MEMORANDUM TO DOCKET A 90 33 SUBJECT: Docketing of Detailed Responses to Comments on the Part 70 Operating Permit Regulations This document entitled " Response to Comments on the 40 CFR Part 70 Rulemaking" is being placed in Docket number A 90 33 to docket the Environmental Protection Agency's ( EPA) responses to comments received on the Part 70 proposal. Each chapter of this document ( except Chapter 1 and 12) corresponds to the 11 sections of the Part 70 regulations. Chapter 1 is introductory remarks and Chapter 12 contains responses to miscellaneous comments.

The EPA received approximately 500 comments during the public comment period on the regulations proposed in the FEDERAL REGISTER on May 10, 1991. The EPA has thoroughly reviewed and considered each of these comments in the process of developing the final Part 70 regulations. The EPA has revised the final rule to reflect these comments where it deemed it appropriate. Explanations of these revisions and their relationship to comments can be found in the preamble to the final rule. Where EPA decided not to follow the suggestions of commenters, or where comments have resulted in very minor changes in the regulation, the rationale for these decisions will be found in this response to comments document.

While EPA is progressing to fulfill its duty to respond to all significant comments, it has determined that effective implementation of the Part 70 operating permit program will be better served by proceeding at this time with promulgation of the regulations, rather than delaying until all chapters of the response to comments document are completed. This submission of the response to comments document contains the introduction and responses to comments on section 70.11, " Requirements for Enforcement Authority," of the Part 70 regulations. The EPA will submit additional chapters as they are completed and expects the remainder of the comment responses to be placed in the docket within 30 days of Part 70 promulgation. 2.0 COMMENTS AND RESPONSES ON SECTION 70.2: DEFINITIONS 2.1 SUMMARY OF COMMENTS ON SECTION 70.2 The proposed definitions for " major source," " regulated pollutant," " responsible official," and " stationary source" drew numerous comments, which are summarized in this Section. The definitions of " actual emissions," " administrative permit amendments," " affected source," " affected States," " applicable requirements," " complete application," " draft proposed permit," " emissions unit," " federally enforceable limitation," " final permit," " fugitive emissions," " potential to emit," and " whole program" also drew comment. There were no comments on the definitions of " Act," " affected unit," " designated representative," " EPA," " flexible source operation," " general permit," " Part 70 permit," " Part 70 source," " permit modification," " permit revision," " permitting authority," " renewal," or " State."

Many definitions appeared in more than one place in the proposed rule. They were defined in Section 70.2 and discussed in greater detail in other Sections where applicable. This chapter only contains those comments that specifically referred to Section 70.2 of the proposed regulations. Additional comments relating to these definitions may be found in the chapters that address their use. These discussions are referenced in the responses in this chapter.

Several definitions in Section 70.2 of the proposed rule were moved to those Sections in the final rule where the definition was primarily or exclusively used. The definitions for " actual emissions," " administrative permit amendment," and " complete application" were moved to Sections 70.9, 70.7, and 70.5, respectively. Definitions for " federally enforceable limitation," " flexible source operation," and " minor permit amendment" were deleted from Part 70.

2.2 ACTUAL EMISSIONS Comment: Three State agencies ( IV D 91, IV D 113, IVD 384) and four industry groups ( IV D 124, IV D 152, IV D 311, IV D 314) commented on the definition of " actual emissions." Three industry commenters ( IV D 210, IV D 311, IV D 314) believed that actual emissions should be based on calculations of actual emissions, rather than on the average rate of emissions over a two year period. One State agency ( IV D 384) commented that the definition of actual emissions should specifically include the use of continuous emission monitors ( CEM's) to determine emissions, and that it should reference EPA's Compilation of Air Pollutant Emission Factors ( AP 42) or some other consistent approach for determining emissions when actual emissions are not available. Two State agencies ( IV D 91 and IV D 113) contended that the proposed definition did not conform with 40 CFR 52.21( b)( 21). An industry commenter ( IV D 124) stated that actual emissions should be based on any two year period within the fiveyear permitting period. Another industry commenter ( IV D 124) requested that the words " or any other 12 month period" be added.

Response: In both the proposed and final regulations, the definition of " actual emissions" allows either calculations of actual emissions or averaged actual emissions, and no revision to the regulations is necessary on this point. The proposal definition did allow for calculation based on the " preceding calendar year or any other period defined by the permitting authority." However, the Administrator has decided to clarify that a period of time other than the preceding calendar year may be used if the time period is " representative of normal source operation." The appropriate time period may be the previous calendar year or an average of two or more average years, as allowed by the permitting authority.

The use of CEM's by all sources to determine actual emissions will not be mandated. Another applicable requirement, such as acid rain requirements, may mandate the use of CEM's, but this is not necessary or appropriate for all sources. Appropriate reference materials should be used when calculations are made to estimate actual emissions, but there is no mandate that only AP 42 must be referenced. States usually are responsible for suggesting appropriate methods or offering guidance for estimating emissions when federal guidance is lacking or unclear. When guidance is lacking and a calculation must be made, a source might approach this problem in numerous ways, for example, they may use average emission factors such as those contained in AP 42 or they may choose to obtain a more accurate estimate by extrapolating an average emission rate based on existing source specific data.

In the final regulations, the definition of actual emissions has been moved to Section 70.9( b)( 2)( iii) within the regulatory section concerning fees. 2.3 ADMINISTRATIVE PERMIT AMENDMENT Comment: Two industry commenters ( IV D 124 and IV D 207) requested changes in the wording of this definition. One of these commenters ( IV D 124) requested that the phrase " more frequent monitoring" be replaced with " a change in frequency of monitoring." The other commenter ( IV D 207) suggested broadening the definition of the New Source Review ( NSR) program to include any preconstruction permit program.

Response: The Administrator believes using administrative permit amendments to reflect an increase in the frequency of monitoring would be appropriate. The final definition has not been changed in response to this comment. The proposed and final definitions allow an administrative permit amendment to be used to change a monitoring requirement only when this change results in " more frequent monitoring." Administrative permit amendments may not be used to weaken permit terms and conditions that relate to the frequency of monitoring or reporting. However, a change resulting in a more stringent application of such a requirement may be made, as would be the case if monitoring were performed more frequently than prescribed by an applicable requirement.

The suggestion from commenter IV D 207 concerning broadening the definition of NSR has also not resulted in a change to the final regulations. The proposed regulation defining administrative amendments did use the term " preconstruction review." As a general rule, any reference to preconstruction review requirements in the preamble was meant to include requirements of both the NSR and Prevention of Significant Deterioration ( PSD) programs.

In the final rule there have been several modifications to the definition of administrative permit amendment. The most important change concerns the use of administrative permit amendments to incorporate requirements from EPA approved preconstruction review programs into Part 70 permits. The EPA will allow States to use these procedures and apply the permit shield only if the State's NSR program meets the procedural requirements substantially equivalent to those contained in Section 70.7 and 70.8 and the compliance requirements substantially equivalent to those contained in Section 70.6. If a State's NSR program does not meet these requirements, the shield may not apply and the permit modification process must be used for the incorporation. For additional information on changes to the final rule in regard to administrative permit amendments, please refer to the final rule's preamble discussion on Section 70.7.

This definition has been moved from Section 70.2, where it appeared in the proposal, to Section 70.7 in the final regulation.

2.4 AFFECTED SOURCE Comment: Industry commenter IV D 124 believed that " under" should be replaced with " as defined in."

Response: The wording of the definitions of " affected source" and " affected unit" have changed since the proposal, although the intended meaning remains unchanged.

2.5 AFFECTED STATES Comment: Four industry commenters ( IV D 124, IV D 134, IV D 173, IV D 313) suggested modifications to this definition. Two of these commenters ( IV D 124 and IVD 134) opposed the use of the 50 mile radius to define affected States; one commenter ( IV D 124) further requested that 1

g/ m3 be used instead of the 50 mile radius. Other suggestions for the definition of affected States included " one whose air quality may be affected and is contiguous and within 50 miles of the permitted source," and " those whose air quality is demonstrated by the State to be significantly affected." Another commenter ( IV D 313) requested that the term " whose air quality may be affected" be clarified.

Response: The final regulations have not been modified in response to comments concerning the definition of " affected States." The Administrator has not established any specific ambient air quality standard or other tests for the purpose of defining affected State status, other than the 50 mile test, because he does not wish to impose any new rigorous analysis upon the States for purposes of implementing this requirement. In the proposal, the Administrator defined the term " may be affected," contained in Section 505( a)( 2)( A) of the Act, as equivalent to the 50 mile geographic trigger contained in Section 505( a)( 2)( B). The EPA read the reference to the 50 mile radius in Section 505( a)( 2)( B) as an indication of Congress' judgement as to which States should be deemed " affected States." The EPA believes that the 50 mile trigger provides adequate protection for virtually any case and is relatively simple to administer, especially compared to alternatives that attempt to define a significant ambient impact. Few commenters objected to defining affected State status with a 50 mile geographic test, and no compelling evidence to show the need for any other tests was offered. Therefore, this interpretation has been retained as proposed.

Also unchanged from the proposed rule is EPA's statement that it might waive its own and neighboring States' review of permits for any category of sources, except major sources, either when approving an individual program, or in a regulation applicable to all programs. The EPA may also waive its own right to review, but maintain the requirement for a State to notify neighboring States [ Section 505( d) of the Act]. During Phase II of the acid rain program, the Agency does not intend to waive its own right to review affected sources.

2.6 APPLICABLE REQUIREMENTS Comment: One industry commenter ( IV D 404) suggested that applicable requirements include only those regulations that have been promulgated when the permit is issued and the specific parts of the Act that are directly applicable to emission sources. Another industry commenter ( IV D 323) concurred and requested that the definition of " applicable requirement" be amended to indicate that it does not refer to any de minimis emissions exempted under existing State rules.

Response: In response to comment and after further review by the Administrator, several important changes to the definition of " applicable requirements" were made. Three important changes were made in the final rule and are discussed in detail in Section IV. F. 1. of the preamble. Applicable requirements has been clarified to include not only those requirements in effect at the time of permit issuance, but also includes those that have been promulgated prior to permit issuance and have compliance dates effective during the permit term. The second revision to the definition clarifies that requirements of the accidental release program, Section 112( r) of the Act, are applicable requirements. The third change clarifies that the National Ambient Air Quality Standards ( NAAQS) are applicable requirements for temporary sources and for the States, but are not directly imposed on all sources.

The definition of " applicable requirement" has not been changed to exclude existing State de minimis exemptions because such exemptions are not recognized by the EPA for purposes of the Part 70 operating permit program. Therefore, existing State de minimis exemptions cannot be utilized by the source when applying for a Part 70 permit, unless such exemptions have been proposed by the State as part of the State's permit program submittal and approved by the EPA as being " insignificant," under the meaning of 70.5( c). Once approved, however, these exemptions will, in some cases, not be available to the source. These exempted emissions or activities may still have to be fully explained in the permit application when the exemption interferes with the determination or imposition of applicable requirements or the calculation of fees [ see Section IV. E. 4. of the preamble to the final rule and Section 5.3.2 of this document].

2.7 COMPLETE APPLICATION Comment: One local government ( IV D 85) believed that the definition of " complete application" was inadequate and inconsistent with current State regulations. An industry commenter ( IV D 124) believed that the applicant should have the same amount of time to respond to notices of application deficiencies as the permitting authority takes to make the completeness determination.

Response: In response to comment and for editorial reasons, the definition of " complete application" was removed from Section 70.2 and placed in Section 70.5. Section 70.2 of the proposal defined a complete application as one containing " information needed to begin to process the application," while Section 70.5 contained much of the same language and additional clarifying language. In the final rule, " complete application" is defined within Section 70.5( a)( 2) as an application that contains " all information required pursuant to paragraph ( c) of this section." The definition in the final rule appears to require a higher standard that the proposal language but, in fact, an application must contain the information required by Section 70.5( c) in order for the permitting authority to begin processing the application and this is, in many cases, a smaller set of information than might be needed to issue a permit. This change does not, however, alter the State's discretion in regard to what information they might require of sources for the application to be deemed " complete" but merely clarifies that the information required by Section 70.5( c), at a minimum, must be in an application for it to be complete.

The Administrator recognizes that certain administrative procedures that States are required to adopt in their State Part 70 operating permit program in order to have a program approvable by EPA may be inconsistent with current State regulations. However, Section 502( b)( 1) of the Act requires the Administrator to promulgate regulations establishing minimum permit program elements, one of which is timely determination of an application's completeness.

The Administrator has provided States with additional flexibility by giving States discretion in regard to establishing deadlines for applicants to respond to requests for additional information, rather than by requiring State regulations to require that these submittals be made within the same deadline set for completeness determinations. This flexibility reflects the important implementation guideline that Title V should build on, rather than unnecessarily disrupt, existing programs.

2.8 DRAFT PROPOSED PERMIT Comment: Three commenters ( IV D 92, IV D 362, IV D 212) believed that " draft proposed permit" should be changed to " draft permit." One State agency ( IV D 91) commented that the term " preliminary draft" should be used.

Response: In response to these comments, the Administrator has created two new definitions to replace " draft proposed permit: " draft permit" and " proposed permit." A draft permit is the version of the permit that a permitting authority offers for public participation under Section 70.7( h) or affected State review under Section 70.8. The proposed permit is the version of the permit that the permitting authority proposes to issue and forwards to the Administrator for review under Section 70.8. These new definitions help clarify the status of the permit during the procedural processes leading to the issuance of a " final permit". This clarification also removes the need to create a definition for the term " preliminary draft."

2.9 EMISSIONS UNIT Comment: An industry commenter ( IV D 97) requested that a limit below which the emissions unit becomes insignificant be defined. Another industry commenter ( IV D 321) believed that the definition of emissions unit should be expanded to include any part of a stationary source that is regulated by emission rate, design, or operation, in addition to those that emit or have the potential to emit any regulated pollutant.

Response: States are allowed to propose emissions levels or activities as " insignificant" within their Part 70 program submittal for approval by EPA. These " insignificant" emissions or activities would then, in many cases, be exempt from being described in detail within the permit application [ see Section 70.5( c)]. Further discussion on this issue can be found in the preamble to the final rule in Section IV. E. 4. or in this document in Section 5.3.2.

Concerning the expansion of the definition to include " any part of a stationary source is regulated...," the definition already included " any part of a stationary source...," but the Administrator has modified the definition to include " any part or activity of a stationary source..." If the commenter intended to modify the definition because of confusion over the definition of " regulated pollutant," it is not clear from his comment. However, the definition of regulated pollutant has changed significantly since proposal and these changes, along with the change to the definition of stationary source, should help to address the commenter' concerns. Additional comment and response about the definition of regulated pollutant is found in Section 2.16 of this document.

2.10 FEDERALLY ENFORCEABLE LIMITATION Comment: Two industry commenters ( IV D 200 and IV D 319) requested clarification of this definition, stating that the definition provided little direction on what the Agency meant by " federally enforceable limitations." Another industry commenter ( IV D 404) believed that enforceable restriction should be clearly defined with regard to restricting emissions below the threshold for a major source.

Response: In response to comments and for purposes of clarifying the regulations, the definition of " federally enforceable limitation" has been removed from Section 70.2 of the regulations. In a general sense, the phrase " federally enforceable" is equivalent to the phrase " enforceable by the Administrator and citizen under the Act," for purposes of Part 70. In the final rule, the phrase " federally enforceable" is used to refer to Act requirements ( including requirements of an applicable requirement of the Act) and terms and conditions of Part 70 permits.

Section 70.6( b)( 1) of the final rule now states that " All terms and conditions in a Part 70 permit, including any provisions designed to limit a source's potential to emit, are enforceable by the Administrator and citizens under the Act." In addition, the preamble to the final rule restates this and adds that Part 70 general permits may be used by sources for the purpose of restricting potential to emit.

For sources of criteria pollutants, the following limitations are available under Title I of the Act to make voluntarily assumed restrictions on potential to emit federally enforceable without getting a Part 70 permit: ( 1) limitations contained in preconstruction review permits approved under a NSR program, and ( 2) limitations adopted as source specific SIP revisions. Furthermore, for Section 112( b) pollutants, the Administrator is considering allowing States to use programs approved under Section 112( l) as a means of developing federally enforceable limits on potential to emit without requiring the source to obtain a Part 70 permit to make the limitations federally enforceable. This concept will be addressed in the forthcoming guidance issued pursuant to Section 112( l)( 2).

2.11 FINAL PERMIT Comment: One industry commenter ( IV D 375) requested that this definition be clarified by adding " required under Part 70" following " all administrative concurrence and procedures," in order to avoid detaining the Part 70 permit until concurrence on totally unrelated issues is reached.

Response: In response to this comment, the definition has been changed to more directly refer to Part 70 review procedures. The definition now states that a final permit is one that has completed " all review procedures required by '' 70.7 and 70.8," rather than " administrative concurrence and procedures at the State and Federal levels."

2.12 FUGITIVE EMISSIONS Comment: One State agency ( IV D 384) commented that the definition of fugitive emissions should include dust from roadways, storage piles, and other open sources. An industry commenter ( IV D 134) disagreed, however, arguing that fugitive emissions should exclude particulates generated by truck traffic, earth moving equipment, and other landfill construction activities. Industry commenter IV D 311 requested clarification of fugitive emissions.

Response: The definition of " fugitive emissions" has not changed. Fugitive emissions do indeed include emissions generated from roadways, storage piles, truck traffic, earth moving equipment, landfill construction activities, and other open sources by definition. However, Title V does not impose any new requirements on these sources other than that fugitive emissions may need to be estimated for purposes of calculating fees. For a more detailed discussion on the requirements imposed on fugitive sources by Part 70, refer to Chapter 3.5 of this document.

2.13 MAJOR SOURCE Comment: Numerous local government agencies that manage affected units ( IV D 54, IV D 64, IV D 68, IV D 69, IV D 70, IV D 71, IV D 73, IV D 74, I V D 78, IV D 95, IV D 292, IV D 293, IV D 294, IV D 298, IV D 299, IV D 300, IV D 305, IV D 329, IV D 328, IV D 329, IV D 338, IV D 339, IV D 340, IV D 382, IV D 385, IV D 391, IV D 399), two industry groups ( IV D 103 and IV D 181) and one State agency ( IV D 166) requested that the phrase " potential to emit" be removed from the definition of major source. One industry ( IV D 200) and one local government ( IV D 107) supported the definition of major source in the rule.

Response: The final rule and preamble now clearly state that potential to emit may be restricted by limitations placed in a Part 70 permit. This clarification should remove much of the misapprehension that sources feel about using maximum potential to emit to determine major source status, as it is clear that potential to emit can be restricted by reducing the maximum capacity to emit using actual operating hours, control equipment, and other means. Furthermore, Title V permits are an appropriate means by which a source can assume a voluntary limit on emissions for purposes of avoiding being subject to more stringent requirements. Section 70.6( b)( 1) has been revised to clarify that such terms and conditions assumed voluntarily for purposes of limiting a source's potential to emit will be federally enforceable. This definition is also consistent with the definitions used in the Act at Sections 302 and 112, as well as Part D of Title I, and does not intend to overrule established precedent.

Comment: Three industry commenters ( IV D 129, IV D 142, IV D 306) and one State agency ( IV D 219) objected to the requirement that properties under common control be considered as a major stationary source. In some cases, they argued, these properties may be owned by one parent corporation but operated by two independent companies. They believed that common control should not apply to a parent company that does not actively control the operation.

Response: Including the phrase " under common control" in the definition of " major source" is consistent with established precedent in the Act at Sections 112 and 302 and Part D of Title I ( NSR). These Sections are explicitly referenced in the Title V definition of major source. The phrase " under common control of the same person or persons under common control" in the definition would apply when two properties are owned by one parent corporation. However, properties owned or operated by one corporate entity would have to meet the other important qualifying statements before they would be found to be a major source.

Comment: A few commenters proposed exceptions to the requirement that contiguous or adjacent properties be considered a major stationary source, including railroad and pipeline right of ways connecting power plants and mines ( IV D 129); oil or gas exploration, production wells, pipeline compressors, and pumping stations or other units; and mines ( IV D 142). A Federal agency ( IV D 109) requested that military installations such as airfields, utilities, shipyards, hospitals, or space research facilities be treated as separate units according to the type of operations performed.

Response: This portion of the definition is consistent with precedent established in the NSR program under authority of Part D of Title I, as well as with discussion contained in the House Committee Report concerning the definition of " major source." In the final rule, only one exception to the requirement that contiguous or adjacent properties be considered a major source has been provided. This exception is required by language in Section 112( n)( 4) of the Act. The final regulation now states that " emissions from any oil or gas exploration or production well ( with its associated equipment), and emissions from any pipeline compressor or pump station shall not be aggregated with emissions from other similar units, whether or not such units are in a contiguous area or under common control, to determine whether such units or stations are major sources."

Comment: Two industry groups ( IV D 142 and IV D 164) and one State agency ( IV D 214) commented that emissions from mobile sources located at the stationary source cannot be counted in determining whether a facility is a major source. The State agency commented that mobile sources, such as equipment used in asphalt plants and sand and gravel operations, usually are housed separately but sometimes are brought together for one job. The agency believed such operations should not qualify the source as a major source. One of the industry groups ( IV D 142) further commented that there was precedent for such mobile sources not being included in the major source determination under NRDC v. EPA, 725 F. 2d 761, 764.

Response: Title V generally follows established precedents in regard to the determination of major source and, in most cases, would not include emissions from mobile sources located at a stationary source in determining whether a facility is a major source. The definition of " major source" in Section 70.2 of the proposed and final regulations specifically state that it applies to " any stationary source ( or any group of stationary sources..." and then references Sections 112 and 302, and Part D of Title I. An exception is provided in Section 328( a)( 4)( C) of the Act where emissions from vessels servicing or associated with Outer Continental Shelf ( OCS) sources are to be considered direct emissions from the source. The statement, " the activities of any vessels shall not be considered part of a major source...", has been deleted from the definition of " major source" in response to comment. These vessels are mobile sources and must be included in the determination of major source status for stationary sources. Many of these comments are addressed in Section 3.2.1 of this document concerning major source definitions. However, temporary sources are required to obtain Part 70 permits under certain circumstances. If the commenters are actually referring to sources that would meet the definition of temporary source, they would be required to obtain Part 70 permits under Section 70.6( e) of the Act.

Comment: Two other industry groups ( IV D 184 and IV D 303) commented that moveable drilling rigs and oil well service equipment units or sets of units should not be major sources unless their potential emissions exceed the " major source" threshold.

Response: This interpretation is consistent with Sections 112 and 302, and Part D of Title I of the Act, and with the definition of " major source" in Section 70.2 of the regulation, both of which determine major source status by potential to emit. Oil and gas exploration and production facilities, as well as pipeline compressor pump stations, are exempted from being defined as a major source due to aggregation of emissions from contiguous and adjacent properties ( see Section 3.2.1 of this document).

Comment: Five industry groups ( IV D 199, IV D 200, IVD 205, IV D 206, IV D 375) proposed that only those sources currently regulated under the Act should be subject to definition as a major source under Title V. One of these commenters ( IV D 199) further stated that stationary sources should be limited to those stationary source categories that have been regulated under Section 111 or 112 of the Act since August 7, 1980. Another of the commenters believed that a major source should be limited to those sources that emit or have the potential to emit 100 tons per year or more of any regulated pollutant.

Response: The Administrator responds that the Act does not limit the major source status under Title V to sources " currently regulated" at the time of passage of the Act or at time of program approval in each State or to stationary sources regulated under Section 111 or 112 since August 7, 1980. The Act specifically provides in Section 502( b)( 9) that major source permits with terms of three or more years should be reopened to incorporate applicable standards and regulations promulgated after permit issuance. This provision evidences Congress's intent that the Part 70 program include all major sources and there be time limits on major source status determinations.

Furthermore, Congress intended that major source status should also include sources with potential to emit less than 100 tons per year, including Section 112( b) pollutants and criteria pollutants in nonattainment areas ( Part D of Title I). The EPA does not have discretion within the Part 70 rulemaking to increase or override major source thresholds previously specified in the Act. For example, the definition of " major source" contained in Section 112 applies to stationary sources that emit or have the potential to emit, in the aggregate, 10 tons per year ( tpy) or more of any HAP listed pursuant to Section 112( b) of the Act, 25 tpy or more of any combination of such HAP, or such lesser quantity as the Administrator may establish by rule.

Comment: One local government agency ( IV D 85) supported the inclusion of fugitive emissions in determining whether a source met the 100 tpy emissions limit to qualify as a major source. One State agency ( IV D 91), however, believed that fugitive emissions from fuel conversion plants should not be considered in determining whether the source was major. An industry commenter ( IV D 111) stated that it is beyond EPA's statutory authority to include fugitive particulate matter emissions from mining operations to determine whether a source is major until a Section 302( j) rulemaking has been conducted.

Response: Chapter 3.5 of this document contains significant discussion on the subject of whether fugitive emissions are included in determining major source status. In summary, Title V does not interfere with established precedents in this regard. Title V does, however, provide that fugitive emissions can be used for purposes of calculating permit fees, regardless of whether or not they are included for purposes of determining major source status.

Comment: Two industry groups ( IV D 188 and IV D 394) and one State agency ( IV D 398) opposed the use of the standard industrial classification ( SIC) code to determine groupings for major source determination. These commenters stated that some facilities may have the same SIC code but different management and, therefore, may require separate permits. They believed sources should be allowed to demonstrate which sources are included in one permit and which need to be permitted separately. The State agency ( IV D 398) commented that major industrial groupings needed to be defined separately.

Response: The final rule has not been changed in this regard. As promulgated, the two digit SIC code will be used to aggregate stationary sources on contiguous or adjacent properties consistent with established NSR procedures as the legislative history suggests that Congress intended. Additional discussion on this subject can be found in Section 3.2.1 of this document and in the preamble to the proposed rule.

Comment: One Federal agency ( IV D 352) stated that the definition of major source of radionuclides should be consistent with the definition of radionuclides under Section 112 of the Act. Industry commenter IV D 404 also believed that the definition of radionuclides should follow that of 40 CFR 61( h), such that a stationary source is any source that emits or has the potential to emit, in the aggregate, a 10 mrem effective dose equivalent.

Response: In the proposed regulation, the definition for " major source" stated that, " For radionuclides, such term shall have the meaning specified by the Administrator by rule." Therefore, defining a radionuclide source as a " major source" depends on the emissions criteria established within the regulation specifically applicable to that source. For instance, 40 CFR 61( h) is a National Emission Standard for Hazardous Air Pollutants ( NESHAP) applying specifically to emissions of radionuclides other than radon from Department of Energy ( DOE) facilities, therefore, this regulation applies only to DOE facilities. Future Section 112 rulemakings will establish the emissions levels for " major sources" of radionuclides. Regulations will also be promulgated to establish emissions standards for categories and subcategories of radionuclides, including radon.

Comment: One industry commenter ( IV D 173) requested that the definition of major source be amended by adding the words " after controls." Without such language, the commenter argued, there are too many sources, and permitting authorities will not have the time or technology to determine removal efficiency of the various control devices.

Response: The final regulations are promulgated as proposed in regard to this comment. Pollution controls are already taken into account when potential to emit is determined for a source. It is unnecessary and inappropriate to also take controls into account when determining major source status, as major source status is based on the potential to emit.

2.14 MINOR PERMIT AMENDMENT Comment: One State agency ( IV D 398) commented that there should be a two tiered definition for minor permit amendments, including a threshold for de minimis exemptions.

Response: Extensive comments concerning the proposed minor permit amendment provisions were received, and the definition of " minor permit amendment" has been removed from the final rule. For more information about the deletion of this definition and about the permit revision procedures that have replaced it, see Section 70.7 of the final rule and the discussion in the preamble of the final rule concerning Section 70.7.

2.15 POTENTIAL TO EMIT Comment: Six industry commenters ( IV D 174, IV D 175, IV D 176, IV D 177, IV D 178, IV D 383) stated that potential to emit should be interpreted to include operational limits that are not federally enforceable. Three industry commenters ( IV D 144, IV D 184, IV D 303) believed that potential to emit should not be based on the maximum operating capacity of 8760 hours per year, as many sources do not operate at maximum capacity. One State agency ( IV D 214) commented that States should be allowed to use a definition of potential to emit that does not include control equipment or operational limitations. Another industry commenter ( IV D 173) stated that potential to emit should be determined after controls.

Response: In the final rule, " potential to emit" is based on maximum capacity after taking into account any physical or operational limitations on capacity, including control equipment and restrictions on hours or operation. In response to comment, clarifying language has been added to the final rule and preamble explaining that potential to emit may now be limited by a restriction enforceable by the Administrator and citizens under the Act and that limitations are enforceable if they are either contained in Part 70 permits or otherwise federally enforceable. For further information in regard to making limitations on potential to emit Federally enforceable, see Sections 2.10 and 2.13 of this document.

The Administrator views it as axiomatic that a limit on potential to emit may not be recognized for purposes of the Part 70 program unless that limitation is Federally enforceable. This follows established precedent in the NSR program. See Final Rule: Requirements for the Preparation, Adoption, and Submittal of Implementation Plans; Approval and Promulgation of Implementation Plans, 54 Fed. Reg. 27274, June 28, 1989.

2.16 REGULATED POLLUTANT Comment: While a few State ( IV D 92, IV D 125, IV D 212) and environmental groups ( IV D 76 and IV D 252) proposed broadening the definition of " regulated pollutant," several industry commenters ( IV D 139, IVD 160, IV D 188, IV D 199, IV D 200, IV D 202, IV D 208, IV D 303, IV D 311, IV D 344, IV D 375) suggested limiting the scope of regulated pollutants. Some of these industry commenters ( IV D 160, IV D 199, IV D 202, IV D 303, IV D 375) proposed that pollutants regulated under the Act at Section 111 and 112 not be subject to Title V unless a standard has been promulgated. One of these commenters ( IV D 200) further suggested that Title V should not apply to Section 111 and 112 pollutants, except for those listed under Section 112( r). Each of the following suggestions to limit the scope of regulated pollutants was made by one industry commenter: regulated pollutants should include only any federally regulated volatile organic compounds ( VOC's) ( IV D 375); the definition of regulated pollutant should include a de minimis cutoff ( IV D 188); the definition of regulated pollutant should be source specific ( IV D 311); perchlorethylene, methyl chloride, 1 1 1 trichloroethane, and chlorofluorocarbons ( CFC's) should not be considered regulated pollutants ( IV D 344); a source should be regulated only when there are substantive requirements in effect on the emission or control of the substance ( IV D 203); and a source should not be regulated solely on the quantity of emissions ( IV D 139). On the other hand, one State ( IV D 125) and two environmental commenters ( IV D 76 and IV D 252) considered the definition of regulated pollutants to be too narrow, suggesting various pollutants that should be added. Two State commenters ( IV D 92 and IV D 212) suggested adding fine particulate matter ( PM 10) to the list of regulated pollutants. An environmental commenter ( IV D 76) indicated that CFC's, other pollutants regulated under Title IV, and incinerator emissions regulated under Section 129 of the Act should be included in the definition of regulated pollutant. Industry commenter IV D 208 requested clarification on what pollutants were regulated, suggesting that if no maximum achievable control technology ( MACT) standard is promulgated for HAPs, then the pollutant is not regulated.

Response: Many of the comments concerning " regulated pollutant" are addressed in Section 3.4.2 of this document. Many commenters were confused by this term because the Act defined it differently and used it only for fee calculation purposes. In the final rule, " regulated pollutant ( for presumptive fee calculation)" refers to pollutants for which a source may be assessed permit fees. A new term, " regulated air pollutant", has been added to the definitions to refer to pollutants for which a standard, regulation, or requirement is promulgated or otherwise established.

Several changes were made to the definition of " regulated air pollutant"  which was " regulated pollutant" in the proposal. First, substances regulated under Title VI of the Act ( protection of stratospheric ozone) were added to the list of " regulated air pollutants." Second, the final Part 70 regulations clarify when a substance regulated under Section 112 becomes a " regulated air pollutant". The term " regulated air pollutant" includes any pollutant subject to a standard or other requirements under Section 112 of the Act, including Section 112( r) of the Act. As applied to an individual source only, the definition includes any pollutant for which a MACT standard is promulgated on a case by case basis under Section 112( g)( 2) of the Act. This type of MACT requirement will apply only to the individual source for which it was developed. Generally speaking, if a Section 112( b) pollutant has no standard promulgated or other requirement under Title III, it would not be a " regulated air pollutant", however, Section 112( b) pollutants might be regulated because they are also sources of VOC's, or because they are also listed pursuant to Section 112( r). Although there may not be a Federal standard or requirement for a VOC, a standard or requirement in a SIP that has been approved by EPA would cause the VOC emissions to be considered a " regulated air pollutant."

In response to commenters, the term " regulated air pollutants" includes any pollutant for which a NAAQS has been promulgated ( including nitrogen oxides), PM 10, and any class I or II substances subject to a standard promulgated under or established by Title VI. The definition of " regulated air pollutant" already includes incinerator emissions regulated under Section 129 to the extent that these emissions are subject to a standard or requirement in Section 112.

There are no changes to the rule in regard to de minimis cutoffs for " regulated air pollutants", however, Section 70.5( c) provides that the State may exempt certain " insignificant" emissions or activities from being included in the application. The EPA will approve State program exemptions for insignificant emissions if they do not interfere with determinations of applicability, the imposition of applicable requirements, or the calculation of fees.

In the final rule, " regulated pollutant ( for presumptive fee calculation" only refers to pollutants for which fees may be assessed under the authority of Section 502( b)( 3) of the Act. It includes all " regulated air pollutants" except carbon monoxide ( CO), substances that are only " regulated air pollutants" because they are subject to a standard or regulation in Section 112( r), and class I or II substances subject to a standard promulgated under or established by Title VI.

In the final rule, a HAP listed pursuant to Section 112( b) becomes a " regulated pollutant ( for presumptive fee calculation)" when EPA first promulgates a MACT standard for that pollutant. In addition, if a pollutant is regulated at a particular source, its emissions will be considered for fee purposes even if a general standard has not been issued.

The EPA has also decided to exercise its discretion by excluding from " regulated pollutant ( for presumptive fee calculation)" those substances that would be regulated pollutants only because they are regulated under Section 112( r) ( the accidental release program) for reasons more fully described in the preamble to the final rule. The proposal was also modified so as to allow States relying on the $ 25/ tpy presumptive minimum to exclude from the calculation insignificant quantities of actual emissions not required to be in a permit application pursuant to Section 70.5( c).

2.17 RESPONSIBLE OFFICIAL Comment: Many industry commenters ( IV D 52, IV D 56, IV D 86, IV D 102, IV D 111, IV D 161, IV D 173, IV D 184, IV D 198) and one State agency ( IV D 91) strongly objected to the proposed definition of " responsible official." These commenters preferred a broader definition of responsible official. They stated that basing the definition on specific requirements for employees or expenditures was impractical and would frequently mean that company officials who had no specific knowledge of the facility would be responsible for the permitting process. These commenters preferred that the facility manager be the responsible official, regardless of the size of the facility. One industry commenter ( IV D 173) believed that responsible official should be defined as in 40 CFR 403.12( l)( 3). One industry commenter ( IV D 369) believed that the definitions of responsible official and designated official were conflicting, and created confusion about who could sign a Part 70 permit application. The commenter further stated that the definition of responsible official was more appropriate.

Response: The proposed definition of " responsible official" was modified in response to comment. Now the regulation allows a " duly authorized representative" who is responsible for the overall operation of one or more corporate manufacturing, production, or operating facilities to be the responsible official in certain circumstances. Sources have the greatest flexibility when the permitting authority approves delegation of authority to this representative in advance. States could establish their own criteria for this delegation of authority in their individual rulemakings, but this will not be required by the Administrator. This modification will allow a plant manager, for instance, to be the " responsible official," regardless of the size of the facility, as long as the designation is approved in advance. The portion of the definition allowing a president, secretary, treasurer, vice president in charge of a principal business function, or any other similar person to be the " responsible official" has not changed.

2.18 STATIONARY SOURCE Comment: Several groups ( IV D 2, IV D 85, IV D 91, IVD 92, IV D 109, IV D 139, IV D 212, IV D 251, IV D 258) requested clarification on or modification of the definition of " stationary source," especially regarding the differences between a stationary source and an emissions unit. One of these commenters ( IV D 85) feared that the proposed definition of stationary source allowed the disaggregation of a group of common units so that a permit was not required. A few commenters ( IV D 2, IV D 85, IV D 92, IV D 212) preferred a broad interpretation of the term, indicating that a stationary source would be any building, structure, installation, operation, or combination thereof that contains one or more emissions units. One industry commenter ( IV D 82) believed that the definition of stationary source should be patterned on the definition of the term in Title I, stating that the proposed definition was too narrow. A few industry commenters ( IV D 139, IV D 251, IV D 375), one local government agency ( IV D 362), and one Federal agency ( IV D 109) preferred a narrower interpretation of stationary source, stating that any activities or pieces of equipment should not be included as part of the stationary source. One of these groups ( IV D 362) further requested that language be added to clarify that portable pieces of equipment could not be considered stationary sources. The Federal agency ( IVD 109) requested that the definition be modified to make it subject to exclusions or conditions of coverage of activities or equipment contained in 42 U. S. C. 7401 et. seq. Two State ( IV D 91 and IV D 212) groups contended that the definition conflicted with existing definitions of stationary source: one stated that it is inconsistent with the definition of major stationary source at Section 302 of the Act ( IV D 212), and the other ( IV D 91) believed that it does not conform with the definition of stationary source at 40 CFR 52.21( b)( 5).

Response: This definition has been changed in response to comment. The part of the definition including " any activity or piece or equipment" has been deleted. The definition now clearly does not regulate emissions from mobil sources, as might possibly be construed by including " activities" and " pieces of equipment" in the definition. This change now makes the Part 70 definition consistent with the term as used in other parts of the Act and Federal regulations.

The definition of " stationary source" will not allow the disaggregation of a group of common units so that a permit is not required, since the requirement for a permit is governed by Section 70.3 ( on applicability) and the definition of " major source" contained in Section 70.2, not the definition of " stationary source." Section 70.3 requires permitting of any major source, any source subject to a standard, limitation, or other requirement under sections 111 and 112, any affected source, and any source designated by the Administrator. The definition of " major source" in Section 70.2 means a stationary source or a group of stationary sources located on contiguous or adjacent properties, under common control of the same person, and belonging to the same major industrial group ( having the same 2 digit SIC code). The Part 70 definition of " major source" includes " major sources" under Section 112 of the Act and " major stationary sources" as defined in Section 302 and Part D of Title I of the Act. See Sections 2.12 and 3.2.1 of this document for additional discussion on the major source definition and the aggregation of units located on contiguous or adjacent properties.

Definitions contained in various regulations promulgated pursuant to the Act are inconsistent with one another in regard to both the specific terms that are defined and the specific wording of definitions for the same terms. One commenter stated that the Part 70 definition of " stationary source" is inconsistent with Section 302 of the Act. This is not true because the definition of " major source" in Part 70 specifically includes " a major stationary source of air pollutants, as defined in section 302 of the Act..." Another commenter believed that there is a conflict with the definition of " stationary source" at 40 CFR 52.21( b)( 5). These two definitions only differ in respect to the language used to describe the pollutants emitted, not in respect to what types of property or devices constitute the physical being of the stationary source: 40 CFR 52.21( b)( 5) refers to " air pollutants subject to regulation under the Act," while " stationary source" in Section 70.2 refers to " regulated air pollutants and pollutants listed under Section 112( b) of the Act." This is not a substantive difference since these phrases are used to convey the general concept that this type of source emits pollutants, not to define the emissions. A Federal commenter requested that the following phrase be added to the definition of stationary source: " This definition is subject to exclusions or conditions of coverage of activities or equipment contained in 42 U. S. C. section 7401 et seq." It appears  although it is not clear  that the commenter is referring to specific exemptions or exclusions found in the Act. The Administrator has not made this change because the request is vague with no legal or policy justification showing the need for such change, and because the Administrator finds that this change is unnecessary and inappropriate.

2.19 WHOLE PROGRAM Comment: One State ( IV D 179) and one local government ( IV D 85) agency each commented that the definition of whole program should be changed to include programs submitted by individual air permitting authorities.

Response: This definition has not been changed. It is important that it not change in order to provide some distinction between a whole program covering a whole State and a partial program that may cover only an area served by a individual local permitting authority within the State.

2.20 OTHER COMMENTS Comment: One industry commenter ( IV D 366) proposed adding a definition for process unit, such that a process unit means equipment assembled and integrated to perform a common service or to produce articles or chemical intermediate and products. The commenter noted that a process unit can operate independently if supplied with sufficient fuel or raw materials and sufficient product storage facilities. A Federal agency ( IV D 109) believed the following definition such be added: Common military control means a United States Military Property entirely under the command of an Army MACOM, Air Force Major Command, Navy Major Claimant, or Marine Corps. An industry commenter ( IVD 377) stated that violations of law should be defined, and offered the following definition: " any case of noncompliance existing at the time of permit issuance that is identified in the compliance schedule for the source or that rests on material facts that were not disclosed to the permitting authority prior to permit issuance." Response: The Administrator has not changed the regulations to add the suggested definitions to Part 70. It would be especially counterproductive to define a term such as " violations of law" in the narrow way that the commenter suggests, as his suggestion does not include such events as operating without a permit. The Administrator sees no purpose in defining " process unit" or " common military control" for purposes of Title V, as these terms are not used within the regulations as promulgated. 3.0 COMMENTS AND RESPONSES ON SECTION 70.3: APPLICABILITY 3.1 SUMMARY OF COMMENTS ON SECTION 70.3 Comments on applicability were received from industry, State and local agencies, and a few Federal agencies. The issue of deferring nonmajor sources for five years drew the greatest number of comments. Other areas receiving significant attention were the major source definition, list of source categories proposed for exemption, and fugitive emissions.

3.2 SOURCES SUBJECT TO PERMITTING 3.2.1 Major Source Definition Comment: Many industry commenters ( IV D 49, IV D 77, IV D 97, IV D 159, IV D 160, IV D 161, IV D 200, IV D 271, IV D 312, IV D 317, IV D 331, IV D 341, IV D 345, IV D 346, IV D 350, IV D 390) and State commenters ( IVD 04, IV D 166, IV D 191, IV D 219, IV D 301, IV D 322) supported using two digit standard industrial classification ( SIC) codes to define major sources. Several of the industry commenters ( IV D 160, IV D 208, IV D 312, IV D 350) opposed use of the support activity test; one commenter ( IV D 160) argued that the percent allocations of a support unit will change from year to year at a given plant, while another ( IV D 208) was concerned that a single plant would be forced to have multiple permits if certain units were shared by different installations. Another industry commenter ( IV D 315) said EPA should allow facility permits that cover all emission sources within a facility or group of facilities under common ownership.

One State agency ( IV D 367), two industry groups ( IV D 93 and IV D 188), and one Federal agency commenter ( IV D 352) opposed the sole use of two digit SIC codes to determine the source. Another industry commenter ( IV D 311) generally supported use of SIC codes, but stated that there will be instances when a source will want to include different SIC codes in one permit. State agency commenter IV D 223 suggested that EPA allow the source owner or operator to demonstrate that use of a three or four digit SIC code is appropriate.

Response: Section 502( a) of the Clean Air Act ( CAA) requires all major sources to obtain a Title V permit. A major source is defined in Section 501( 2) of the Act as " any stationary source ( or any group of stationary sources located within a contiguous area and under common control)" that is either a major source as defined in Section 112, or a major stationary source as defined in Section 302 or Part D of Title I. EPA does not believe it is appropriate to change the definition of " major source" that was proposed.

Consistent with EPA's past practice under new source review ( NSR), the regulations require all commonly owned or controlled pollutant emitting activities on contiguous or adjacent properties to obtain an operating permit if they are within the same major ( two digit) SIC group, assuming the aggregated activities emit enough pollutants to exceed the applicable emissions thresholds provided in the Act.

Any equipment used to support the main activity at a site would also be considered part of the same major source, regardless of the two digit SIC code for that equipment. For example, an automobile manufacturing plant may consist of a foundry ( SIC Group 33), a power plant ( SIC Group 49), and an assembly plant ( SIC Group 37). Assume that the equipment is situated at the same site, under common ownership, and that the foundry and power plant are used solely to supply the assembly plant. In this example, all three activities would be considered to be part of one major source. However, if less than 50 percent of the output of the foundry was dedicated to the mentioned auto assembly plant, it would be considered a separate source. If the power plant supported both the foundry and the assembly plant and no other source, it would be considered part of the source that consumed the largest percentage of the power generated. Thus, a single plant would not be required to have multiple permits even if it supported several different installations.

The EPA has not changed the definition from the proposal because the definition is what was intended by Congress, is consistent with past agency practice, and furthers important policy goals.

The EPA continues to believe that Congress intended that sources be aggregated by two digit SIC code at the source site to determine whether the source is major. The statute defines " major source" to include a " major source as defined in Section 112" or a " major source as defined in Section 302 or Part D of Title I." Section 501( 2)( B) of the Act. Under Section 302 and Part D of Title I, EPA has a long practice of defining major stationary source by reference to twodigit SIC codes. Congressional reliance upon a term for which there is a long standing EPA interpretation is strong evidence that Congress considers the existing interpretation permissible, if not mandatory. At this time, EPA anticipates that it will also reference twodigit SIC codes in defining major source under Section 112.

Furthermore, the House Committee Report, in an explanation of the use of the term " major source" in Section 182( c) of the Act ( regarding serious ozone nonattainment areas), sheds light on the Title V definition as well [ see H. R. Rep. No. 490( I), 101st Cong., 2d Sess. 236 237 ( 1990)]. Specifically, the report states the following:

The definition of " major source" here and elsewhere in the bill uses the term " group of sources located within a contiguous area and under common control." The Committee understands this to mean a group of sources with a common industrial grouping, i. e., the same two digit SIC code. It is the approach followed today by EPA as a result of the Alabama Power litigation. It avoids the possibility that dissimilar sources, like a power plant and an adjacent coal mine, will be considered as the same " source" because of common ownership.

The legislative history reference to Alabama Power and EPA's current approach, suggest that aggregation by SIC code should be done in a manner consistent with established NSR procedures. See New Source Review Workshop Manual, Draft, October 1990, and New Source Review: Prevention of Significant Deterioration and Nonattainment Area Guidance Notebook, 1991, for further information on how NSR handles this and other precedent setting issues that relate to Title V.

The Administrator believes that using two digit SIC codes to define " major source" serves several important policy concerns. Because the Administrator currently uses two digit SIC codes for NSR purposes, permitting authorities and sources will be familiar with this definition. Another advantage is that using two digit SIC codes will promote greater consistency in air regulations. The two digit SIC code level is superior to the three or four digit SIC code level for several reasons. Two digit categories are narrow enough to separate sets of activities into common sense groupings. These two digit categories are, at the same time, broad enough to minimize the likelihood of artificially dividing a set of activities that does not constitute a plant or facility into more than one group. The two digit categories are also broad enough to minimize the likelihood of disputes over whether a set of activities falls entirely into one category or another.

The definition of " major source" need not be changed based on commenters' concerns regarding whether one permit or several should cover various emission sources at a facility or group of facilities. The definition of " major source" does not preclude permitting authorities from issuing one permit for all emissions sources within a facility or group of facilities under common ownership, regardless of SIC code. Similarly, permitting authorities may decide to issue a group of permits to cover a facility or group of facilities even when all emissions are from units in the same SIC code.

One commenter was concerned that the percent allocation for support units at a facility may change from year to year affecting the support activity test. Congressional intent was that Title V would handle the determination of source in the same manner as the NSR program. Under NSR, support facilities are those facilities that convey, store, or otherwise assist in the production of the principal product at the site. The commenter's question seems to assume that a support unit assists more than one primary activity ( source) in the production of a product. NSR considers an emissions unit that supports two or more sources as part of the source that relies most heavily on its support. Many factors in addition to percentage allocation of output to each source is considered in such determinations and not enough information is provided to answer the question specifically.

Comment: One industry representative ( IV F 02e) commented that the permit should apply to individual processes defined as major sources or as sources of hazardous air pollutants ( HAPs), and not to the entire plant site.

Response: States may continue to issue individual permits for specific processes, as long as they are aggregated and filed together in accordance with the definition of " major source." States may also choose to issue one permit for the entire major source ( plant). Whether the State chooses to issue one permit or a collection of permits for a major source, the permit( s) must contain all applicable requirements that apply to the source. Additionally, Part 70 applicability may extend to other than major sources ( nonmajor sources), including any Section 111, Section 112, Title IV, or other source in a source category designated by the Administrator. Permits for these nonmajor sources need only contain applicable requirements for the emissions units that trigger applicability.

Comment: Three industry commenters ( IV D 184, IV D 257, IV D 303) stated that the Title V program should indicate that emissions from oil and gas exploration and pipeline compressor stations are not to be aggregated with emissions from other similar units in determining whether a source is major. One of these commenters argued that in the case of a mobile drilling rig, which will relocate a number of times on a lease, the major source determination should be made independently at each location and should not be additive.

Response: The EPA has changed the definition of " major source" in Section 70.2 of the regulations to make it consistent with the requirements of Section 112( n)( 4) of the Act. The regulations now provide that " emissions from any oil or gas exploration or production well ( with its associated equipment) and emissions from any pipeline compressor pump station shall not be aggregated with emissions from other similar units, whether or not such units are in a contiguous area or under common control, to determine whether such units or stations are major sources."

Comment: Three environmental groups ( IV D 228, IV D 229, IV D 432) argued that the provision in Section 70.2( r) stating that the activities of vessels shall not be considered part of a major source violates the Outer Continental Shelf ( OCS) provision in Section 328( a)( 4)( C) of the Act that includes vessel emissions as direct emissions from the OCS source.

Response: Evaluation of the requirements of the Act with respect to the OCS program has prompted the Agency to delete the reference to vessels in the major source definition. Specifically, Section 328( a)( 4)( C)( iii) of the Act requires that emissions from vessels servicing or associated with the OCS source be considered direct emissions from the source. The promulgated definition will allow permitting of these sources consistent with the requirements of the OCS program.

3.2.2 Potential Emissions Comment: Several industry commenters ( IV D 135, IV D 160, IV D 204, IV D 311, IV D 312, IV D 323, IV D 350) recommended that a major source should be based on actual, not potential, emissions. Response: The proposal defined a major source in terms of a source's potential to emit all air pollutants from all emissions units within the same two digit major group industrial classification under common control at the same plant site. The final rule retains potential emissions as the basis for determining major source status. " Potential to emit" is defined in Section 70.2 of the regulations as the maximum capacity of a source to emit any air pollutant, taking into account any physical or operational limitation on that capacity enforceable by the Administrator, including any air pollution control equipment.

EPA is required by statute to base the definition of major source on potential, not actual, emissions. Title V defines " major source" to include " major source as defined in Section 112" and " major stationary source as defined in Section 302 or Part D of Title I." Section 501( 2) of the Act. The cross referenced statutory definitions are based on whether a source emits or " has the potential to emit" a specified amount of pollutants. Sections 112( a)( 1), 302( j) ( emphasis added).

Comment: Many industry commenters ( IV D 01, IV D 49, IV D 100, IV D 169, IV D 174, IV D 175, IV D 176, IV D 177, IV D 178, IV D 181, IV D 200, IV D 273, IV D 317, IV D 350) and several State commenters ( IV D 59, IV D 191, IV D 219, IV D 279, IV D 322, IV D 359) favored allowing sources to restrict potential emissions to below Title V major source threshold levels. However, the State commenters urged that this provision be used only if sources conduct adequate monitoring and submit periodic reporting to the reviewing agency.

One State agency ( IV D 125) urged that the federally enforceable NSR program be used as a mechanism to deal with sources whose potential to emit is " major" but whose emissions are restricted enforceably to below the threshold for major stationary sources. Three State agencies ( IV D 125, IV D 231, IVD 267) recommended the use of general permits as an acceptable alternative. One State agency ( IV D 125) argued that use of enforceable company commitments is merely another form of permit review. Another of the State agencies ( IV D 267) agreed but questioned whether small sources could afford to monitor and report every six months. One State agency ( IV D 219) questioned what would happen to an existing Title V permit if a source controlled emissions to below the major source threshold.

Response: The Preamble to the proposal discussed the scenario in which a source chooses to restrict enforceably its potential emissions below the threshold for a major stationary source in order to exempt itself from the requirement to obtain a full Part 70 permit, assuming no other provision of the Act captures that source in the program. Three options were proposed to address this situation: ( 1) a State could issue State general operating permits to such sources, without subjecting them to the federally approved permit program, and submit those State permits as State Implementation Plan ( SIP) revisions to make the limits federally enforceable; ( 2) a State could submit its operating permit program to EPA for approval as a SIP revision, and then issue federally enforceable State permits to these sources; or ( 3) a source could submit to the permitting authority an " enforceable commitment" containing specific physical or operational conditions that would restrict the source's potential emissions below the applicability threshold.

After considering comments on this issue, EPA has decided to adopt the first two options, but finds the third option to be unacceptable. It would needlessly create a separate, although similar, process outside of the permitting process. To be at all acceptable, such a process would have to require public notice and review, and these agreements would then have to be made federally enforceable through some as yet undefined means. The two options described in detail in the proposal, as well as another method described in the following paragraph, would satisfactorily do just this, without the burden of creating and implementing another process external to the permitting program.

Another acceptable option has been provided in the final rules. Under this option, States may issue to these sources Federal Part 70 permits that are reduced in scope and detail. Such a permit could contain specific physical or operational conditions that would restrict the source's potential emissions to a level below the applicability thresholds stated in Section 70.3( a). Monitoring and reporting requirements in the permit could be limited to those necessary to ensure enforcement of these conditions. The permitting authority could use a general permit under Part 70 to implement this option. Failure of the sources to meet these permit conditions could trigger a requirement to submit a revised, detailed Title V permit application.

One commenter questioned what would happen to an existing Title V permit in the event that a source controlled its emissions to below the major source threshold. These emission reductions would have to be restricted enforceably in order for the permitting authority to recognize the change in status from major to nonmajor source. However, the nonmajor sources may still be required to obtain Part 70 permits, provided that there is no deferral or permanent exemption in place for the nonmajor source and that it is otherwise subject to Part 70.

3.3 SOURCE CATEGORY EXEMPTIONS 3.3.1 Deferral of Nonmajor Sources Comment: In general, commenters overwhelmingly supported the five year deferral of nonmajor sources. Specific commenters favoring this provision included 34 industry representatives ( IV D 49, IV D 52, IV D 57, IV D 63, IV D 77, IV D 93, IV D 159, IV D 160, IV D 174, IV D 175, IV D 176, IV D 177, IV D 178, IV D 181, IV D 186, IV D 189, IV D 195, IV D 199, IV D 200, IV D 202, IV D 203, IV D 205, IV D 206, IV D 213, IV D 217, IV D 269, IV D 272, IV D 307, IV D 312, IV D 324, IV D 330, IV D 361, IV D 404, IV F 01y), six State groups ( IV D 121, IV D 125, IV D 191, IV D 211, IV D 219, IVD 270), and one government agency ( IV D 269). Several industry commenters ( IV D 160, IV D 269, IV D 312) noted that the deferral would minimize severe administrative burdens for sources, the States, and EPA. A State commenter ( IV D 270) noted that because there is some question about the legality of the proposed section, EPA should provide a further rationale for the deferral of nonmajor sources. One State agency commenter ( IV D 261) and an environmental representative ( IV D 432) argued that source categories cannot be exempted or deferred because it is impractical and infeasible for the permitting authority. The commenter added that the applicants can be exempted only if it is impracticable, infeasible, or unnecessarily burdensome for sources.

Two environmental groups ( IV D 229 and IV D 261) argued that there should be no exemption for small or nonmajor sources unless there is a specific finding that it would be impracticable, infeasible, or unduly burdensome for the nonmajor source to comply with the Act's requirements; the Act does not provide an exemption on the basis it would be unduly burdensome for the States to permit the sources.

Response: Section 502( a) of the Act provides the Administrator the discretion to exempt one or more source categories ( in whole or in part) from the requirement to obtain a permit " if the Administrator finds that compliance with such requirements is impracticable, infeasible, or unnecessarily burdensome on such categories." The Act specifies that major sources may not be exempt from these requirements.

Section 70.3( b)( 1) of the final Part 70 regulations retains most of the provisions of the proposal and provides States the option of exempting all nonmajor sources ( except for acid rain sources and solid waste incineration sources) temporarily from the requirement to obtain a permit. A State may choose to provide the temporary deferral for all nonmajors or for nonmajors only in selected source categories. A State also has the option of allowing deferred sources to apply for and receive a permit during the deferral period. As explained below, the Administrator will enter into a rulemaking in the future to decide whether or not to grant further permanent exemptions to all or some specific categories of nonmajor sources. Additionally, the proposal requirements in paragraph 70.3( b)( 2) concerning a showing by the State for source category exemptions in nonattainment areas has been deleted from the final rule for the reasons given in the preamble to the final rule.

The EPA finds that without this deferral, compliance with the permitting requirements would be " impracticable, infeasible" and " unnecessarily burdensome on such source categories" within the meaning of Section 502( a) of the Act. Two independent and sufficient reasons support EPA's determination. The first was presented in the Preamble to the proposal: the burden on the permitting authorities and EPA will make permitting all nonmajor sources in the early stages of the program impracticable and infeasible. The second reason, which by itself justifies deferral, is that the requirements necessary to obtain a Title V permit during the early stages of the program would be " unnecessarily burdensome" for nonmajor sources. This is because the anticipated burden on permitting authorities and EPA, as described in the Preamble to the proposal, would translate into a significant, additional, and unnecessary burden on nonmajor sources if they were required to be permitted.

Nonmajor sources will be disproportionately affected by the administrative difficulties faced by the permitting authorities. The great majority of nonmajor sources are small businesses, and many are not currently subject to State air permit programs. Nonmajor sources will require more assistance from permitting authorities and EPA because of the relative lack of resources and technical and legal expertise, as well as inexperience in dealing with environmental regulation, that characterizes most small businesses. If permitting authorities become overburdened due to a backlog of thousands of permits to be processed, in many States nonmajor sources will be unable to obtain additional technical and procedural assistance from permitting authorities. Although the small business technical assistance program should help these sources, the small business program staff will also be assisting small businesses that are major sources and will face the same problems and time constraints as permitting staffs.

Difficulty in obtaining assistance will unnecessarily burden nonmajor sources in various ways. For example, difficulty in obtaining assistance from permitting authorities could make it difficult, if not impossible, for some nonmajor sources to submit a timely and complete application. If they fail to submit a timely and complete application, these sources would lose the " application shield," thereby forcing them to close or run the risk of operating without a permit in violation of the Act. The inexperience of nonmajor sources with permitting and their relative lack of technical and legal resources also makes it more likely that such sources will require more permit revisions soon after permit issuance. If permitting authorities are overburdened, it will be difficult for nonmajor sources to obtain permit revisions early in the process. This will prevent them from promptly making what they believe are necessary changes.

The EPA notes that some nonmajor sources are already permitted at the State level, and therefore would have some experience with the permitting process and completing permit applications. A State need not extend the deferral to these sources. However, even these sources will have to deal with the increased burdens flowing from the requirements of other titles of the Act Amendments ( CAAA). As stated above, EPA expects that the great majority of nonmajor sources will be small businesses. Some nonmajor sources will in fact be either adjuncts to large corporations possessing significant resources along with technical and legal expertise, or will have independently acquired such resources and expertise. It is therefore likely that there will be certain nonmajor sources for which the requirements of the Part 70 program may not be unnecessarily burdensome.

While the permitting requirements will be significantly less burdensome for these sources, EPA has determined that it is not feasible to subject these sources to different treatment for purposes of this deferral. This is primarily because the class of sophisticated nonmajor sources described above bears little or no relation to the delineation of source " categories" as that term is used in Section 502( a). Rather, EPA believes that these sources typically represent a small percentage of each of the various categories of nonmajor sources. Given the anticipated lack of resources discussed above, it is not reasonable to expect permitting authorities to sift through the large number of nonmajor sources and select those for which the permit program requirements will not be unnecessarily burdensome. Indeed, the requirement to conduct such a survey would to a great extent undercut the benefits intended by this deferral, and would not be justified by the minor gains in emission controls resulting from the permitting of these few nonmajor sources.

As already mentioned, States are free to apply the deferral only to certain categories of nonmajor sources. The Part 70 regulations therefore do not prevent a State from drawing distinctions based upon which nonmajor sources have the resources and expertise necessary to comply with the permit program.

The EPA also notes that an alternative to deferral under Section 502( a) exists in the form of general permits. General permits reduce the administrative burden for sources and permitting authorities by simplifying the permit issuance process on certain categories of nonmajor sources. However, not all nonmajor sources are well suited to general permits and the sources for which general permit would be applicable must still comply with the administrative procedures related to permit issuance, such as public review, and EPA and affected State review. Administrative burdens would therefore be reduced but not eliminated and still represent a significant, additional, and unnecessary burden on nonmajor sources.

Compelling States to permit nonmajor sources during the early stages of the Title V permitting program is not only extremely burdensome for these sources, it is unnecessarily so. Requiring nonmajor sources to be permitted at the beginning of the program would not provide major benefits to air quality and might actually hinder implementation of the Act. The temporary exemption for nonmajor sources poses few risks to progress in improving air quality. By definition, these sources emit less than major sources and are less significant contributors to air quality problems. Furthermore, deferring permitting requirements does not defer a source's obligation to comply with the underlying substantive air pollution control requirements. Nonmajor sources may be subject to New Source Performance Standards ( NSPS) or existing National Emission Standards for Hazardous Air Pollutants ( NESHAP) regulations that in general already contain many of the same monitoring, recordkeeping, and reporting requirements that would apply to major sources and represent one of the major benefits of the permit program.

Requiring nonmajors to obtain permits at the start of a permitting program could hinder implementation of the Act. It will stress the system by greatly increasing the number of permits that must be processed. This additional stress would make it more likely that errors would occur in permitting major sources, which could adversely affect air quality. Concentrating State permitting resources on major sources during the first phase of the program will make more efficient use of those resources.

Furthermore, deferring permitting requirements for nonmajor sources temporarily does not only delay the permitting burden on these sources, it will significantly decrease the burden. Once the programs have been operating for several years and the initial wave of permitting is completed, permitting staff will have the time and experience necessary to assist nonmajor sources with the permitting process.

Thus, the temporary exemption of minor sources furthers important policy goals. The failure to defer nonmajors would greatly increase the burden on those sources, would probably not provide significant environmental benefits, would stress the permitting system when it is at its most vulnerable time, and might actually hinder achievement of air quality gains. Temporarily deferring the applicability of Title V requirements to nonmajor sources might even have a net air quality benefit to the extent it facilitates bringing more major sources into compliance earlier.

The EPA believes that the preceding analysis of the burden on nonmajor sources is ample justification for the exemption under Section 502( a) of the Act being implemented here. This is particularly so in light of the observation from the Alabama Power Company v. Costle decision, 636 F. 2d 360 ( D. C. Cir. 1979), that a deferral of the applicability of Act provisions requires far less justification than an outright exemption.

Comment: Many of the industry commenters urged that deferral of nonmajor sources continue indefinitely.

Response: The Administrator does not intend for the deferral of nonmajor sources to continue indefinitely. In the proposal, permitting authorities were allowed to defer ( temporarily exempt) nonmajor sources, except for acid rain sources, from coverage under Part 70 for five years after program approval. The final rule retains the provisions in this regard, with the exception of the 5 year limitation. The preamble to the final rule states that the Administrator will complete a national rulemaking within 5 years of the first approval of a State program that defers non major sources to consider further deferral or permanent exemption for nonmajor sources.

The burdens of the permitting program previously identified, including the lack of adequate resources and technical and legal expertise on the part of sources, as well as the potential difficulty in obtaining technical and legal assistance from permitting authorities, are likely to continue for some significant number of nonmajor sources beyond the early stages of the permit program. Accordingly, EPA believes it would be unduly burdensome, and in some cases onerous, to subject all such sources to the full panoply of procedural and substantive requirements embodied in the final permit rules. Although the Agency anticipates that many nonmajor sources will qualify for general permits and thereby avoid the greater burdens associated with obtaining specific permits, EPA also believes it likely that a certain number of categories of nonmajor sources should be permanently exempted from the permit program. This is so despite the support that will be offered through the Small Business Technical Assistance Program established under Section 507. While that program will be beneficial to nonmajor sources, the extraordinary number of nonmajor sources that could conceivably enter the permit system absent this deferral, as many as 350,000 sources, could overwhelm the capacities of the State technical assistance programs.

To address these serious concerns, EPA stated in the preamble to the final rule that it intends, within 3 years of the first approval of a full or partial State permit program that defers nonmajor sources, to initiate a rulemaking to determine whether to grant a further deferral from the permit program to all or some specific categories of nonmajor sources. In addition, the rulemaking will consider whether to grant permanent exemptions to any source categories for which there is a sufficient record to support such an exemption. As part of this rulemaking, EPA, in conjunction with sources, will gather information which will enable the Agency to make exemption determinations as appropriate. The EPA will propose such a rule no later than 4 years following approval of the first full or partial State permit program with a deferral and promulgate the rule within 5 years of that date. Comment: A few commenters ( IV D 219, IV D 314, IV D 322, IV D 331) indicated that the deferral process is unclear. Their basic questions centered on whether nonmajor sources must obtain permits within five years or after the initial five years.

Response: Nonmajor sources must obtain permits after the end of the temporary exemption. At that time, nonmajor sources will be required to submit a complete permit application within 12 months, unless the source is covered by a permanent exemption. Section 503( c) states that sources are required to submit an application to the permitting authority within 12 months, or such earlier date as the permitting authority may establish, of becoming subject to the State permit program and that the permitting authority is required to issue or deny the permit within 18 months of receipt of an application.

Comment: Three industry commenters ( IV D 197, IV D 205, IV D 206) indicated that the deferral should apply to certain major sources as well as nonmajor sources.

Response: The Administrator may not extend any deferral ( temporary exemption) or permanent exemption to any major source, as this is explicitly prohibited by Section 502( a) of the Act.

Comment: Two environmental groups' ( IV D 228 and IV D 432) interpretation of Section 70.3( b) was that it would exempt nonmajor incinerators from permitting and argued that Section 129( e) requires such sources to obtain Title V permits.

Response: The proposal identified major sources and nonmajor sources with applicable requirements of the acid rain program ( affected units) as not eligible for the deferral from Part 70 program applicability and did not single out solid waste incineration units for any special consideration in this regard. The final rule specifically allows nonmajor solid waste incineration units to be deferred only until the time they are independently required to obtain permits under Section 129( e) of the Act. This is because the Administrator believes that States should not be allowed to override the Act's specific schedule for permitting specific source categories.

Comment: One industry commenter ( IV D 272) suggested deleting the restriction on deferrals for nonattainment areas, as it is not required by the Act. A State commenter ( IV D 125) noted that a State should not be required to show that its SIP obligations can be effectively enforced without a federally enforceable permit.

Response: The proposal made the deferral for nonmajor sources in nonattainment areas contingent upon a showing by the permitting authority that the State could effectively enforce its SIP obligations on such sources without using Title V operating permits. The final rules do not include this requirement because such a showing is not required by the Act. Section 502( a) of the Act makes no distinction regarding treatment of exemptions in attainment areas versus nonattainment areas. The EPA also determined that the proposed provision was impractical and unnecessary. It would have demanded a significant amount of resources from State agencies at a critical period in program development. States said that it would have taken almost as much effort to make the demonstration as it would to permit the nonmajor sources. The purpose of allowing States to defer permitting obligations for nonmajor sources would have been dramatically undercut if a special showing were required for nonattainment areas.

Comment: Several State agency commenters ( IV D 97, IVD 100, IV D 219, IV D 415) either disagreed with the five year deferral or wanted it limited. They expressed concern that it would be difficult to adequately fund their programs without fee collection from nonmajor sources. Another agency commenter ( IV D 261) argued that if such deferral is legal, a threeyear deferral would be sufficient, provided major source permitting is completed in three years.

Several industry and State representatives urged flexibility in applying the deferral provisions. Two industry groups ( IV D 160 and IV D 312) commented that owners of nonmajor sources should be allowed to obtain permits if they wish. Two States ( IV D 97 and IV D 219) favored allowing the deferral of nonmajor sources to be optional. Two other State groups ( IV D 121 and IV D 270) commented that States should be allowed to require a permit from a nonmajor source if they believe a permit is necessary.

Response: Both the proposed and final rule make the deferral of nonmajor sources optional for States. The Agency believes this is appropriate because the permitting authority's ability to handle permitting of nonmajor sources ( and the corresponding burden to such sources) may vary from State to State. Some States may already require nonmajor sources to obtain permits, and may want to continue this source coverage in their new Part 70 programs with minimal disruption. Other States may have relatively few major sources and may determine they can effectively handle the permitting of nonmajor sources without imposing administrative demands that are unnecessarily burdensome for these sources. Because States have the discretion to provide a deferral, they can also limit the deferral in any manner ( e. g., to three years only or to specific source categories only) consistent with their needs in implementing the program.

Several commenters were concerned that deferring nonmajor sources would prevent them from collecting fees adequate to fund their program costs. As stated in the preamble to the proposal, States are allowed to independently charge fees to federally exempted sources at their discretion. Furthermore, the cost of program development for the deferred sources would not have to be included in any calculation of fee adequacy or overall Part 70 program costs for the years that the deferral were effective. Alternatively, since the deferral is discretionary, States have the option of not deferring any nonmajor sources or only deferring specific categories of nonmajor sources and possibly collecting higher overall fee amounts than they would if they had deferred all nonmajor sources.

The proposal also stated, in Section 70.3( c)( 4), that any source whose initial applicability was deferred would be given the option of obtaining a permit prior to the end of the 5 year deferral period. The final rules continue to allow States to determine whether nonmajor sources should have the option of obtaining a Part 70 permit. Some companies have business reasons for obtaining an operating permit. For example, a lender may wish to determine that air emissions from a facility are permitted under the law. As a result, there may be sources that a permitting authority determines do not need a permit for air pollution control purposes, but which have independent business reasons to seek operating permits.

3.3.2 Exempt Source Categories Comment: Many commenters offered suggestions on categories that should be exempt from the permitting program in accordance with Section 502( a) of the Act Amendments. Several industry commenters ( IV D 132, IVD 272, IV D 306, IV D 311, IV D 317, IV D 323 and IV D 330) requested an exemption from Title V requirements for research and development laboratories, ( e. g., pharmaceutical research and development) where changes may need to be made on an hourly basis to improve processes and develop new ones. Other suggested categories for exemption included wood stoves ( IV D 219, IV D 269, IV D 322, IV D 343, IV D 398), asbestos demolition/ renovation sites ( IV D 86, IV D 100, IV D 198, IV D 202, IV D 203, IV D 211, IV D 219, IV D 269, IV D 272, IV D 301, IV D 306, IV D 319, IV D 330, IV D 343, IV D 352, IV D 398, IV D 404), residential boilers ( IV D 269), Resource Conservation and Recovery Act remediation sites ( IV D 132, IV D 198, IV D 202), maintenance equipment ( IV D 52 and IV D 198), peaking electrical generating units ( IV D 79), surface coal mines ( IV D 219), automotive refinishing plants ( IV D 266), and aircraft de icing operations ( IV D 344).

Five industry commenters ( IV D 257, IV D 86, IV D 184, IV D 199, IV D 205) suggested that temporary oil and gas upstream operations such as drilling wells, workovers, well servicing, and well treatments should be exempt from the permitting requirements. Several additional industry commenters ( IV D 57, IV D 268, IVD 272, IV D 330) also suggested exempting any temporary emissions units located at a source for a short duration ( i. e., less than the time necessary to complete a permit action).

One industry commenter ( IV D 226) proposed that all nonmajor sources be exempt from the permitting requirements unless EPA determines that unique circumstances dictate that a specific nonmajor source category should be permitted. One industry commenter ( IV D 236) proposed exempting facilities subject to a NESHAP from the Title V permitting program, arguing that it would be duplicative to have those facilities obtain a permit.

Response: In the proposal, the Administrator solicited comment and information concerning which source categories might be especially appropriate for permanent exemptions, pursuant to the authority given in 502( a), such as asbestos demolition and renovation operations under the NESHAP program and woodstoves under the NSPS program. The Agency also asked for comment on any other criteria that should be used to judge the effect of permanently deferring nonmajor sources, including the burden on sources and permitting authorities, and the aggregate effect on air quality of any permanent exemption.

Many commenters on the proposed Part 70 rules offered suggestions on categories of sources appropriate for permanent exemption. However, at this time, there is not sufficient information in the record to justify any permanent exemptions for other than the two source categories specifically identified in the proposal: asbestos demolition and renovation under the NESHAP program and woodstoves under the NSPS program. As stated in the preamble to the final rule, The Administrator intents to initiate a rulemaking within 3 years of the first approval of a full or partial State permit program that defers nonmajor sources to determine whether to grant further deferrals and to consider whether to grant permanent exemptions to any source categories for which there is a sufficient record to support such an exemption. As part of this proposed rulemaking, EPA, in conjunction with sources, will gather information which will enable the Agency to make exemption or deferral determinations as appropriate. The EPA will propose such a rule no later than 4 years following approval of the first full or partial State permit program with a deferral and promulgate the rule within 5 years of that date.

The final rule identifies two source categories for permanent exemption: ( 1) all sources subject to regulation under the demolition and renovation provisions of the NESHAP for asbestos ( 40 CFR 61.145); and ( 2) all residential wood heaters subject to regulation under the NSPS [ 40 CFR 60 ( AAA)]. As with the temporary deferral for nonmajor sources, there are two reasons for exempting asbestos demolition and renovation operations and residential wood heaters. Each reason provides an independent justification for the exemptions. First, as described in more detail below, permitting such sources would be impracticable and infeasible for permitting authorities. Second, permitting such sources poses an unnecessary burden for these sources. Additionally, exempting these source categories furthers an important goal of the Agency's implementation of the Act: It minimizes disruption of many existing State programs. Several State permitting programs already exempt both categories from their own permitting programs. The EPA has typically deferred the responsibility for addressing the regulation of residential sources to State and local agencies.

Requiring permits from both of these source categories would require the permitting authority to determine who would be permitted  each individual demolition operation or wood heater owner, or demolition and renovation contractors and wood heater manufacturers. Either option presents numerous practical problems.

Many owners and operators of sites where asbestos demolition and renovation operations take place may be responsible for permitting these sources only once and it would be difficult and burdensome for these individuals to obtain permits for one time operations. Conversely, when an individual is responsible for permitting many of these operations in temporary locations; permitting them raises many of the same difficulties related to permitting temporary sources. Because these activities often commence at a particular site with relatively short notice, it is very difficult to predict all the locations where these activities would take place five years in advance ( with five years expected to be the term of most Title V permits) and it is likely that there would be a separate application submitted for every site. Because the source may commence operation up to a year before a complete application need be submitted, it is also likely that the location of these operations may have changed numerous times before the application is submitted or a permit issued. A permit issued after the activity ceases is of minimal value.

The burden of obtaining permits for permitting asbestos demolition and renovation sources is unnecessary because it would provide few additional environmental or enforcement benefits. The EPA and delegated States under the NESHAP get advance notice of all regulated demolition or renovation operations. Enforcement personnel are able to target and prioritize inspection resources and monitor compliance with NESHAP work practice standards. The EPA and the States also receive waste disposal documentation verifying proper disposal at EPA approved disposal sites. Because of the temporary nature of these sources, permits issued to them would likely only require compliance with the NESHAP work practice standards because additional reporting or recordkeeping requirements would be unnecessary. No monitoring in the traditional sense would be required because the asbestos NESHAP is a work practice standard, not an emissions limitation.

The EPA finds that a permanent exemption for residential wood heaters subject to the NSPS is appropriate because of the burden that Federal permitting would place on homeowners, distributors, manufacturers, and permitting authorities alike. First, requiring permits from all subject residential wood heaters ( likely numbering in the hundreds of thousands) in attainment and nonattainment areas across the country would require a significant allocation of resources from both homeowners and permitting authorities to achieve relatively minimal air quality benefits in some areas. Because the problems associated with particulate matter ( PM) and HAP emissions from wood heaters tend to be very localized in nature, the EPA believes that a requirement to obtain a permit for owners of residential wood heaters subject to the NSPS is unnecessary in some areas and should remain at the discretion of State and local agencies. Some local agencies in nonattainment areas have already successfully employed control programs for these sources as part of their attainment strategies and they may wish to retain the right to permit these sources, consistent with their ability to retain more stringent State requirements.

Second, if homeowners were required to obtain a Title V permit, they would likely be required to provide verification that they were in compliance with certain installation or fuel quality requirements. This might involve expensive inspections or laborious recordkeeping. It would be unnecessarily burdensome for private citizens to comply with such requirements. The frequent transfer of residential ownership could also complicate compliance efforts. If wood heater manufacturers or distributors were the permittees, there would be no practical way for wood heater performance in residential locations to be monitored.

Third, the permitting of residential wood heaters by permitting authorities could prove to be extremely resource intensive. The large number of permittees affected would likely experience problems in obtaining technical assistance from the permitting authority, which would make obtaining a permit more burdensome for homeowners. Effectively determining the number and location of all wood heaters in a given jurisdiction would be a complicated task. There are hundreds of thousands of such sources throughout the country. Many State and local agencies in areas where wood stoves are a significant concern have already developed nonregulatory public information, outreach, and voluntary control programs. Adding the additional burden of permitting these numerous sources would likely not be an efficient use of agency resources.

Several commenters suggested that temporary emission units be exempted from permitting requirements. Section 504( e) of the Act Amendments and Section 70.6( e) of the proposed and final rule, allows but does not require, permitting authorities to issue a single permit for similar operations by the same source owner or operator at multiple temporary locations. These operations must be temporary and involve at least one change of location during the term of the permit. At this time, the Administrator does not wish to issue a blanket permanent exemption for all or specific categories of temporary sources for the same reasons stated previously for other sources. However, nonmajor temporary sources could be deferred, at State discretion, from permitting during the temporary deferral for nonmajor sources and it is possible that the administrator may permanently exempt some categories of temporary sources at a later date. Furthermore, there is not enough evidence, at this time, to decide if the fact that a temporary emissions units is located at a source for a period of time less than that necessary to complete a permit action is, by itself, sufficient grounds to justify a permanent exemption for all temporary sources.

One commenter proposed that all nonmajor sources be exempt from the permitting requirements unless unique circumstances dictate that a specific nonmajor source category should be permitted. Contrary to the commenters assumption that all nonmajor sources are exempt from the regulations until the administrator finds that a particular source should be permitted, Section 502( a) of the Act states that major sources and any other source ( including nonmajor sources) are to be covered by Title V unless the administrator promulgates regulations providing an exemption. At this time, the Administrator does not feel that there is sufficient grounds on which to base a decision as to source categories appropriate for permanent exemptions, other than for asbestos demolition and renovation sources under NESHAP and wood heaters under NSPS.

Concerning the comment that facilities subject to a NESHAP should be exempt from the permit program, Section 502( a) of the Act Amendments states, in part, that it is unlawful to operate any source subject to standards or regulations under Section 112 ( NESHAP) except in compliance with a Title V permit. Section 502( a) also allows the Administrator to promulgate regulations to exempt one or more source categories, except that no major source may be exempted. Therefore, standards or requirements of the NESHAP regulations are applicable requirements of the Part 70 program and only nonmajor sources can be exempted by the administrator by rule. In the proposal and the final rule, EPA has given the States the option of deferring ( temporarily exempting) the applicability of nonmajor sources, for all or specific source categories, from the Part 70 operating permit program. In the final rule, EPA has also stated its intent to initiate a rulemaking in the future to consider permanent exemptions for nonmajor sources. As already mentioned, at this time, the Administrator is exempting only one specific category of nonmajor sources subject to a NESHAP: asbestos demolition and renovation.

3.4 EMISSIONS UNITS AND PART 70 SOURCES 3.4.1 Emissions Units Described in the Permit Application Comment: Three industry commenters ( IV D 209, IV F 02a, IV F 02c) interpreted the proposal to require each major source to apply for a permit and to describe each emission point, however small, even when there were Act requirements applicable to only one emission source, or perhaps no applicable requirements at all. One State agency commenter ( IV D 125) argued this should be the requirement. Thirteen industry commenters ( IV D 156, IV D 159, IV D 160, IV D 169, IV D 182, IV D 188, IV D 204, IV D 208, IV D 272, IV D 323, IV D 314, IV D 311, and IV D 209) and one Federal agency commenter ( IV D 352) urged that the Title V program should cover only those units that trigger applicability and are regulated. One industry commenter ( IV F 02a) submitted four " real life" examples of facilities with multiple emission units that would not be subject to the permit program except for the presence of one emission unit. The commenter said that including all the unregulated emission units in the permit application would be unnecessarily burdensome. Another industry representative ( IV F 02e) recommended that permits be written for or directed at individual processes, rather than the entire facility, suggesting that writing or revising such complex permits would be unmanageable for both the source and the reviewing agency. One industry commenter ( IV D 369) requested clarification on whether EPA would permit each unit within a source.

One State agency ( IV D 125) argued that every stack must have an emission rate and every emission point must be identified or a Title V permit would be ineffective as an enforcement tool.

Two State agencies ( IV D 125 and IV D 219) and one industry commenter ( IV D 98) urged that once a source is subject to Title V for one pollutant, all sources of all emissions should be included in the Title V permit and all limits should be enforceable.

Response: Section 70.3( c) of the proposal stated that once subject to the Part 70 operating permit program for one pollutant, any major or nonmajor source must include the following in its application: A description of all emissions units and any requirements that apply to these units, except for those units not subject to any applicable requirement and that are exempted by the permitting authority from the collection of fees; and an accounting of all emissions of regulated pollutants from all nonexempt units. A regulated pollutant was defined in the proposal as nitrogen oxides ( NO x), any volatile organic compound ( VOC), any pollutant for which a National Ambient Air Quality Standard ( NAAQS) has been promulgated, and any pollutant addressed by any standard promulgated under Section 111 or 112 of the Act. The " accounting" mentioned in the first sentence of this paragraph refers to the requirement that emissions of regulated pollutants be included in applications, whether or not there are any applicable requirements that apply directly to the units emitting these pollutants, for the purpose of collecting fees from the sources. The proposal also required all fugitive emissions to be included in this accounting.

The final Part 70 regulations use the term " regulated air pollutant" to refer, generally, to all pollutants subject to a standard, regulation, or requirement and the term " regulated pollutant ( for presumptive fee calculation )" for use in calculating fees. The final rule requires that for major and nonmajor sources, the permit application must identify all the emission units and other activities that emit or have the potential to emit regulated air pollutants, except that only a list need be provided for certain emissions units, in accordance with the exemption provided for insignificant activities or emissions in Section 70.5( c) of the rule. As stated in the proposal, this is the case for nonmajors even though only one emission unit or subset of units may have triggered the Title V permitting requirement. The permitting authority may also require the application to identify any other emission units and/ or pollutants subject to future regulation so that the permitting authority can meet its obligations under Section 502( b)( 9) of the Act to reopen permits when new regulations are passed.

On the other hand, major source permits are required to include all applicable requirements for all regulated emission units at the source and nonmajor source permits are required to include, at a minimum, only those applicable requirements that apply to the regulated emissions unit( s) that initially triggered the source's requirement to obtain a permit.

3.4.2 Regulated Pollutants Comment: State commenter IV D 125 argued that the definition of regulated pollutant should be very specific and include a comprehensive list. State commenter ( IV D 219) argued that Section 112 pollutants should be considered " regulated" from the date the Act Amendments were passed, not on the date a standard is promulgated. Four industry commenters ( IV D 156, IV D 160, IV D 193, IV D 200) recommended that " regulated pollutant" include pollutants under Sections 111 and 112 of the Act only after a standard is promulgated. One of these commenters ( IV D 200) stated that chemicals listed under Section 112( r) should not be viewed as regulated pollutants. An environmental group ( IV D 76) disagreed, indicating that in order to implement Section 112( g), the permit should apply to all sources of all HAPs.

Response: The proposal defined " regulated pollutant" to mean substances for which a standard has been promulgated under the Act. The term regulated pollutant was used in the proposed regulation in describing what information is required in permit applications and permits. This caused confusion because the Act defined the term regulated pollutant differently and used it specifically for calculating fees. To avoid this confusion, the final Part 70 regulations use the term " regulated air pollutant" to describe the information required for permit applications and permits, and the term " regulated pollutant ( for presumptive fee calculation)" for use in calculating fees.

It would seem, based on the above discussion, that the commenter who would like a specific list of " regulated pollutants" ( the proposal terminology) is really asking for a list of " regulated air pollutants" ( the terminology of the final rule). In the final rule, " regulated air pollutant" is defined to include the following specific pollutants or categories of pollutants for which information must be submitted in applications and for which applicable requirements must be included in permits: ( 1) NO x or any VOC, ( 2) any NAAQS pollutant, ( 3) any pollutant subject to a standard promulgated under Section 111 of the Act, ( 4) any Class I or II substance subject to a standard promulgated under or established by Title VI of the Act, and ( 5) any pollutant subject to a standard or other requirement established under Section 112, including Sections 112( g), ( j), and ( r) of the Act. As now applied in the regulations, the revised definition will ensure that the permitting authority receives complete information on all pollutants which are " regulated" under the Act and emitted by a source. By having this information, the permitting authority can properly determine which requirements under the Act apply to the source, and include these requirements in the permit. Only by including all requirements applicable to a source in the permit can a permitting authority ensure that the permit assures compliance with the Act.

Several commenters supported EPA's position that Section 112 pollutants should not be considered to be regulated until after a standard is promulgated. One commenter held that these pollutants should be considered regulated on the date of passage of the Act Amendments. In the final rule, Section 112 pollutants are not considered to be regulated air pollutants, until a specific MACT standard [ or requirement under Section 112( r)( 7)] is promulgated, or a case by case MACT determination is made ( but only in regard to that particular source for which the determination was made). Section 112 of the Act does not contain any standards applicable to toxics pollutants, it requires that standards be promulgated according to certain schedules or determined on a case by case basis and therefore did not directly regulate these emissions at the time of passage of the Act.

In the final rule, several important changes were made to the definition of " regulated air pollutant" ( which was " regulated pollutant" in the proposal). First, substances regulated under Title VI of the Act ( protection of stratospheric ozone) were added to the list of " regulated air pollutants." As a general rule, regulatory requirements under the stratospheric ozone program should be included in a source's permit. However, because of the nature of some Title VI regulations, the Administrator may determine by future regulation that some CFC regulations need not be in an operating permit. For example, the Administrator may decide that a Title V permit need not contain production limits that apply on a company wide, rather than facility specific, basis.

Second, the final Part 70 regulations clarify when a substance regulated under Section 112 becomes a regulated air pollutant. The definition of regulated air pollutant includes any pollutant subject to a standard or other requirements under Section 112 of the Act, including Section 112( r) of the Act. As applied to an individual source only, the definition includes any pollutant for which a MACT standard is promulgated on a case by case basis under Section 112( g)( 2) of the Act, which requires such a standard to be developed for new, reconstructed, or modified sources. This type of MACT requirement, which is to be developed by the permitting authority where no applicable emission standards have yet been established, will apply only to the individual source for which it is developed. Because the requirement to develop such a standard is triggered by action by a single source, EPA believes that such a standard should not require the substance to be treated as a regulated air pollutant for the entire regulated community at the time the standard is developed for a single source.

The proposal requested comment on when a pollutant listed in Section 112( b) becomes a regulated pollutant for fee purposes. The following three alternatives were set forth: ( 1) at the time of enactment of the 1990 Act Amendments, ( 2) when EPA first promulgates a MACT standard for that pollutant, or ( 3) when a MACT standard for that pollutant first becomes applicable to the permitted source. The proposal adopted the second alternative.

The final rule adopts a slightly modified version of the second alternative, i. e., a pollutant becomes a regulated pollutant ( for presumptive fee calculation) when EPA first promulgates a MACT standard for that pollutant. In addition, if a pollutant is regulated at a particular source, its emissions will be considered for fee purposes even if a general standard has not been issued. The EPA continues to rely on the rationale in the preamble supporting the second alternative. This alternative is the most reasonable interpretation of the Act and makes the most sense from a policy perspective.

Section 70.9( b)( 2)( i) of the proposal provided that carbon monoxide should be excluded from the definition of regulated pollutant for purposes of determining the minimum fee amount. In the final rule, carbon monoxide is specifically excluded from any demonstration of fee schedule adequacy because it is excluded from the definition of regulated pollutant ( for presumptive fee calculation), which is used only for purposes of Section 70.9( b)( 2) regarding fee schedule adequacy. Carbon monoxide is excluded from fees demonstrations due to the language of Section 502( b)( 3)( B)( i) which excludes carbon monoxide from being included in any calculation by a permitting authority of whether fees have been collected in amounts adequate to cover the reasonable costs of the permit program. The EPA has also decided to exercise its discretion by excluding from regulated pollutant ( for presumptive fee calculation) those substances that would be regulated pollutants only because they are regulated under Section 112( r) ( the accidental release program). Requiring these substances to be included in calculating the presumptive minimum necessary to cover a State's permit program costs would be administratively difficult and would not significantly increase the presumptive minimum. Because releases of these substances are not permitted and occur accidentally, the amount of actual emissions from an accidental release may not be known  certainly it is unlikely that it would be measured with monitoring equipment. The EPA believes that there will be relatively few substances that are regulated under Section 112( r) and not regulated elsewhere under the Act. Additionally, the amount of emissions of such substances are likely to be small enough that they would be insignificant for purposes of calculating the presumptive minimum amount to cover permit program costs.

In the final rule, substances regulated under Title VI of the Act ( protection of stratospheric ozone) have been specifically excluded from the definition of regulated pollutant ( for presumptive fee calculation) for several reasons. These regulated air pollutants are to be phased out and therefore would only be contained in Part 70 permits until such time as the phase out were completed. The vast majority of emissions of these substances are not released from the limited number of facilities that manufactures them but rather from the large number of small sources that release them in de minimis amounts. Furthermore, the total nationwide emissions of these substances are relatively small when compared to emissions of any other category of regulated air pollutants and, therefore, requiring permitting authorities to account for them in their fee adequacy demonstrations would present more of a paperwork and accounting burden than is necessary.

The proposal was also modified so as to allow States relying on the $ 25/ tpy presumptive minimum to exclude from the calculation insignificant quantities of actual emissions not required to be in a permit application pursuant to Section 70.5( c). The EPA could not justify requiring States to include such emissions in the presumptive minimum calculation given the administrative burden of collecting the necessary information for fees purposes, and the insignificant additional fees that a State would be required to collect if these insignificant levels of emissions were included. To the extent that actual emissions must be included in the calculation of the $ 25/ tpy presumptive minimum, they need not be measured using the same methods as might be required to determine whether a source is complying with an underlying applicable requirement.

Section 502( b)( 3) provides that States relying on the $ 25/ tpy presumptive minimum must base this computation upon each regulated pollutant ( for presumptive fee calculation) and defines this for fee purposes only in terms of criteria pollutants ( except CO), pollutants regulated under Sections 111 or 112 of the Act, and VOC. No exemption from fees is created for such pollutants which a particular source emits them but there is no specific regulatory requirement. On the other hand, no fees are required from other regulated air pollutants as defined more expansively in Section 70.2 in making the $ 25/ tpy test.

Comment: One industry commenter ( IV D 314) wanted Title V major sources to be limited to source categories which, as of August 7, 1980, were regulated under Section 111 or 112 of the Act. One commenter ( IV F 02e) recommended that a Title V permit not be required for emission units already permitted under a Act or State operating permit program.

Response: There is no legal basis for limiting major sources to those source categories regulated under Section 111 or 112 as of August 7, 1980. The Act Amendments requires all major sources as defined in the Act to obtain a Title V permit and does not exempt sources that are already permitted. However, States may consolidate existing permits with Title V permits for such sources.

Comment: One environmental group ( IV D 229) noted that Section 70.5( b)( 3)( viii) excludes VOC's and expressed that this is bad policy because VOC's play an important role in smog formation.

Response: This section in the proposed rule concerned the requirement that an application must contain other information that might be required by an applicable requirement and did not mean that all VOC related information were not required in Title V permit applications. The proposal only excluded from applications emissions information on VOC's that might be used for source specific ambient dispersion modeling. This is because dispersion modeling is not required for VOC's as either a Title I requirement on the State or as a requirement for an individual source. Because of the confusion created by this formulation in the proposal, the final rule has been revised to eliminate the examples of " other requirements" in Section 70.5( c)( 3)( vii).

Comment: One industry commenter ( IV D 289) asked whether total PM or fine PM ( PM 10) is the regulated pollutant for particulate matter. The commenter pointed out that most emission standards are written for total PM.