[Federal Register: April 29, 2008 (Volume 73, Number 83)]
[Rules and Regulations]
[Page 23086-23101]
[DOCID:fr29ap08-6]

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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[EPA-R05-OAR-2004-WI-0002; FRL-8557-6]

Approval and Promulgation of Air Quality Implementation Plans;
Wisconsin; Redesignation of the Forest County Potawatomi Community
Reservation to a PSD Class I Area

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final rule.

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SUMMARY: In this final action, EPA is approving the request by the
Forest County Potawatomi Community's (FCP Community) Tribal Council to
redesignate certain portions of the FCP Community Reservation as a non-
Federal Class I area under the Clean Air Act (Act or CAA) program for
the Prevention of Significant Deterioration (PSD) of air quality. These
regulations are designed to preserve the air quality in national parks
and other areas that are meeting the National Ambient Air Quality
Standards (NAAQS). The Class I designation will result in lowering the
allowable increases in ambient concentrations of particulate matter,
sulfur dioxide, and nitrogen dioxide on the Reservation.

DATES: This final rule is effective on May 29, 2008.

ADDRESSES: EPA has established a docket for this action under Docket ID
No. EPA-R05-OAR-2004-WI-0002. All documents in the docket are listed on
the http://www.regulations.gov Web site. Although listed in the index,
some information is not publicly available, e.g., confidential business
information or other information whose disclosure is restricted by
statute. Certain other material, such as copyrighted material, is not
placed on the Internet and will be publicly available only in hard copy
form. Publicly available docket materials are available either
electronically through http://www.regulations.gov or in hard copy at
the Environmental Protection Agency, Region 5, Air and Radiation
Division, 77 West Jackson Boulevard, Chicago, Illinois 60604-3507. This
Facility is open from 8:30 a.m. to 4:30 p.m. Central Standard Time,
Monday through Friday, excluding legal holidays. We recommend that you
telephone Constantine Blathras at<PHONE_NUMBER> before visiting Region
5's office. Hard copies of these docket materials are also available in
the EPA Headquarters Library, Room Number 3334 in the EPA West
Building, located at 1301 Constitution Ave., NW, Washington, DC. The
EPA/DC Public Reading Room hours of operation will be 8:30 a.m. to 4:30
p.m. Eastern Standard Time (EST), Monday through Friday, excluding
legal holidays. The telephone number for the Public Reading Room is
(202) 566-1744.

FOR FURTHER INFORMATION CONTACT: Constantine Blathras, Air Permits
Section, Air Programs Branch (AR-18J), Environmental Protection Agency,
Region 5, 77 West Jackson Boulevard, Chicago, Illinois 60604-3507;
telephone number:<PHONE_NUMBER>; fax number:<PHONE_NUMBER>; e-mail
address<EMAIL_ADDRESS>
SUPPLEMENTARY INFORMATION: Throughout this document whenever ``we,''
``us,'' or ``our'' is used, we mean EPA.

I. General Information

A. Does This Action Apply to Me?

    This action will apply to applicants to the PSD construction permit
program on Class I trust lands of the FCP Community.

B. Where Can I Obtain Additional Information?

    In addition to being available in the docket, an electronic copy of
this final rule is also available on the World Wide Web. Following
signature by the EPA Administrator, a copy of this final rule will be
posted on the EPA's New Source Review (NSR) Web site, under Regulations
& Standards, at http://www.epa.gov/nsr/actions.html.

C. How Is This Action Organized?

    The information presented in this action is organized as follows:

I. General Information
    A. Does This Action Apply to Me?
    B. Where Can I Obtain Additional Information?
    C. How is this Action Organized?
II. Background
    A. The Clean Air Act Prevention of Significant Deterioration
(PSD) Program and Class I Area Redesignations
    B. The Forest County Potawatomi Community Redesignation Request
III. Overview of This Final Action
    A. What We Proposed
    B. Final Action and Differences From Proposal
IV. Basis for Final Action
    A. Class I Redesignation Requirements
    1. EPA's Interpretation of Section 164 of the Clean Air Act
    B. Lands Suitable for Redesignation
    C. EPA's Role in Evaluating Class I Redesignations
    D. Impact of Dispute Resolution on Redesignation
    E. Appropriate Mechanism for Codifying Class I Area
    1. Role of Federal Implementation Plans (FIP)
    2. Contents of Implementation Plan
    F. Air Program Implementation in Indian Country/Role of Tribes
in Protecting Air Quality
    G. Air Quality Related Values (AQRVs) of Redesignated Lands
    H. Impact of Class I Redesignation on Minor Sources
V. Statutory and Executive Order Reviews
    A. Executive Order 12866: Regulatory Planning and Review
    B. Paperwork Reduction Act
    C. Regulatory Flexibility Act (RFA), as Amended by the Small
Business Regulatory Enforcement Fairness Act of 1966 (SBREFA), 5
U.S.C. 601 et seq.
    D. Unfunded Mandates Reform Act
    E. Executive Order 13132: Federalism
    F. Executive Order 13175: Consultation and Coordination With
Indian Tribal Governments
    G. Executive Order 13045: Protection of Children From
Environmental Health & Safety Risks
    H. Executive Order 13211: Actions That Significantly Affect
Energy Supply, Distribution, or Use
    I. National Technology Transfer Advancement Act
    J. Executive Order 12898: Federal Actions To Address
Environmental Justice in Minority Populations and Low-Income
Populations
    K. Congressional Review Act
VII. Statutory Authority

II. Background

A. The Clean Air Act Prevention of Significant Deterioration (PSD)
Program and Class I Area Redesignations

    The CAA provides a comprehensive structure for ``protect[ing] and
enhanc[ing] the quality of the Nation's air resources[.]'' See section
101(b) of the CAA. The basis of the CAA's regulatory structure is the
NAAQS, which specify the maximum permissible concentrations of certain
pollutants in the ambient air. See section 108 and 109 of the CAA.
Furthermore, Part C of Title I of the CAA provides for the prevention
of significant deterioration of air quality. The PSD program sets forth
procedures for the preconstruction review and permitting of new and
modified major stationary sources of air pollution locating in areas
meeting the NAAQS, i.e., ``attainment'' areas, or in areas for which
there is insufficient information to classify an area as either
attainment or nonattainment, i.e., ``unclassifiable'' areas. These
areas are referred to as ``PSD areas.'' See section 165(a) of the CAA.
``Major stationary sources'' are large industrial sources which emit or
have the potential to emit 250 tons per year (tpy) or more of a
regulated air pollutant (100 tpy or more if the source falls in one of
28 specified categories). See 40 Code of Federal Regulations (CFR)
section 52.21(b). The applicability of the PSD program to a particular
source must be determined in advance of construction, and it is
pollutant specific. To obtain a PSD permit, a major stationary source
must install the ``best available control technology'' (BACT) to
control emissions of regulated pollutants emitted in significant
amounts. See section 165(a)(4) and section 169(3) of the CAA; 40 CFR
52.21(j). PSD permits also require the source to demonstrate that it
will not contribute to a violation of the NAAQS or applicable PSD
increments (the maximum allowable air quality deterioration allowed in
a PSD area). See section 165(a)(3).
    The CAA provides three basic classifications for PSD areas: Class
I, II and III. For each classification, the PSD regulations establish
the incremental amount of air quality deterioration allowed. However
and in all cases, the NAAQS set the maximum allowable concentration
levels of certain pollutants that may not be exceeded in a PSD area,
irrespective of any increment. Increments have been established for
three pollutants--Particulate Matter (PM10), Sulfur Dioxide
(SO2) and Nitrogen Dioxide (NO2)--and for a
variety of averaging periods, which correspond to the averaging periods
for the NAAQS for those pollutants. See 40 CFR 52.21(c). Class I areas
include national parks greater than 6,000 acres in size, national
wilderness areas greater than 5,000 acres in size and other natural
areas of special concern; the smallest increments are specified for
those areas. In addition, when Congress enacted the PSD program in
1977, it provided that these areas may not be redesignated to another
classification. See section 162(a) of the CAA. Class II applies to
areas in which pollutant increases accompanying moderate growth are
allowed. Under the 1977 amendments to the CAA, all areas, other than
the mandatory Federal Class I areas were initially designated as Class
II PSD areas. However, States and Tribes have the authority to
redesignate Class II areas to Class I to provide additional air quality
protection and some Tribes have done so.\1\ Class III applies to those
areas in which more air quality deterioration is considered acceptable.
States and Tribes have the authority also to redesignate Class II areas
to Class III to promote development, but to date; none have chosen to
do so.
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    \1\ These are the Northern Cheyenne Reservation, the Flathead
Indian Reservation, the Fort Peck Indian Reservation, and the
Spokane Indian Reservation. See 40 CFR 52.1382(c), 52.2497(c), and
52.144(c).
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    The CAA directs the Secretary of the Interior, or other appropriate
Federal land manager, to review other Federal lands and recommend for
redesignation to Class I any appropriate areas ``where air quality
related values (AQRVs) are important attributes of the area.'' See
section 164(d) of the CAA. The Act does not define AQRVs nor identify
specific AQRVs other than visibility (See section 165(d)(2)(B) of the
Act), but in the legislative history to the Act, AQRVs are described as
follows:

    The term ``air quality related values'' of Federal lands
designated as Class I includes the fundamental purposes for which
such lands have been established and preserved by the Congress and
the responsible Federal agency. For example, under the 1916 Organic
Act to establish the National Park Service (16

U.S.C. 1), the purpose of such national park lands ``is to conserve
the scenery and the natural historic objects and the wildlife
therein and to provide for the enjoyment of the same in such manner
and by such means as will leave them unimpaired for the enjoyment of
future generations.''

    Nevertheless, Class I status is not reserved for special Federal
areas alone. Section 164 of the CAA provides to States and Indian
governing bodies the ultimate authority to reclassify any lands within
their borders as Class I. The CAA specifies that ``a State may
redesignate such areas as it deems appropriate as Class I areas.'' See
section 164(a) of the CAA. Tribes have similar authority to redesignate
``lands within the exterior boundaries of reservations.''
    The procedural requirements for a Class I redesignation by a Tribe
are set out in section 164(c) of the CAA and are further defined in the
implementing regulations at 40 CFR 52.21(g)(4). These provisions
explain the steps a Tribe needs to follow to request redesignation of
reservation lands. The EPA Administrator may disapprove a redesignation
request only if the Administrator finds that the proposal did not meet
the procedural requirements or was inconsistent with the CAA. See 42
U.S.C. 164(b)(1)(C)(2).

B. The Forest County Potawatomi Community Redesignation Request

    The FCP Community is a federally recognized Indian Tribe recognized
by a congressional Act of June 23, 1913 (38 Stat. 102). The 1913 Act
provided that 11,786 acres of non-contiguous land purchased by the
Federal government would be set aside for the purpose of making
allotments to the Wisconsin Potawatomi Indians (which included the FCP
Community). While the lands were purchased for making allotments, no
allotments were ever made due to changes in Federal allotment policies.
Thus, title to the land remained with the United States until 1988,
when Congress passed legislation to place the land in trust for the FCP
Community, and to recognize explicitly all of these lands as belonging
to the FCP Community.\2\ The majority of the FCP Community's
reservation lands are located in Forest County, Wisconsin, with the
remaining acreage located in six neighboring townships.
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    \2\ On August 6, 1987, the Senate enacted Bill 1602 which
declared that the trust lands that had been purchased pursuant to 38
Stat. 102 are ``hereby declared to be the reservation of the Forest
County Potawatomi Community of Wisconsin.''
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    The FCP Community is downwind of key areas of industrial
development. The reservation is located in the North Central Wisconsin
Intra-State Air Quality Control Region 238. Land in the
northern counties of this region is mostly forested. Lands south of
Madison County in this region are mostly agricultural. Population and
industry is concentrated southwest and west of the reservation, in the
areas of Wausau, Stevens Point, Wisconsin Rapids, and Rhinelander. At
present, Forest County itself has little industrial development, and
the CAA's PSD minor source baseline date, which is the date on which
the first complete application for a PSD permit is filed in a
particular area, has not been triggered. Thus, at this time, there has
been no PSD increment consumption in this area.
    On February 14, 1995, the FCP Community submitted its formal
request for redesignation to EPA's Region 5 office. FCP Community's
redesignation request proposes to reclassify as Class I those trust
parcels of 80 acres or more located in Forest County. See Notice of
Proposed Rulemaking, 60 FR 33779 (June 29, 1995). A list of these
parcels can be found in the codification section of this notice labeled
Subpart YY-Wisconsin, Forest County Potawatomi Reservation (b). The FCP
Community explained its reasons for requesting redesignation as
follows:

    ``* * * the Forest County Potawatomi Community respects Mother
Earth, and is aware of clean air as being a valuable resource that
all living things depend upon to exist, and, * * * the Forest County
Potawatomi Community wish to continue to strive towards self-
determination, which will be strengthened by codes and land use
plans that are compatible with their renewable resources and
culture, and, * * * the present level of protection given to the
Forest County Potawatomi air resource does not provide the level of
protection the Tribe wishes to give their air, which they want to
maintain as very pristine. * * *'' See Technical Report at 2.

The FCP Community reaffirmed these reasons in comments submitted to EPA
on April 27, 2007, by citing the unique history of the reservation and
FCP Community, the location of the headwaters of several wild and
scenic rivers in the area, the importance of fish as a nutritional and
recreational resource, the location of key wetlands in the area, the
FCP Community's desire to protect and restore Devil's Lake, and the
designation of portions of the area including the FCP Community
Reservation and surrounding areas as eligible for listing in the
National Historic Register as ``Traditional Cultural Property.'' A
Traditional Cultural Property is one that meets the criteria for
listing in the National Register and which has an ``association with
cultural practices or beliefs of a living community,'' as rooted in
that community's history and which is important because of its role in
maintaining the continuing cultural identity of the community.\3\
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    \3\ Jeff Crawford, Forest County Potawatomi Attorney General,
``Comments Regarding U.S. Environmental Protection Agency's proposed
Federal Implementation Plan under the Clean Air Act for Certain
Trust Lands of the FCP Community if Designated as a PSD Class I
Area'' [hereafter FCP 2007 Comments], April 2007, at 3-10.
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    Additionally, the FCP Community described the central importance of
``purity'' to its cultural and spiritual practices, where natural
resources ``must be drawn from spiritually pure natural environments.
Concern about access to these resources and the ability of the
environment to provide the pure resources needed to sustain Potawatomi
culture occupies the thoughts and prayers of the community.'' FCP
Community member Jim Thunder, stated: ``Today we are abusing our Mother
Earth. Our air, water and soil are polluted. We are told not to eat
fish out of certain streams and lakes. I pray to our creator that we
look back so that we may see ahead. Let us examine our lives so that we
are respectful to our fellow humans and to nature. Let us respect our
children and, above all, let us live our lives in accordance with our
beliefs.'' \4\
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    \4\ Id. at 10.
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    Finally, the FCP Community also explains that clean air is
important to the Tribal enterprises and economy of the Tribe, and to
the northern Wisconsin area, where recreation and tourism are a primary
component of the economic base and a key projected component of
economic growth for the Tribe and for the region.\5\
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    \5\ ``Tourism in these seven counties [Forest, Oneida, Florence,
Langlade, Marinette and Oconto] grew by 117% between 1994 and 2005
compared to 107% for Wisconsin as a whole [citation omitted]. In
2005 in these seven counties, the $715 million spent by tourists
created some 18,005 equivalent full-time jobs and generated some
$23.2 million in revenue for local governments through such means as
property taxes, sales taxes, lodging taxes, and so forth [citation
omitted].'' Id. at 14.
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III. Overview of This Final Action

    EPA is taking final action on its evaluation of the FCP Community's
Tribal Council request to redesignate certain portions of the FCP
Reservation as a non-Federal Class I area under the CAA program for the
prevention of significant deterioration of air quality. We have decided
to approve this request. The Class I designation will result in
lowering the allowable increases in ambient concentrations of PM,
SO2, and NOX on the Reservation.

A. What We Proposed

    On June 29, 1995, and July 10, 1997, EPA proposed to approve a
request by the FCP Community Tribal Council to redesignate lands within
the FCP Community Reservation in the State of Wisconsin to Class I
under EPA's regulations for prevention of significant deterioration of
air quality (60 FR 33779, 62 FR 37007). The Class I designation will
result in lowering the allowable increases in ambient concentrations of
PM, SO2, and NOX on certain of the FCP
Community's lands.
    On December 18, 2006, EPA proposed that it would promulgate a
Federal Implementation Plan (FIP) if it approves FCP Community's
request, with the FIP to be implemented by EPA unless or until it is
replaced by a Tribal Implementation Plan (TIP).

B. Final Action and Differences From Proposal

    In this final action, we are approving FCP's Community request to
redesignate certain reservation lands to Class I status. EPA finds that
the FCP Community has met the applicable procedural requirements and
thus its redesignation request must be approved.
    However, we are amending, based on comments received, the language
proposed in the December 18, 2006, rulemaking, which had stated in
pertinent part the following modification to the FIP for the PSD
program in Wisconsin:

    (e) Regulations for the prevention of the significant
deterioration of air quality. The provisions of Sec.  52.21(b)
through (w) are hereby incorporated and made a part of the
applicable State plan for the State of Wisconsin for sources wishing
to locate in Indian country; and sources constructed under permits
issued by EPA, except as specified in paragraph (f) of this section.
    (f) Forest County Potawatomi Community reservation lands 80
acres and over in size and located in Forest County are designated
as a Class I area for the purposes of prevention of significant
deterioration of air quality. The individual parcels listed below
all consist of a description from the Fourth Principal Meridian. * *
*
    (8) Section 2 of T36N R13E* * *
    (26) N\1/2\ of Section 22 of T35N R16E* * *
    (27) SE\1/4\ of Section 22 of T35N R16E* * *

    First of all, the FCP Community noted that the draft language was
not based on the current language for 40 CFR 52.2581, which provides:

    (e) Regulations for the prevention of significant deterioration
of air quality. The provisions of Sec.  52.21 except paragraph
(a)(1) are hereby incorporated and made a part of the applicable
State plan for the State of Wisconsin for sources wishing to locate
in Indian country; and sources constructed under permits issued by
EPA.

EPA agrees and for that reason the current language should be the
starting point to any modification of this provision.
    Second, the FCP Community stated that EPA's proposed FIP language
``creates ambiguity regarding whether the requirements of 40 CFR 52.21
apply to the FCP Community's Reservation.'' \6\ EPA intends that the
requirements of 40 CFR 52.21 apply to the parcels redesignated as Class
I, and has modified the proposed FIP language accordingly to remove the
phrase ``except as specified in paragraph (f) of this section. The
revised rulemaking text is as follows:

    \6\ FCP Comment letter, 2007, at 31.
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    (e) Regulations for the prevention of significant deterioration
of air quality. The provisions of Sec.  52.21 except paragraph
(a)(1) are hereby incorporated and made a part of the applicable
State plan for the State of Wisconsin for sources wishing to locate
in Indian country; and sources constructed under permits issued by
EPA.
    (f) Forest County Potawatomi Community Reservation.
    (1) The provisions for prevention of significant deterioration
of air quality at 40 CFR 52.21 are applicable to the Forest County
Potawatomi Community Reservation, pursuant to Sec.  52.21(a).
    (2) In accordance with section 164 of the Clean Air Act and the
provisions of 40 CFR 52.21(g), those parcels of the Forest County
Potawatomi Community's land 80 acres and over in size which are
located in Forest County are designated as a Class I area for the
purposes of prevention of significant deterioration of air quality.
For clarity, the individual parcels are listed in 40 CFR
52.2581(f)(2).

    Finally, the FCP Community has commented that the three parcels,
numbers 8, 26, and 27 have been incorrectly identified either in the
description of lands provided in the Tribe's letter of February 24,
1998, or in EPA's list of parcels proposed for redesignation published
in the December 18, 2006, proposed rulemaking. These lands are,
however, correctly identified on the December 13, 1994, S. Funk map
provided by the Tribe with its redesignation request. This map was
specifically reviewed by the Bureau of Indian Affairs, Minneapolis
District office, which certified that the lands marked for proposed
redesignation are lands held in trust for the Tribe. Letter from Robert
Jaeger, Superintendent, Bureau of Indian Affairs to David Kee,
Director, Region 5 Air and Radiation Division on April 16, 1998. This
map has been available for public notice and comment during the
pendancy of this rulemaking. Accordingly, EPA has corrected the legal
description of parcel numbers 8, 26, and 27 in the list of lands
redesignated to Class I pursuant to today's action.

IV. Basis for Final Action

A. Class I Redesignation Requirements

    EPA is taking this action in accordance with the requirements of
section 164 of the CAA. In section 164 of the Act, Congress provides
States and Tribes the ultimate authority to reclassify any lands within
their borders as Class I based on the following statutory and
regulatory requirements:
    (1) At least one public hearing must be held in accordance with
procedures established in 40 CFR 51.102. See 40 CFR 52.21(g)(2)(i).
    (2) Other States, Indian Governing Bodies, and Federal Land
Managers whose lands may be affected by the proposed redesignation must
be notified at least 30 days prior to the public hearing. See 40 CFR
52.21(g)(2)(ii).
    (3) At least 30 days prior to the Tribe's public hearing, a
discussion of the reasons for the proposed redesignation including a
satisfactory description and analysis of the health, environmental,
economic, social and energy effects of the proposed redesignation must
be prepared and made available for public inspection. See 40 CFR
52.21(g)(2)(iii).
    (4) Prior to the issuance of the public notice for a proposed
redesignation of an area that includes Federal lands, the Tribe must
provide written notice to the appropriate Federal Land Manager and
afford an adequate opportunity for the Federal Land Manager to confer
with the Tribe and submit written comments and recommendations. See 40
CFR 52.21(g)(2)(iv).
    (5) The proposal to redesignate has been made after consultation
with the elected leadership of local and other substate general purpose
governments in the area covered by the proposed redesignation. See 40
CFR 52.21(g)(2)(v).
    (6) Prior to proposing the redesignation, the Indian Governing Body
must consult with the State(s) in which the Reservation is located and
that border the Reservation. See 40 CFR 52.21(g)(4)(ii).
    (7) Following completion of the procedural steps and consultation,
the Tribe submits to the Administrator a proposal to redesignate the
area. See 40 CFR 52.21(g)(4).
1. EPA's Interpretation of Section 164 of the Clean Air Act
    In addition to reiterating the CAA section 164 requirements, the
following discussion identifies the actions taken

by the FCP Community to fulfill those requirements and clarifies our
interpretation of the requirements in light of several comments we
received.
    1. At least one public hearing must be held in accordance with
procedures established in 40 CFR 51.102. See 40 CFR 52.21(g)(2)(i).
    The regulations require that a public hearing on a proposed
redesignation be conducted in accordance with 40 CFR 51.102, which
requires the following: A minimum of 30 days notice, ``prominent
advertisement'' regarding the hearing in the affected area,
availability of plans; notification to the EPA Administrator, local air
pollution authorities, and preparation of a record of the proceedings.
See 40 CFR 51.102(a)-(f).
    The FCP Community held a public hearing on the proposed
redesignation on September 29, 1994, at the Potawatomi Tribal Hall, in
Crandon, Wisconsin. The FCP Community's redesignation request included
a certification that the hearings were held in compliance with
applicable notice requirements, including adequate notice to
appropriate local, State and Federal entities, as well as public
hearing requirements. A transcript of the hearing, notices (including
copies of advertisements), letter invitations, copies of comments
received, a transcript of the hearing, and response to comments was
included in the FCP application for redesignation. Accordingly, EPA
finds that the hearing held by the FCP Community was adequate.
    2. Other States, Indian Governing Bodies, and Federal Land Managers
whose lands may be affected by the proposed redesignation must be
notified at least 30 days prior to the public hearing. See 40 CFR
52.21(g)(2)(ii).
    The FCP Community held its public hearing on September 29, 1994.
Notices of the public hearing, as well as notification of the public
comment period and copies of supporting documents, were sent to dozens
of governmental entities and interest groups in a letter dated August
26, 1994. Entities noticed included EPA Region 5, the States of
Wisconsin and Michigan \7\ (even though the lands covered by the
redesignation lie wholly within Forest County, Wisconsin), the Bureau
of Indian Affairs, the U.S. Fish and Wildlife Service; nine Wisconsin
Tribal governments; nineteen counties and townships; local planning
commissions in Wausau, Eau Claire, and Green Bay, Wisconsin; and, many
other organizations. The FCP Community also published notices of the
September 29, 1994, public hearing in four local newspapers, which ran
between August 29, 1994 and September 1, 1994. Representatives from
many of these governmental entities and organizations provided comments
at the hearing or in writing. The FCP Community responded to these and
other comments received from private individuals and commercial
entities in its February 1995 ``Responses to Common Questions and
Issues in Written Comments on the Proposed Forest County Potawatomi
Community PSD Class I Area Redesignation,'' Technical Report at
Appendix A. For a copy of this document, please visit the public docket
of this rulemaking.
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    \7\ EPA examined correspondence between the Tribe and the State
of Michigan and confirmed that the State received timely
notification of the public hearing.
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    In light of the outreach, public notice, opportunity for comment,
and information distributed by the FCP Community in preparation for
making their request to EPA for redesignation, EPA finds that the FCP
Community provided adequate opportunity for notice, comment, and
consultation.
    3. At least 30 days prior to the Tribe's public hearing, a
discussion of the reasons for the proposed redesignation including a
satisfactory description and analysis of the health, environmental,
economic, social and energy effects of the proposed redesignation must
be prepared and made available for public inspection. See 40 CFR
52.21(g)(2)(iii).
    Section 164(b)(1)(A) of the CAA requires that a State or Tribe
prepare for public comment a ``satisfactory description and analysis of
the health, environmental, economic, social, and energy effects of the
proposed redesignation.'' However, neither the CAA nor EPA regulations
define ``satisfactory description and analysis,'' as that term is used
in CAA section 164(b) and 40 CFR 52.21(g)(2). In construing its
meaning, EPA considered Congressional intent that EPA's review of a
``description and analysis'' be deferential. In addition, EPA
considered the question: ``Satisfactory to whom?'' Many commenters
argued that the Tribe's request should be denied because they were
unsatisfied with the level of documentation in the Tribe's application
regarding economic impacts and whether the Tribe had sufficiently
demonstrated that Class I redesignation would not have an adverse
economic impact on surrounding areas, be they local communities,
adjacent states, or states across the nation. EPA disagrees.
    In enacting section 164(b), it is clear that Congress intended to
entrust EPA with the authority to set a deferential standard for
``satisfactory description and analysis.'' Thus, EPA stated in its
final rule on the Yavapai Apache Class I redesignation that: ``[The use
of the word ``satisfactory''] in the statute and implementing
regulations suggests a relatively low threshold. Congress did not
dictate that the analysis be comprehensive or exhaustive. Further, the
statutory language does not assign any specific weight to the
consideration of health, environmental economic, social or energy
effects, or suggest that one consideration should be given priority
over another. * * * See ``Arizona Redesignation of the Yavapai Apache
Reservation to a PSD Class I Area,'' 61 FR 56461-56464 (November 1,
1996).
    Therefore, there is no requirement that a State or Tribe conduct a
balancing test of the costs and benefits of a redesignation request,
nor that the various factors to be considered in its analysis need to
be balanced against one another. EPA has taken the position that the
fact that no weight or priority is assigned to any particular factor,
taken together with the broad redesignation discretion conferred on
States and Tribes, indicates that the Tribe does not have to justify or
overcome a balancing test in its redesignation request or show that a
proposed redesignation will have no impact on the surrounding
community.
    Legal precedent clearly supports EPA's interpretation. In Nance v.
EPA, 645 F.2d 701 (9th Cir. 1981), petitioners claimed that the
Northern Cheyenne Tribe's analysis was inadequate in several respects.
However, the Ninth circuit court rejected the claim that the Tribe was
required to meet exacting analysis requirements and held that the Tribe
had considered the factors identified in EPA's regulations. Nance v.
EPA, 645 F.2d at 712. EPA's decision in this case was upheld under the
far more exacting pre-1977 regulatory regime that expressly provided
for an analysis that included consideration of growth anticipated,
regional impacts, and social, environmental and economic effects as
well as stricter EPA scrutiny of the analysis.
    Moreover, the court found that the Tribe's decision was supported
and strengthened by the policy for maintaining clean air embodied in
the CAA:

    [T]he Clean Air Act contains a strong presumption in favor of
the maintenance of clean air, and the nature of a decision which
simply requires that the air quality be maintained at a certain
level prevents any exact prediction of its consequences. The Tribe
has considered the factors enumerated in EPA regulations, and its
choice in favor of the certainty of clean air is a choice

supported by the preferences embodied in the Clean Air Act.

Nance v. EPA, 645 F.2d at 712.
    In another case regarding the approval of a redesignation request,
in this case for the Yavapai Apache Tribe (See Administrator, State of
Arizona v. EPA, 151 F.3d at 1211, 9th Cir. 1998, hereafter Arizona v.
EPA), the Ninth Circuit also deferred to EPA's conclusion that the
existing statutory requirement of a ``satisfactory description and
analysis'' is a relatively low threshold. The court explained that the
1977 CAA amendments to the PSD provisions, which are still in the
statute, changed previous law by eliminating EPA's previous authority
to override a classification by a local government on the basis that
the local government did not properly weigh energy, environment, and
other factors. Arizona v. EPA at 151 F.3d at 1211 (citing legislative
history). Moreover, EPA's role in reviewing redesignation requests is
so limited it cannot disapprove a request unless it finds that the
redesignation ``does not meet the procedural requirements'' of the Act,
CAA Section 164(b)(2); this statutory limitation provides no support
for the commenters' suggestion that EPA has broad authority to review
the quality of the ``description and analysis'' much less to disapprove
a redesignation unless the description and analysis are
``satisfactory.''
    For those reasons, EPA finds that the FCP Community met the
statutory requirement to provide a ``satisfactory description and
analysis.'' Nevertheless, many commenters argued that the Tribe's
request should be denied because they were unsatisfied with the level
of documentation in the Tribe's application regarding economic impacts
and whether the Tribe had sufficiently demonstrated that Class I
redesignation would not have an adverse economic impact on surrounding
areas, be they local communities, adjacent states, or states across the
nation.\8\
---------------------------------------------------------------------------

    \8\ FCP 2007 Comments, at 15.
---------------------------------------------------------------------------

    As discussed previously, neither the CAA nor its implementing
regulations require a State or Tribe to assess the impact of a proposed
redesignation on areas outside the lands proposed for redesignation,
nor to demonstrate that a request for redesignation would not impact
these areas. Nevertheless, the FCP Community's application for
redesignation contained information to show that the Tribe had examined
the existing economy of the region and analyzed the potential impact of
Class I redesignation on the existing and future projected economic
growth in the region, concluding that ``The development of large
industrial projects will very likely be effected [sic] more by economic
viability, external market conditions, and other existing local
environmental and land use restrictions than by the Class I
redesignation.'' \9\
---------------------------------------------------------------------------

    \9\ Technical Report, included in Application, at 56.
---------------------------------------------------------------------------

    Furthermore, supplemental information submitted by the FCP
Community in June 1995, contained an additional analysis showing that
the anticipated (at that time) PSD caliber sources planning to
construct or expand, as well as projected area economic growth, would
not be adversely impacted by the proposed Class I area. The analysis
concluded that ``Class I redesignation will not effect the operations
of any existing industry because the PSD program only effects the
development of new air pollutant sources.'' Therefore, the Technical
Report concluded, ``The redesignation will not result in the loss of
any existing jobs, nor in the ``downsizing'' or closing of any existing
businesses. It will only require major new development projects to
analyze the effects of and control the emission of air pollutants, so
that the existing air quality remains clean [emphasis in original].''
\10\
---------------------------------------------------------------------------

    \10\ Technical Report at 55. Supplemental information submitted
by the FCP Community in its 2007 comments on the proposed FIP
provided additional information to show that economic development
did not slow or decrease near Class I areas.
---------------------------------------------------------------------------

    Moreover, the Tribe prepared a Technical Report and released it for
public comment in advance of its public hearing. This Technical Report
examines the environmental, health, economic, social and energy effects
of the proposed redesignation both on and off FCP Community reservation
lands. The analysis includes a survey of present conditions and
presents projected impacts of redesignation on health, employment, and
natural resources, including the project impacts to aquatic, forest and
wetlands ecosystems; and to fish and wildlife populations. The FCP
Community's Technical Report also provides a discussion of the
projected effects of redesignating the FCP Community Reservation lands
to Class I and the effects of remaining Class II.
    Additionally, although there is no statutory obligation to identify
AQRVs prior to seeking redesignation, the FCP Community's Technical
Report and a supplementary support document dated June 14, 1995,
provide the FCP Community's analysis of potential impacts of the two
AQRVs identified (mercury deposition and acid rain) in the context of
the health, environmental, energy, economic, and social factors
analysis, both for lands subject to the redesignation request, and
those located outside the proposed area. The Technical Report notes in
several instances that adverse impacts on AQRVs, which occur at
concentrations lower than Class I increments, might pose an additional
restriction on the sitting of large projects.
    In conclusion, upon review of the documentation submitted by the
FCP Community, EPA finds that the FCP Community has fully met the
requirement in CAA section 164(b)(1)(A) and 40 CFR 52.21(g)(2)(iii) to
provide a ``satisfactory description and analysis of the health,
environmental, economic, social, and energy effects of the proposed
redesignation.''
    4. Prior to the issuance of the public notice for a proposed
redesignation of an area that includes Federal lands, the Tribe must
provide written notice to the appropriate Federal Land Manager (FLM)
and afford an adequate opportunity for the FLM to confer with the Tribe
and submit written comments and recommendations. See 40 CFR
52.21(g)(2)(iv).
    In addition to consultation undertaken by the FCP Community with
Federal, State, and local agencies, the FCP Community consulted
directly with the Bureau of Indian Affairs (BIA) regarding FLM
responsibilities. After those consultations, the BIA informed the FCP
Community of that Agency's support of the Class I redesignation request
and that Agency's view that the Tribe would be the appropriate land
manager for the lands subject to the redesignation request.\11\ EPA
finds, accordingly, that the Tribe has satisfied this requirement.
---------------------------------------------------------------------------

    \11\ Letter from Acting Superintendent Robert C. Ford, Great
Lakes Agency, Bureau of Indian Affairs, U.S. Department of Interior,
to Al Milham, Chairman, February 15, 1994.
---------------------------------------------------------------------------

    5. The proposal to redesignate has been made after consultation
with the elected leadership of local and other substate general purpose
governments in the area covered by the proposed redesignation. See 40
CFR 52.21)(g)(2)(v).
    The lands covered by the proposed redesignation lie wholly within
Forest County, Wisconsin, and are comprised wholly of reservation lands
held in federal trust. The CAA requires notice to governmental entities
``in the area covered by the proposed redesignation.'' See
52.21(g)(2)(v) (emphasis added). There is no requirement, however, for
a finding on what areas may be affected

by a proposed redesignation or notice to such governments in such
areas. As discussed in Section IV.A.1-2, the FCP Community's
application contains a list of dozens of federal, state and local
governmental offices which were notified of the Tribe's intended
action. Additionally, the FCP Community developed a fact sheet and held
a consultation session with federal, state, and local governmental
representatives to further explain and hear concerns regarding the
proposed action, besides the required public hearing. Further, the FCP
Community received numerous comments on its proposed action, to which
it prepared a response to comments document. Thus, and even while the
regulation does not provide a standard for ``consultation,'' EPA deems
the actions of the FCP Community to have provided sufficient notice and
opportunity for comment.
    6. Prior to proposing the redesignation, the Indian Governing Body
must consult with the State(s) in which the Reservation is located and
that border the Reservation. See 40 CFR 52.21(g)(4)(ii).
    The FCP Community's reservation is located wholly within the State
of Wisconsin. For that reason, the FCP Community included several
Wisconsin offices and agencies in its notice on the proposed
redesignation and public hearing, as discussed in section IV.A.1-2
above. Nevertheless, the FCP Community also provided notice of its
intent to redesignate to several divisions of the Michigan Department
of Environmental Quality, although the State of Michigan does not
border the reservation. Both Wisconsin and Michigan provided comments
on the proposed redesignation, to which the Tribe responded in its
response to comments document. Thus, EPA finds that the FCP Community's
consultation efforts comply with the requirement to consult with
States.
    7. Following completion of the procedural requirements, the Tribe
submits to the Administrator a proposal to redesignate the area. See 40
CFR 52.21(g)(4).
    On December 4, 1993, and by majority vote, the FCP Community
General Council and the tribal governing body of the FCP Community
passed a resolution to request the Administrator to redesignate the FCP
Community Reservation and on February 10, 1995, the FCP Community
General Council passed a resolution to submit its completed
redesignation request package to EPA. The FCP Community submitted its
formal request for redesignation to EPA's Region 5 office on February
14, 1995.
    EPA reviewed the FCP Community's request and made a preliminary
determination that the request met the applicable procedural
requirements of 40 CFR 52.21(g)(4). After making this preliminary
determination, EPA published a notice of proposed rulemaking in the
Federal Register proposing to approve the request and announced a 120-
day public comment period on the issue of whether the Tribe had met the
procedural requirements. See Notice of Proposed Rulemaking, 60 FR 33779
(June 29, 1995).
    However, on June 8, 1995, the Governors of Wisconsin and Michigan
sent a letter to EPA objecting to EPA's proposal to grant the FCP
Community request for redesignation and requested EPA to intervene. The
letter also requested that EPA not finalize the proposed redesignation
until further regulations were in place to address permitting on non-
Federal Class I areas. On August 7, 1995, EPA published a notice
cancelling the August 2, 1995, hearing and indefinitely extending the
public comment period because the Governors of Wisconsin and Michigan
had requested negotiations pursuant to Section 164(e) of the CAA to
resolve their dispute regarding the proposed Class I request. In
response to the States' requests, EPA suspended the rulemaking to
address the States' concerns. See 60 FR 40139 (August 7, 1995).
    In 1997, EPA published an advanced notice of proposed rulemaking to
address PSD permitting in non-Federal Class I areas. 62 FR 27158 (May
16, 1997). Additionally, two public workshops were held to gather
comments on the advanced proposal. 62 FR 33786 (June 23, 1997). EPA
also initiated a dispute resolution process for Michigan and Wisconsin,
but after 2 years of discussions, the parties had failed to reach an
agreement.
    Accordingly, EPA published a notice scheduling two public hearings
on the proposed redesignation and setting the closing date of the
public comment period for September 15, 1997. 62 FR 37007 (July 10,
1997). EPA held two public hearings on the proposed redesignation, the
first on August 12, 1997, in Carter, Wisconsin, and the second on
August 13, 1997, in Rhinelander, Wisconsin, with an informational
meeting preceding each hearing. EPA also provided numerous
opportunities for input from local governments in EPA's public notice
and hearing process on the proposed rulemaking for the redesignation.
    The redesignation proposal elicited numerous comments from state
governments, local governments and the general public. Responses to
these comments are found in the response to comments document, which is
part of the record for this rulemaking. However, major comments are
summarized in this notice.

B. Lands Suitable for Redesignation

    Section 164(c) of the CAA provides that ``Lands within the exterior
boundaries of reservations of federally recognized Indian Tribes may be
redesignated. * * *'' 42 U.S.C. 7474(c). The PSD regulations define
``Indian Reservation'' as ``any federally recognized reservation
established by Treaty, Agreement, executive order, or act of
Congress.'' See 40 CFR 52.21(b)(27). The FCP Community's reservation
lands are comprised of non-contiguous trust parcels comprising a total
area in excess of 11,700 acres, as described in Section II.B. The FCP
Community's trust holdings are primarily located in Forest County, with
other parcels located in surrounding townships. In its redesignation
request, the FCP Community included only those parcels of 80 acres or
greater in size and located within Forest County.
    Several commenters raised concerns that the area proposed for
redesignation includes lands that are not within the boundaries of the
FCP Indian reservation. To address these concerns, EPA sought further
information from both the FCP Community and the Bureau of Indian
Affairs (BIA) regarding the status of lands proposed by the FCP
Community for redesignation. By letter of February 24, 1998, the FCP
Community provided documents describing the parcels subject to the
proposed redesignation. EPA subsequently requested an opinion from the
U.S. Department of Interior (DOI) on the status of those lands, and,
DOI's BIA stated as follows:

    The map compiled by S. Funk and dated 12/13/94 was used for
determination purposes. All of those lands identified on that map as
tribal trust meet the criteria of Section 164(c) of the CAA as so
stated. The parcels noted as tribal trust have all been designated
reservation land by proclamation of the Assistant Secretary.\12\

    \12\ Letter from Robert Jaeger, Superintendent, BIA Great Lakes
Agency, to David Kee, Air and Radiation Division, USEPA Region 5,
April 16, 1998.

The BIA certification is available for inspection at the public docket
for this rulemaking.
    However, the FCP Community commented that the list of parcels
subject to the Class I redesignation request contained errors when
compared to the S. Funk map. These

errors have been corrected in this action. See Section III.B. EPA's
action redesignates to Class I only those lands from FCP Community's
original list which have been confirmed to be held in trust for the FCP
Community and, therefore, are part of FCP Community's Reservation.
    Several commenters, including the FCP Community, also expressed
their belief or concern that lands acquired by a Tribe or State
subsequent to this redesignation request would automatically become
part of the Class I area without having to follow the redesignation
process in 40 CFR 52.21(g). However, EPA believes that a State or Tribe
is required to submit a new redesignation request and follow all of the
procedural steps to redesignate additional parcels not covered by a
previous request where, as here, a Tribe has requested redesignation of
specified parcels, and not its entire reservation. In addition, EPA
would be required to follow the public notice and comment procedures
set out by Congress in section 164(b)(2) of the CAA to review the new
request prior to making its determination whether to grant the request.
Therefore, any additional lands which are placed into trust for the FCP
Community would require the FCP Community to submit a new redesignation
request.
    Some commenters also alleged that the areas proposed for
redesignation were either too small or too dispersed to allow for
effective air quality management as discussed in sections 162 and 164
of the CAA. EPA disagrees. As explained in the notice that resolves the
dispute resolution with the State of Michigan and that is published
concurrently with this final action in this Federal Register, EPA can
only consider the size of an area proposed for redesignation when
resolving a dispute under CAA section 164(e). Michigan raised such a
dispute and EPA is resolving it in a separate notice. For reasons
explained there, EPA concluded that the size of the areas requested for
redesignation provides no basis for disapproval.

C. EPA's Role in Evaluating Class I Redesignations

    Several commenters asserted that EPA's consideration of a
redesignation request should not be limited to whether a Tribe or State
has met the procedural requirements, but rather, that EPA should also
consider the substantive basis of the request, examine tribal
jurisdiction, and interject its judgment as to whether the Tribe or
State redesignation request is warranted by considering such factors as
the potential economic impact of the redesignation. EPA disagrees.
These comments urge that EPA should, to varying degrees, exceed the
congressional imposed limits on EPA's review authority and suggest
imposing requirements on a Tribe's redesignation request that go far
beyond what the CAA provides.
    EPA began administering a PSD program in 1974, before Congress
promulgated statutory provisions for the PSD program in the Clean Air
Act Amendments of 1977, Public Law 95-95, 91 Stat. 685 (1977
Amendments). In its early CAA implementing regulations, EPA played an
active role in the review and approval of redesignation requests. See
39 FR 42510, 42515 (Dec. 5, 1974). Among other things, EPA's pre-1977
regulations authorized it to disapprove a redesignation request if a
State had ``arbitrarily and capriciously disregarded'' anticipated
growth, or the social, environmental, and economic impact of
redesignation on surrounding areas. See 40 CFR
52.21(c)(3)(vi)(a)(1975); 40 CFR 52.21(c)(3)(ii)(d)(1975).
    However, in the 1977 CAA Amendments, Congress minimized EPA's
authority to disapprove redesignation requests. Specifically, in
section 164(b)(2), Congress limited EPA's authority to disapprove a
redesignation ``only if [EPA] finds, after notice and opportunity for
public hearing,'' that the applicable ``procedural requirements'' of
section 164 have not been met. 42 U.S.C. 7474(b)(2) [emphasis added].
By this language, Congress clearly intended to limit EPA's role to
ensuring that a State or Tribe adheres to the procedural requirements
of section 164(b)(2). As the House Report accompanying the 1977
Amendments stated:

    The intended purpose of [the congressional PSD program is] * * *
to delete the [preexisting] EPA regulations and to substitute a
system which gives a greater role to the States and local
governments and which restricts the Federal Government. * * * [b]y
eliminating the authority which the Administrator has under current
EPA regulations to override a State's classification of an area on
the ground that the State improperly weighed energy, environment,
and other factors.

    EPA honored this directive when it revised its PSD regulations
following the 1977 CAA Amendments. See 42 FR 57479-57480 (Nov. 3, 1977)
and thus EPA ``will no longer be able to base a disapproval of a
proposed redesignation on a finding that the State decision was
arbitrary or capricious.'' Furthermore, although this language refers
to States, the CAA and legislative history make clear that the
discussion applies equally to tribal redesignations. See also Arizona
v. EPA.
    Thus, Congress has limited EPA's review of a proposed
redesignation. Under section 164(c)(2) of the CAA, EPA's role is to
determine whether the requesting State or Tribe followed specific
procedural requirements, and to ensure that the local decision making
process provides ample opportunity for interested parties to express
their views. It is inappropriate for EPA to interpose superseding
Federal views on the merits of the resulting State or Tribal decisions,
so long as procedural rigor is assured. Thus, in the case of the FCP
Community's redesignation request, EPA's review of the redesignation
proposal is limited to ensuring that the FCP Community followed the
prescribed statutory requirements. See Section IV.A. For those reasons,
EPA concludes that comments regarding the possible economic impact of
the redesignation or the merits of the Tribe's request do not provide
any basis for EPA to disapprove the redesignation.

D. Impact of Dispute Resolution on Redesignation

    Section 164(e) of the CAA and 40 CFR 52.21(t) provide the current
statutory and regulatory framework for resolving disputes between
States and Tribes arising from the redesignation of an area. Section
164(e) provides that if the Governor of an affected State or the
appropriate Indian Governing Body of an affected Tribe disagrees with a
request for redesignation by either party, then the governor or Indian
ruling body may request that EPA negotiate with the parties to resolve
the dispute. Pursuant to the statute and implementing regulations, EPA
is not a party to the dispute. The Administrator of EPA is by statute
designated as the final arbiter of the dispute.
    The statute provides that either party can ask the Administrator
for a recommendation to resolve the dispute, and if the parties fail to
reach an agreement during the negotiations, ``the Administrator shall
resolve the dispute and his determination, or the results of agreements
reached through other means, shall become part of the applicable plan
and shall be enforceable as part of such plan.'' See section 164(e).
The statute further provides that, ``In resolving such disputes
relating to area redesignation, the administrator shall consider the
extent to which the lands involved are of sufficient size to allow
effective air quality management or have air quality related values of
such an area.'' Section 164(e).

    As previously noted in Section IV.C, section 164(b)(2) of the CAA
provides a general rule which allows EPA to disapprove a redesignation
request ``only if [it] finds, after notice and opportunity for public
hearing,'' that applicable ``procedural requirements'' of the section
are unmet. Section 164(e) of the CAA creates a limited exception to
this general rule and requires EPA to consider additional factors where
a State or Tribe requests that EPA enter into negotiations to resolve a
State-Tribal dispute.
    Section 164(e) mandates that when EPA resolves a dispute, it must
``consider the extent to which the lands involved are of sufficient
size to allow effective air quality management or have air quality
related values of such area.'' But where the parties reach agreement,
the agreement becomes part of the applicable plan and the dispute is
ended. Similarly, where EPA resolves a dispute in favor of the party
requesting redesignation, dispute resolution is also terminated, and
the only remaining question is whether the Tribe met the requirements
of section 164(b)(2). EPA explained its role in the dispute resolution
process as follows:

    When the dispute resolution process in section 164(e) is invoked
by an affected state or Tribe, EPA is called upon to participate in
that process and to recommend a resolution, if requested by the
parties, or to finally resolve the dispute, if the parties are
unable to reach agreement. However, where the parties successfully
reach agreement through the dispute resolution process, EPA is
inclined to read section 164(e) of the CAA to provide that EPA has
no further role to play in the dispute resolution process.

71 FR 75696.
    EPA received letters from the Governors of Michigan and Wisconsin,
dated June 8, 1995, requesting that EPA initiate dispute resolution.
Between June 1995 and July 1999, in two separate rounds of dispute
resolution proceedings, the parties utilized a professional mediation
service, under contract to EPA, to mediate the separate disputes
between Wisconsin and the FCP Community, and between Michigan and the
FCP Community.
    EPA has determined that no issues raised during either dispute
resolution process would provide a basis on which EPA would deny the
FCP Community's request for redesignation. For this reason, EPA is
treating its resolution of the disputes invoked by the States of
Wisconsin and Michigan under section 164(e) of the CAA separately from
its approval of the redesignation request, and is publishing them
separately, but at the same time as this final action. EPA provides a
complete discussion of the resolution of the intergovernmental disputes
in these two separate Federal Register notices.

E. Appropriate Mechanism for Codifying Class I Area

1. Role of Federal Implementation Plans (FIP)
    As noted in section IV.A, Section 164 of the CAA affords States and
Tribes the right to request that EPA redesignate lands under their
control. If all procedural requirements are met, EPA must approve this
request. However, several commenters asserted that EPA has no authority
to implement the redesignation by any mechanism but a TIP. EPA
disagrees.
    Before the FCP Community submitted this request for redesignation
from Class II to Class I the Yavapai Apache Tribe of Arizona submitted
such a request, and on October 2, 1996, EPA approved the request. The
State of Arizona, within which the Yavapai Apache lands were located,
had raised objections to the redesignation and requested to enter into
section 164(e) dispute negotiations with the Yavapai Apache. The EPA
held a meeting with the parties, but ultimately no agreement was
reached. The EPA was forced to resolve the dispute, and did so by
granting the redesignation request and codifying the redesignation in a
FIP. 61 FR 56461 (November 1, 1996) and 61 FR 56450 (November 1, 1996).
The State of Arizona continued to dispute the approval of the
reservation to Class I and filed a suit before the United States Court
of Appeals for the Ninth Circuit. See Arizona v. EPA. The Ninth
Circuit's decision stated, among other things, that EPA had not abused
its discretion by approving the Tribe's redesignation request but that
EPA should have codified the Class I area in a TIP rather than a FIP,
and remanded the redesignation back to the EPA regional office so that
EPA could follow the appropriate procedures for promulgating the Class
I area as a TIP.
    On February 12, 1998, however, EPA promulgated a final rule under
section 301 of the CAA entitled ``Indian Tribes: Air Quality Planning
and Management.'' 63 FR 7254 (Feb. 12, 1998). This rule, generally
referred to as the ``Tribal Authority Rule'' or ``TAR,'' discusses
those provisions of the CAA for which it is appropriate to treat Indian
Tribes in the same manner as States and establishes the requirements
that Indian Tribes must meet if they choose to seek such treatment. The
EPA also concluded with this rule that certain provisions of the CAA
should not be applied to Tribes in exactly the same manner in which
they were applied to States. One of those provisions was CAA 110(c)(1),
which provides the Administrator with the authority to promulgate a FIP
within 2 years of finding that a State plan is insufficient. 63 FR at
7265. EPA reasoned that Tribes, unlike states, ``in general are in the
early stages of developing air planning and implementation expertise''
because the specific authority for Tribes to establish air programs was
first expressly addressed in 1990. Id. at 7264-7265. Because Tribes
were only recent participants in the process, EPA determined it would
be inappropriate to hold them to the same deadlines and Federal
oversight as the states. Id. at 7265. The EPA noted, however, that it
was ``not relieved of its general obligation under the CAA to ensure
the protection of air quality throughout the nation, including
throughout Indian country.'' Id. The EPA concluded that the Agency
could ``act to protect the air quality pursuant to its `gap-filling'
authority under the CAA as a whole'' and that ``section 301(d)(4)
provides EPA with discretionary authority, in cases where it has
determined that treatment of Tribes as identical to states is
`inappropriate or administratively infeasible,' to provide for direct
administration through other regulatory means.'' Id.
    Under that authority, EPA adopted 40 CFR 49.11, which established
the framework for adoption of FIP provisions for Indian Country: ``[The
Administrator] [s]hall promulgate without unreasonable delay such
Federal implementation plan provisions as are necessary or appropriate
to protect air quality, consistent with the provisions of section
304(a) (sic 301(a)) and 301(d)(4), if a Tribe does not submit a tribal
implementation plan meeting the completeness criteria of 40 CFR 51,
Appendix V, or does not receive EPA approval of a submitted tribal
implementation plan.'' 40 CFR 49.11(a). The intent of this provision
was to recognize that Tribes may not initially have the capability to
implement their own delegated CAA programs and that the TAR does not
relieve EPA of its general obligation under the CAA to protect air
quality throughout the nation, including in Indian country. See 63 FR
7265. Therefore, the TAR established two possible routes for the
codification of a Class I redesignation on Tribal lands: (1) A TIP, if
one has been developed by the Tribe and approved by EPA; and (2) A FIP,
if a TIP did not exist and a FIP was necessary to protect air quality.
    For that reason, and consistent with the approach detailed in the
TAR, the

FCP Community sent a letter to Francis X. Lyons, Regional Administrator
of EPA Region 5, requesting that EPA promulgate the requested
redesignation of the proposed Class I area parcels in a FIP, as opposed
to utilizing a TIP, because the FCP Community was continuing to build
its capacity and infrastructure to run its air program and was not yet
ready to submit its own TIP. On August 23, 1999, EPA sent a letter to
the FCP Community agreeing that a FIP would be an appropriate option
for implementing the Class I area should EPA grant the FCP Community's
request. On December 18, 2006, EPA published a supplemental proposal
seeking comment on the proposed codification of the FCP Community
redesignation in a FIP. 71 FR 75694 (December 18, 2006). In that
proposal, EPA expressed its view that, consistent with the TAR, until
such time as the FCP Community develops a TIP and has it approved, EPA
retains the authority to promulgate the redesignation approval in a
FIP.
    The PSD program is implemented in Wisconsin under an EPA approved
SIP which excludes all of Indian country within the State. In the
December 18, 2006 proposal, EPA explained:

    Wisconsin initially implemented the Federal PSD program under a
delegation of authority from EPA. Wisconsin subsequently submitted a
PSD rule and program which EPA approved for all sources in Wisconsin
except for sources located in tribal lands and other sources that
require permits issued by the EPA. See 64 FR 28748 (May 27, 1999).
The current EPA regulations addressing the PSD program in Wisconsin
are found at 40 CFR 52.2581.

71 FR 75694, 75698. Therefore, EPA's December 18, 2006, proposal to
codify the Forest County Potawatomi Class I area is an amendment to an
existing FIP for Wisconsin Indian country, rather than the promulgation
of a new FIP.
    For those reasons, EPA does not agree with any suggestion that
promulgation of a FIP cannot be the mechanism for implementing a
redesignation of tribal lands as Class I. As discussed previously in
this section, the FCP Community has formally requested that EPA approve
its request to redesignate certain reservation lands and has
demonstrated that it has met the necessary procedural requirements.
EPA's promulgation of a FIP, at the Tribe's express request because it
is not yet ready to develop its own TIP, does not supplant the Indian
governing body's role in making the decision to request EPA approval of
the redesignation.
    However, another commenter also argues that use of a FIP is
inappropriate because section 164(c) of the CAA states that only the
appropriate Indian governing body may redesignate reservation lands,
which, the commenter suggests, leaves no role for EPA. The commenter is
mistaken. Section 164 of the CAA sets out the requirements for non-
federal land redesignations and clearly specifies that the decision to
redesignate will be made by the appropriate State or Indian governing
body following certain procedural steps, discussed in Section IV.A, and
that EPA makes the decision whether to approve the redesignation. The
Tribe has requested the redesignation and EPA has approved it. That is
fully consistent with CAA section 164(b)(2).
    Furthermore, one State commenter asserts that a FIP is
inappropriate in this case because it is not needed to protect the air
quality of the lands proposed for redesignation because these lands are
already protected as Class II areas under the CAA. EPA does not agree.
As the FCP Community's request for redesignation makes clear, the FCP
Community is seeking greater protection for these lands than is
presently provided under their Class II classification. Section 164(c)
of the CAA provides that States and Tribes may redesignate lands of
their choosing where they meet the procedural requirements for
redesignation. Moreover, this State commenter argues that a FIP is
inappropriate because the TAR rule addresses only ``tribal air quality
programs'' and Class I redesignation is not such a program. EPA
disagrees that the use of a FIP is inappropriate for implementation of
anything except a tribal air quality program. As discussed at the
beginning of this section, 40 CFR 49.11 states in pertinent part that
``[The Administrator] [s]hall promulgate without unreasonable delay
such Federal implementation plan provisions as are necessary or
appropriate to protect air quality * * * if a Tribe does not submit a
tribal implementation plan. * * *'' (emphasis added). Where, as here,
the FCP Community has declined to submit a TIP, a FIP is an appropriate
mechanism to protect the air quality of the redesignated Class I lands.
2. Contents of Implementation Plan
    Both Wisconsin and Michigan objected to the proposed redesignation
and requested dispute resolution under section 164(e) of the CAA. To
resolve the dispute with the State of Wisconsin, the FCP Community and
Wisconsin entered into a Memorandum of Agreement (FCP Community--
Wisconsin MOA) for implementation of the proposed Class I area in
Wisconsin. The terms of the agreement are not appropriate for inclusion
into the FIP, however, because they do not apply to the effects of the
Class I Redesignation. Rather, the agreement establishes certain
special provisions regarding the effects of the Class I redesignation
on potential sources outside the redesignated area. Those provisions
have been summarized by EPA as follows:

    [T]he agreement between the FCP Community and Wisconsin subjects
all major sources in Wisconsin located within a ten (10) mile radius
of any redesignated Tribal land to performing an increment analysis
and to meeting consumption requirements applicable to a Class I
area. Major sources located outside of ten (10) miles are subject to
increment analysis and consumption requirements applicable to any
redesignated Tribal land as if it were a Class II area. Also under
the agreement, all major sources within sixty-two (62) miles are
subject to an analysis of their impact on air quality related values
(AQRVs) of the redesignated Tribal lands to determine if they will
have an adverse impact on these AQRVs.

71 FR 75696. As these special provisions differ from Wisconsin's
currently approved SIP for the PSD program, for this portion of the FCP
Community--Wisconsin MOA to become enforceable will require revision of
the Wisconsin SIP, which otherwise would not recognize a limitation of
the area in which the Class I increment analysis must be conducted.
    EPA takes the position that it generally will not interfere with
the agreements reached between Tribes and States through the CAA's
164(e) dispute resolution process. However, to the extent that the
agreement reached under the terms of the MOA allows for restricting the
requirements normally associated with Class I areas as these apply to
sources located outside a 10-mile radius of the redesignated
reservation lands, EPA takes the position that a revision of the
Wisconsin SIP will be necessary to apply this provision to potential
sources located outside the boundaries of the redesignated parcels.
Therefore, EPA disagrees with the State commenter who argued that a SIP
cannot be used in conjunction with any aspect of a Class I rulemaking.
    EPA received several comments on language to be used in the
implementation plan. The FCP Community has stated that EPA has used out
of date language in the proposed FIP and therefore any FIP should use
the current language for 40 CFR 52.2581. EPA agrees, and this change is
noted in Section III.B. The FCP Community also states that EPA's

proposed FIP leaves ambiguous whether the provisions of 40 CFR 52.21
would apply to the redesignated FCP Community Reservation Class I land.
EPA agrees and has modified the FIP to make clear that the provisions
of the PSD program apply to the redesignated reservation lands. This
change is also noted in Section III.B.

F. Air Program Implementation in Indian Country/Role of Tribes in
Protecting Air Quality

    Several commenters argued that EPA should deny the FCP Community's
request because if this request is granted, then other Tribes will be
encouraged to seek Class I redesignation and could eventually result in
a nationwide blanket of Class I areas. EPA disagrees. Any redesignation
request, by either a State or Tribe will have to consider the area of
impact in its technical analysis supporting the redesignation request.
Furthermore, the CAA does not require a State or Tribe to project
potential future redesignations or speculate about their potential, and
does not allow EPA to consider the likelihood of future redesignations
as a basis for a disapproval under CAA section 164(b)(2). Any future
proposed redesignation will be reviewed on a fact-specific basis
according to the applicable regulations.
    Other commenters expressed their view that because State air
programs already address air quality, there is no need for a Tribe to
implement its own air program, and, additionally, tribal air programs
will unfairly burden existing state air programs by duplicating or
adding to existing state requirements. EPA disagrees.
    EPA's authorization of State air programs does not extend to
federally recognized Indian reservations, which are excluded from State
SIP approvals. CAA section 164(c) expressly provides that Tribes are
responsible for redesignating reservations, and that Tribes can
redesignate their lands when they conclude that the redesignation is
appropriate to protect Reservation air quality. See TAR, 63 FR 7254, at
7254. It is Congress, through the CAA, that has provided Tribes (and
States) with the authority to redesignate certain lands and to
implement programs under CAA authorities.
    The CAA states that ``air pollution prevention * * * and air
pollution control at the source is the primary responsibility of States
and local governments * * *'' and that ``each State shall have the
primary responsibility for assuring air quality within the entire
geographic area comprising such State. * * *'' 42 U.S.C. 7401(a)(3) and
7407(a). States, however, are not the exclusive regulating entity under
the CAA.
    In the 1990 amendments to the CAA, Congress amended the CAA to add
sections 110(o) and 301(d), which allow Tribes to administer many CAA
programs in the same manner as States. See 59 FR 43956. EPA furthered
this congressional purpose when it promulgated regulations for
implementation of CAA programs by Tribes. See 63 FR 7254 (February 12,
1998). These amendments reflect Congressional recognition that Tribes
should be primarily responsible for environmental regulations and
decisions that impact reservation environments.
    Nevertheless, redesignation of the FCP Community lands to Class I
will not require the Tribe to develop any air quality regulations.
Because northeastern Wisconsin is a designated Class II area and is an
attainment area, PSD requirements already apply to sources there. The
regulations currently in place under Wisconsin's PSD program already
require the owner/operator of proposed major stationary sources
locating in PSD areas to submit a permit application containing an
analysis of their air quality impacts and to install ``best available
control technology'' to control emissions. See sections 165(a) and
169(3) of the CAA. The air quality analysis must show that the proposed
source will not cause or contribute to a violation of an applicable PSD
increment or a NAAQS, as demonstrated by air quality modeling. See 40
CFR 52.21(c) and (d). After notice and public hearing for a proposed
permit, the permitting authority reviews the permit application and
determines whether the PSD permit requirements have been met.
    Thus following this rulemaking granting Class I status to FCP
Community reservation lands, the States of Wisconsin and Michigan will
remain, for their respective lands, the permitting authorities for
sources located outside the FPC Community reservation. EPA will remain
the federal permitting authority for proposed sources locating within
the FCP Community reservation boundaries until the FCP Community
applies for and receives delegation of this authority. Until Wisconsin
amends its SIP to specify how the redesignation of the Reservation as a
Class I area will affect sources in Wisconsin, such sources will treat
the Reservation identically to the way they would treat any other Class
I area. Sources in Michigan will treat the Reservation as a Class I
area as they would any other Class I area under the FIP that currently
applies to Michigan, and which will not be altered by this action.

G. Air Quality Related Values of Redesignated Lands

    Commenters challenged the redesignation on the basis that the
Reservation does not have appropriate air quality related values. EPA,
however, does not believe those comments provide any basis for
rejecting the redesignation request. Neither Section 164(b) of the CAA
nor EPA's implementing regulations governing redesignation require a
State or Tribe requesting a redesignation to demonstrate or establish
that the affected lands have AQRVs, and Congress did not make AQRVs a
prerequisite for redesignation of non-federal Class I areas. It is
therefore unnecessary for EPA to determine what AQRVs the lands at
issue might possess in order for the Agency to act on, including
granting, the redesignation request. See 61 FR 56450, 56458-56459 (Nov.
1, 1996) (redesignation of Yavapai-Apache lands). While States and
Tribes ``may redesignate such [other] areas [within their jurisdiction]
as [they] deem[] appropriate'', there is no requirement that states or
Tribes identify AQRVs before proposing to redesignate an eligible area.
See CAA section 164(a), 40 CFR 52.21(g)(4).

H. Impact of Class I Redesignation on Minor Sources

    Some commenters argue against the redesignation because they
believe that the economic impact of Class I redesignation would affect
residential, agricultural, and small businesses and small business
growth in the area or the State of Wisconsin. EPA disagrees with this
comment. Analyses included in the FCP Community's Technical Report show
that only large stationary sources proposing to locate in close
proximity to the Reservation lands would be affected by the
redesignation and regardless of whether they are in a Class II or a
Class I area, such major sources are already required to obtain an air
quality permit, conduct modeling analyses, and use the best available
technology to control emissions under the PSD program. In terms of
other businesses, the redesignation will not affect mobile emission
sources such as cars because no vehicle inspection and maintenance
(smog-check) programs would be required. In addition, redesignation
would not limit the home use of wood-burning stoves, nor would it
create restrictions on controlled forest burning, or require dirt roads
to be paved to reduce dust and particulates. Thus,

home and small business owners in nearby communities should not be
affected by a Class I designation of Reservation lands. Furthermore and
as explained in Section IV.C, economic impacts, including impacts on
minor sources, are not within the scope of EPA's review when evaluating
a redesignation request.

V. Statutory and Executive Order Reviews

A. Executive Order 12866: Regulatory Planning and Review

    This action is not a ``significant regulatory action'' under the
terms of Executive Order 12866 (58 FR 51735, October 4, 1993) and is
therefore not subject to review under the Executive Order.
    However, as part of its application package for Class I
redesignation, the FCP Community prepared an analysis of the potential
costs and benefits associated with this action on the affected region
(Forest County and those counties bordering Forest County). This
analysis directly supports a finding that the impact of the proposed
redesignation would not result in an adverse annual impact to the
economy of $100 million or more. See ``EPA memorandum dated October 25,
2004'' in the public docket for this action.
    As discussed in greater detail in the memorandum, the FCP Community
analysis identifies those economic sectors with the largest employment
in the area. These are industry, manufacturing and trade, which
together account for 46% of the jobs in the affected area. To evaluate
the effect of Class I redesignation on economic expansion and future
industrial plant development in the affected area, the FCP Community
prepared an independent air dispersion modeling analysis to determine
the air quality impacts on the Class I area from various new projects.
These included a 250-ton-per-day paper mill, three different types of
power plants, and a mining project.
    The modeling and screening results analyzed indicate that the
proposed Class I redesignation should not have major effects on
economic expansion and industrial development in the region. The
redesignation could restrict the sifting of large paper mills and large
coal-fired powered plants to at least 10 km from the reservation, and
would limit the development of multiple projects that would have an
unacceptable cumulative effect on the Class I increments, but none of
the known proposed developments in the region would be adversely
affected.

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.
We are not promulgating any new paperwork requirements (e.g.,
monitoring, reporting, recordkeeping) as part of this final action.
However, the Office of Management and Budget (OMB) has previously
approved the information collection requirements contained in the
existing regulations (40 CFR parts 51 and 52) under the provisions of
the Paperwork Reduction Act, 44 U.S.C. 3501 et seq., and has assigned
OMB control number 2060-0003, EPA ICR number 1230.20. The OMB control
numbers for EPA's regulations in 40 CFR are listed in 40 CFR part 9.
    This analysis included an examination of the additional regulatory
burden, per regulated unit, on those sources constructing or modifying
near a Class I area, and which may be required to perform a Federal
Class I area analysis to determine the effect of the proposed source on
AQRV inside the Class I area, and on the consumption of increment,
where the baseline has been triggered. It is important to note that not
all sources located near Class I areas would have to perform such
monitoring; these requirements apply only when emissions from the
source have the potential to impact the Class I area.
    The EPA's analysis for OMB included the additional burden placed
upon the regulated community as well as on State and Federal agencies.
The redesignation of FCP Community lands from Class II to Class I is
wholly consistent with the analysis put forth in EPA's ICR and OMB's
approval and no new paperwork requirements are being promulgated with
this action.

C. Regulatory Flexibility Act (RFA), as Amended by the Small Business
Regulatory Enforcement Fairness Act of 1996 (SBREFA), 5 U.S.C. 601 et
seq.

    The RFA generally requires an agency to prepare a regulatory
flexibility analysis of any rule subject to notice and comment
rulemaking requirements under the Administrative Procedure Act or any
other statute unless the agency certifies that 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.
    For purposes of assessing the impacts of this final action on small
entities, small entity is defined as: (1) A small business as defined
by the Small Business Administration's (SBA) regulations at 13 CFR
121.201; (2) a small governmental jurisdiction that is a government of
a city, county, town, school district, or special district with a
population of less than 50,000; or (3) a small organization that is any
not-for-profit enterprise that is independently owned and operated and
is not dominant in its field. This action does not require a regulatory
flexibility analysis because it will not have a significant economic
impact on a substantial number of small entities.
    The EPA believes that the reclassification of the proposed area to
Class I will impose virtually no additional requirements on small
entities, regardless of whether they are minor sources or major
sources. For small entities that are also minor sources, since at the
present time the baseline concentrations for this area have not been
triggered and none of the Class I increments have yet been consumed,
minor emission sources are unaffected by PSD requirements. Should the
Class I increments be completely consumed in the future, it is possible
that some pollution control requirements would fall to minor sources.
However, any such future pollution control requirements imposed on off-
reservation sources would be under the jurisdiction of the states, not
EPA. Therefore, EPA is not in a present or future position to directly
regulate small entities and therefore is not required to conduct an RFA
analysis.
    For small entities that are major sources, the impact is not
expected to be substantial. As demonstrated in section V.A., the
requirements for demonstrating compliance with the NAAQS and PSD
increments for major facilities in and surrounding Class I areas are
similar to the requirements for major facilities in and surrounding
Class II areas. Therefore, this action will not have a significant
impact on a substantial number of small entities.
    While EPA is not required to conduct an RFA analysis, as a matter
of good public policy, the Agency has reviewed information on the
impact of the redesignation provided by the FCP Community in its
Technical Report submitted pursuant to the Tribe's request for Class I
redesignation. In this document, the Tribe reviewed the potential
impact of the Class I redesignation on various types of sources,
concluding that impacts of the redesignation to Class I would impact
only certain major stationary sources, and would impose no additional
requirements on minor sources.
    For example, air dispersion modeling and EPA-approved screening
performed

for the Tribe's TSD demonstrates that a 140 MW natural gas fired
combustion turbine power plant could be constructed and operated
directly adjacent to the reservation without violating any of the Class
I increments. Power plants of this type produce relatively high levels
of nitrogen oxides (NOX), which are their major emissions,
yet despite its direct proximity to a Class I area, such a facility
would impact only a small fraction (~4%) of the allowable Class I
increment for NOX. Considering that the FCP Community
analysis shows that a major gas-fired power generating facility could
be operated immediately next to the reservation without significant
impacts, and that only very large industrial projects located within
approximately 10 km of the reservation would be affected by the
redesignation, it appears very unlikely that any small businesses
located within 100 kilometers would produce emissions in large enough
quantities to trigger the Class I restrictions.
    Nevertheless, it is possible that a small business located close
enough to the reservation may be a major source of criteria air
pollutants. Even in that event, the PSD requirements for Class I areas
would be very unlikely to impose a significant financial burden on such
a small business. If it is an existing business at the time the
redesignation goes into effect, it would not be subject to the PSD
permitting requirements, which apply only to new stationary sources or
major modifications to existing sources.
    Even if the small business in question was new to the Class I area,
hence subject to PSD permitting, the redesignation would still not
impose additional significant financial or regulatory burdens on the
small entity. As a major source of criteria air pollutants, the small
business would be subject to PSD permitting regulations whether the
reservation had been redesignated to Class I or had remained a Class II
area, as it is now. Major stationary sources proposing to locate in any
PSD area, regardless of whether it is Class II or Class I, must still
conduct the same type of analyses to measure the impact of their
emissions on the allowable increments and use the best available
control technology to reduce their emissions and minimize adverse
effects.
    Should the area remain Class II, the major source would still be
required to perform a modeling analysis to ensure that the Class II
increments are protected in order to obtain a permit. Since a modeling
analysis is required in any case, the cost of adding additional
receptor points, if needed, to the modeling analysis to gather the
necessary data to ensure that the Class I increments will also be
protected should be relatively small. Likewise, since every major
stationary source proposing to locate in a PSD area, whether it has
been designated as Class I or Class II, must employ ``best available
control technology'' to reduce emissions, proximity to a Class I area
generally would not affect the level of control required to meet BACT.
In short, regardless of whether they are in a Class II or a Class I
area, major sources are required to obtain an air quality permit,
conduct modeling analyses, and use the best available technology to
control emissions under the PSD program. Thus, as a general rule,
redesignation should not inflict additional control costs on a source.
    Under certain circumstances a major source may be required to
achieve further decreases in emissions to reduce its impact on the air
quality related values of a Class I area. Such a requirement would
necessitate further regulatory action by either the FCP Community or
EPA, however, and the impacts of the specific requirements can be
appropriately assessed at that time. Additionally, it would be very
unusual for a small business to also be a major source and a
substantial number of small entities should certainly not be so
affected.
    Several other Indian Tribes have redesignated tribal lands to Class
I in other parts of the country, and their experience can provide us
with some insight into the impact redesignation typically has on small
entities in the vicinity. These include the Northern Cheyenne Tribe,
Montana; Flathead Indian Reservation, Montana; Fort Peck Indian
Reservation, Montana and the Spokane Indian Reservation, Washington,
which were redesignated as Class I areas between 1977 and 1990. Thus
far, there has been very little economic impact on small businesses,
nearby towns, local governments or other small entities following Class
I redesignation in those areas. The EPA has no reason to believe that
same pattern of minimal economic impact to small businesses will not be
repeated in Forest County and the surrounding counties.
    Small entities that are minor sources of air pollution will not be
affected at all by this action at this time. The PSD permit program
does not cover minor sources and, as previously discussed, EPA does not
directly regulate minor entities. The reclassification of the proposed
area to Class I therefore imposes virtually no additional requirements
on small entities since the baseline concentration level for Forest
County has not yet been triggered and none of the PSD increments in the
area have yet been consumed. The baseline concentration is the
conceptual reference point or ''starting'' point for determining air
quality deterioration in an area subject to the PSD program. Thus, the
baseline concentration is essentially the ambient air quality existing
at the time the first complete PSD application is made for a major new
source affecting a PSD baseline area. Since no PSD permit application
triggering a baseline date has been submitted in the Forest County
area, there has not been any consumption of the PSD increments in the
area. Should major and minor sources of pollution consume all of the
available increment in an area at some point in the future, it is
possible that some pollution control requirements would then fall to
minor sources, but since roughly 75% of the land in Forest County is
National Forest, and there is presently very little industrial
development in the area, there is likely to be little consumption of
the Class I increments for some time to come.
    After considering the economic impacts of this final rule on small
entities, I certify that this action will not have a significant
economic impact on a substantial number of small entities. This final
rule will not impose any requirements on small entities that are not
major sources because this action affects only major stationary
sources, as defined by 40 CFR 52.21.

D. Unfunded Mandates Reform Act

    Title II of the Unfunded Mandates Reform Act of 1995 (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
one 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 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 one year. The redesignation would not impose significant
additional financial or regulatory burdens on a new or modified source
subject to the PSD permitting requirements. As a major source of
criteria air pollutants, a new or modified source would be subject to
PSD regulations whether the reservation had been redesignated to Class
I or had remained a Class II area, as it is now. New major stationary
sources proposing to locate in any PSD area, regardless of whether it
is Class II or Class I, must still conduct the same type of analyses to
measure the impact of their emissions on the allowable increments and
use the best available control technology to reduce their emissions and
minimize adverse effects. No additional permits would be required as a
result of a redesignation of FCP Community reservation lands. In
addition, the EPA has determined that this rule contains no regulatory
requirements that might significantly or uniquely affect small
governments because, as already stated in other sections of this
regulatory package, the redesignation from a Class II to a Class I area
would not impose additional significant financial or regulatory burdens
on sources. Thus, this rule is not subject to the requirements of
sections 202 and 205 of the UMRA.

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.''
    Under section 6 of Executive Order 13132, we may not issue a
regulation that has federalism implications, that imposes substantial
direct compliance costs, and that is not required by statute, unless
the Federal government provides the funds necessary to pay the direct
compliance costs incurred by State and local governments, or we consult
with State and local officials early in the process of developing the
proposed regulation. We also may not issue a regulation that has
federalism implications and that preempts State law, unless we consult
with State and local officials early in the process of developing the
proposed regulation.
    This final 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. The rule merely implements an
authority currently available to Indian Tribes to redesignate their
reservation lands under the PSD program of the CAA, and does not alter
the relationship or the distribution of power and responsibilities
established in the CAA. Thus, Executive Order 13132 does not apply to
this rule.
    Although section 6 of Executive Order 13132 does not apply to this
rule, EPA did consult with State and local officials in developing this
rule. A summary of the concerns raised during that consultation and
EPA's response to those concerns are provided in the public docket of
this rulemaking.

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 (November 6, 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.''
    The EPA has concluded that this final rule establishes federal
standards and will have tribal implications. However, it will neither
impose substantial direct compliance costs on tribal governments, nor
preempt Tribal law. Thus, consistent with section 3 of the Executive
Order, in the process of developing this final action, EPA consulted
with FCP Community tribal officials to allow them to have meaningful
and timely input into its development. EPA consulted with
representatives of the FCP Community prior to their submission of the
redesignation request. During this consultation, EPA explained the
function of the CAA's redesignation provision, differences between
Class I and Class II designations, and alternatives to the proposed
Class I redesignation.
    The FCP Community chose to submit a request for redesignation to
Class I on February 14, 1995 to further their goal of exercising
control over reservation resources and to better protect the members of
their community. Since the FCP Community submitted its request for
redesignation, EPA has kept the FCP Community informed of its process
for completing the rulemaking through written correspondence,
conference calls, and face to face meetings when appropriate. Records
of these communications are found in the docket for this final action.
Most recently, EPA officials held consultations with the FCP Community
between February and August 2007 to discuss this final action and to
answer the Community's questions. Overall, EPA expects that the impact
of the redesignation to Class I will be positive.

G. Executive Order 13045: Protection of Children From Environmental
Health & Safety Risks

    Executive Order 13045: ``Protection of Children from Environmental
Health Risks and Safety Risks,'' 62 FR 19885 (April 23, 1997), applies
to any rule that: (1) Is determined to be ``economically significant''
as defined under Executive Order 12866; and (2) concerns an
environmental health or safety risk that EPA has reason to believe may
have a disproportionate effect on children. If the regulatory action
meets both criteria, the Agency must evaluate the environmental health
or safety effects of the planned rule on children, and explain why the
planned regulation is preferable to other potentially effective and
reasonably feasible alternatives considered by the Agency.
    This final rule is not subject to the Executive Order because it is
not economically significant as defined in Executive Order 12866, and
the Agency does not have reason to believe the

environmental health or safety risks addressed by this action present a
disproportionate effect on children. Redesignation of the identified
parcels of the FCP Community Reservation to Class I status will reduce
the allowable increase in ambient concentrations of various types of
pollutants. The reduction of these pollutants can only be expected to
better protect the health of tribal members, members of the surrounding
communities, and especially children and asthmatics.
    The adverse health effects of exposure to high levels of criteria
air pollutants such as sulfur dioxide and fine particulate matter are
well known and well documented. Sulfur dioxide, for example, is known
to irritate the respiratory system. As explained in the FCP Community's
Technical Support Document, exposure to high concentrations for even
short periods can cause bronchial constriction and exposure to lower
concentrations of sulfur dioxide for longer periods and suppresses the
respiratory system's natural defenses to particles and bacteria.\13\
Children and asthmatics are especially vulnerable to the adverse health
effects of sulfur dioxide.\14\ If the Class I redesignation is codified
in a FIP, the allowable increase in ambient concentrations of sulfur
dioxide after redesignation of the reservation to Class I status (on an
annual arithmetic mean basis) will be one-tenth of the current Class II
allowable increase in ambient concentrations, thus providing greater
health protection to children from such air pollutants.
---------------------------------------------------------------------------

    \13\ SO2--How Sulfur Dioxide Affects the Way We Live
& Breathe. U.S. EPA Office of Air Quality Planning & Standards
(November 2000) (available at http://www.epa.gov/air/urbanair/so2/
index.html).
    \14\ Health and Environmental Impacts of SO2
(September 30, 2003) (available at http://www.epa.gov/air/urbanair/
so2/hlth1.html).
---------------------------------------------------------------------------

    Likewise, the allowable increase in ambient concentrations of
particulate matter after Class I redesignation (on an annual basis)
will be approximately one-fourth of the current Class II increase.
Particulate matter consists of airborne particles and aerosols ranging
in size from less than 1 micrometer to more than 100 micrometers. Aside
from natural sources, industrial activity can release great quantities
of particulates (dust, soot, ash and other solid and liquid particles).
Combustion products emitted during power generation, heating, motor
vehicle use and various industrial processes are also classified as
particulate matter. The vast majority (~99%) of such inhalable
particulate matter is trapped in the upper respiratory tract, but the
remainder enters the windpipe and the lungs, clinging to the protective
mucosa. The smallest particles are deposited in the alveoli and
capillaries of the lung, where they impair the exchange of oxygen and
causes shortness of breath. Children, the elderly, and people with
pulmonary problems and respiratory conditions (e.g., emphysema,
bronchitis, asthma, or heart problems) are the most susceptible to
these debilitating effects.\15\ Adverse health effects from particulate
matter are often cumulative and progressive, worsening as particulates
gradually collect in the lungs following repeated, long-term
exposure.\16\
---------------------------------------------------------------------------

    \15\ Health and Environmental Impacts of PM (30 September 2003)
(available at http://www.epa.gov/air/urbanair/pm/hlth1.html).
    \16\ PM--Chief Causes for Concern (30 September 2003) (available
at http://www.epa.gov/air/urbanair/pm/chf.html).
---------------------------------------------------------------------------

    Fine particulate matter is the worst offender in that regard.
Scientific studies have shown that particulate matter, especially fine
particles (those particles with an aerodynamic diameter of less than
2.5 micrometers and commonly known as PM2.5), are retained
deep within the lung.\17\ Short term exposure to such fine particulate
matter can cause lung irritation and may impair immune responses. Some
of the material from the particles can dissolve in the lungs, causing
cell damage, and the particles themselves may consist of compounds that
are toxic or which form acids when combined with moisture in the lungs.
Long-term lower level exposures can cause cancer and other respiratory
illnesses. Reducing the allowable increase in ambient concentrations of
particulate matter by roughly 75% should thus provide greater health
protection from such afflictions to children on the reservation and in
the surrounding communities.
---------------------------------------------------------------------------

    \17\ Information on Particulate Matter (FINE) PM Condensed from
Health and Environmental Effects of Particulate Matter; U.S. EPA
Office of Air Quality Planning and Standards (July 1997). (available
on http://www.air.dnr.state.ga.us/information/pm25.html).
---------------------------------------------------------------------------

    In short, the environmental health or safety risks addressed by
this action do not present a disproportionate risk to children. In
fact, they are expected to have a positive rather than a negative
impact on children's health and the environment.

H. Executive Order 13211: Actions That Significantly Effect Energy
Supply, Distribution, or Use

    This rule is not subject to Executive Order 13211, ``Actions
Concerning Regulations That Significantly Affect Energy Supply,
Distribution, or Use'' (66 FR 28355, May 22, 2001), because it is not a
significant regulatory action under Executive Order 12866.

I. National Technology Transfer and Advancement Act

    As noted in the proposed rule, Section 12(d) of the National
Technology Transfer and Advancement Act of 1995 (``NTTAA''), Public Law
104-113, 12(d) (15 U.S.C. 272 note) directs EPA to use voluntary
consensus standards in its regulatory activities unless to do so would
be inconsistent with applicable law or otherwise impractical. Voluntary
consensus standards are technical standards (e.g., materials
specifications, test methods, sampling procedures, and business
practices) that are developed or adopted by voluntary consensus
standards bodies. The NTTAA directs EPA to provide Congress, through
OMB, explanations when the Agency decides not to use available and
applicable voluntary consensus standards.
    This action does not involve technical standards. Therefore, EPA
did not consider the use of any voluntary consensus standards.
    J. Executive Order 12898: Federal Actions to Address Environmental
Justice in Minority Populations and Low-Income Populations
    Executive Order 12898 (59 FR 7629 (Feb. 16, 1994)) establishes
Federal executive policy on environmental justice. Its main provision
directs Federal agencies, to the greatest extent practicable and
permitted by law, to make environmental justice part of their mission
by identifying and addressing, as appropriate, disproportionately high
and adverse human health or environmental effects of their programs,
policies, and activities on minority populations and low-income
populations in the United States.
    EPA has determined that this final rule will not have
disproportionately high and adverse human health or environmental
effects on minority or low-income populations because it increases the
level of environmental protection for all affected populations without
having any disproportionately high and adverse human health or
environmental effects on any population, including any minority or low-
income population.
    The EPA believes that the redesignation of FCP Community lands in a
FIP from Class II to Class I area should not raise any environmental
justice issues since it will reduce the allowable increase in ambient
concentrations of various types of pollutants. Consequently, this
redesignation should result in health

benefits to tribal members and members of the surrounding communities.

K. Congressional Review Act

    The Congressional Review Act, 5 U.S.C. 801 et seq., as added by the
Small Business Regulatory Enforcement Fairness Act of 1996, generally
provides that before a rule may take effect, the agency promulgating
the rule must submit a rule report, which includes a copy of the rule,
to each House of the Congress and to the Comptroller General of the
United States. EPA will submit a report containing this rule and other
required information to the U.S. Senate, the U.S. House of
Representatives, and the Comptroller General of the United States prior
to publication of the rule in the Federal Register. A Major rule cannot
take effect until 60 days after it is published in the Federal
Register. This action is not a ``major rule'' as defined by 5 U.S.C.
804(2). Therefore, this rule will be effective May 29, 2008.

VII. Statutory Authority

    The statutory authority for this final action is provided by
sections 110, 301 and 164 of the CAA as amended (42 U.S.C. 7410, 7601,
and 7474) and 40 CFR part 52.

List of Subjects in 40 CFR Part 52

    Environmental protection, Air pollution control, Carbon monoxide,
Intergovernmental relations, Lead, Nitrogen dioxide, Ozone, Particulate
matter, Reporting and recordkeeping requirements, Sulfur dioxides,
Volatile organic compounds.

    Dated: April 18, 2008.
Stephen L. Johnson,
Administrator.

0
For the reasons stated in the preamble, part 52, chapter I, of title 40
of the Code of Federal Regulations is amended as follows:

PART 52--[AMENDED]

0
1. The authority citation for part 52 continues to read as follows:

    Authority: 42 U.S.C. 7401 et seq.

Subpart YY--Wisconsin

0
2. Section 52.2581 is amended by adding paragraph (f) to read as
follows:

Sec.  52.2581  Significant deterioration of air quality.

* * * * *
    (f) Forest County Potawatomi Community Reservation.
    (1) The provisions for prevention of significant deterioration of
air quality at 40 CFR 52.21 are applicable to the Forest County
Potawatomi Community Reservation, pursuant to Sec.  52.21(a).
    (2) In accordance with section 164 of the Clean Air Act and the
provisions of 40 CFR 52.21(g), those parcels of the Forest County
Potawatomi Community's land 80 acres and over in size which are located
in Forest County are designated as a Class I area for the purposes of
prevention of significant deterioration of air quality. For clarity,
the individual parcels are described below, all consisting of a
description from the Fourth Principal Meridian, with a baseline that is
the Illinois-Wisconsin border:
    (i) Section 14 of Township 36 north (T36N), range 13 east (R13E).
    (ii) Section 26 of T36N R13E.
    (iii) The west half (W\1/2\) of the east half (E\1/2\) of Section
27 of T36N R13E.
    (iv) E\1/2\ of SW\1/4\ of Section 27 of T36N R13E.
    (v) N\1/2\ of N\1/2\ of Section 34 of T36N R13E.
    (vi) S\1/2\ of NW\1/4\ of Section 35 of T36N R13E.
    (vii) Section 36 of T36N R13E.
    (viii) Section 2 of T35N R13E.
    (ix) W\1/2\ of Section 2 of T34N R15E.
    (x) Section 10 of T34N R15E.
    (xi) S\1/2\ of NW\1/4\ of Section 16 of T34N R15E.
    (xii) N\1/2\ of SE\1/4\ of Section 20 of T34N R15E.
    (xiii) NW\1/4\ of Section 28 of T34N R15E.
    (xiv) W\1/2\ of NE\1/4\ of Section 28 of T34N R15E.
    (xv) W\1/2\ of SW\1/4\ of Section 28 of T34N R15E.
    (xvi) W\1/2\ of NE\1/4\ of Section 30 of T34N R15E.
    (xvii) SW\1/4\ of Section 2 of T34N R16E.
    (xviii) W\1/2\ of NE\1/4\ of Section 12 of T34N R16E.
    (xix) SE\1/4\ of Section 12 of T34N R16E.
    (xx) E\1/2\ of SW\1/4\ of Section 12 of T34N R16E.
    (xxi) N\1/2\ of Section 14 of T34N R16E.
    (xxii) SE\1/4\ of Section 14 of T34N R16E.
    (xxiii) E\1/2\ of Section 16 of T34N R16E.
    (xxiv) NE\1/4\ of Section 20 of T34N R16E.
    (xxv) NE\1/4\ of Section 24 of T34N R16E.
    (xxvi) N\1/2\ of Section 22 of T35N R15E.
    (xxvii) SE\1/4\ of Section 22 of T35N R15E.
    (xxviii) N\1/2\ of SW\1/4\ of Section 24 of T35N R15E.
    (xxix) NW\1/4\ of Section 26 of T35N R15E.
    (xxx) E\1/2\ of Section 28 of T35N R15E.
    (xxxi) E\1/2\ of NW\1/4\ of Section 28 of T35N R15E.
    (xxxii) SW\1/4\ of Section 32 of T35N R15E.
    (xxxiii) E\1/2\ of NW\1/4\ of Section 32 of T35N R15E.
    (xxxiv) W\1/2\ of NE\1/4\ of Section 32 of T35N R15E.
    (xxxv) NW\1/4\ of Section 34 of T35N R15E.
    (xxxvi) N\1/2\ of SW\1/4\ of Section 34 of T35N R15E.
    (xxxvii) W\1/2\ of NE\1/4\ of Section 34 of T35N R15E.
    (xxxviii) E\1/2\ of Section 36 of T35N R15E.
    (xxix) SW\1/4\ of Section 36 of T35N R15E.
    (xl) S\1/2\ of NW\1/4\ of Section 36 of T35N R15E.
    (xli) S\1/2\ of Section 24 of T35N R16E.
    (xlii) N\1/2\ of Section 26 of T35N R16E.
    (xliii) SW\1/4\ of Section 26 of T35N R16E.
    (xliv) W\1/2\ of SE\1/4\ of Section 26 of T35N R16E.
    (xlv) E\1/2\ of SW\1/4\ of Section 30 of T35N R16E.
    (xlvi) W\1/2\ of SE\1/4\ of Section 30 of T35N R16E.
    (xlvii) N\1/2\ of Section 34 of T35N R16E.

 [FR Doc. E8-8946 Filed 4-28-08; 8:45 am]

BILLING CODE 6560-50-P