[Federal Register: December 21, 2005 (Volume 70, Number 244)]
[Proposed Rules]
[Page 75771-75779]
[DOCID:fr21de05-26]

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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Parts 122 and 412

[EPA-HQ-OW-2005-0036; FRL-8011-7]
RIN 2040-AE80

Revised Compliance Dates for National Pollutant Discharge
Elimination System Permit Regulation and Effluent Limitation Guidelines
for Concentrated Animal Feeding Operations

AGENCY: Environmental Protection Agency (EPA).

ACTION: Proposed rule.

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SUMMARY: EPA proposes to extend certain compliance dates in the
National Pollutant Discharge Elimination System (NPDES) permitting
requirements (40 CFR part 122) and Effluent Limitations Guidelines and
Standards (ELGs) (40 CFR part 412) for concentrated animal feeding
operations (CAFOs) in conjunction with EPA's efforts to respond to the
order issued by the Second Circuit Court of Appeals in Waterkeeper
Alliance et al. v. EPA, 399 F.3d 486 (2nd Cir. 2005). The purpose of
today's proposed rule is to address timing issues associated with the
Agency's response to the Waterkeeper decision.
    This proposal would revise dates established in the 2003 CAFO rule,
issued on February 12, 2003, by which facilities newly defined as CAFOs
were required to seek permit coverage and by which all CAFOs were
required to have nutrient management plans (NMPs) developed and
implemented. EPA is proposing to extend the date by which operations
defined as CAFOs as of April 14, 2003, who were not defined as CAFOs
prior to that date, must seek NPDES permit coverage, from February 13,
2006, to March 30, 2007. EPA is also proposing to amend the date by
which operations that become defined as CAFOs after April 14, 2003, due
to operational changes that would not have made them a CAFO prior to
April 14, 2003, and that are not new sources, must seek NPDES permit
coverage, from April 13, 2006, to March 30, 2007. Finally, EPA is
proposing to extend the deadline by which CAFOs are required to develop
and implement NMPs, from December 31, 2006, to March 30, 2007. This
proposal would revise all references to the date by which NMPs must be
developed and implemented currently in the 2003 CAFO rule.
    EPA will also be issuing a proposed rule to revise the 2003 CAFO
regulations more broadly in order to address the Second Circuit Court
of Appeals decision in a subsequent Federal Register Notice, which the
Agency plans to propose for public comment in early 2006.

DATES: Comments on this proposed action must be received on or before
January 20, 2006.

ADDRESSES: Submit your comments, identified by Docket ID No. EPA-HQ-OW-
2005-0036 by one of the following methods:
    (1) http://www.regulations.gov: Follow the on-line instructions for

submitting comments.
    (2) E-mail<EMAIL_ADDRESS>Attention Docket ID No. EPA-HQ-OW-
2005-0036.
    (3) Mail: Send the original and three copies of your comments to:
Water Docket, Environmental Protection Agency, Mail code 4203M, 1200
Pennsylvania Ave., NW., Washington, DC 20460, Attention Docket ID No.
OW-2005-0036.
    (4) Hand Delivery: Deliver your comments to: EPA Docket Center, EPA
West, Room B102, 1301 Constitution Avenue, NW., Washington, DC,
Attention Docket ID No. OW-2005-0036. Such deliveries are only accepted
during the Docket's normal hours of operation and special arrangements
should be made for deliveries of boxed information.
    Instructions: Direct your comments to Docket ID No. EPA-HQ-OW-2005-
0036. EPA's policy is that all comments received will be included in
the public docket without change and may be made available online at
http://www.regulations.gov, including any personal information

provided, unless the comment includes information claimed to be
Confidential Business Information (CBI) or other information

whose disclosure is restricted by statute. Do not submit information
that you consider to be CBI or otherwise protected through http://www.regulations.gov or e-mail. The http://www.regulations.gov Web site

is an ``anonymous access'' system, which means EPA will not know your
identity or contact information unless you provide it in the body of
your comment. If you send an e-mail comment directly to EPA without
going through http://www.regulations.gov your e-mail address will be

automatically captured and included as part of the comment that is
placed in the public docket and made available on the Internet. If you
submit an electronic comment, EPA recommends that you include your name
and other contact information in the body of your comment and with any
disk or CD-ROM you submit. If EPA cannot read your comment due to
technical difficulties and cannot contact you for clarification, EPA
may not be able to consider your comment. Electronic files should avoid
the use of special characters, any form of encryption, and be free of
any defects or viruses. For additional information about EPA's public
docket visit the EPA Docket Center homepage at http://www.epa.gov/epahome/dockets.htm
.

    Docket: All documents in the docket are listed in the http://www.regulations.gov
 index. Although listed in the index, some

information is not publicly available, e.g., CBI or other information
whose disclosure is restricted by statute. Certain other material, such
as copyrighted material, will be publicly available only in hard copy.
Publicly available docket materials are available either electronically
in http://www.regulations.gov or in hard copy at the Water Docket in

the EPA Docket Center, EPA West, Room B102, 1301 Constitution Ave.,
NW., Washington, DC. The Public Reading Room is open from 8:30 a.m. to
4:30 p.m., Monday through Friday, excluding legal holidays. The
telephone number for the Public Reading Room is<PHONE_NUMBER>, and the
telephone number for the Water Docket is<PHONE_NUMBER>.

FOR FURTHER INFORMATION CONTACT: Kawana Cohen, Water Permits Division,
Office of Wastewater Management (4203M), Environmental Protection
Agency, 1200 Pennsylvania Ave., NW., Washington, DC 20460; telephone
number:<PHONE_NUMBER>, e-mail address<EMAIL_ADDRESS>
SUPPLEMENTARY INFORMATION:

I. General Information
    A. Does this Action Apply to Me?
    B. What Should I Consider as I Prepare My Comments for EPA?
II. Background
    A. The Clean Water Act
    B. History of Actions to Address CAFOs under the NPDES
Permitting Program
    C. Ruling by the U.S. Court of Appeals for the Second Circuit
    1. Issues Upheld by the Court
    2. Issues Vacated by the Court
    3. Issues Remanded by the Court
    D. What Requirements Still Apply to CAFOs?
    E. Status of EPA's Response to the Waterkeeper Decision
    F. Compliance Dates in the 2003 CAFO Rule Affected by the
Waterkeeper Decision
III. Today's Proposal
    A. Application Deadline for Newly Defined CAFOs
    1. Proposal to Extend Deadline for Seeking Permit Coverage
    2. Background
    3. Rationale
    B. Deadline for Nutrient Management Plans
    1. Proposal to Extend Deadline for Nutrient Management Plans
    2. Background
    3. Rationale
IV. Statutory and Executive Order Reviews
    A. Executive Order 12866: Regulatory Planning and Review
    B. Paperwork Reduction Act
    C. Regulatory Flexibility Act
    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 and Safety Risks
    H. Executive Order 13211: Actions Concerning Regulations That
Significantly Affect Energy Supply, Distribution, or Use
    I. National Technology Transfer and Advancement Act

I. General Information

A. Does This Action Apply to Me?

    This action applies to concentrated animal feeding operations
(CAFOs) as defined in section 502(14) of the Clean Water Act and in the
NPDES regulations at 40 CFR 122.23. The following table provides a list
of standard industrial codes for operations covered under this revised
rule.

                              Table 1.--Entities Potentially Regulated by this Rule
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                                                                                Standard
                                                                              North American       industrial
                Category                   Examples of regulated entities     industry code      classification
                                                                                (NAIC)              code
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Federal, State, and Local Government:
    Industry............................  Operators of animal production
                                           operations that meet the
                                           definition of a CAFO.
                                          Beef cattle feedlots (including              112112               0211
                                           veal).
                                          Beef cattle ranching and farming             112111               0212
                                          Hogs............................              11221               0213
                                          Sheep...........................       11241, 11242               0214
                                          General livestock except dairy                11299               0219
                                           and poultry.
                                          Dairy farms.....................              11212               0241
                                          Broilers, fryers, and roaster                 11232               0251
                                           chickens.
                                          Chicken eggs....................              11231               0252
                                          Turkey and turkey eggs..........              11233               0253
                                          Poultry hatcheries..............              11234               0254
                                          Poultry and eggs................              11239               0259
                                          Ducks...........................             112390               0259
                                          Horses and other equines........              11292               0272
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    This table is not intended to be exhaustive, but rather provides a
guide for readers regarding entities likely to be regulated by this
action. This table lists the types of entities that EPA is now aware
could potentially be regulated by

this action. Other types of entities not listed in the table could also
be regulated. To determine whether your facility is regulated under
this rulemaking, you should carefully examine the applicability
criteria in 40 CFR 122.23. If you have questions regarding the
applicability of this action to a particular entity, consult the person
listed in the preceding FOR FURTHER INFORMATION CONTACT section.

B. What Should I Consider as I Prepare My Comments for EPA?

    1. Submitting Confidential Business Information. Do not submit this
information to EPA through http://www.regulations.gov or e-mail.

Clearly mark the part or all of the information that you claim to be
CBI. (For CBI information in a disk or CD ROM that you mail to EPA,
mark the outside of the disk or CD ROM as CBI and then identify
electronically within the disk or CD ROM the specific information that
is claimed as CBI). In addition to one complete version of the comment
that includes information claimed as CBI, a copy of the comment that
does not contain the information claimed as CBI must be submitted for
inclusion in the public docket. Information so marked will not be
disclosed except in accordance with procedures set forth in 40 CFR
part.)
    2. Tips for Preparing Your Comments. It will be helpful if you
follow these guidelines as you prepare your written comments:
    i. Identify the rulemaking by docket number and other identifying
information (subject heading, Federal Register date and page number).
    ii. Follow directions--The Agency may ask you to respond to
specific questions or organize comments by referencing a Code of
Federal Regulations (CFR) part or section number.
    iii. Explain why you agree or disagree; suggest alternatives and
substitute language for your requested changes.
    iv. Describe any assumptions and provide any technical information
and/or data that you used.
    v. If you estimate potential costs or burdens, explain how you
arrived at your estimate in sufficient detail to allow for it to be
reproduced.
    vi. Provide specific examples to illustrate your concerns, and
suggest alternatives.
    vii. Explain your views as clearly as possible.
    viii. Make sure to submit your comments by the comment period
deadline identified.

II. Background

A. The Clean Water Act

    Congress passed the Federal Water Pollution Control Act (1972),
also known as the Clean Water Act (CWA), to ``restore and maintain the
chemical, physical, and biological integrity of the nation's waters''
(33 U.S.C. 1251(a)). Among the core provisions, the CWA establishes the
NPDES permit program to authorize and regulate the discharge of
pollutants from point sources to waters of the U.S. 33 U.S.C. 1342.
Section 502(14) of the CWA specifically includes CAFOs in the
definition of the term ``point source.'' Section 502(12) defines the
term ``discharge of a pollutant'' to mean ``any addition of any
pollutant to navigable waters from any point source'' (emphasis added).
EPA has issued comprehensive regulations that implement the NPDES
program at 40 CFR part 122. The Act also provides for the development
of technology-based and water quality-based effluent limitations that
are imposed through NPDES permits to control the discharge of
pollutants from point sources. CWA section 301(a) and (b).

B. History of Actions To Address CAFOs Under the NPDES Permitting
Program

    EPA's regulation of wastewater and manure from CAFOs dates to the
1970s. EPA initially issued national effluent limitations guidelines
and standards for feedlots on February 14, 1974 (39 FR 5704), and NPDES
CAFO regulations on March 18, 1976 (41 FR 11458).
    In February 2003, EPA issued revisions to these regulations that
focused on the 5% of the nation's animal feeding operations (AFOs) that
presented the highest risk of impairing water quality and public health
(68 FR 7176) (the ``2003 CAFO rule''). The 2003 CAFO rule required the
owner or operators of all CAFOs \1\ to seek coverage under an NPDES
permit. CAFO industry organizations (American Farm Bureau Federation,
National Pork Producers Council, National Chicken Council, and National
Turkey Federation (NTF), although later NTF later withdrew its
petition) and environmental groups (Waterkeeper Alliance, Natural
Resources Defense Council, Sierra Club, and American Littoral Society)
filed petitions for judicial review of certain aspects of the 2003 CAFO
rule. This case was brought before the U.S. Court of Appeals for the
Second Circuit. On February 28, 2005, the court ruled on these
petitions and upheld most provisions of the 2003 rule but vacated and
remanded others. Waterkeeper Alliance et al. v. EPA, 399 F.3d 486 (2nd
Cir. 2005). The court's decision is described below.
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    \1\ The Clean Water Act regulates the conduct of persons, which
includes the owners and operators of CAFOs, rather than the
facilities or their discharges. To improve readability in this
preamble, reference is made to ``CAFOs'' as well as ``owners and
operators of CAFOs.'' No change in meaning is intended.
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C. Ruling by the U.S. Court of Appeals for the Second Circuit

    The Second Circuit's decision in Waterkeeper upheld certain
challenged provisions of the 2003 rule and vacated or remanded others.
This discussion is included in the preamble to provide the reader with
background information and context why this proposed action is
necessary. While today's proposal deals solely with the compliance
dates, EPA plans to publish a subsequent rulemaking that will address
more broadly the substantive changes to the 2003 rule in response to
Waterkeeper. The Agency plans to make available the more comprehensive
rulemaking for public comment in early 2006.
1. Issues Upheld by the Court
    This section discusses provisions of the 2003 CAFO rule that were
challenged by either industry or environmental petitions, but were
upheld by the Waterkeeper court and therefore remain unchanged. EPA is
not proposing to revise any of these provisions in today's notice and
is not soliciting comment on them.
    a. Land Application Regulatory Framework and Interpretation of
``Agricultural Storm Water''. The Waterkeeper court upheld EPA's
authority to regulate, through NPDES permits, the runoff of manure,
litter, and process wastewater that CAFOs apply to crop or forage land.
The court rejected the Industry Petitioners' claim that land
application runoff at CAFOs must be channelized before it can be
considered to be a point source discharge subject to permitting. The
court noted that the CWA expressly defines the term ``point source'' to
include ``any * * * concentrated animal feeding operation * * * from
which pollutants are or may be discharged,'' and found that the Act
``not only permits, but demands'' that land application discharges be
construed as discharges ``from'' a CAFO. Waterkeeper Alliance et al. v.
EPA, 399 F.3d at 510.
    The Waterkeeper court also upheld EPA's determination in the 2003
CAFO rule that precipitation-related discharges of manure, litter, or
process wastewater from land application areas under the control of a
CAFO qualify as ``agricultural storm water'' only where the CAFO has
applied the manure in

accordance with NMPs that ensure ``appropriate agricultural
utilization'' of the manure, litter, and process wastewater nutrients.
EPA's interpretation of the Act in this regard was reasonable, the
court found, in light of Congressional intent in excluding agricultural
storm water from the meaning of the term ``point source'' and given the
precedent set in an earlier Second Circuit case, Concerned Area
Residents for the Environment v. Southview Farm, 34 F.3d 114 (2d Cir.
1994). Waterkeeper Alliance et al. v. EPA, 399 F.3d at 508-09.
    b. Effluent Guidelines. The Waterkeeper court upheld the CAFO
effluent guidelines against challenges from the litigants, except for
the items remanded to EPA, as noted further below, as follows:

--Identification of best available technologies. The court rejected the
environmental organizations' claim that when EPA chose the pollution
control technologies on which to base effluent guidelines for CAFOs,
the Agency did not meet its duty to identify the single CAFO with the
best-performing technology. The court found that EPA had collected
extensive data on the waste management systems at CAFOs and had
considered approximately 11,000 public comments on the proposed CAFO
rule, and on those bases, EPA had adequately justified its selection of
``best available technologies'' on which to base the regulations.
--Groundwater controls. The court upheld EPA's decision to leave
groundwater discharges to be addressed at the state level or on a site
specific basis. EPA had determined that because such discharges depend
greatly on local geology and other site-specific factors, the need for
controls on groundwater discharges was a matter to be evaluated at the
local level rather than established in a national regulation.
--Economic methodologies. The court upheld the financial methodologies
that EPA used for determining whether the technology-based permit
requirements for CAFOs set in the 2003 rule would be economically
achievable by the industry as a whole.
2. Issues Vacated by the Court
    The following are the elements of the 2003 rule that the
Waterkeeper court found to be unlawful and therefore vacated. EPA is
not proposing to revise any of these provisions in today's notice and
is not soliciting comment on them. As noted above, EPA intends to
address the court's ruling vacating these provisions in a subsequent
proposal that will follow in the coming months.
    a. Duty to Apply. The CAFO industry organizations argued that the
EPA exceeded its statutory authority by requiring all CAFOs to either
apply for NPDES permits or otherwise demonstrate that they have no
potential to discharge. The court agreed with the CAFO industry
petitioners on this issue and therefore vacated the ``duty to apply''
provision of the 2003 CAFO rule.
    The court found that the duty to apply, which the Agency had based
on a presumption that most CAFOs have at least a potential to
discharge, was invalid, because the CWA subjects only actual discharges
to regulation rather than potential discharges. The court acknowledged
EPA's strong policy considerations for seeking to impose a duty to
apply--``EPA has marshaled evidence suggesting that such a prophylactic
measure may be necessary to effectively regulate water pollution from
Large CAFOs, given that Large CAFOs are important contributors to water
pollution'' (399 F.3d at 506, fn.22)\2\--but found that the Agency
nevertheless lacked statutory authority to do so.
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    \2\ Similarly, the United States Government Accountability
Office concluded in 2003 that the measures in EPA's 2003 rule would
solve the problems created by exemptions in the 1976 rule. (United
States General Accounting Office. 2003. Livestock Agriculture:
Increased EPA Oversight Will Improve Environmental Protection for
Concentrated Animal Feeding Operations, Report to the Ranking
Member, Committee on Agriculture, Nutrition and Forestry, U.S.
Senate. GAO-03-285. Washington, DC)
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    b. Nutrient Management Plans. The environmental organizations
argued that the 2003 CAFO rule was unlawful because: (1) The rule
empowered permitting authorities to issue permits without any
meaningful review of the CAFO's NMP, (2) the rule failed to require
that the terms of the NMP be included in the NPDES permit, and (3) the
permitting scheme established by the rule violated the Clean Water
Act's public participation requirements. The court agreed with the
environmental petitioners on these three issues.
    The court relied on provisions of the Act that authorize point
source discharges only where NPDES permits ``ensure that every
discharge of pollutants will comply with all applicable effluent
limitations and standards,'' citing CWA sections 402(a)(1), (a)(2), and
(b). Because the 2003 CAFO rule allowed CAFOs to write their own NMPs
and because those plans were not required to be reviewed by the
permitting agency or made available to the public for comment before
the permit was issued, the court found that the rule did not ensure
that each Large CAFO will develop a satisfactory plan. The court also
found that the terms of the NMPs themselves are ``effluent
limitations'' as that term is defined in the Act and therefore must be
included in the permit under CWA sections 301 and 402. In addition, the
court found that by not making the NMPs part of the permit and
available to the public for review, the 2003 CAFO rule violated public
participation requirements in sections 101(e) and 402 of the Act.
3. Issues Remanded by the Court
    The court also remanded other aspects of the CAFO rule to EPA ``for
further clarification and analysis.'' EPA is not proposing to revise
any of these provisions in today's proposal and is not soliciting
comment on them. As previously noted, the agency plans to address these
issues in its forthcoming proposed rule. They are as follows:
    a. Water Quality-Based Effluent Limits. The court agreed with EPA
that agricultural storm water is excluded from the meaning of the term
``point source'' and therefore is not subject to water quality-based
effluent limitations in permits. However, the court directed EPA to
``clarify the statutory and evidentiary basis for failing to promulgate
water quality-based effluent limitations for discharges other than
agricultural storm water discharges as that term is defined in 40 CFR
122.23(e),'' and to ``clarify whether States may develop water quality-
based effluent limitations on their own.''
    b. New Source Performance Standards--100-Year Storm. Standard. The
2003 CAFO rule set the new source performance standards (NSPS) for
swine, poultry, and veal CAFOs at a level of zero discharge. A CAFO in
these categories could fulfill this requirement by showing that either
(1) Its production area was designed to contain all manure, litter,
process wastewater, and precipitation from the 100-year, 24-hour storm,
or (2) it would comply with ``voluntary superior performance
standards'' based on innovative technologies, under which a discharge
from the production area would be allowed if it was accompanied by an
equivalent or greater reduction in the quantity of pollutants released
to other media (e.g., air emissions). The court found that EPA had not
justified in the record nor provided adequate public participation with
respect to either of these provisions. As a result, the court remanded
these provisions to EPA to clarify, via a process that adequately

involves the public, the statutory and evidentiary basis for their
allowance.
    c. BCT Effluent Guidelines for Pathogens. The court held that the
2003 CAFO rule violated the CWA because EPA had not made an affirmative
finding that the BCT-based ELGs `` i.e., the ``best conventional
technology'' guidelines for conventional pollutants such as fecal
coliform `` do in fact represent BCT technology. The court remanded
this issue to EPA to make such a finding based on the best available
control technology economically achievable (BAT)/best practicable
control technology currently available (BPT) technologies EPA studied
or to establish specific BCT limitations for pathogens based on some
other technology.

D. What Requirements Still Apply to CAFOs?

    The Waterkeeper decision either upheld or did not address most
provisions of the 2003 CAFO rule. This section describes certain key
portions of the rule that were not challenged in Waterkeeper. EPA is
not proposing to revise any of these provisions and is not soliciting
comment on them.
    The definitions provided in 40 CFR 122.23(b) of the 2003 CAFO rule
remain in effect and are unchanged. First, an operation must be defined
as an animal feeding operation (AFO) before it can be defined as a
concentrated animal feeding operation (CAFO). 40 CFR 122.23. The term
``animal feeding operation'' is defined by EPA regulation as a ``lot or
facility'' where animals ``have been, are or will be stabled or
confined and fed or maintained for a total of 45 days or more in any 12
month period and crops, vegetation, forage growth, or post harvest
residues are not sustained in the normal growing season over any
portion of the lot or facility.''
    Whether an AFO is a CAFO depends primarily on the number of animals
confined, which is also unchanged. Large CAFOs are AFOs that contain
more than the threshold number of animals detailed in 40 CFR
122.23(b)(4). Medium CAFOs contain fewer animals than Large CAFOs and
also: (1) Discharge pollutants into waters of the U.S. through a man-
made ditch, flushing system, or other similar man-made device; or (2)
discharge pollutants directly into waters of the U.S. that originate
outside of and pass over, across, or through the facility or otherwise
come into direct contact with the confined animals. 40 CFR
122.23(b)(6)(ii). The NPDES permitting authority also may, on a case-
by-case basis, designate any AFO, including Small CAFOs, as a CAFO
after conducting an on-site inspection and finding that the facility
``is a significant contributor of pollutants to waters of the United
States.'' 40 CFR 122.23(c). The permitting authority may not exercise
its authority to designate a facility as a Small CAFO unless pollutants
are discharged into waters of the U.S. through a man-made ditch,
flushing system, or other similar man-made device, or are discharged
directly into waters of the U.S. which originate outside of the
facility and pass over, across, or through the facility or otherwise
come into direct contact with the animals confined in the operation.
    The 2003 CAFO rule also eliminated the provision in the original
regulations stating that a facility was not defined as a CAFO if it
discharged only in the event of a 25-year, 24-hour storm. The
Waterkeeper decision did not affect this aspect of the 2003 rule, under
which facilities no longer have an exemption from the definition of a
CAFO if they discharge only in the event of a 25-year, 24-hour storm.
Likewise, the Waterkeeper decision did not affect the 2003 rule's
inclusion, for the first time, of certain animal sectors within the
definition of a CAFO, such as chicken operations with dry systems for
handling manure.
    Any discharge of manure, litter, or process wastewater from the
production area of a CAFO to a water of the U.S. violates the CWA
unless it is authorized by an NPDES permit. By eliminating the 25-year,
24-hour storm exemption in the 2003 rule, any overflow (see definition
in Sec.  412.2(g)), from any containment structure under any climatic
condition, including chronic or catastrophic rainfall events, is an
illegal discharge unless authorized by a permit. Additionally, any
runoff of manure, litter, or process wastewater from a CAFO land
application area to waters of the U.S. that is not agricultural storm
water is illegal unless authorized by a permit. Examples include, but
are not limited to, the discharge of litter, manure, or process
wastewater directly to waters of the United States (e.g., application
of liquid manure directly to surface water); dry-weather discharges due
to the land application of manure, litter, or process wastewater; or
the discharge of process wastewater or liquid manure from subsurface
drains during dry weather.
    Nutrient management planning requirements for permitted CAFOs
established in the 2003 CAFO rule also remain in place following the
court's ruling. All permitted CAFOs must develop and implement an NMP
that meets the requirements of 40 CFR 122.42(e) and 40 CFR 412.4, where
applicable. The NMP identifies the necessary actions to ensure that
runoff is eliminated or minimized through proper and effective manure,
litter, and wastewater management, including compliance with the ELGs.
NMPs for Large CAFOs must also contain additional provisions regarding
the land application of manure. Permitted CAFOs must comply with all
applicable recordkeeping and reporting requirements including those
specified in 40 CFR 122.42(e).
    ELG requirements for existing Large CAFOs also are largely
unchanged following the court's ruling. ELG requirements ensure the
appropriate storage of manure, litter, and process wastewater and
proper land application practices. They vary depending upon the types
of animals confined: Subpart A for horses and sheep; Subpart B for
ducks; Subpart C for dairy cattle, heifers, steers, and bulls; and
Subpart D for swine, poultry, and veal calves (40 CFR part 412).
Additionally, New Source requirements for beef and dairy operations
remain unchanged (40 CFR 412.35).
    Permitted Small and Medium CAFOs are not subject to the ELGs
specified in part 412. Rather, they must comply with all case-by-case
technology-based requirements developed by the permitting authority
(i.e., Best Professional Judgment (BPJ)).

E. Status of EPA's Response to the Waterkeeper Decision

    EPA is developing a rulemaking to respond to all of the issues in
the 2003 CAFO rule vacated or remanded by the Second Circuit Court of
Appeals. EPA plans to issue a proposed rulemaking for public comment in
early 2006 and a final rulemaking as expeditiously as possible.

F. Compliance Dates in the 2003 CAFO Rule Affected by the Waterkeeper
Decision

    The 2003 CAFO rule required all newly defined CAFOs, as of the date
of the final rule, and some new dischargers to seek permit coverage by
February 13, 2006, or April 13, 2006, respectively. The rule also
required all CAFOs to develop and implement an NMP by December 31,
2006. EPA is proposing to revise each of these dates in order: (1) To
provide the Agency sufficient time to take final action on the
regulatory revisions it plans to propose in the near future with
respect to the Second Circuit's decision; and (2) To require NMPs to be
submitted at the time of the permit application, consistent with the
court's decision.

III. Today's Proposal

    Today's proposal is intended to extend certain dates for compliance
specified in the 2003 CAFO rule. EPA proposes to extend the dates for
newly defined CAFOs to seek NPDES permit coverage and the date by which
all CAFOs must develop and implement NMPs. Because EPA is not likely to
have completed the rulemaking responding to the Waterkeeper decision
prior to the dates by which newly defined CAFOs must seek permit
coverage, the Agency proposes in today's notice to revise these dates
to a time that is subsequent to the forthcoming CAFO rule revision.
    Inasmuch as these proposed revisions precede the other regulatory
revisions that EPA plans to propose to respond to the Waterkeeper
decision, they are made strictly in the context of existing regulations
promulgated in the 2003 CAFO rule. Today's proposal is simply a means
of avoiding conflict with existing deadlines that precede EPA's
upcoming revisions to the 2003 rules. Today's proposal does not, for
example, address issues associated with the court's vacature of the
requirement that all CAFOs seek coverage under an NPDES permit. That
issue and other related issues will be addressed in the separate
upcoming rulemaking. Therefore, EPA is today soliciting comment only on
its proposal to revise specific dates in the 2003 rule, as described
below.

A. Application Deadline for Newly Defined CAFOs

1. Proposal To Extend Deadline for Seeking Permit Coverage
    EPA is proposing to extend the date by which operations defined as
CAFOs as of April 14, 2003, that were not defined as CAFOs prior to
that date, must seek NPDES permit coverage, from February 13, 2006, to
March 30, 2007. EPA is also proposing to amend the date by which
operations that become defined as CAFOs after April 14, 2003, due to
operational changes that would not have made them a CAFO prior to April
14, 2003, and that are not new sources, must seek NPDES permit
coverage, from April 13, 2006, to March 30, 2007.
    Today's proposal would not affect the requirements applicable to
new source CAFOs that discharge or propose to discharge, even those in
categories that were added to the definition of a CAFO in the 2003 CAFO
rule. New source CAFOs that discharge or propose to discharge are
required by the 2003 CAFO rule to seek NPDES permit coverage at least
180 days prior to the time that they commence operating.
2. Background
    The 2003 CAFO rule added facilities that had not been previously
defined as CAFOs (in the 1976 regulations) to the definition of a CAFO.
Operations newly defined as CAFOs in the 2003 CAFO rule included veal
operations, chicken and layer operations using other than liquid manure
handling systems, and AFOs that were previously not defined as CAFOs
because they discharged only in the event of a 25-year/24-hour storm
(see 40 CFR 122.23(b)). Those CAFOs in these categories that were in
existence on the date the 2003 CAFO rule took effect (April 14, 2003)
represent the group of CAFOs currently subject to the February 13,
2006, deadline (see 40 CFR 122.23(g)(2)). This group of CAFOs
represented most of the newly defined CAFOs that were covered by the
2003 rule. In addition, other existing facilities that might become
CAFOs, as a result of the revised CAFO definitions in the 2003 CAFO
rule, are so-called ``new dischargers'' that might at some date
subsequent to the effective date of the 2003 CAFO rule become a CAFO
due to changes in their operations, where those changes would not have
made the operation a CAFO prior to April 14, 2003. This second group of
facilities is currently required to seek permit coverage by April 13,
2006, or 90 days after becoming defined as a CAFO (whichever date is
later) (see 40 CFR 122.23(g)(3)(iii)).
    Both of these groups of CAFOs were allowed three years to seek
permit coverage when EPA issued the 2003 CAFO rule. In the preamble to
the 2003 CAFO rule, EPA reasoned that such an approach was consistent
with Congressional intent with respect to newly established point
sources, in the 1972 Clean Water Act, and with Agency practice in a
similar prior rulemaking. Moreover, the Agency believed that the three
year delay provided other advantages, including adequate time for
States to provide permit coverage for CAFOs that were not previously
required to be permitted and to revise state regulatory programs (see
68 FR 7204).
3. Rationale
    These newly defined CAFOs are required by the current regulations
to seek NPDES permit coverage by the dates established in the 2003 CAFO
rule (either in February 2006 or April 2006). Both of these dates occur
before the time when EPA will be issuing the upcoming rule revisions.
EPA is proposing to extend those dates to allow EPA time to complete
that rulemaking. EPA believes that, under these circumstances, there
are compelling reasons to provide these CAFOs, who are required to
apply for an NPDES permit for the first time under the 2003 rule, an
extension of time so that they need not apply for permits until after
EPA has completed the forthcoming revisions to the 2003 rule. This is
appropriate, for example, because among other things the revisions will
address the court's ruling on which CAFOs need to apply for permits at
all and, where permits are issued, the need to include terms of the
NMPs in the permit.
    Because today's proposed extension would add another year to the
three years originally provided for these facilities to obtain NPDES
permit coverage, EPA does not believe that a further extension beyond
March 2007, is either necessary or appropriate at this time.

B. Deadline for Nutrient Management Plans

1. Proposal To Extend Deadline for Nutrient Management Plans
    EPA is proposing to extend the deadline by which permitted CAFOs
are required to develop and implement NMPs, from December 31, 2006, to
March 30, 2007. This proposal would revise all references to the date
by which NMPs must be developed and implemented currently in the 2003
CAFO rule. Thus the deadlines established in 40 CFR 122.21(i)(1)(x),
122.42(e)(1), 412.31(b)(3), and 412.43(b)(2) are all proposed to be
revised accordingly.
    Today's proposal would not affect CAFOs operating under existing
permits so long as those permits remain in effect. If their existing
permits require development and implementation of an NMP, currently
permitted CAFOs must develop and implement their NMPs in accordance
with the terms of their current permit.
2. Background
    The 2003 CAFO rule required all CAFOs to develop and implement a
NMP by December 31, 2006, except that CAFOs seeking to obtain coverage
under a permit subsequent to that date were required to have a NMP
developed and implemented upon the date of permit coverage. The same
dates were established for the implementation of the land application
requirements in the Effluent Limitation Guidelines (ELGs), including
the NMP requirements in the ELGs. As discussed in the preamble to the
2003 CAFO rule, EPA believed that these dates were reasonable given
that operations would have had three and a half years from the time the
2003 rule

was issued to employ the necessary planning and construction to
implement an NMP. For Large CAFOs that are new sources (i.e., those
commencing construction after the effective date of the 2003 CAFO
rule), the land application requirements at 40 CFR 412.4(c) applied
immediately.
    EPA concluded that this timeframe also allowed States to update
their NPDES programs and issue permits to reflect the NMP requirements
of the 2003 CAFO rule and provided flexibility for permit authorities
to establish permit schedules based on specific circumstances,
including prioritization of NMP development and implementation based on
site-specific water quality risks and the available infrastructure for
development of NMPs.
3. Rationale
    The proposal to extend the date by which CAFOs must develop and
implement their NMPs is consistent with today's proposal to extend the
deadline for newly defined CAFOs to seek permit coverage, and would
mean that CAFOs would be required to have developed and implemented an
NMP as of the date they apply for an NPDES permit.
    As previously discussed, EPA plans to address in a separate
proposal the Second Circuit's ruling with respect to including terms of
the NMP in permits issued to CAFOs. For present purposes, EPA notes
that making these two deadlines coincide would be consistent with the
Court's direction to include terms of the NMP in permits issued to
CAFOs.
    EPA does not believe that additional time beyond March 2007 is
necessary at this time because the substantive NMP requirements have
been in place since February 2003, and CAFOs have thus had adequate
time to prepare NMPs. By extending the original deadline for NMP
development by three additional months, today's proposal allows the
CAFO operator time during the winter season to prepare the NMP
paperwork and to begin implementing the practices in the NMP.

IV. Statutory and Executive Order Reviews

A. Executive Order 12866: Regulatory Planning and Review

    Under Executive Order 12866, (58 FR 51735; October 4, 1993), the
Agency must determine whether the regulatory action is ``significant''
and therefore subject to Office of Management and Budget (OMB) review
and the requirements of the Executive Order. The Order defines
``significant regulatory action'' as one that is likely to result in a
rule that may:
    1. Have an annual effect on the economy of $100 million or more or
adversely affect in a material way the economy, a sector of the
economy, productivity, competition, jobs, the environment, public
health or safety, or State, local, or tribal governments or
communities;
    2. Create a serious inconsistency or otherwise interfere with an
action taken or planned by another agency;
    3. Materially alter the budgetary impact of entitlements, grants,
user fees, or loan programs or the rights and obligations of recipients
thereof; or
    4. Raise novel legal or policy issues arising out of legal
mandates, the President's priorities, or the principles set forth in
the Executive Order.
    It has been determined that this proposed rule is not a
``significant regulatory action'' under the terms of Executive Order
12866 and, therefore, is not subject to OMB review.

B. Paperwork Reduction Act

    This proposed action does not impose any new information collection
burden. As discussed above, the purpose of today's proposed rule is
solely to address timing issues associated with the Agency's response
to the Waterkeeper court ruling based on litigation ensuing from the
2003 CAFO rule. However, the Office of Management and Budget (OMB) has
previously approved the information collection requirements contained
in the existing regulations at 40 CFR parts 9, 122, 123, and 412 under
the provisions of the Paperwork Reduction Act, 44 U.S.C. 3501 et seq.
and has assigned OMB control number 2040-0250. The EPA ICR number for
the original set of regulations is 1989.02. A copy of the OMB approved
Information Collection Request (ICR) may be obtained from Susan Auby,
Collection Strategies Division; U.S. Environmental Protection Agency
(2822T); 1200 Pennsylvania Ave., NW., Washington, DC 20460 or by
calling<PHONE_NUMBER>.
    Burden means the total time, effort, or financial resources
expended by persons to generate, maintain, retain, or disclose or
provide information to or for a Federal agency. This includes the time
needed to review instructions; develop, acquire, install, and utilize
technology and systems for the purposes of collecting, validating, and
verifying information, processing and maintaining information, and
disclosing and providing information; adjust the existing ways to
comply with any previously applicable instructions and requirements;
train personnel to be able to respond to a collection of information;
search data sources; complete and review the collection of information;
and transmit or otherwise disclose the information.
    An agency may not conduct or sponsor, and a person is not required
to respond to, a collection of information unless it displays a
currently valid OMB control number. The OMB control numbers for EPA's
regulations in 40 CFR are listed in 40 CFR part 9.

C. Regulatory Flexibility Act

    The Regulatory Flexibility Act (RFA) generally requires an agency
to prepare a regulatory flexibility analysis of any rule subject to
notice and comment on 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 today's proposed rule on
small entities, small entity is defined as: (1) A small business based
on Small Business Administration (SBA) size standards; (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; and (3) a small organization that is any not-for-profit
enterprise which is independently owned and operated and is not
dominant in its field.
    After considering the economic impacts of today's proposed rule on
small entities, I certify that this action will not have a significant
economic impact on a substantial number of small entities. In
determining whether a rule has a significant economic impact on a
substantial number of small entities, the impact of concern is any
significant adverse economic impact on small entities, since the
primary purpose of the regulatory flexibility analyses is to identify
and address regulatory alternatives ``which minimize any significant
economic impact of the rule on small entities.'' 5 U.S.C. 603 and 604.
Thus, an agency may certify that a rule will not have a significant
economic impact on a substantial number of small entities if the rule
relieves regulatory burden, or otherwise has a positive economic effect
on all of the small entities subject to the rule.
    The effect of the proposal, if implemented is solely to extend
certain compliance deadlines related to NPDES CAFO permitting. EPA
believes that this will have the effect of relieving the regulatory
burden for affected CAFOs.

We continue to be interested in the potential impacts of the proposed
rule on small entities and welcome comments on issues related to such
impacts.

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 UMRA generally requires EPA to identify and
consider a reasonable number of regulatory alternatives and to 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.
    EPA has determined that this proposed rule would 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. As discussed above, the purpose of
today's proposed rule is solely to address timing issues associated
with the Agency's response to the Waterkeeper court ruling based on
litigation ensuing from the 2003 CAFO rule.

E. Executive Order 13132: Federalism

    Executive Order 13132, entitled ``Federalism'' (64 FR 43255, August
10, 1999), requires EPA to develop an accountable process to ensure
``meaningful and timely input by State and local officials in the
development of regulatory policies that have federalism implications.''
``Policies that have federalism implications'' is defined in the
Executive Order to include regulations that have ``substantial direct
effects on the States, on the relationship between the National
Government and the States, or on the distribution of power and
responsibilities among the various levels of government.''
    Under section 6(b) of Executive Order 13132, EPA 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 EPA
consults with State and local officials early in the process of
developing the proposed regulation. Under section 6(c) of Executive
Order 13132, EPA may not issue a regulation that has federalism
implications and that preempts State law, unless the Agency consults
with State and local officials early in the process of developing the
proposed regulation.
    EPA has concluded that this proposed 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.
EPA does not consider an annual impact of $2 million on States to be a
substantial effect. In addition, EPA does not expect this rule to have
any impact on local governments.
    Further, the revised regulations would not alter the basic State-
Federal scheme established in the Clean Water Act under which EPA
authorizes States to carry out the NPDES permitting program. EPA
expects the revised regulations to have little effect on the
relationship between, or the distribution of power and responsibilities
among, the Federal and State governments. Thus, Executive Order 13132
does not apply to this rule.
    In the spirit of Executive Order 13132, and consistent with EPA
policy to promote communications between EPA and State and local
governments, EPA specifically solicits comment on this proposed rule
from State and local officials.

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 9, 2000),
requires EPA to develop an accountable process to ensure ``meaningful
and timely input by tribal officials in the development of regulatory
policies that have tribal implications.''
    This proposed rule does not have tribal implications. It will not
have substantial direct effects on tribal governments, on the
relationship between the Federal Government and Indian tribes, or on
the distribution of power and responsibilities between the Federal
Government and Indian tribes, as specified in Executive Order 13175.
Thus, Executive Order 13175 does not apply to this rule.
    In the spirit of Executive Order 13175, and consistent with EPA
policy to promote communications between EPA and tribal governments,
EPA specifically solicits additional comment on this proposed rule from
tribal officials.

G. Executive Order 13045: Protection of Children From Environmental
Health and 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 E.O. 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 regulation is not subject to Executive Order 13045 because it
is not economically significant as defined under E.O. 12866, and
because the Agency does not have reason to believe the environmental
health and safety risks addressed by this action present a
disproportionate risk to children. The benefits analysis performed for
the 2003 CAFO rule determined that the rule would result in certain
significant benefits to children's health. (Please refer to the
Benefits Analysis in the record for the 2003 CAFO final rule.)

Since today's action would not affect the environmental benefits of the
rule, these benefits are retained.

H. Executive Order 13211: Actions Concerning Regulations That
Significantly Affect Energy Supply, Distribution, or Use

    This proposed rule would not be 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

    Section 12(d) of the National Technology Transfer and Advancement
Act of 1995 (``NTTAA''), Public Law 104-113, section 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 standard 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 proposed rulemaking does not involve technical standards.
Therefore, EPA is not considering the use of any voluntary consensus
standards.

List of Subjects

40 CFR Part 122

    Environmental protection, Administrative practice and procedure,
Confidential business information, Hazardous substances, Reporting and
recordkeeping requirements, Water pollution control.

40 CFR Part 412

    Environmental protection, Feedlots, Livestock, Waste treatment and
disposal, Water pollution control.

    Dated: December 15, 2005.
Stephen L. Johnson,
Administrator.

    For the reasons stated in the preamble, the Environmental
Protection Agency proposes to amend 40 CFR parts 122 and 412 as
follows:

PART 122--EPA ADMINISTERED PERMIT PROGRAMS: THE NATIONAL POLLUTANT
DISCHARGE ELIMINATION SYSTEM

    1. The authority citation for part 122 continues to read as
follows:

    Authority: The Clean Water Act, 33 U.S.C. 1251 et seq.

    2. Amend Sec.  122.21 by revising paragraph (i)(1)(x) to read as
follows:

Sec.  122.21  Application for a permit (applicable to State programs,
see Sec.  123.25).

* * * * *
    (i) * * *
    (1) * * *
    (x) For CAFOs that must seek coverage under a permit after March
30, 2007, certification that a nutrient management plan has been
completed and will be implemented upon the date of permit coverage.
* * * * *
    3. Sections 122.23 (g)(2) and (g)(3)(iii) are revised to read as
follows:

Sec.  122.23  Concentrated animal feeding operations (applicable to
State NPDES programs, see Sec.  123.25).

* * * * *
    (g) * * *
    (1) * * *
    (2) Operations defined as CAFOs as of April 14, 2003, who were not
defined as CAFOs prior to that date. For all CAFOs, the owner or
operator of the CAFO must seek to obtain coverage under an NPDES permit
by a date specified by the Director, but no later than March 30, 2007.
    (3) * * *
    (iii) If an operational change that makes the operation a CAFO
would not have made it a CAFO prior to April 14, 2003, the operation
has until March 30, 2007, or 90 days after becoming defined as a CAFO,
whichever is later.
* * * * *
    4. Section 122.42 is amended by revising the third sentence in
paragraph (e)(1) introductory text to read as follows:

Sec.  122.42  Additional conditions applicable to specified categories
of NPDES permits (applicable to State NPDES programs, see Sec.
123.25).

* * * * *
    (e) * * *
    (1) * * * Permitted CAFOs must have their nutrient management plans
developed and implemented by March 30, 2007. CAFOs that seek to obtain
coverage under a permit after March 30, 2007 must have a nutrient
management plan developed and implemented upon the date of permit
coverage. * * *
* * * * *

PART 412--CONCENTRATED ANIMAL FEEDING OPERATIONS (CAFO) POINT
SOURCE CATEGORY

    1. The authority citation for part 412 continues to read as
follows:

    Authority: 33 U.S.C. 1311, 1314, 1316, 1317, 1318, 1342, 1361.

    2. Amend Sec.  412.31 by revising paragraph (b)(3) to read as
follows:

Sec.  412.31  Effluent limitations attainable by the application of the
best practicable control technology currently available (BPT).

* * * * *
    (b) * * *
    (3) The CAFO shall attain the limitations and requirements of this
paragraph by March 30, 2007.
    3. Amend Sec.  412.43 by revising paragraph (b)(2) to read as
follows:

Sec.  412.43  Effluent limitations attainable by the application of the
best practicable control technology currently available (BPT).

* * * * *
    (b) * * *
    (2) The CAFO shall attain the limitations and requirements of this
paragraph by March 30, 2007.

[FR Doc. 05-24303 Filed 12-20-05; 8:45 am]

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[Federal Register: June 23, 2009 (Volume 74, Number 119)]
[Notices]
[Page 29691-29692]
[DOCID:fr23jn09-43]

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ENVIRONMENTAL PROTECTION AGENCY

[FRL-8922-3]

Proposed Consent Decree, Clean Air Act Citizen Suit

AGENCY: Environmental Protection Agency.

ACTION: Notice of Proposed Consent Decree; Request for Public Comment.

-----------------------------------------------------------------------

SUMMARY: In accordance with section 113(g) of the Clean Air Act, as
amended (``CAA'' or ``Act''), 42 U.S.C. 7413(g), notice is hereby given
of a proposed consent decree to address a lawsuit filed by Wildearth
Guardians in the United States District Court for the District of
Columbia: Wildearth Guardians v. Jackson, No.1:08-cv-02253, (D. D.C.).
Wildearth Guardians filed a deadline suit to compel the Administrator
to respond to an administrative petition seeking EPA's objection to a
CAA Title V operating permit issued by the Colorado Department of
Public Health and the Environment, Air Pollution Control Division to
Anadarko Petroleum Corporation to operate their Frederick Natural Gas
Compressor Station in Weld County, Colorado. Under the terms of the
proposed consent decree, EPA has agreed to respond to the petition by
September 14, 2009.

DATES: Written comments on the proposed consent decree must be received
by July 23, 2009.

ADDRESSES: Submit your comments, identified by Docket ID number EPA-HQ-
OGC-2009-0355, online at http://www.regulations.gov (EPA's preferred
method); by e-mail to<EMAIL_ADDRESS>by mail to EPA Docket Center,
Environmental Protection Agency, Mailcode: 2822T, 1200 Pennsylvania
Ave., NW., Washington, DC 20460-0001; or by hand delivery or courier to
EPA Docket Center, EPA West, Room 3334, 1301 Constitution Ave., NW.,
Washington, DC, between 8:30 a.m. and 4:30 p.m. Monday through Friday,
excluding legal holidays. Comments on a disk or CD-ROM should be
formatted in Word or ASCII file, avoiding the use of special characters
and any form of encryption, and may be mailed to the mailing address
above.

FOR FURTHER INFORMATION CONTACT: Sheila Igoe, Office of General Counsel
(Mail Code 2344A), U.S. Environmental Protection Agency, 1200
Pennsylvania Ave., NW., Washington, DC 20460; telephone: (202) 564-
5513; fax number<PHONE_NUMBER>; e-mail address<EMAIL_ADDRESS>
SUPPLEMENTARY INFORMATION:

I. Additional Information About the Proposed Consent Decree

    This proposed consent decree would resolve a lawsuit seeking a
response to an administrative petition to object to a CAA Title V
permit issued by the Colorado Department of Public Health and the
Environment, Air Pollution Control Division to Anadarko Petroleum
Corporation to operate their Frederick Natural Gas Compressor Station
in Weld County, Colorado. Under the terms of the proposed consent
decree, EPA has agreed to respond to the petition by September 14,
2009. In addition, the proposed consent decree states that within
fifteen (15) business days EPA shall deliver notice of such action to
the Office of the Federal Register for prompt publication.
    For a period of thirty (30) days following the date of publication
of this notice, the Agency will accept written comments relating to the
proposed consent decree from persons who were not named as parties or
intervenors to the litigation in question. EPA or the Department of
Justice may withdraw or withhold consent to the proposed consent decree
if the comments disclose facts or considerations that indicate that
such consent is inappropriate, improper, inadequate, or inconsistent
with the requirements of the Act. Unless EPA or the Department of
Justice determines, based on any comment submitted, that consent to
this consent decree should be withdrawn, the terms of the decree will
be affirmed.

II. Additional Information About Commenting on the Proposed Consent
Decree

A. How Can I Get a Copy of the Consent Decree?

    The official public docket for this action (identified by Docket ID
No. EPA-HQ-OGC-2009-0355) contains a copy of the proposed consent
decree. The official public docket is available for public viewing at
the Office of Environmental Information (OEI) Docket in the EPA Docket
Center, EPA West, Room 3334, 1301 Constitution Ave., NW., Washington,
DC. The EPA Docket Center Public Reading Room is open from 8:30 a.m. to
4:30 p.m., Monday through Friday, excluding legal holidays. The
telephone number for the Public Reading Room is<PHONE_NUMBER>, and the
telephone number for the OEI Docket is<PHONE_NUMBER>.
    An electronic version of the public docket is available through
http://www.regulations.gov. You may use the http://www.regulations.gov
to submit or view public comments, access the index listing of the
contents of the official public docket, and to access those documents
in the public docket that are available electronically. Once in the
system, select ``search,'' then key in the appropriate docket
identification number.
    It is important to note that EPA's policy is that public comments,
whether submitted electronically or in paper, will be made available
for public viewing online at http://www.regulations.gov without change,
unless the comment contains copyrighted material, CBI, or other
information whose disclosure is restricted by statute. Information
claimed as CBI and other information whose disclosure is restricted by
statute is not included in the official public docket or in the
electronic public docket. EPA's policy is that copyrighted material,
including copyrighted material contained in a public comment, will not
be placed in EPA's electronic public docket but will be available only
in printed, paper form in the official public docket. Although not all
docket

materials may be available electronically, you may still access any of
the publicly available docket materials through the EPA Docket Center.

B. How and to Whom Do I Submit Comments?

    You may submit comments as provided in the ADDRESSES section.
Please ensure that your comments are submitted within the specified
comment period. Comments received after the close of the comment period
will be marked ``late.'' EPA is not required to consider these late
comments.
    If you submit an electronic comment, EPA recommends that you
include your name, mailing address, and an e-mail address or other
contact information in the body of your comment and with any disk or CD
ROM you submit. This ensures that you can be identified as the
submitter of the comment and allows EPA to contact you in case EPA
cannot read your comment due to technical difficulties or needs further
information on the substance of your comment. Any identifying or
contact information provided in the body of a comment will be included
as part of the comment that is placed in the official public docket,
and made available in EPA's electronic public docket. If EPA cannot
read your comment due to technical difficulties and cannot contact you
for clarification, EPA may not be able to consider your comment.
    Use of the http://www.regulations.gov Web site to submit comments
to EPA electronically is EPA's preferred method for receiving comments.
The electronic public docket system is an ``anonymous access'' system,
which means EPA will not know your identity, e-mail address, or other
contact information unless you provide it in the body of your comment.
In contrast to EPA's electronic public docket, EPA's electronic mail
(e-mail) system is not an ``anonymous access'' system. If you send an
e-mail comment directly to the Docket without going through http://
www.regulations.gov, your e-mail address is automatically captured and
included as part of the comment that is placed in the official public
docket, and made available in EPA's electronic public docket.

    Dated: June 16, 2009.
Richard B. Ossias,
Associate General Counsel.
[FR Doc. E9-14710 Filed 6-22-09; 8:45 am]

BILLING CODE 6560-50-P


[Federal Register: March 15, 2011 (Volume 76, Number 50)]
[Notices]
[Page 14111-14113]
[DOCID:fr15mr11-157]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-64054; File No. SR-NASDAQ-2011-036]

Self-Regulatory Organizations; The NASDAQ Stock Market LLC;
Notice of Filing and Immediate Effectiveness of Proposed Rule Change To
Modify NASDAQ Options Market Rules Chapter VII, Various Sections,
Dealing With Market Maker Obligations

March 8, 2011.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that
on March 3, 2011, The NASDAQ Stock Market LLC (``NASDAQ''), filed with
the Securities and Exchange Commission (``Commission'') the proposed
rule change as described in Items I and II below, which Items have been
prepared by NASDAQ. The Commission is publishing this notice to solicit
comments on the proposed rule change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change

    NASDAQ proposes to amend Chapter VII, Section 3, Continuing Market
Maker Registration, Section 5, Obligations of Market Makers, and
Section 6, Market Maker Quotations, of the NASDAQ rulebook for the
NASDAQ Options Market (``NOM'') to: (a) Permit market maker assignment
by option rather than by series; (b) adopt a $5 quotation spread
parameter; and (c) amend the quoting requirement for Market Makers as
explained further below. These changes are scheduled to be implemented
on NOM on or about May 31, 2011; the Exchange will announce the
implementation schedule by Options Trader Alert, once the rollout
schedule, which will be based in part on NOM participants' readiness,
is finalized.
    The text of the proposed rule change is available at
nasdaq.cchwallstreet.com, at NASDAQ's principal office, and at the
Commission's Public Reference Room.

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

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

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

1. Purpose
    The purpose of the proposed rule change is to strengthen Market
Maker obligations. The NASDAQ Options Market (``NOM''), the options
trading facility of The NASDAQ Stock Market LLC, has been fully
operational for over two years. During this time, NASDAQ has carefully
considered the role of Market Makers in the NOM marketplace and their
concomitant obligations.
    An Options Market Maker is a Participant \3\ registered with NASDAQ
as a Market Maker.\4\ Market Makers on NOM have certain obligations
such as maintaining two-sided markets and participating in transactions
that are ``reasonably calculated to contribute to the maintenance of a
fair and orderly market.'' \5\ To register as a Market Maker, a
Participant must file a written application with Nasdaq Regulation,
which will consider an applicant's market making ability and other
factors it deems appropriate in determining whether to approve an
applicant's registration.\6\ All Market Makers are designated as
specialists on NOM for all purposes under the Act or rules
thereunder.\7\ The NOM Rules place no limit on the number of qualifying
entities that may become Market Makers.\8\ The good standing of a
Market Maker may be suspended, terminated, or withdrawn if the
conditions for approval cease to be maintained or the Market Maker
violates any of its agreements with NASDAQ or any provisions of the NOM
Rules.\9\
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    \3\ The term ``Options Participant'' or ``Participant'' means a
firm or organization that is registered with the Exchange pursuant
to Chapter II of the NOM Rules for purposes of participating in
options trading on NOM as a ``Nasdaq Options Order Entry Firm'' or
``Nasdaq Options Market Maker.''
    \4\ See NOM Rules, Chapter VII, Section 2.
    \5\ See NOM Rules, Chapter VII, Section 5(a).
    \6\ See NOM Rules, Chapter VII, Section 2(a).
    \7\ See NOM Rules, Chapter VII, Section 2.
    \8\ See NOM Rules, Chapter VII, Rule 2(c).
    \9\ See NOM Rules, Chapter VII, Section 4(b).
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    Currently, a Participant that has qualified as a Market Maker may
register to make markets in individual series of

options.\10\ Instead, NASDAQ proposes to require that Market Makers
register by option. Thus, once so registered, a NOM Market Maker is
subject to the market making obligations in all series of that option,
except Quarterly Options Series, adjusted option series and any options
series until the time to expiration for such series is less than nine
months.\11\ In order to effect this change, NASDAQ proposes to amend
various provisions in Sections 3, 5 and 6 of Chapter VII that currently
refer to ``series.'' NASDAQ believes that registration by option rather
than series should spread the benefits of Market Maker quoting across
all series of an option, which should, in turn, result in higher
quality markets.
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    \10\ See NOM Rules, Chapter VII, Section 3(a).
    \11\ See proposed NOM Rules, Chapter VII, Section 6(d)(i)(2).
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    NASDAQ also proposes to adopt quotation spread parameters, also
known as bid/ask differentials, which establish the maximum permissible
width between a Market Maker's bid and an offer in a particular series.
Specifically, NASDAQ proposes to adopt a $5 wide quote spread
parameters for all options.\12\ Currently, NOM Market Makers are not
subject to quote spread parameters, such that the requirement for a
two-sided market can be met with a quotation that is very wide. NASDAQ
believes that a $5 quote spread parameter for NOM Market Makers should
result in narrower markets, and thereby, improve the quality of NOM's
markets.
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    \12\ See proposed NOM Rules, Chapter VII, Section 6(d)(ii).
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    Lastly, NASDAQ proposes to amend its quotation requirement for
Market Makers. Today, NOM Market Makers are required to make markets on
a continuous basis in at least 75% of the options series in which the
Market Maker is registered. NASDAQ proposes to change this requirement
to 60% of the series; in those series, to satisfy this requirement with
respect to quoting a series, a Market Maker must quote such series 90%
of the trading day (as a percentage of the total number of minutes in
such trading day) \13\ or such higher percentage as the Exchange may
announce in advance.\14\ Nasdaq Regulation may consider exceptions to
the requirement to quote 90% (or higher) of the trading day based on
demonstrated legal or regulatory requirements or other mitigating
circumstances. Although the proposed 60% requirement is lower than the
current 75%, the Exchange is also proposing herein to adopt, for the
first time, a quote spread requirement and a requirement to register by
option rather than by series, which are considerable changes for Market
Makers. NASDAQ believes that this new 60% quoting requirement is needed
to balance the proposed, new quotation spread parameters.
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    \13\ For example, on a normal trading day, which lasts 390
minutes (from 9:30 a.m. to 4 p.m.), quoting in a series would need
to be maintained for the total of at least 351 minutes in order to
meet the 90%-of-the-trading-day threshold. In a shortened trading
session, the total number of minutes the quote must be maintained
would be lowered proportionately (and the same percentage threshold
would apply).
    \14\ Any such higher percentage would involve an appropriate
advance announcement, which would then be available on the
Exchange's Web site. In the illustration above, if the Exchange set
the threshold, for example, at 99% (rather than 90%), then on a
normal trading day, quoting would need to be maintained for 386
(rather than 351) minutes out of the total of 390 minutes.
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    Under this proposal, NASDAQ recognizes that certain options series
present special challenges for Market Makers, due to nontraditional
terms. Accordingly, NASDAQ proposes that Quarterly Option Series,
adjusted option series, and any option series until the time to
expiration for such series is less than nine months be treated
differently. Specifically, under this proposal, Market Makers shall not
be subject to the continuous quoting obligation in Section 6(d) of NOM
rules in any Quarterly Option Series, any adjusted option series,\15\
and any option series until the time to expiration for such series is
less than nine months. Accordingly, the requirement to make two-sided
markets set forth in 5(a)(i) of NOM Rules shall not apply to Market
Makers respecting Quarterly Option Series, adjusted option series, and
series with an expiration of nine months or greater.
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    \15\ For these purposes, an adjusted option series is an option
series wherein one option contract in the series represents the
delivery of other than 100 shares of underlying stock or Exchange-
Traded Fund Shares.
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    In addition, if a technical failure or limitation of a system of
the Exchange prevents a Market Maker from maintaining, or prevents a
Market Maker from communicating to NOM, timely and accurate quotes, the
duration of such failure or limitation shall not be included in any of
the calculations under this subparagraph (i) with respect to the
affected quotes.
    As a whole, the proposed amendments are intended to improve the
quality of NOM markets, while carefully considering the important role
of Market Makers in the NOM marketplace. Adopting quotation spread
parameters and requiring registration across the series of an option
are intended to encourage market making in more series; at the same
time, NASDAQ recognizes the need to balance these new, more burdensome
obligations with a lower series quoting percentage requirement. This
balance of obligations should help to make the market better for all
participants. NASDAQ believes that it has crafted a reasonable balance
in this proposal.
2. Statutory Basis
    The Exchange believes that its proposal is consistent with Section
6(b) of the Act \16\ in general, and furthers the objectives of Section
6(b)(5) of the Act \17\ in particular, in that it is designed to
prevent fraudulent and manipulative acts and practices, to promote just
and equitable principles of trade, to foster cooperation and
coordination with persons engaged in facilitating transactions in
securities, and to remove impediments to and perfect the mechanisms of
a free and open market and a national market system, and, in general,
to protect investors and the public interest. The Exchange believes
that the proposal is appropriate and reasonable for Market Makers,
similar to the rules of other options exchanges (as specified below)
and should, at the same time, enhance the quality of the Exchange's
options markets.
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    \16\ 15 U.S.C. 78f(b).
    \17\ 15 U.S.C. 78f(b)(5).
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B. Self-Regulatory Organization's Statement on Burden on Competition

    Nasdaq does not believe that the proposed rule change will result
in any burden on competition that is not necessary or appropriate in
furtherance of the purposes of the Act, as amended.

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

    Written comments were neither solicited nor received.

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

    Because the foregoing proposed rule change does not:
    (i) Significantly affect the protection of investors or the public
interest;
    (ii) Impose any significant burden on competition; and
    (iii) Become operative for 30 days from the date on which it was
filed, or such shorter time as the Commission may designate, if
consistent with the protection of investors and the public interest, it
has become effective pursuant to Section 19(b)(3)(A) of the

Act \18\ and Rule 19b-4(f)(6) thereunder.\19\
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    \18\ 15 U.S.C. 78s(b)(3)(A).
    \19\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)(iii)
requires the self-regulatory organization to submit to the
Commission written notice of its intent to file the proposed rule
change, along with a brief description and text of the proposed rule
change, at least five business days prior to the date of filing of
the proposed rule change, or such shorter time as designated by the
Commission. The Exchange has satisfied this requirement. The
Exchange previously filed its proposal under Section 19(b)(2) of the
Act but subsequently withdrew that proposal and refiled under
Section 19(b)(3)(A). See Securities Exchange Act Release No. 63815
(February 1, 2011), 76 FR 6646 (February 7, 2011) (SR-NASDAQ-2011-
012).
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    In particular, NASDAQ notes that the proposed rule change is
similar to the rules of other options exchanges in a variety of ways.
With respect to registration by series, most options exchanges require
registration by option (also called underlying).\20\ With respect to
quotation spread parameters, most options exchanges currently impose
such parameters on market makers; some options exchanges have a $5 wide
requirement for electronic quotes,\21\ while others impose $5 wide
parameter in certain situations and narrower parameters in other
situations, usually related to the opening and the particular market
making category.\22\ With respect to the quotation requirement and
exception for certain series, the proposal is identical to Phlx Rule
1014(b)(ii)(D)(1) respecting the 60% of series, 90% of the trading day
requirement, except certain series.\23\
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    \20\ See NYSEArca Rule 6.35(d) and Phlx Rule 507(b). ISE
appoints by class and group. See ISE Rules 100(a)(6) and 802.
    \21\ See NYSEAmex Rule 925NY(b)(5), which is similar, but not
identical, because trading auctions on the NYSE Amex's floor-based
exchange are excluded from its rule.
    \22\ See Phlx Rule 1014(c)(i)(A)(1)(a) and (c)(i)(A)(2) and ISE
Rule 803(b)(4).
    \23\ Phlx Rule 1014(b)(ii)(D)(1) and (4). Securities Exchange
Act Release No. 60084 (June 10, 2009) (SR-Phlx-2009-37); see also
Securities Exchange Act Release No. 57186 (January 22, 2008), 73 FR
4931 (January 28, 2008) (approving SR-NYSEArca-2007-121).
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    At any time within 60 days of the filing of the proposed rule
change, the Commission summarily may temporarily suspend such rule
change if it appears to the Commission that such action is necessary or
appropriate in the public interest, for the protection of investors, or
otherwise in furtherance of the purposes of the Act.

IV. Solicitation of Comments

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

Electronic Comments

     Use the Commission's Internet comment form (http://
www.sec.gov/rules/sro.shtml); or
     Send an e-mail to<EMAIL_ADDRESS>Please include
File Number SR-NASDAQ-2011-036 on the subject line.

Paper Comments

     Send paper comments in triplicate to Elizabeth M. Murphy,
Secretary, Securities and Exchange Commission, 100 F Street, NE.,
Washington, DC 20549-1090.

All submissions should refer to File Number SR-NASDAQ-2011-036. This
file number should be included on the subject line if e-mail is used.
To help the Commission process and review your comments more
efficiently, please use only one method. The Commission will post all
comments on the Commission's Internet Web site (http://www.sec.gov/
rules/sro.shtml). Copies of the submission, all subsequent amendments,
all written statements with respect to the proposed rule change that
are filed with the Commission, and all written communications relating
to the proposed rule change between the Commission and any person,
other than those that may be withheld from the public in accordance
with the provisions of 5 U.S.C. 552, will be available for Web site
viewing and printing in the Commission's Public Reference Room on
official business days between the hours of 10 a.m. and 3 p.m. Copies
of such filing also will be available for inspection and copying at the
principal office of the Exchange. All comments received will be posted
without change; the Commission does not edit personal identifying
information from submissions. You should submit only information that
you wish to make available publicly. All submissions should refer to
File Number SR-NASDAQ-2011-036 and should be submitted on or before
April 5, 2011.

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\24\
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    \24\ 17 CFR 200.30-3(a)(12).
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Cathy H. Ahn,
Deputy Secretary.
[FR Doc. 2011-5862 Filed 3-14-11; 8:45 am]
BILLING CODE 8011-01-P