 40 CFR Part 81, Subpart E, an identification of the STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 210 boundaries of areas and the area designations and classifications for the 1 hour NAAQS at the time of the 8 hour designations.

3c. Comments and Rresponses a. Comments on JuneCOMMENTS ON JUNE 2, 2003 ProposalPROPOSAL:

With regard to limiting the applicability of 1 hour obligations to that portion of the 8 hour nonattainment area that was also part of the 1 hour nonattainment area, one commenter supports this policy, especially for the enhanced I/ M program. The commenter believes that the environmental benefit of requiring an extension of the enhanced I/ M program to areas recently added to the CMSA and designated nonattainment for the 8 hour NAAQS to be minimal, costly,

and disruptive of the continued implementation of the enhanced I/ M program in the current 1 hour nonattainment area.

One commenter objected to requiring the substitute planning requirement ( 10 percent advance increment of emission reductions) that applies to areas with an outstanding attainment demonstration for the entire 8 hour ozone nonattainment area. Instead, the commenter recommended it should only apply to the 1 hour nonattainment STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 211 area.

RESPONSE: The final rule provides for retaining applicable emission control and growth requirements for an area's 1 hour classification in only the original 1 hour nonattainment area.

As noted in the final rulemaking notice, we are now allowing the State to meet its unmet 1 hour attainment demonstration obligation through one of three alternative mechanisms, one of which is a 5 percent ( rather than a 10 percent) by submitting the outstanding attainment demonstration or by taking one of two early actions for 8

hour planning: achieve a 5 percent advance increment of emission reductions or submit an early 8 hour attainment demonstration. The advance increment of emission reductions is applied throughout the entire 8 hour nonattainment area because, although it is being submitted in lieu of the 1

hour requirement, it is intended to address the 8 hour nonattainment problem. Because this alternative toSimilarly, the 1 hour8 hour attainment demonstration is intended to address attainment for the full 8 hour area.

Because these alternatives to the 1 hour attainment demonstration are intended to address attainment and progress toward the 8 hour standard, the advance increment STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 212 of progress needs to be obtained from theNAAQS, the State would need to apply these requirements, if selected, to the entire 8 hour nonattainment area. We developed these alternatives in response to concerns that areas focus on the 8 hour standardNAAQS rather than on the 1 hour standardNAAQS and that continued planning obligations for the 1 hour standardNAAQS would burden State resources. States still have the flexibility to choose to develop the 1 hour attainment demonstrations for the 1 hour area if they would like to restrict the unmet planning obligation to the old area.

51.905( e) What obligations that applied for the 1 hour NAAQS will no longer apply after revocation of the 1 hour NAAQS for an area? ( Section VI. C. 3. d. of proposal; see 68 FR 32824; Section 51.905( e) of proposed and final rules)

1a. Background In the June 2, 2003 proposed rule ( 68 FR 328224), we proposed that once the 1 hour standardNAAQS is revoked, EPA would no longer make findings of failure to attain that standardNAAQS and, therefore, we would not reclassify areas based upon a finding that the area failed to attain the 1 hour NAAQS. We indicated areas should focus their resources on attainment of the 8 hour standardNAAQS and stated that we believed it would be counterproductive to STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 213 establish new obligations for States with respect to the 1 hour standardNAAQS after they have begun planning for the 8 hour standardNAAQS. In addition, we noted that the attainment dates for areas classified as marginal, moderate and serious had passed and that the CAA does not provide for reclassification of severe areas. We also noted other mechanisms that are available to make sure that States continue to make progress toward attaining the 8 hour NAAQS.

In addition, we indicated that conformity requirements would no longer apply underfor the 1 hour standardNAAQS once the standardNAAQS is revoked. The June 2, 2003 proposal explains that, under section 176( c) of the CAA, conformity applies to areas designated nonattainment or subject to the requirement to develop a maintenance plan pursuant to section 175A. Once the 1 hour standardNAAQS is revoked,

areas would no longer be designated nonattainment for the 1

hour standardNAAQS or subject to the obligation to develop a maintenance plan under section 175A for the 1 hour standardNAAQS and thus would no longer be subject to the obligation to demonstrate conformity ( either transportation conformity or general conformity) for that standardNAAQS.

The draft regulatory text incorporated these concepts and also provided that, at the time of revocation of the 1 STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 214 hour standardNAAQS, any provisions of applicable SIPs that require conformity determinations in such areas for the 1 hour NAAQS will no longer be enforceable as a matter of law pursuant to section 176( c)( 5) of the ActCAA.

Additionally, the draft regulatory text reflected the discussion in the preamble to the proposed rule regarding what portions of a 1 hour maintenance plan could be revised or removed once the 1 hour standardNAAQS was revoked ( 68 FR 32823). The draft regulatory text provided that areas with approved 1 hour maintenance plans could modify those plans to remove the obligation to submit a maintenance plan for the 1 hour NAAQS eight years after approval of the initial 1 hour maintenance plan and to remove the obligation to implement contingency measures upon a violation of the 1

hour NAAQS. The draft regulatory text providesd, however,

that these requirements would remain enforceable until EPA approved a SIP removing or revising them and also provided that EPA would not approve such revisions until EPA approves an 8 hour attainment demonstration for an area designated nonattainment for the 8 hour NAAQS or an 8 hour maintenance plan for an area designated attainment for the 8 hour NAAQS.

Finally, EPA noted that such a SIP revision must also be consistent with sections 110( l) and 193 of the ActCAA. STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 215 2b. Summary of Ffinal Rrule We are adopting the approach we set forth in our proposed rule and providing clarification regarding the penalty obligations under sections 181( b)( 4) and 185A of the CAA that apply in severe areas that do not attain the 1 hour standardNAAQS by the applicable attainment date. The final rule provides that as of the effective date of revocation of the 1 hour standard:

Areas will not be obligated to continue to demonstrate conformity for the 1 hour NAAQS as of the effective date of the revocation of the 1 hour NAAQS.

NAAQS:

We will no longer make findings of failure to attain the 1 hour standardNAAQS and, therefore, ( a) we will not reclassify areas to a higher classification for the 1 hour standardNAAQS based on such a finding, and ( b)

areas that were classified as severe for the 1 hour NAAQS are not obligated to impose fees as provided under sections 181( b)( 4) and 185A of the CAA.

Areas will not be obligated to continue to demonstrate conformity for the 1 hour NAAQS as of the effective date of the revocation of the 1 hour NAAQS.

An area with an approved 1 hour maintenance plan under STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 216 section 175A of the CAA may modify theits maintenance plan to: ( 1) remove obligations related the planning obligation to developing adevelop the second 10 year maintenance plan for the 1 hour NAAQS; and, ( 2)

replace the obligation to implementexisting 1 hour contingency measures upon a violation of the 1 hour NAAQS.

measure trigger with an 8 hour value. However, before the EPA can consider approving such a revision, certain conditions must be met. If the area is designated nonattainment for the 8 hour ozone NAAQS, it must first have an approved 8 hour attainment demonstration in place. If the area has been designated as attainment for the 8 hour ozone NAAQS, it must first have an approved section 110( a)( 1) maintenance plan in place for the 8 hour NAAQS.

NSR under the 1 hour NAAQS will no longer apply in areas that are 8 Hour NAAQS nonattainment/ 1 Hour NAAQS nonattainment.

Each of these provisions is discussed further below.

( i) Findings of Failure to Attain the 1 hour NAAQS.

We continue to believe, as stated in the preamble to the proposed rule, that areas should focus their resources on attainment of the 8 hour standardNAAQS and that it would be STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 217 counterproductive to establish new obligations for States with respect to the 1 hour standardNAAQS after they have begun planning for the 8 hour standardNAAQS. Moreover, we do not believe there is a basis to determine whether an area has met the 1 hour standardNAAQS once that standardNAAQS no longer applies   ; once the 1 hour standardNAAQS is revoked,

there will not be an applicable attainment date with which to make a determination as to whether an area has met its attainment date or not. Since the obligations to reclassify areas and impose fees are based on a determination that an area has failed to meet the standardNAAQS by the appropriate attainment date, those obligations also would no longer apply for the 1 hour standardNAAQS once the 1 hour standardNAAQS has been revoked.

While we did not specifically state in our proposal that severe areas would no longer be obligated to impose fees under sections 181( b)( 4) and 185A based on a failure to attain the 1 hour NAAQS after the effective date of the revocation of the 1 hour NAAQS, it is a logical extension of our proposal as that obligation is triggered by a finding of failure to attain. In addition, this is consistent with Appendix B of the June 2, 2003 proposal, which did not identify the section 185A fee provision as an applicable STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 218 requirement.

( ii) Conformity under the 1 hour NAAQS. Regarding conformity, we are adopting the approach we set forth in our proposed rule.( 68 FR 32823). The final rule provides that,

upon revocation of the 1 hour NAAQS for an area, conformity determinations will no longer be required for the 1 hour NAAQS. At that time, any provisions of applicable SIPs that require conformity determinations for the 1 hour standardNAAQS in such areas will no longer be enforceable pursuant to section 176( c)( 5) of the CAA.

Under section 176( c) of the CAA, conformity applies to areas designated nonattainment or subject to the requirement to develop a maintenance plan pursuant to section 175A for a specific NAAQS. Once the 1 hour standardNAAQS is revoked,

areas designated attainment for the 8 hour standardNAAQS would no longer be subject to the obligation to demonstrate conformity for the 1 hour standardNAAQS and would have no conformity obligation for the 8 hour standardNAAQS.

Likewise, even areas designated nonattainment for the 8 hour standardNAAQS would no longer have an obligation to demonstrate conformity under the 1 hour standardNAAQS. The reason for this is that these areas would no longer be designated nonattainment for the 1 hour standardNAAQS and STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 219 would no longer be required to develop a maintenance plan under section 175A for purposes of the 1 hour standardNAAQS.

( iii) 1 hour maintenance plans. Regarding the revisions to 1 hour maintenance plans, as noted above, upon revocation of the 1 hour NAAQS, an area with an approved 1 hour maintenance plan under section 175A of the CAA may modify the maintenance plan to remove both the obligation to submit a second maintenance plan for the 1 hour NAAQS 8 years after approval of the initial 1 hour maintenance plan and the obligation to implement contingency measures upon a violation of the 1 hour NAAQS. The maintenance plan requirements will remain enforceable as part of the approved 1 hour NAAQS SIP until such time as EPA approves a SIP revision removing such obligations. We will not approve a SIP revision requesting these modifications until the State submits and EPA approves an attainment demonstration for the 8 hour NAAQS for an area designated nonattainment for the 8

hour ozone NAAQS or a maintenance SIP for the 8 hour NAAQS for an area designated attainment for the 8 hour NAAQS. Any revision to such SIP must meet the requirements of section 110( l) and 193 of the CAA.

3( iv) New Source Review under the 1 hour NAAQS. As noted above concerning anti backsliding provisions related to STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 220 growth measures, our June 2, 2003 proposal indicated that 1

hour NSR requirements would continue to apply in a nonattainment area if that area's classification under the 1 hour ozone standard ( at the time of designation for the 8

hour standard) is higher than its classification under the 8 hour standard ( 68 FR 32821). We indicated at proposal that Congress intended each area that was classified for the 1 hour ozone NAAQS under subpart 2 to adopt the specified control obligations in subpart 2 for the area's 1 hour classification. Accordingly, we proposed that the 1 hour NSR obligations continue to apply after revocation.

We have now determined that it is inappropriate to mandate that a State continue to apply 1 hour nonattainment NSR requirements to such areas. Therefore, today's final rule specifies that, at the time that the 1 hour NAAQS is revoked, a State may request approval of a SIP revision to replace its 1 hour nonattainment NSR program with an NSR program based on its 8 hour classification. We will approve such changes to a State's SIP upon a finding based on section 110( l) of the Act that the change will not interfere with the State's ability to reach attainment of the 8 hour standard and will be consistent with reasonable further progress. STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 221 For example, upon approval of a SIP revision for a nonattainment area that we classify as marginal for the 8

hour standard, the major source threshold would be 100 tpy and the offset ratio would be at least 1: 1. Any lower major stationary source threshold and higher offset ratio that applied by virtue of the area's previous 1 hour classification would no longer apply.

Although the proposal identified nonattainment NSR as a measure to address growth and not a control obligation, we proposed to treat NSR in the same manner as control obligations. We stated that such requirements should continue to apply based on Congressional intent to prohibit States from altering or removing provisions from SIPs if the SIP revision would jeopardize the air quality protection provided in the approved plan. 68 FR at 32819. We further concluded that Congress intended the specified control obligations in subpart 2 to continue to apply after revocation by virtue of the 1 hour classifications.

Upon further reflection, and consideration of public comments, we have revised our approach concerning NSR in areas that were non attainment for the 1 hour NAAQS and continue to be nonattainment under the 8 hour NAAQS. While some commenters believed that NSR requirements that are part STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 222 of SIPs submitted to meet 1 hour NAAQS requirements should be retained, several preferred that the 1 hour NSR program be replaced by an NSR program under the 8 hour standard when the 1 hour standard is revoked. Other commenters supported removing the 1 hour NSR requirements based on a showing that removing the requirements would not interfere with attainment or maintenance of the 8 hour standard. We agree with these commenters that there is no need to retain 1 hour NSR programs where there is a finding under section 110( l)

that 8 hour NSR will not interfere with the State's ability to reach attainment of the 8 hour standard. Moreover, we note major NSR only applies to new sources and to existing sources that have a physical change or change in the method of operation. Therefore, emission limitations and other requirements in NSR permits issued under 1 hour NSR programs will continue to be in force when the 1 hour NAAQS is revoked.

Also, our revised approach is more consistent with our longstanding treatment of NSR as a growth measure. We have historically treated control measures differently from measures to control growth. We provided no rationale in our proposal for treating control measures and growth measures in the same manner for purposes of the 8 hour standard, in STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 223 contrast with our historical approach.

Unlike control requirements such as RACT and I/ M, the NSR program is a growth measure and is not specifically designed to produce emissions reductions. Instead, its purpose is to allow new source growth to occur without interfering with an area's ability to attain. The statute and regulatory history identify nonattainment NSR as a growth measure. Thus, we have previously concluded that NSR is not a " control" measure in the context of Section 175A maintenance plans. See 68 FR 25418, 25436 ( May 12, 2003).

Specifically, we explained that the requirement that contingency provisions include " control" measures does not include nonattainment NSR. We reasoned that the LAER and offset requirements included in existing NSR permits would remain in effect for those sources. Thus, the LAER and offset measures that were relied upon to attain the NAAQS would remain in effect after the nonattainment NSR program was replaced. We also noted that another preconstruction review program ( in that context, PSD) would be triggered to limit growth consistent with attainment in the future.

Those considerations apply with equal force here, as discussed in more detail below.

The role of the NSR permitting program as a growth STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 42 Part D New Source Review ( part D NSR) Requirements for Areas Requesting Redesignation to Attainment, October 14, 1994, from Mary D. Nichols.

224 measure, rather than a control measure, is evident in the structure of the Act, which delineates nonattainment NSR and control measures as separate SIP requirements. In the general requirements for nonattainment plan provisions, NSR permits are listed in CAA 172( c)( 5), while control measures are listed in CAA 172( c)( 6). Similarly, in defining implementation plan requirements, CAA 110( a)( 2)( C) sets forth the requirement for permit programs and CAA 110( a)( 2)( A) the control measures. As we explained in our 1994 policy memo42, if the term " measures," as used in sections 110( a)( 2)( A) and 110( a)( 2)( C), had been intended to include PSD and part D NSR, there would have been no point to requiring that SIPs include both measures and preconstruction review. Section 172( e), which applies when EPA relaxes a NAAQS, only requires EPA to ensure that " controls" are no less stringent than they were for the more stringent NAAQS that has been replaced. It contains no specific requirements concerning growth measures.

Moreover, the statute is clear regarding the roles of the NSR program and control measures in nonattainment areas.

CAA 172( a)( 2) requires attainment as expeditiously as STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 225 practicable considering control measures and CAA 172( c)( 1)

and ( c)( 6) require implementation of all control measures as expeditiously as practical to provide for attainment of the NAAQS by the area's attainment date. Conversely, CAA 173( a)( 1)( A) requires only that growth due to proposed sources, when considered together with the other plan provisions required under section 172, be sufficient to ensure RFP. Thus, unlike the control measures required by Section 172( c)( 1) and ( c)( 6), NSR is not a measure in and of itself to assure attainment of the NAAQS. Rather, NSR should be considered in conjunction with a State's control measures to assure, consistent with the requirements in Section 172( c)( 4), that the emissions from new sources will be consistent with RFP and not interfere with attainment of the applicable NAAQS.

In light of these different statutory goals, we believe the appropriate review of NSR SIP revisions under the 8 hour standard is whether: 1) the SIP revision is consistent with reasonable further progress; and whether 2)

the SIP revision will not interfere with the ability to attain.

With regard to the specific requirements of 110( l), we do not believe that States will have difficulty STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 226 demonstrating that replacing the 1 hour NSR program with an NSR program based on the area's 8 hour classification satisfies the Section 110( l) requirements. As one commenter noted, NSR is a prospective permitting program that only applies to future emissions from new and modified sources.

Any source that is subject to the 1 hour NSR requirements is required to continue to comply with those requirements. In this respect, there will be no degradation of air quality by virtue of this SIP change. Moreover, unlike control measures, States do not rely on the NSR program to generate emissions reductions to move an area further toward attainment. The essential question is whether the NSR program changes will hinder future air quality improvements based on future growth projections. Such a question inherently involves a look at the present day air quality,

which is best reflected by the current 8 hour classifications. As long as the State plans to manage growth within the emissions inventory and include growth in their attainment plans, new source growth will be consistent with RFP and not interfere with the State's ability to attain. Therefore, we believe that the 8 hour NSR program requirements, based on an area's present air quality needs,

will assure that progress continues toward attainment STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 227 despite future economic growth.

c. Comments and Rresponses a.( i) Comments on June 2, 2003 proposal:

COMMENT: Several commenters addressed this issue.

Most agreed with the proposal, but recommended that we clarify that the section 185A penalty fees would not be imposed after the 1 hour standardNAAQS is revoked. A few of the commenters disagreed on the basis that EPA should not revoke the 1 hour standardNAAQS and that all requirements that apply for purposes of the 1 hour standardNAAQS remain applicable.

Regarding conformity, the majority of commenters that addressed this issue objected to EPA's proposal. Most of these commenters believed the 1 hour standardNAAQS and any 1 hour SIP budgets should remain in effect, such that for an area that was designated nonattainment under the 1 hour standardNAAQS, or was redesignated to attainment and had an approved maintenance plan under the 1 hour standardNAAQS,

conformity requirements would still apply. Given the variety of comments we received about how conformity will be implemented, in this section we provide a response following each type of comment.

Comment: Several commenters indicated that STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 228 revoking the 1 hour standardNAAQS for conformity is backsliding, and offered several arguments for why the 1

hour budgets should be retained in 1 hour nonattainment and maintenance areas.

Some commenters indicated that once approved, the motor vehicle emissions budget is part of the applicable implementation plan, and EPA may not render them nugatory for conformity purposes. Commenters also asserted that EPA may not unilaterally revise a state's SIP or suspend it, and in order to require states to revoke the budgets in their SIPs, EPA would have to find the budgets inadequate.

Further, commenters argued that EPA may not lawfully allow states to discontinue implementation of the budgets in their current SIPs, and if states were to decide on their own that budgets no longer apply for conformity purposes, commenters said that EPA would be obligated to impose sanctions pursuant to section 179( a)( 3). Commenters asserted that states may not revise their SIPs to remove budgets without complying with section 110( l), which states that EPA cannot approve revisions " if the revision would interfere with any applicable requirement concerning attainment and reasonable further progress ( as defined in section 171), or any other applicable requirement of this Act." STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 229 Commenters also specifically made the point that revoking the 1 hour standard in areas that are maintenance for that standard conflicts with EPA's proposal that areas can modify discretionary measures only if section 110( l) is met.

Response:

RESPONSE: The CAA specifically states that conformity applies only in " a nonattainment area..." and " an area that was designated as a nonattainment area but that was later redesignated by the Administrator as an attainment area and that is required to develop a maintenance plan under section 7505a of this title..." ( 42 U. S. C. 7506( 5)). Therefore, CAA section 176( c)( 5) restricts conformity to nonattainment areas and areas that are required to submit maintenance plans under section 175A; in these areas, the Federal government's sovereign immunity is waived so that states can require conformity to be determined by the U. S. Department of Transportation. However, after revocation of the 1 hour standardNAAQS, the areas previously nonattainment for the 1

hour standardNAAQS are no longer nonattainment for that standardNAAQS. Similarly, after revocation of the 1 hour standardNAAQS, the areas previously required to submit section 175A maintenance plans under the statute for the 1 STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 230 hour standardNAAQS will no longer be required to do so.

Therefore, after revocation the statute will no longer waive sovereign immunity to allow sStates to require the U. S.

Department of Transportation to perform conformity determinations in such areas after revocation.

States are not taking any action to remove the budgets for the 1 hour ozone standardNAAQS in their SIPs, nor are they required to do so. In fact, EPA has proposed that 8

hour nonattainment areas would be able to use the 1 hour budgets for conformity for the 8 hour standardNAAQS, if they exist in an area ( November 5, 2003, proposed rule, 68 FR 62690). Thus, although the 1 hour budgets would remain in the SIP, areas previously designated nonattainment or maintenance for the 1 hour standardNAAQS would no longer be required or even authorized to show conformity under CAA section 176( c)( 5) for that standardNAAQS. Similarly, EPA would have no grounds for imposing sanctions where conformity is not conducted in these areas because there would be no SIP planning or implementation failure, since any SIP provisions requiring conformity would become enforceable under section 176( c)( 5) after revocation. EPA also disagrees that States cannot revise their SIPs to remove budgets without a demonstration that 110( l) is met, STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 231 because states will not be revising their SIPs to remove budgets.

As we acknowledged in our June 2, 2003, proposal, EPA's conclusion that conformity cannot apply in 1 hour maintenance areas once the 1 hour standardNAAQS is revoked differs from the approach we planned to take in 1997. In 1997, we interpreted revoking the 1 hour ozone standardNAAQS to mean that conformity would not apply for the 1 hour ozone standardNAAQS in areas that were nonattainment for the 1

hour ozone standardNAAQS, but that conformity would continue to apply for the 1 hour ozone standardNAAQS in areas with a maintenance plan. However, the 1997 interpretation would lead to an unfair and counter intuitive result: areas that had attained the standardNAAQS and had made the effort to establish a maintenance plan would have to continue a required program, but areas that had not attained would not.

We reconsidered this result and found it to be unfair and inappropriate. Further, upon reanalyzing CAA section 176( c)( 5), we concluded that this interpretation did not fit with the text of the statute.

Although section 110( l) would normally require areas to demonstrate that removing prior SIP requirements would not interfere with any applicable requirements of the CAA, where STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 232 the CAA itself now forbids application of a prior requirement such a demonstration would be unnecessary.

Further, it would interfere with the statutory limitation on the applicability of conformity to require conformity determinations in areas that are no longer required by the CAA to submit section 175A maintenance plans.

CommentCOMMENT: Commenters remarked that revoking the 1 hour ozone standardNAAQS is of particular concern in areas that are currently nonattainment or maintenance for the 1

hour ozone standardNAAQS that are projected to bewill be designated attainment for the 8 hour ozone standardNAAQS,

because once the standardNAAQS is revoked, these areas will no longer be subject to conformity. A couple of commenters made the point that revoking the 1 hour standardNAAQS would have economic implications for their area because without transportation conformity, the emissions from the transportation sector could grow without restraint and therefore, emissions from the industrial sector would have to be limited further. Commenters were also concerned that their region would lose the ability to forecast whether a violation could occur.

ResponseRESPONSE: We promulgated the 8 hour ozone standardNAAQS in response to the latest data and science STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 233 regarding ozone; we believe the 8 hour ozone standardNAAQS is more protective of public health. In 1997, EPA made the decision to replace the 1 hour ozone standardNAAQS with the 8 hour ozone standardNAAQS, because EPA concluded that the 1 hour standardNAAQS is not needed to protect health and welfare.

It is our conclusion that areas that are in attainment for the 8 hour standardNAAQS would not be subject to conformity because the statute explicitly limits the applicability of conformity to designated nonattainment and to maintenance areas. These areas still have an incentive to monitor the growth of emissions from the transportation sector; if these areas violate the 8 hour standardNAAQS, EPA could designateredesignate them as nonattainment for the 8

hour standardNAAQS and conformity would then apply.

The EPA notes that although States could not implement conformity for attainment areas as a matter of federal law,

they could still requirework with their MPOs to estimate regional emissions that would be generated by the planned transportation activitiessystem to see whether a violation could occur, and could even limit the MPOs from growing beyond a certain amount.

b. Comments on draft regulatory text ( sect. 51.905( e) STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 234 of the draft):

Comment: Several commenters supported this provision.

and to address motor vehicle emissions growth. These type of State activities may be done under State law, when possible, or on a voluntary basis.

COMMENT: One commenter supports, in part, our proposal to allow amendment of maintenance plans, but takes issue with the fact that States would face a continuing obligation to implement contingency measures after revocation of the 1

hour standardNAAQS and the criteria for approval of such amendments. After the 1 hour NAAQS is revoked, a State's obligation to implement contingency measures should automatically be lifted. The Illinois EPA recommends that amendments to the maintenance plans for these areas be approved after the 1 hour NAAQS has been revoked.

RESPONSE: Once we revoke the 1 hour standardNAAQS, the requirement for submission   or subsequent improvements to or additions   revision of a section 175A maintenance plan under the 1 hour standard areNAAQS no longer requiredapply.

The State still has an obligation to ensure that air quality remains clean, and to invoke contingency measures if concentration increases threaten to violaten accordance with the NAAQSterms of the approved SIP. The final rule provides STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 235 that, upon revocation of the 1 hour NAAQS, an area with an approved 1 hour maintenance plan under section 175A of the CAA may modify the maintenance plan to remove the obligation to submit a maintenance plan for the 1 hour NAAQS 8 years after approval of the initial 1 hour maintenance plan and to remove the obligation to implement contingency measures upon a violation of the 1 hour NAAQS. The final rule provides that EPA would not approve a SIP revision requesting these modifications until the State submits and EPA approves an attainment demonstration for the 8 hour NAAQS for an area initially designated nonattainment for the 8 hour ozone NAAQS or a maintenance SIP for the 8 hour NAAQS for an area initially designated attainment for the 8 hour NAAQS. Any revision to such SIP must meet the requirements of section 110( l) and 193 of the CAA. For areas that are not required to submit attainment demonstrations ( e. g., marginal areas),

the SIP revisions that affect prior maintenance plans under the 1 hour standardNAAQS may be made when other portions of the 8 hour SIP are due ( e. g, the NSR provisions).

Comment: Several commenters support the predication that The EPA disagrees with the comments that certain obligations in the maintenance plan should no longer apply upon revocation of the 1 hour standard, EPA would no longer be STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 236 required to determine whether an area has attained the 1

hour standard by its 1 hourNAAQS. The EPA believes that in order to ensure that these revisions will not interfere with attainment or maintenance of the 8 hour NAAQS, these areas should first have an approved 8 hour attainment deadline or to reclassify the area to a higher classification based on a " failure to attain" determination. One commenter agrees with EPA's approach to allow States to request the removal of obligations to submit an 8 year update to 1 hour maintenance plans and implement contingency measures upon a violation of the standard. Anotheror maintenance SIP in place.

COMMENT: A commenter recommended that, in general, the rule should make it clear that any revocation actionsSIP revisions must comply with Sections 1l0( 1) and 193.

RESPONSE: The proposed rule   as well as the final rule   provides that EPA will not approve revisions to the maintenance plan until EPA approves the area's 8 hour SIP for either attainment or maintenance, which will ensure noninterference with the 8 hour standardNAAQS. However, the final rule also includes a requirement that the changes must be in accordance with sections 110( l) and 193.

Comment: Several commenters supported the proposed rule. STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 237 Other commenters believed the 1 hour NAAQS should not be revoked at all, and therefore there would not be a need for the anti backsliding provision regarding NSR.

Response: We address the issue of the revocation of the 1

hour NAAQS elsewhere in this notice and do not repeat it here.

( ii) Comments on draft regulatory text ( sect. 51.905( e) of the draft):

COMMENT: One commenter believes that proposed 40 CFR § 51.905( e)( l) contains an apparent misstatement that EPA should correct. That provision states that upon revocation of the 1 hour NAAQS, an area with an approved maintenance plan for that NAAQS may modify that plan to remove the obligation under CAA § 175A( b) to submit a " second round"

maintenance plan eight years after redesignation to attainment and to remove the obligation to implement contingency measures upon a 1 hour NAAQS violation. The provision goes on to say that EPA will not approve a SIP revision making these modifications until the state submits and EPA approves: ( 1) an 8 hour attainment demonstration, if the area is designated nonattainment for the 8 hour NAAQS;

or ( 2) an 8 hour maintenance SIP under proposed 40 CFR § 51.905( a)( 3)( iii), if the area is designated attainment for STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 238 the 8 hour standardNAAQS. Option ( 2) does not make sense,

however. Proposed 40 CFR § 51.905( e) by its terms applies to areas with approved 1 hour maintenance plans. Thus, these areas by definition have been redesignated to attainment   i. e., are no longer nonattainment   for the 1 hour NAAQS.

Yet proposed 40 CFR § 51.905( a)( 3)( iii) applies only to areas that are " designated nonattainment for the 1 hour NAAQS at the time of revocation of the 1 hour NAAQS". NAAQS."

Thus, contrary to the last clause of § 51.905( e)( l), areas that are maintenance for the 1 hour NAAQS and attainment for the 8 hour NAAQS cannot be subject to § 51.905( a)( 3)( iii).

RESPONSE: The commenter has pointed out a flaw in the proposal. The final rule has been modified from the proposal to account for this situation. A separate parallel provision has been established in section 51.905( a)( 4) for areas that haverequiring 1 hour maintenance plans at the time of revocation of the 1 hour standard under which they would be obligatedplan areas to submit a maintenance plan under section 110( a)( 1). As provided earlier, EPA has also changed the proposed regulatory text   consistent with the June proposal   to indicate that 51.905( a)( 3) and ( 4) apply,

respectively to areas that are nonattainment or maintenance of the 1 hour NAAQS at the time of designation for the 8 STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 239 hour NAAQS. Section 51.905( e)( 1) has been modified to provide that the State would not be able to modify thean existing 1 hour maintenance plan until EPA approves the new 8 hour maintenance plan.

CommentCOMMENT: One commenter provided suggested language changes to section 51.905( e). that would have basically retained the section 175A maintenance plan and the conformity requirement.

RESPONSE: As noted above under other similar comments on the June 2, 2003 proposal, once EPA revokes the 1 hour standardNAAQS, and the area is an 8 hour attainment area,

section 175A maintenance provisions do not apply and conformity for the 1 hour standardNAAQS no longer applies.

Section 51.905( f) 6. What is the continued applicability of the NOx SIP Call after revocation of the 1 hour NAAQS?

( Section VI. C. 3. c. of proposal; see 68 FR 32824; section 51.905( f) of the proposed and final rules)

1a. Background In the June 2, 2003 proposal ( 68 FR 32824),

we noted that it is important to ensure that the transition to the 8 hour standardNAAQS does not jeopardize the controls required to be in place under the NOx SIP Call rule and the section 126 rule ( i. e., the rules for addressing the longrange transport of ozone and its precursor, NOx). We STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 43When EPA promulgated the NOx SIP Call, we required the same level of reductions for both the 1 hour and 8 hour ozone NAAQS ( 63 FR 57356, October 27, 1998). In response to the Court of Appeals remand of the 8 hour standardNAAQS, EPA stayed the 8 hour basis of the NOx SIP Call ( 65 FR 2674, January 18, 2000). However, since the same level of reductions was required for both the 8 hour and 1 hour standardsNAAQS, the stay had no practical effect on States' compliance with the rule. Because EPA also stayed the 8 hour portion of the Section 126 Rule, we did not move forward to make the section 126 findings under the 8 hour standardNAAQS which would trigger the 8 hour control requirements ( 65 FR 2674, January 18, 2000). We plan to complete rulemaking action on the 8 hour petitions at the time we lift the 8 hour stay. All of the States affected by the 1 hour and/ or 8 hour Section 126 Rule are also covered by the NOx SIP Call. The Section 126 Rule contains a provision under which the Section 126 findings and control requirements would be withdrawn if States have approved SIPs meeting the NOx SIP Call. The EPA has already withdrawn the 1 hour Section 126 Rule in 3three States and the District of Columbia and proposed to withdraw the 1 hour rule in all other affected States except one. ( We expect to propose action with respect to the rule in the remaining State shortly.)

240 jointly referred to these rules in the proposal as the NOx transport rules. We indicated that we plan to lift the stay of the 8 hour basis for the NOx transport rules. 43 Regardless of whether we lift that stay, the controls required have substantial benefits for reductions of both 1 hour and 8 hour ozone levels. We indicated that we believe that relaxing such controls would be contrary to the principles we identified in the proposal for an effective transition. Thus, we proposed that States must continue to adhere to the emission budgets established by the NOX STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 241 transport rules after the 1 hour standardNAAQS is revoked in whole or in part.

The draft regulatory text reflected the discussion in the June proposal.

2b. Summary of Ffinal Rrule. We are adopting the approach we set forth in our proposed rule and draft regulatory text.

States must continue to adhere to the emission budgets established by the NOx transport rules after the 1 hour standardNAAQS is revoked. States retain the authority to revise control obligations they have established for specific sources or source categories under the NOx SIP Call rule so long as the State demonstrates consistent with section 110( l) that such modification will not interfere with attainment of or progress toward meeting the 8 hour NAAQS or any other applicable requirement of the CAA. We continue to believe that the reductions required by the NOx transport rules are necessary to address transported emissions for the 8 hour ozone NAAQS as well as the 1 hour ozone NAAQS.

3c. Comments and Rresponses ( i) Comments on the June 2, 2003 proposal:

Only a handful of commenters addressed this issue, all of whom supported the proposal. Several of these commenters STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 242 recommended that we lift the stay of the NOx transport rules with respect to the 8 hour standardNAAQS. Additionally,

only a few commenters specifically commented on this provision of the draft regulatory text ( 51.905( f)), and all supported the concept.

D. What is the Required Timeframe for Obtaining Emissions Reductions to Ensure Attainment by the Attainment Date?

( Section VI. E of the proposed rule ( 68 FR 32826); Section 51.908( e) of the draft regulatory text; Section 51.908 of theand final rule. s)

1. Background:. In the June 2003 proposal, we proposed that emissions reductions needed for attainment must be implemented by an area's attainment date. We noted this meant that emissions reductions must be implemented by the beginning of the final ozone season prior to the attainment date. For example, for areas with an attainment date in May 2010, the emissions reductions need to be implemented by the beginning of the 2009 ozone season because a determination of attainment will be based on air quality monitoring data from 2007, 2008 and 2009. The proposal cautioned that States should be aware of the consequences of failing to implement the control measures necessary for attainment sufficiently far in advance of their attainment date. As STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 44 See section 4. entitled, " How Will EPA Address the Provision Regarding 1 Year Extensions?" where we interpret the clause " no more than 1 exceedance" in section 181( 5)( b) to mean, for purposes of the 8 hour NAAQS, that the 4th high reading at an ozone monitor in the ozone season preceding the attainment date is less than 0.85 ppm.

243 noted above, for areas covered under subpart 2, section 181( a)( 5) of the CAA allows up to two 1 year attainment date extensions if two criteria are met: the area has complied with all requirements and commitments in the approved SIP and the area has no more than one exceedance of the NAAQS in the attainment year. As provided above, we've interpreted the second criterion to mean that to obtain the first 1 year extension, the area must be meeting the level of the standardNAAQS in the attainment year itself. 44 Thus, States should ensure that the emissions reductions are implemented to ensure that ozone levels for the ozone season preceding the attainment date are below the level of the standardNAAQS. If an area does not meet the eligibility requirements for the 1 year extension, it would be subject to a reclassification to a higher classification ( bump up).

Areas covered under subpart 1 are able to obtain up to two 1 year attainment date extensions, however there is no provision for a bump up in subpart 1. If an area covered under subpart 1 fails to attain, section 179 of the CAA STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 244 provides that EPA publish a finding of failure to attain which starts a 1 year time frame for States to submit a SIP revision that provides for attainment within a specified time frame.

2. Summary of final rule:. In section 51.908, we are adopting the approach we set forth in our proposed rule,

namely that emissions reductions needed for attainment must be implemented by the beginning of the ozone season immediately preceding the area's attainment date. We believe that Congress contemplated that control measures would continue to be implemented up to the attainment year.

For example, section 182( c)( 2)( B) requires areas classified as serious or higher to achieve an average of 3 percent reduction in emissions per year over each three year3 year period until the area's attainment date. If Congress intended areas to achieve all reductions needed for attainment three3 years prior to attainment, then the last 9 percent reductions required for serious and above areas would be reductions beyond those needed for attainment. We do not believe that Congress mandated these reductions in addition to the reductions needed to attain the standardNAAQS. In fact, this requirement is included in the statute as a part of the subparagraph addressing attainment STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 45 As discussed in the section regarding the two 1 year attainment date extensions, section 172( a)( 2)( C), which applies to all pollutants, allows for a 1 year attainment date extension if the area has had " minimal exceedances" in the attainment year and section 181( a)( 5), which applies to 245 and reasonable further progress, which indicates that Congress intended it to address progress toward attainment.

This is further supported by the definition of reasonable further progress in section 171( 1) as " annual incremental reductions in emissions ... for the purpose of ensuring attainment ..." Other provisions in the CAA also support the concept that areas do not need to achieve three3 years in advance of the attainment date the full complement of reductions needed for attainment. For example, Congress only provided marginal areas with three3 years to attain the standardNAAQS and did require at least minimal additional controls be implemented in such areas. In addition, the fact that Congress provided for two 1 year extensions of the attainment date also indicated that Congress believed that some areas might not be fully implementing all measures needed for attainment three3 years in advance of the attainment date. Rather, Congress contemplated that areas would have air quality healthy enough to make it substantially likely the area would attain within the next one1 or two2 years. 45 Finally, we note that the STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version ozone nonattainment areas classified under subpart 2, allows for a 1 year extension if the area has had no more than 1 exceedance in the attainment year.

246 standardNAAQS itself does not contemplate that air quality must be at " attainment levels" for each of the three3 years on which attainment is based. Rather, attainment is determined based on an average of the 4th high reading at a monitor over a three3 year period. Thus, the 4th high reading for an area could be above the standardNAAQS for one or both of the years preceding the attainment year, but so long as the 4th high level for the other year( s) was low enough to produce an average at or below 0.084 ppm, the area would be attaining the standardNAAQS.

As noted in the June 2003 preamble, despite the fact that we believe an area need not have all controls implemented until the beginning of the final attainment season, the State needs to consider that attainment is based on a 3 year average. Thus, the State will need to ensure that implementation of controls is not unduly delayed. A State that plans to achieve reductions by the beginning of the ozone season prior to the attainment date may still experience meteorology conducive to very high ozone formation in that last ozone season that may result in the area having a 4th highest daily ozone concentration above STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 46Memorandum, `` Guidance on the Reasonably Available Control Measures ( RACM) Requirement and Attainment Demonstration Submissions for Ozone Nonattainment Areas.'' John S. Seitz, Director, Office of Air Quality Planning and Standards. November 30, 1999. Wweb site: http:// www. epa. gov/ ttn/ oarpg/ t1pgm. html.

247 the level of the 8 hour standardNAAQS, making it ineligible for the first of the 1 year extensions. Such an area   if classified under subpart 2   would then be reclassified ( bumped up) to a higher classification and be subject to additional planning requirements and mandatory control measures. Thus, a State should be aware of the consequences of delaying too long to implement control measures needed for attainment. Additionally, in reviewing implementation timeframes in SIPs, EPA will consider whether those timeframes are as expeditious as practicable. A guidance memorandum from John Seitz of November 30, 199946 reiterates the need to implement measures as expeditiously as practicable:

In order for EPA to determine whether an area has provided for implementation as expeditiously as practicable, the State must explain why the selected implementation schedule is the earliest schedule based on the specific circumstances of that area. Such claims cannot be general claims that more time is needed but rather should be specifically grounded in evidence of economic or technologic infeasibility. While it may be appropriate for some control measures to be implemented shortly after adoption, the EPA recognizes that other measures may need a longer period. STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 248 The EPA will review the State's submission to ensure that sufficient information is provided for the EPA to determine whether the State has adopted all RACM necessary for attainment as expeditiously as practicable and provided for implementation of those measures as expeditiously as practicable. The EPA will make those determinations based on the information provided by the State and any other information available to the EPA at the time the Agency approves or disapproves the attainment demonstration.

3. Comments and Rresponses CommentCOMMENT: Some commenters agreed with our proposal as written, i. e., to require that emission reductions needed for attainment be implemented by the beginning of the ozone season prior to the attainment year.

However, several commenters disagreed with the timeframe that was included in our proposal that required reductions be in place by the beginning of the ozone season prior to the attainment date because it precludes areas from realizing the benefit of Federal measures prior to developing additional local controls.

Another commenter stated that the attainment deadlines place an extraordinary burden on metropolitan areas to achieve the level of emissions reductions necessary to demonstrate attainment. The commenter felt that requiring emissions reductions to be implemented at the beginning of the ozone season prior to the attainment date is one1 year earlier than is required. The commenter stated that so long STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 249 as there are no exceedances in the attainment year, i. e.,

having controls in place by the beginning of the ozone season of the attainment year, the area has meet the statutory requirement and could qualify for the first of two 1 year attainment date extensions allowed under the CAA.

The commenter further stated that controls for moderate areas would need to be in place by about the same time the area's SIP must be submitted to EPA in order to provide three3 years of clean data for the demonstration of attainment.

Other commenters stated that all emissions reductions needed for attainment must be implemented in sufficient time to ensure attainment by the attainment date without relying on the CAA provisions for the 1 year extensions.

ResponseRESPONSE: Section 172( c)( 2) of the CAA requires that emissions reductions needed for attainment be phased in such that RFP toward attainment is achieved. For areas classified as moderate under subpart 2, their attainment date would be as expeditiously as practicable but no later than 6 years after the date of classification. Their ROP requirement would be at least a 15 percent VOC emissions reduction from the base year to be achieved no later than 6 years after the base year. However, if the area needed more STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 250 than 15 percent VOC reductions in order to demonstrate attainment, then any additional reductions would also have to be achieved by the beginning of the ozone season prior to the area's attainment date.

States should be aware of the consequences of failing to implement the control measures necessary for attainment sufficiently far in advance of the attainment date. For areas covered under subpart 2, section 181( a)( 5) of the CAA does allow for up to two 1 year attainment date extensions in certain circumstances. The final rule on how those extension provisions would be implemented appears elsewhere in this preamble under the discussion of attainment dates.

To obtain the first of the 1 year extensions, the CAA basically requires that the area be meeting the level of the standardNAAQS in the attainment year itself, even if the area has not actually attained considering the most recent 3 years of data. Thus, the States should ensure that the emissions reductions be implemented to ensure that ozone levels for the ozone season preceding the attainment date are below the level of the standardNAAQS. If an area does not meet the eligibility requirements for a 1 year extension ( as proposed elsewhere in this rulemaking) in the attainment year, then the area would not be eligible for an attainment STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 251 date extension, and EPA would have an obligation to reclassify the area to a higher classification (" bump up").

A marginal area with an attainment date 3 years after its nonattainment designation that fails to attain would be subject to bump up to at least moderate, and would then have to prepare a plan to attain within 3 years afterward ( 6 years after their nonattainment designation).

There is further discussion of this situation as it relates to the 1 hour ozone standardNAAQS in the General Preamble of April 16, 1992 ( 57 FR 13498, 13506); this discussion may have some applicability to the 8 hour standardNAAQS.

Areas covered under subpart 1 are also able to obtain up to two 1 year extensions of the attainment date ( see section 172( a)( 2)( C)). There is no provision for bump up in classification similar to that under subpart 2. However, if an area fails to attain, section 179 of the CAA provides that EPA publish a finding that the area failed to attain.

The State then must submit within 1 year after that publication a revision to the SIP that provides for attainment within the time provided under section 179.

Section 179 also provides that the SIP revision must also include any additional measures that EPA may prescribe. STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 252 COMMENT: Comment: Several commenters suggested that nonattainment areas should be afforded the opportunity to install controls in time to monitor for attainment before the attainment deadline. The commenters believes that for many industrialized and metropolitan areas classified under Subpart 2 as marginal, moderate or serious, it will not be feasible to have stationary and mobile source controls in place three3 years before the attainment deadlines for the purposes of attainment monitoring. Pragmatically, state SIPS will not be finalized until mid 2007, at which time industrial facilities can begin the 18 24 month period for detailed engineering, permitting and procurement of NOXx control equipment. The installation of controls would occur over a 5 year average facility turnaround period.

Furthermore, Tier II fuels and engines will just be entering the market as will cleaner diesel fuel and engines. It is virtually certain that many of these areas will not have the necessary emission reductions in place three3 years before the attainment deadline and will be required to rely on the case by case extensions to the designated attainment deadlines. The commenters believe that Congress did not intend for EPA to establish attainment deadlines that would in a large number of castes automatically require areas to STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 253 use deadline extensions; such areas have probably been misclassified. All nonattainment areas should be afforded the opportunity to install controls in time to monitor for attainment by the attainment deadline, but not three years prior to the attainment year. This would also eliminate the need for case by case extensions.

RESPONSE: The final rule does not require emission reductions to be in place three ozone seasons prior to the attainment date. However, the after the fact determination of whether an area actually attains the NAAQS by its attainment date must be done by looking back at the previous 3 years of ambient air quality data. However, as noted elsewhere in this preamble, the ActCAA provides for up to two 1 year extensions of the attainment date.

CommentCOMMENT: Marginal areas may not be able to demonstrate compliance in three3 years and the final rule should provide for automatic extensions for such areas.

Additional time to implement all of these reductions may be required in order for marginal areas to comply. By creating an automatic extension, EPA will avoid the inevitable cost of SIP nonattainment planning problems that communities will face if these measures are fully implemented.

RESPONSE: Subpart 2 does not require marginal areas to STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 254 submit an attainment demonstration. As noted elsewhere in this preamble, the ActCAA provides for up to two 1 year extensions of the attainment date. However, the ActCAA does not provide for " automatic" extensions.

CommentCOMMENT: One commenter noted that EPA's proposal provides: " For each nonattainment area, the State must provide for implementation of all control measures needed for attainment no later than the beginning of the attainment year ozone season." CAA § 51.908( e). Attainment of the eight hour standardNAAQS is based on analysis of three3 years of data. Part 51, App. I ¶ 2.3( a) (" The primary and secondary ozone ambient air quality standards are met at an ambient air quality monitoring site when the 3 year average of the annual fourth highest daily maximum 8 hour average ozone concentration is less than or equal to 0.08 ppm.").

Thus, to meet the statutory requirement that SIPs provide for attainment, the rule must require SIPs to provide for implementation of all control measures needed for attainment no later than three3 years before the attainment date.

RESPONSE: We disagree with the comment. In section 51.908,

we are adopting the approach we set forth in our proposed rule, namely that emissions reductions needed for attainment STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 255 must be implemented by the beginning of the ozone season immediately preceding the area's attainment date. We believe that Congress contemplated that control measures would continue to be implemented up to the attainment year.

For example, section 182( c)( 2)( B) requires areas classified as serious or higher to achieve an average of 3 percent reduction in emissions per year over each three year period until the area's attainment date. If Congress intended areas to achieve all reductions needed for attainment three years prior to attainment, then the last 9 percent reductions required for serious and above areas would need to be reductions beyond those needed for attainment. We do not believe that Congress mandated these reductions in addition to the reductions needed to attain the standard.

In fact, this requirement is included in the statute as a part of the subparagraph addressing attainment and reasonable further progress, which indicates that Congress intended it to address progress toward attainment. This is further supported by the definition of reasonable further progress in section 171( 1) as " annual incremental reductions in emissions ... for the purpose of ensuring attainment ..."

Other provisions in the CAA also support the concept that areas do not need to achieve 3 years in advance of the STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 256 attainment date the full complement of reductions needed for attainment. For example, Congress only provided marginal areas with three years to attain the standard and did require at least minimal additional controls be implemented in such areas. In addition, the fact that Congress provided for two 1 year extensions of the attainment date also indicated that Congress believed that some areas might not be fully implementing all measures needed for attainment 3 years in advance of the attainment date. Rather, Congress contemplated that areas would have air quality healthy enough to make it substantially likely the area would attain within the next one or two years. Finally, we note that the standard itself does not contemplate that air quality must be at " attainment levels" for each of the three years on which attainment is based. Rather, attainment is determined based on an average of the 4th high reading at a monitor over a three year period. Thus, the 4th high reading for an area could be above the standard for one or both of the years preceding the attainment year, but so long as the 4th high level for the other year( s) was low enough to produce an average at or below 0.084 ppm, the area would be attaining the standard.

As noted in the June 2003 preamble, despite the fact STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 257 that we believe an area need not have all controls implemented until the beginning of the final attainment season, the State needs to consider that attainment is based on a 3 year average. Thus, the State will need to ensure that implementation of controls is not unduly delayed. A State that plans to achieve reductions by the beginning of the ozone season prior to the attainment date may still experience meteorology conducive to very high ozone formation in that last ozone season that may result in the area having more than the allowed number of days with concentrations above the level of the 8 hour standard,

making it ineligible for the first of the 1 year extensions.

Such an area   if classified under subpart 2   would then be reclassified ( bumped up) to a higher classification and be subject to additional planning requirements and mandatory control measures. Thus, a State should be aware of the consequences of delaying too long to implement control measures needed for attainment. Additionally, in reviewing implementation timeframes in SIPs, EPA will consider whether those timeframes are as expeditious as practicable. A guidance memorandum from John Seitz of November 30, 1999 reiterates the need to implement measures as expeditiously as practicable: STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 258 In order for the EPA to determine whether an area has provided for implementation as expeditiously as practicable,

the State must explain why the selected implementation schedule is the earliest schedule based on the specific circumstances of that area. Such claims cannot be general claims that more time is needed but rather should be specifically grounded in evidence of economic or technologic infeasibility. While it may be appropriate for some control measures to be implemented shortly after adoption, the EPA recognizes that other measures may need a longer period.

The EPA will review the State's submission to ensure that sufficient information is provided for the EPA to determine whether the State has adopted all RACE necessary for attainment as expeditiously as practicable and provided for implementation of those measures as expeditiously as practicable. The EPA will make those determinations based on the information provided by the State and any other information available to the EPA at the time the Agency approves or disapproves the attainment demonstration.

Comment: Our rationale is presented above.

COMMENT: In addition, a commenter stated that this timing was inconsistent with the draft modeling guidance which essentially requires areas with an attainment date of 2013 STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 259 to have their controls in place by 2011 to perform an attainment demonstration. The 2011 date is inconsistent from the proposal which would require that the emissions reductions be in place in 2012. The commenter further stated that it seems inappropriate that the draft modeling guidance would be driving the schedule for implementation of control measures as opposed to the 8 hour implementation rule.

RESPONSE: Comments on the modeling requirements will be addressed in Phase 2 of this rulemaking. The approach on when emission reductions needed for attainment must be in place was not based on the modeling requirements, but on the rationale stated in the preamble to the final rule.

E. COMMENTS ON OTHER ISSUESE. Conformity Under the 8 Hour Ozone Standard The June 2, 2003 proposal provided background discussion on issues related to transportation conformity and general conformity under the 8 hour ozone standard. See sections VI. M ( 68 FR 32841) and VI. N. ( 68 FR 32842).

However, we did not propose any rules related to either. We did receive a number of comments on this topic, however.

Responses to those comments are included in the response to comments document. STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 47EPA issued the memorandum " Boundary Guidance on Air Quality Designations for the 8 Hour Ozone National Ambient Air Quality Standard ( NAAQS or Standard)" on March 28, 2000, from John S. Seitz, Director, Office of Air Quality Planning and Standards, to the Air Directors, Regions I X, to provide guidance to State and local agencies and Tribes on designating areas and EPA's views on boundaries for nonattainment areas for the 8 hour NAAQS.

260 F. Comments on Other Issues We received comments on other issues associated with elements of this final rulemaking. We address those comments here. Comments on any other issues not mentioned herediscussed in this preamble will be addressed in the second phase of this final rulemaking.

1. Designations of nonattainment and attainment areas: We received a number of comments on the designation process.

RESPONSE: As we noted in the June 2, 2003 proposal, we did not propose to establish attainment/ nonattainment designations nor did we address the principles that will be considered in the designation process; we issued guidance on the principles that States should consider in making designation recommendations in March 2000.47 The designation process is being conducted separately.

2. Early Action Compacts ( EACs):. ( Section VIII. A. 2. and 3 of the proposal; see 68 FR 32859).

We received a number of comments that addressed EACs. STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 261 The June 2, 2003 proposal included a description and background information concerning EACs, but the proposal made clear that we were not proposing any rulemaking on EACs in that notice.

RESPONSE: The comments we received will be addressed when wein the rule that takes final action on the proposed rule to defer the effective date for EAC areas and therefore those comments are not addressed in this current rulemaking.

We note that existing 1 hour maintenance areas will remain subject to all the requirements of that maintenance plan and transportation conformity, until the 1 hour standard is revoked 1 year following the effective date of the area's 8

hour designation. If EPA takes final action deferring the effective date of the 8 hour designation for an EAC area,

revocation of the 1 hour standard will also be effectively deferred for such area. Therefore, for such an EAC area that is a 1 hour maintenance area, the 1 hour maintenance plan, and 1 hour conformity, will continue to apply until 1 year after the 8 hour designation takes effect.

3. Health and environmental concerns: We received a number of general comments related to health and environmental concerns. Some of these cited national health statistics or provided information concerning the levels of STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 262 ozone in their communities or information concerning the adverse health symptoms of themselves or friends, relatives,

or patients. These commenters generally cited this information as a way of encouraging EPA to ensure expeditious attainment of the 8 hour ozone standardNAAQS and in some cases to support leaving the 1 hour standardNAAQS and its implementation process in place.

RESPONSE: We have addressed these latter concerns above in discussion of the classification system, revocation of the 1 hour standardNAAQS and the anti backsliding provisions that serve to ensure that the 8 hour standardNAAQS is attained as expeditiously as practicable with little or no delay in emission reductions as a result of revoking the 1

hour standardNAAQS.

4. Clarity and understandability of proposed rule: A number of commenters expressed concern about the complexity of the proposed rule, and the lack of apparent clarity and transparency. A number of these commenters complained that due to the possible large number of combinations and permutations of options that were possible from the proposal, it was difficult or impossible to determine exactly what the effect of the rule would be. RESPONSE:

One of our principles in drafting the proposal was to make STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 263 the rule as understandable as possible. However, the Supreme Court's ruling on our previous implementation approach left it to EPA to develop an implementation scheme with only general guidance as to how to proceed. Because the consequences of implementation under a particular approach might be fairly large, we felt obligated to place as many practicable options in our proposal as possible to assess public reaction and comment. This approach obviously added complexity to the proposal. We tried to minimize the complexity by setting forth two example frameworks for how some options could work in conjunction with each other. We also attempted in the draft regulatory text to focus on one set of options to illustrate how one set of options would work together. We attempted to simplify where we could and to provide other materials in the docket and on our websiteweb site for this rulemaking ( e. g., the " roadmap" and the crosswalks between the June 2, 2003 proposal and the draft regulatory text) to enable the reader to more easily see relations between various sections of the proposal and to provide a synopsis of the options being proposed.

Although the very nature of the proposal was complex, we believe that the public had sufficient opportunity to comment on the rule. STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 48OAR 2003 0079 0081, 0085 American Petroleum Institute ( API) requests for extension to the August 1st, 2003 comment deadline.

49OAR 2003 0079 0405 Request for Extension of Time for Filing Comments on Draft Regulatory Text for Proposed Rule to Implement the 8 Hour Ozone National Ambient Air Quality Standard ( NAAQS) submitted by Howard J. Feldman, Director, American Petroleum Institute.

50OAR 2003 0079 0542, 0589, 0590 Request for Extension of time for 15 day comment period on approaches to implement the 8 hour ozone NAAQS, submitted by Gregory Dana, Vice President Environmental Affairs, Alliance of Automobile Manufacturers.

264 5. Regulatory text: A number of commenters chastised us for not providing regulatory text with the proposal.

RESPONSE: As noted above, we did provide for public comment draft regulatory text, which reflected one set of proposed options. On August 6, 2002 ( 68 FR 46536), we published a notice of availability of the draft regulatory text for the proposed rule to implement the 8 hour ozone NAAQS. This notice started a 30 day public comment period on the draft regulatory text.

6. Requests for Extension of Comment Periods: We received a number of requests for extension of the comment periods on the three notices related to our proposal ( the June 2, 2003 proposal, 48 the notice of availability of the draft regulatory text, 49 and the notice reopening the comment period on the classification approach. 50) We did not grant STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version OAR 2003 0079 0555 Request for extension of time for 15 day comment period on alternative approaches to implement the 8 hour ozone NAAQS submitted by Howard Feldman, Director Regulatory Analysis and Scientific Affairs, American Petroleum Institute ( API).

OAR 2003 0079 0572 Request for Extension of Public Comment Period submitted by Leslie S. Ritts, Counsel to The National Environmental Development Associations Clean Air Regulatory Project ( NEDA/ CARP).

51See, for instance, OAR 2003 0079 0165 Letter from S. Page, Director, OAQPS to H. J. Feldman, Director, API, denying extension of comment period.

265 any of these requests. 51 We provided a 60 day comment period on our full implementation proposal, which was published on June 2, 2003. We also provided a separate 30 day comment period on draft regulatory text ( notice of availability was published on August 6, 2003). The October 21, 2003 notice was very narrow, supplementing just one aspect of the June 2, 2003 proposal. We believe that a 15 day comment period was sufficient to address this limited issue. That notice was based on several comments which were submitted during the public comment period. Those comments have been available to the public since early August. We are committed by a consent decree to designate areas for the 8 hour ozone NAAQS by April 15, 2004. We believe it was essential to move forward to provide the public health protection that implementation of the 8 hour standardNAAQS STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 266 will yield. We have recognized the strong interest from many stakeholders in our issuance of a final implementation rule prior to the April 2004 designation deadline. These interests, in conjunction with the reasons set forth above,

support our denial of requests for an extension of the comment period. However, as is normally the case, we considered comments received after the close of the comment period to the extent we were able to do so without impeding the process for issuing the final rule.

F. G. Other Considerations Although Phase 2 of the final rule will address aspects of implementation of the 8 hour ozone NAAQS that are not addressed in this rulemaking, additional information is provided below regarding new source review for the 8 hour ozone NAAQS.

1. What happens if a source is in the process of PSD permitting at the time that the area in which it is located is designated as nonattainment for the 8 hour ozone NAAQS?

An area's designation at the time the final permit is issued determines which major New Source Review ( NSR)

requirements apply to the construction activity.

Accordingly, if a source has received its PSD permit before the area is designated nonattainment, it may construct under STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 267 the terms of that permit if it commences an ongoing program of construction within the required time period and completes the project within a reasonable time. However, if the area is designated nonattainment before the permit is issued ( even if the reviewing authority deemed the PSD application complete), the PSD permit may not be issued.

The source would be required to submit a new application to comply with the requirements of the applicable nonattainment major NSR program before receiving a final permit and beginning construction. 40 CFR 52.24( k) and 40 CFR part 51,

appendix S. We have consistently applied this approach in past designation and redesignation situations.

This approach is consistent with CAA section 165, which states that PSD permitting requirements apply only in attainment and unclassifiable areas. The D. C. District Court of Appeals affirmed this plain reading of the statute in the Alabama Power decision [ 636 F. 2d 323]. In response to EPA's attempt to apply PSD permitting requirements in some nonattainment areas, the court stated, " After careful consideration of the statute and the legislative history, we must accept the contention of the industry petitioners that the phrase ` constructed in any area to which this part applies' limits the application of Section 165 to major STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 268 emitting facilities to be constructed in [ attainment and unclassifiable areas]." The court went on to say, " The plain meaning of the inclusion in section 165 of the words ` any area to which this part applies' is that Congress intended location to be the key determinant of the applicability of the PSD review requirements."

This approach is also consistent with the regulatory text in the Federal PSD regulations. These regulations limit the applicability of PSD requirements to " an area designated as attainment or unclassifiable." 40 CFR 51.166( a)( 7)( i); 52.21( a)( 2)( i).

H. EPA's Final Action xxx NEED TO ADD SUMMARY V We are taking final action on key elements of the program to implement the 8 hour ozone NAAQS. This final rule addresses the following topics: classifications for the 8 hour NAAQS; revocation of the 1 hour NAAQS ( i. e., when the 1 hour NAAQS will no longer apply); how anti backsliding principles will ensure continued progress toward attainment of the 8 hour ozone NAAQS; attainment dates; and the timing of emission reductions needed for attainment. A summary of the rule appears in section IV of this preamble.

VI. STATUTORY AND EXECUTIVE ORDER REVIEWS STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 269 A. Executive Order 12866: Regulatory Planning and Review Under Executive Order 12866 ( 58 FR 51735, October 4,

1993), the Agency must determine whether the regulatory action is " significant" and, therefore, subject to Office of Management and Budget ( OMB) review and the requirements of the Executive Order. The Order defines " significant regulatory action" as one that is likely to result in a rule that may:

( 1) have an annual effect on the economy of $ 100 million or more or adversely affect in a material way the economy, a sector of the economy, productivity, competition,

jobs, the environment, public health or safety, or State,

local, or Tribal governments or communities;

( 2) create a serious inconsistency or otherwise interfere with an action taken or planned by another agency;

( 3) materially alter the budgetary impact of entitlements, grants, user fees, or loan programs or the rights and obligations of recipients thereof; or ( 4) raise novel legal or policy issues arising out of legal mandates, the President's priorities, or the principles set forth in the Executive Order."

Pursuant to the terms of Executive Order 12866, it has been determined that this rule is a " significant regulatory STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 270 action" because it raises novel legal or policy issues arising out of legal mandates. As such, this action was submitted to OMB for review. Changes made in response to OMB suggestions or recommendations will be documented in the public record.

B. Paperwork Reduction Act This action does not impose an information collection burden under the provisions of the Paperwork Reduction Act,

44 U. S. C. 3501 et seq. This rule merely interprets the requirement to develop State implementation plans to achieve a new or revised NAAQS. This requirement is prescribed in the CAA sections 110 and part D, subparts 1 and 2 of Title 1. The present final rule does not establish any new information collection burden apart from any that required by law. A SIP contains rules and other requirements designed to achieve the NAAQS by the deadlines established under the CAA, and also contains a demonstration that the State's requirements will in fact result in attainment.

Such a document is not considered information collection.

Burden means the total time, effort, or financial resources expended by persons to generate, maintain, retain, or disclose or provide information to or for a Federal agency.

This includes the time needed to review instructions; STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 271 develop, acquire, install, and utilize technology and systems for the purposes of collecting, validating, and verifying information, processing and maintaining information, and disclosing and providing information;

adjust the existing ways to comply with any previously applicable instructions and requirements; train personnel to be able to respond to a collection of information; search data sources; complete and review the collection of information; and transmit or otherwise disclose the information. An agency may not conduct or sponsor, and a person is not required to respond to a collection of information unless it displays a currently valid OMB control number. The OMB control numbers for EPA's regulations in 40 CFR are listed in 40 CFR part 9.

C. Regulatory Flexibility Act The Regulatory Flexibility Act generally requires an Agency to prepare a regulatory flexibility analysis of any rule subject to notice and comment rulemaking requirements under the Administrative Procedures Act or any other statute unless the Agency certifies the rule will not have a significant economic impact on a substantial number of small entities. Small entities include small businesses, small organizations, and small governmental jurisdictions. STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 272 For purposes of assessing the impacts of today's rule on small entities, small entity is defined as: ( 1) a small business that is a small industrial entity as defined in the U. S. Small Business Administration ( SBA) size standards.

( See 13 CFR 121.); ( 2) a governmental jurisdiction that is a government of a city, county, town, school district or special district with a population of less than 50,000; and ( 3) a small organization that is any not for profit enterprise which is independently owned and operated and is not dominant in its field.

After considering the economic impacts of today's rule on small entities, I certify that this action will not have a significant economic impact on a substantial number of small entities. This rule will not impose any requirements on small entities. Rather, this rule interprets the obligations established in the CAA for States to submit implementation plans in order to attain the 8 hour ozone NAAQS. We are issuing this rule so that States and Tribes will know how we plan to classify areas and transition from implementation of the 1 hour NAAQS to implementation of the 8 hour NAAQS.

D. Unfunded Mandates Reform Act Title II of the Unfunded Mandates Reform Act of 1995 STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 273 ( UMRA), Public Law 104 4, establishes requirements for Federal agencies to assess the effects of their regulatory actions on State, local, and Tribal governments and the private sector. Under section 202 of the UMRA, EPA generally must prepare a written statement, including a cost benefit analysis, for proposed and final rules with " Federal mandates" that may result in expenditures to State,

local, and Tribal governments, in the aggregate, or to the private sector, of $ 100 million or more in any 1 year.

Before promulgating an EPA rule for which a written statement is needed, section 205 of the UMRA generally requires EPA to identify and consider a reasonable number of regulatory alternatives and adopt the least costly, most cost effective or least burdensome alternative that achieves the objectives of the rule. The provisions of section 205 do not apply when they are inconsistent with applicable law.

Moreover, section 205 allows EPA to adopt an alternative other than the least costly, most cost effective or least burdensome alternative if the Administrator publishes with the final rule an explanation why that alternative was not adopted. Before EPA establishes any regulatory requirements that may significantly or uniquely affect small governments,

including Tribal governments, it must have developed under STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 274 section 203 of the UMRA a small government agency plan. The plan must provide for notifying potentially affected small governments, enabling officials of affected small governments to have meaningful and timely input in the development of EPA regulatory proposals with significant Federal intergovernmental mandates, and informing,

educating, and advising small governments on compliance with the regulatory requirements.

The EPA has determined that this rule does not contain a Federal mandate that may result in expenditures of $ 100 million or more for State, local, and Tribal governments, in the aggregate, or the private sector in any 1 year. The estimated administrative burden hour and costs associated with implementing the 8 hour, 0.08 ppm NAAQS were developed upon promulgation of the standardNAAQS and presented in Chapter 10 of U. S. EPA 1997, Regulatory Impact Analyses for the Particulate Matter and Ozone National Ambient Air Quality Standards, Innovative Strategies and Economics Group, Office of Air Quality Planning and Standards,

Research Triangle Park, N. C., July 16, 1997. The estimated costs presented there for States in 1990 dollars totaled $ 0.9 million. The corresponding estimate in 1997 dollars is $ 1.1 million. Should the more traditional classification STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 275 option be adopted as the implementation framework, these costs may increase modestly, but would not reach $ 100 million. Thus, today's rule is not subject to the requirements of section 202 and 205 of the UMRA.

The CAA imposes the obligation for States to submit SIPs to implement the 8 hour ozone NAAQS; in this rule, EPA is merely fleshing out those requirements. However, even if this rule did establish a requirement for States to submit SIPs, it is questionable whether a requirement to submit a SIP revision would constitute a Federal mandate in any case.

The obligation for a State to submit a SIP that arises out of section 110 and part D of the CAA is not legally enforceable by a court of law, and at most is a condition for continued receipt of highway funds. Therefore, it is possible to view an action requiring such a submittal as not creating any enforceable duty within the meaning of section 421( 5)( 9a)( I) of UMRA ( 2 U. S. C. 658( a)( I)). Even if it did,

the duty could be viewed as falling within the exception for a condition of Federal assistance under section 421( 5)( a)( i)( I) of UMRA ( 2 U. S. C. 658( 5)( a)( i)( I)).

In this rule, EPA has determined that this rule contains no regulatory requirements that may significantly or uniquely affect small governments, including Tribal STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 276 governments. Nonetheless, EPA carried out consultations with governmental entities affected by this rule.

E. Executive Order 13132: Federalism Executive Order 13132, entitled " Federalism" ( 64 FR 43255, August 10, 1999), requires EPA to develop an accountable process to ensure " meaningful and timely input by State and local officials in the development of regulatory policies that have federalism implications."

" Policies that have federalism implications" is defined in the Executive Order to include regulations that have " substantial direct effects on the States, on the relationship between the national government and the States,

or on the distribution of power and responsibilities among the various levels of government."

This rule does not have federalism implications. It will not have substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government, as specified in Executive Order 13132. As described in section D, above ( on UMRA), EPA previously determined the costs to States to implement the 8 hour ozone NAAQS to be approximately $ 1 million. While this rule considers options not addressed at STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 277 the time the NAAQS were promulgated, the costs for implementation under these options would may rise modestly.

This rule fleshes out the statutory obligations of States in implementing the 8 hour ozone NAAQS. Finally, the CAA establishes the scheme whereby States take the lead in developing plans to meet the NAAQS. This rule would not modify the relationship of the States and EPA for purposes of developing programs to implement the NAAQS. Thus,

Executive Order 13132 does not apply to this rule.

Although section 6 of Executive Order 13132 does not apply to this rule, EPA actively engaged the States in the development of this rule. EPA held regular calls with representatives of State and local air pollution control agencies. EPA also held three public meetings at which it described the approaches it was considering and provided an opportunity for States and various other governmental officials to comment on the options being considered.

Finally, EPA held three public hearings after the proposed rule was published to obtain public comments.

F. Executive Order 13175: Consultation and Coordination with Indian Tribal Governments Executive Order 13175, entitled " Consultation and Coordination with Indian Tribal Governments" ( 65 FR 67249, STAFF DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE   4/ 13/ 04 1: 30 pm compared with 2/ 26/ 04 version 278 November 9, 2000), requires EPA to develop an accountable process to ensure " meaningful and timely input by tribal officials in the development of regulatory policies that have tribal implications." This determination is stated below.

This rule concerns the implementation of the 8 hour ozone standardNAAQS in areas designated nonattainment for that standardNAAQS. The CAA provides for States and Tribes to develop plans to regulate emissions of air pollutants within their jurisdictions. The regulations flesh out the statutory obligations of States and Tribes that develop plans to implement the 8 hour ozone NAAQS. The TAR gives Tribes the opportunity to develop and implement CAA programs such as the 8 hour ozone NAAQS, but it leaves to the discretion of the Tribe whether to develop these programs and which programs, or appropriate elements of a program,

they will adopt.