[Federal Register Volume 84, Number 29 (Tuesday, February 12, 2019)]
[Proposed Rules]
[Pages 3358-3369]
[FR Doc No: 2019-01863]

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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[EPA-R04-OAR-2018-0617; FRL-9989-40-Region 4]

Air Plan Approval; GA: Non-Interference Demonstration and
Maintenance Plan Revision for Federal Low-Reid Vapor Pressure
Requirement in the Atlanta Area

AGENCY: Environmental Protection Agency (EPA).

ACTION: Proposed rule.

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SUMMARY: The Environmental Protection Agency (EPA) is proposing to
approve a State Implementation Plan (SIP) revision that would support a
change to the Federal Reid Vapor Pressure (RVP) requirements in 13
counties in Atlanta, Georgia. They comprise the following counties:
Cherokee, Clayton, Cobb, Coweta, DeKalb, Douglas, Fayette, Forsyth,
Fulton, Gwinnett, Henry, Paulding, and Rockdale (the ``Atlanta fuel
volatility Area''). The Atlanta fuel volatility Area is a subset of the
Atlanta 15-county 2008 8-hour ozone maintenance area. The 15-county
2008 8-hour ozone maintenance area is comprised of the following
counties: Bartow, Cherokee, Clayton, Cobb, Coweta, DeKalb, Douglas,
Fayette, Forsyth, Fulton, Gwinnett, Henry, Newton, Paulding, and
Rockdale (the ``Atlanta maintenance Area''). This proposed approval is
based in part on EPA's analysis of whether the SIP revision would
interfere with the 15-county Atlanta maintenance Area's ability to meet
the requirements of the Clean Air Act (CAA or Act). On August 15, 2018,
Georgia through the Georgia Environmental Protection Division (GA EPD),
submitted a noninterference demonstration to support its SIP revision
requesting that EPA relax the federal RVP requirements for the Atlanta
fuel volatility Area. This SIP revision updates Georgia's 2008 8-hour
ozone maintenance plan for the 15-county Atlanta maintenance Area and
its emissions inventory, the associated motor vehicle emissions budgets
(MVEBs) and includes measures to offset the emissions increases
expected from the relaxation of the federal RVP requirements. Georgia's
noninterference demonstration concludes that relaxing the federal RVP
requirement from 7.8 pounds per square inch (psi) to 9.0 psi for
gasoline sold between June 1 and September 15 of each year in the
Atlanta fuel volatility Area would not interfere with attainment or
maintenance of any national ambient air quality standards

(NAAQS or standards) or with any other CAA requirement. EPA is
proposing to approve this SIP revision because EPA has preliminarily
determined that the revision is consistent with the applicable
provisions of the CAA.

DATES: Comments must be received on or before March 14, 2019.

ADDRESSES: Submit your comments, identified by Docket ID No. EPA-R04-
OAR-2018-0617 at http://www.regulations.gov. Follow the online
instructions for submitting comments. Once submitted, comments cannot
be edited or removed from Regulations.gov. EPA may publish any comment
received to its public docket. Do not submit electronically any
information you consider to be Confidential Business Information (CBI)
or other information whose disclosure is restricted by statute.
Multimedia submissions (audio, video, etc.) must be accompanied by a
written comment. The written comment is considered the official comment
and should include discussion of all points you wish to make. EPA will
generally not consider comments or comment contents located outside of
the primary submission (i.e. on the web, cloud, or other file sharing
system). For additional submission methods, the full EPA public comment
policy, information about CBI or multimedia submissions, and general
guidance on making effective comments, please visit http://www2.epa.gov/dockets/commenting-epa-dockets.

FOR FURTHER INFORMATION CONTACT: Dianna Myers, Air Regulatory
Management Section, Air Planning and Implementation Branch, Air,
Pesticides and Toxics Management Division, U.S. Environmental
Protection Agency, Region 4, 61 Forsyth Street SW, Atlanta, Georgia
30303-8960. Ms. Myers can be reached via telephone at<PHONE_NUMBER> or
via electronic mail at<EMAIL_ADDRESS>
SUPPLEMENTARY INFORMATION:

I. What is EPA proposing?

    This rulemaking proposes to approve Georgia's SIP revision for the
maintenance plan, submitted on August 15, 2018, that would support the
State's request that EPA relax the federal RVP requirement from 7.8 psi
to 9.0 psi for gasoline sold between June 1 and September 15 of each
year (high ozone season) in the Atlanta fuel volatility Area. EPA is
also proposing to find that Georgia has demonstrated that changing the
federal RVP requirements in the Atlanta fuel volatility Area will not
interfere with attainment or maintenance of any NAAQS or with any other
applicable requirement of the CAA.
    On July 18, 2016, Georgia submitted a 2008 8-hour ozone
redesignation request and maintenance plan for the 15-county 2008 8-
hour ozone Atlanta maintenance Area, which EPA approved on June 2, 2017
(82 FR 25523). With its redesignation request, Georgia included a
maintenance plan demonstration that estimated emissions through 2030
and modeled the federal 7.8 psi RVP summer gasoline volatility limit in
the emissions calculations. The August 15, 2018, submittal updates
Georgia's 2008 8-hour ozone maintenance plan mobile emissions
inventory, associated MVEBs, and includes measures to offset the
emissions increases resulting from any relaxation of the federal RVP
requirements. The offset measures are described in Section V, below.
The updates are summarized in Georgia's submittal which can be viewed
at http://www.regulations.gov.
    To support the August 15, 2018, SIP revision Georgia evaluated
whether changing the 7.8 psi RVP to 9.0 psi RVP federal requirement
would interfere with air quality in the 15-county Atlanta maintenance
Area. To make this demonstration of noninterference, Georgia completed
a technical analysis, including using the current version of EPA's
Motor Vehicle Emissions Simulator (MOVES2014a) to project the change in
emissions that would result from the RVP relaxation of 7.8 psi to 9.0
psi in the 15-county Atlanta maintenance Area.
    In this noninterference demonstration, Georgia used MOVES2014a to
develop its projected emissions inventory according to EPA's guidance
for on-road and nonroad mobile sources. Georgia used the NONROAD 2008
model within MOVES2014a to develop the nonroad emissions inventory to
reflect the emissions changes from relaxing the RVP of 7.8 psi to 9.0
psi in the Atlanta fuel volatility Area.
    The 2014 attainment base year mobile emissions were taken directly
from the 2008 maintenance SIP and future-year on-road mobile source
emissions estimates for 2018, 2020, 2030, and 2040 were modeled using a
RVP input parameter of 10.0 psi.\1\ Georgia interpolated years 2025 and
2035 to further illustrate the downward trend in emissions. Georgia
selected years 2020, 2030 and 2040 because these years are used by the
Atlanta Regional Commission in Atlanta's transportation conformity
determinations. The 2008 8-hour maintenance plan showed compliance with
and maintenance of the 2008 8-hour ozone NAAQS until the 2030 outyear
by providing information to support the demonstration that current and
future emissions of nitrogen oxides (NOx) and volatile organic
compounds (VOC) remained at or below the 2014 base year emissions
inventory. For more detailed information on the current approved
maintenance plan, see EPA's December 23, 2016 (81 FR 94283), proposed
approval of Georgia's maintenance plan for the 2008 8-hour ozone NAAQS.
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    \1\ The input parameter of 10.0 psi includes a RVP of 9.0 psi
with a 1 percent ethanol waiver.
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    In this action, EPA is proposing to approve the State's technical
demonstration that the 15-county Atlanta maintenance Area can continue
to attain and maintain the 2008 ozone NAAQS, as well as other NAAQS,
and meet all other CAA requirements after changing to the sale of
gasoline with a RVP of 9.0 psi during the high ozone season in the 13-
county Atlanta fuel volatility Area. EPA is also proposing to approve
the revised mobile emissions inventory, the associated MVEBs, and the
measures to offset the emissions increases due to relaxation of the
federal RVP requirements. EPA's section 110(l) analysis of the
noninterference demonstration included as a part of Georgia's August
15, 2018, SIP revision is provided below. Consistent with CAA section
211(h) and the Phase II volatility regulations, EPA will initiate a
separate rulemaking to relax the current federal requirement to use
gasoline that complies with the federal RVP limit from 7.8 psi to 9.0
psi in the 13-county Atlanta fuel volatility Area.

II. What is the background for the Atlanta Area?

    On November 6, 1991 (56 FR 56694), EPA designated and classified
the following counties in and around the Atlanta, Georgia metropolitan
area as a Serious ozone nonattainment area for the 1-hour ozone NAAQS:
Cherokee, Clayton, Cobb, Coweta, DeKalb, Douglas, Fayette, Forsyth,
Fulton, Gwinnett, Henry, Paulding, and Rockdale. This 13-county 1-hour
ozone area is the ``Atlanta fuel volatility Area.'' The nonattainment
designation triggered various requirements for the Atlanta 1-hour ozone
nonattainment area. One of those requirements for the 1-hour ozone
nonattainment area was the federal 7.8 psi RVP limit for gasoline sold
between June 1 and September 15, which is the subject of this action.
    Because the Atlanta 1-hour ozone nonattainment area failed to
attain the 1-hour ozone NAAQS by November 15, 1999, EPA issued a final
rulemaking action on September 26, 2003, to

reclassify or ``bump up,'' the area to a Severe ozone nonattainment
area. This reclassification became effective on January 1, 2004 (68 FR
55469). EPA redesignated the Atlanta 1-hour ozone nonattainment area to
attainment for the 1-hour ozone NAAQS, effective June 14, 2005 (70 FR
34660).
    On April 30, 2004 (69 FR 23858), EPA designated the following 20
counties in and around metropolitan Atlanta as a Marginal nonattainment
area for the 1997 8-hour ozone NAAQS: Barrow, Bartow, Carroll,
Cherokee, Clayton, Cobb, Coweta, DeKalb, Douglas, Fayette, Forsyth,
Fulton, Gwinnett, Hall, Henry, Newton, Paulding, Rockdale, Spalding,
and Walton. The Atlanta fuel volatility Area is a sub-set of this 20-
county area. Subsequently, EPA reclassified the Atlanta 1997 8-hour
ozone nonattainment area as a Moderate nonattainment area on March 6,
2008 (73 FR 12013), because the area failed to attain the 1997 8-hour
ozone NAAQS by the required attainment date of June 15, 2007.
Subsequently, the Atlanta 1997 8-hour ozone nonattainment area attained
the 1997 8-hour ozone standard, and on December 2, 2013 (78 FR 72040),
EPA redesignated the area to attainment for the 1997 8-hour ozone
NAAQS.
    Effective July 20, 2012, EPA designated the following 15-counties
Marginal nonattainment for the 2008 8-hour ozone NAAQS: Bartow,
Cherokee, Clayton, Cobb, Coweta, DeKalb, Douglas, Fayette, Forsyth,
Fulton, Gwinnett, Henry, Paulding, and Rockdale. As mentioned before,
the Atlanta fuel volatility Area is sub-set of this 15-county area. The
15-county Atlanta 2008 8-hour ozone nonattainment area did not attain
the 2008 8-hour ozone NAAQS by the attainment date of July 20, 2015,
and therefore on May 4, 2016, EPA published a final rule reclassifying
the area from a Marginal nonattainment area to a Moderate nonattainment
area for the 2008 8-hour ozone standard (81 FR 26697). Moderate areas
were required to attain the 2008 8-hour ozone NAAQS no later than July
20, 2018, six years after the effective date of the initial
nonattainment designations. See 40 CFR 51.1103.
    Under the provisions of EPA's ozone implementation rule for the
2008 8-hour ozone NAAQS (40 CFR part 51, subpart AA), EPA can issue a
determination that an area is attaining the relevant standard, also
known as a Clean Data Determination (40 CFR 51.1118). On July 14, 2016
(81 FR 45419), EPA determined that the Atlanta 2008 8-hour ozone
nonattainment area attained the 2008 8-hour ozone NAAQS based on
complete, quality-assured, and certified ozone monitoring data for
years 2013 through 2015. On July 18, 2016, Georgia submitted a 2008 8-
hour ozone redesignation request and maintenance plan for the area
(hereafter the ``Atlanta maintenance Area), which EPA approved on June
2, 2017 (82 FR 25523).
    At the time of all of the redesignations to attainment noted above
(for the 1979 1-hour ozone NAAQS, the 1997 8-hour ozone NAAQS, and the
2008 8-hour ozone NAAQS), Georgia did not request relaxation of the
federal 7.8 psi RVP requirement for the Atlanta fuel volatility Area.
Georgia is now requesting relaxation of the federal 7.8 psi RVP
requirement to 9.0 psi for the Atlanta fuel volatility Area.
    On October 1, 2015, EPA revised the 8-hour ozone standard from
0.075 ppm to 0.070 ppm (80 FR 65292). Subsequently, on June 4, 2018,
EPA published a final rule (effective date August 3, 2018) designating
the following 7 Atlanta counties Marginal nonattainment for the 2015 8-
hour ozone NAAQS: Bartow, Clayton, Cobb, Dekalb, Fulton, Gwinnett and
Henry (83 FR 25776). The 7 counties comprising the 2015 8-hour ozone
nonattainment area are also part of the 13-county Atlanta fuel
volatility Area. Areas designated Marginal nonattainment must attain
the standard by August 3, 2021.

III. What is the history of the gasoline volatility requirement?

    On August 19, 1987 (52 FR 31274), EPA determined that gasoline
nationwide had become increasingly volatile, causing an increase in
evaporative emissions from gasoline-powered vehicles and equipment.
Evaporative emissions from gasoline, referred to as VOCs, are
precursors to the formation of tropospheric ozone and contribute to the
nation's ground-level ozone problem. Exposure to ground-level ozone can
reduce lung function (thereby aggravating asthma or other respiratory
conditions), increase susceptibility to respiratory infection, and may
contribute to premature death in people with heart and lung disease.
    The most common measure of fuel volatility that is useful in
evaluating gasoline evaporative emissions is RVP. Under section 211(c)
of CAA, EPA promulgated regulations on March 22, 1989 (54 FR 11868),
that set maximum limits for the RVP of gasoline sold during the high
ozone season. These regulations constituted Phase I of a two-phase
nationwide program, which was designed to reduce the volatility of
commercial gasoline during the summer ozone control season. 40 CFR
80.27(a)(1). On June 11, 1990 (55 FR 23658), EPA promulgated more
stringent volatility controls as Phase II of the volatility control
program. These requirements established maximum RVP standards of 9.0
psi or 7.8 psi (depending on the state, the month, and the area's
initial ozone attainment designation with respect to the 1-hour ozone
NAAQS during the high ozone season).
    The 1990 CAA Amendments established a new section, 211(h), to
address fuel volatility. Section 211(h) requires EPA to promulgate
regulations making it unlawful to sell, offer for sale, dispense,
supply, offer for supply, transport, or introduce into commerce
gasoline with a RVP level in excess of 9.0 psi during the high ozone
season. Section 211(h) prohibits EPA from establishing a volatility
standard more stringent than 9.0 psi in an attainment area, except that
EPA may impose a lower (more stringent) standard in any former ozone
nonattainment area redesignated to attainment.
    On December 12, 1991 (56 FR 64704), EPA modified the Phase II
volatility regulations to be consistent with section 211(h) of the CAA.
40 CFR 80.27(a)(2). The modified regulations prohibited the sale of
gasoline with a RVP above 9.0 psi in all areas designated attainment
for ozone, beginning in 1992. For areas designated as nonattainment,
the regulations retained the original Phase II standards published on
June 11, 1990 (55 FR 23658). A current listing of the federal RVP
requirements for states can be found on EPA's website at: https://www.epa.gov/gasoline-standards.
    As explained in the December 12, 1991 (56 FR 64704), Phase II
rulemaking, EPA believes that relaxation of an applicable federal RVP
standard is best accomplished in conjunction with the redesignation
process. In order for an ozone nonattainment area to be redesignated as
an attainment area, section 107(d)(3) of the Act requires the state to
make a showing, pursuant to section 175A of the Act, that the area is
capable of maintaining attainment for the ozone NAAQS for ten years
after redesignation. Depending on the area's circumstances, this
maintenance plan will either demonstrate that the area can maintain
attainment for ten years without the more stringent volatility standard
or that the more stringent volatility standard may be necessary for the
area to maintain its attainment with the ozone NAAQS. Therefore, in the
context of a request for redesignation, EPA will not relax the
volatility standard unless the state requests a relaxation and the
maintenance plan demonstrates, to the satisfaction of EPA,

that the area will maintain attainment without the need for the more
stringent volatility standard. As mentioned before, under the initial
1-hour ozone nonattainment designation, the 13-county Atlanta fuel
volatility Area was required to sell gasoline that complied with the
federal 7.8 psi RVP limit from June 1 to September 15 of each year.
    Additionally, to comply with the 1-hour ozone NAAQS, Georgia
adopted a state fuel program through Georgia Rule 391-3-1-.02(2)(bbb),
Gasoline Marketing, (hereafter ``Georgia Rule''), which required the
sale of low sulfur gasoline with an RVP of 7.0 psi during the high
ozone season in a 45-county Georgia Fuel Area. The Georgia Fuel Area
included the 20-county 1997 8-hour ozone maintenance and the 15-county
2008 8-hour nonattainment areas (the 15-county area being a subset of
the 20-county area) with the remaining counties considered ``counties
of influence.'' The Georgia Rule was implemented through a waiver under
section 211(c)(4)(C) of the CAA, which allowed the adoption of a state
fuel program more stringent than the Federal requirement. EPA
incorporated the Georgia Rule into the Georgia SIP on July 19, 2004 (69
FR 33862). The Georgia Rule was removed from the Georgia SIP effective
October 1, 2015 (80 FR 52627).
    Again, Georgia did not request relaxation of the applicable 7.8 psi
federal RVP standard for the 13-county Atlanta fuel volatility Area
when the Area was redesignated to attainment for the 1979 1-hour ozone
NAAQS, the 1997 8-hour ozone NAAQS, and the 2008 8-hour ozone NAAQS.
Georgia is therefore now submitting a revision to the 2008 8-hour ozone
NAAQS maintenance plan and a non-interference demonstration concluding
that relaxing the federal RVP requirement from 7.8 psi to 9.0 psi for
gasoline sold between June 1st and September 15th of each year in the
Atlanta fuel volatility Area would not interfere with attainment or
maintenance of the any of the NAAQS.

IV. What are the Section 110(l) requirements?

    The modeling associated with Georgia's maintenance plan for the
2008 8-hour ozone NAAQS, approved on June 2, 2017, was premised upon
the future-year emissions estimates for 2018, 2022, 2026, and 2030,
which include the federal 7.8 psi RVP requirement in the Atlanta fuel
volatility Area. To approve Georgia's request to relax the federal RVP
requirement in the Atlanta fuel volatility Area, EPA must conclude that
requested change will satisfy section 110(l) of the CAA. Section 110(l)
requires that a revision to the SIP not interfere with any applicable
requirement concerning attainment and reasonable further progress (as
defined in section 171), or any other applicable requirement of the
Act. In this submittal, Georgia's modeling includes the same future
years but is based on the federal 9.0 psi RVP limit. EPA is proposing
approval of the noninterference demonstration based on an evaluation of
current air quality monitoring data and the information provided in the
noninterference demonstration.
    Additionally, in the absence of an attainment demonstration, to
demonstrate no interference with any applicable NAAQS or requirement of
the CAA under section 110(l), EPA believes it is appropriate to allow
states to substitute equivalent emissions reductions to compensate for
any change to a SIP-approved program, as long as actual emissions in
the air are not increased. ``Equivalent'' emissions reductions are
reductions that are equal to or greater than those reductions achieved
by the control measure approved in the SIP. To show that compensating
emissions reductions are equivalent, adequate justification must be
provided. The compensating, equivalent reductions should represent
actual emissions reductions achieved in a contemporaneous time frame to
the change of the existing SIP control measure order to preserve the
status quo level of emission in the air. If the status quo is
preserved, noninterference is demonstrated. In addition to being
contemporaneous, the equivalent emissions reductions should also be
permanent, enforceable, quantifiable, and surplus.
    EPA evaluates each section 110(l) noninterference demonstration on
a case-by-case basis considering the circumstances of each SIP
revision. EPA interprets 110(l) as applying to all NAAQS that are in
effect, including those for which SIP submissions have not been made.
The degree of analysis focused on any particular NAAQS in a
noninterference demonstration varies depending on a number of relevant
factors, including the nature of the emissions associated with the
proposed SIP revision. EPA's section 110(l) analysis of the
noninterference demonstration included as part of Georgia's August 15,
2018, SIP revision is provided below.

V. What is EPA's analysis of Georgia's submittal?

a. Proposed Conclusions Regarding Georgia's Noninterference
Demonstration

    On August 15, 2018, Georgia submitted a noninterference
demonstration to support the State's request to relax the federal
summertime gasoline RVP limit from 7.8 psi to 9.0 psi for the Atlanta
fuel volatility Area. This noninterference demonstration evaluates the
15-county Atlanta maintenance Area, which encompasses the smaller
Atlanta fuel volatility Area, and the 7-county 2015 8-hour ozone
nonattainment area. This demonstration includes an evaluation of the
impact that the relaxation of the 7.8 psi RVP requirement would have on
Atlanta's ability to maintain the 1997 and 2008 ozone standards. It
also evaluates whether the relaxation of the federal RVP requirement
would interfere with the ability of the 7-county 2015 8-hour ozone
nonattainment area to attain the ozone standard by August 3, 2021,
which is the attainment date for areas classified as Marginal, or with
any of the other applicable NAAQS. Although the attainment date is
August 3, 2021, Marginal areas must show attainment using air quality
data for years 2018 through 2020. The 2015 8-hour ozone NAAQS and other
NAAQS are addressed later in this notice.
    Georgia EPD focused its analysis on the impact of the relaxed
federal RVP limit of 9.0 psi to attainment and maintenance of the ozone
standards and its precursors NOX and VOC. RVP requirements
do not affect lead (Pb), sulfur dioxide (SO2), or carbon
monoxide (CO) emissions. Because VOC and NOX emissions are
also precursors for PM, and NOX is a precursor for nitrogen
dioxide (NO2), these pollutants will be discussed later in
this Section. Georgia is currently in attainment for all PM NAAQS,
SO2, NO2, CO, and Pb. The relaxation of the RVP
requirement will have little to no impact on emissions of these
pollutants or their related precursors.
    In this noninterference demonstration, Georgia used EPA's
MOVES2014a model to develop its projected mobile (on-road and nonroad)
emissions inventory according to EPA's guidance for on-road and nonroad
mobile sources. As mentioned before, the future-year on-road mobile
source emissions estimates for 2018, 2020, 2025 and 2030, 2035 and 2040
were generated with MOVES2014a using a RVP input parameter of 10.0 psi.
This noninterference demonstration modeled year 2018 to align with the
2008 8-hour

ozone maintenance plan. Therefore, the year 2018 serves as a surrogate
for the year 2019 when Georgia projects the relaxation of the federal
RVP requirement would take place. The maintenance plan showed
compliance with and maintenance of the 2008 8-hour ozone NAAQS by
providing information to support this demonstration that current and
future emissions of NOX and VOC remained at or below the
2014 2008 8-hour ozone attainment base year emissions inventory.\2\ The
analysis in this proposal will primarily refer to the years 2018 and
2030 to stay in alignment with the 2008 8-hour ozone maintenance plan.
The emissions trend for year 2020 will be discussed later in the notice
because attainment for the 2015 8-hour ozone NAAQS will be based on
years 2018 through 2020. Also, based on modeling data from EPA's Cross
State Air Pollution Rule, the entire State of Georgia is showing
attainment for the 2015 8-hour ozone NAAQS through 2023.\3\
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    \2\ The 2014 base year emissions are unchanged from the 2008 8-
hour ozone maintenance plan included in Appendix A of this SIP
revision.
    \3\ See the Peter Tsirigotis Memorandum dated October 19, 2018,
entitled ``Considerations for Identifying Maintenance Receptors for
Use in Clean Air Act Section 11 0(a)(2)(D)(i)(I) Interstate
Transport State Implementation Plan Submissions for the 2015 Ozone
National Ambient Air Quality Standards.'' See also https://www.epa.gov/airmarkets/memo-and-supplemental-information-regarding-interstate-transport-sips-2015-ozone-naaqs.
    \4\ In this table, and in tables 2 and 3 below, the 13-county
area refers to the Atlanta 1-hour ozone area (referenced herein as
the Atlanta fuel volatility Area) whereas the 15-county area refers
to the Atlanta 2008 8-hour ozone area (referenced herein as the
Atlanta maintenance Area). The 2-county area is the difference
between the Atlanta 1-hour ozone area boundary and the Atlanta 2008
8-hour ozone boundary. This table is how the State references these
areas in their submittal.
    \5\ As mentioned before, the 1 psi waiver for E10 is included in
all calculations in this table. E10 is a fuel blend with 10 percent
ethanol. Therefore, the actual input parameter is 8.8 psi and 10.0
psi. The 2-county area is not included in the original 13-county
Atlanta fuel volatility Area and was never subject to the 7.8 psi
RVP requirements. Federal RVP limits are 7.8 psi and 9.0 psi, not
including the additional 1.0 psi that applies to 10 percent ethanol
blends. Throughout the rest of the proposal we will refer to the RVP
limits as 7.8 psi and 9.0 psi.
    \6\ In final calculations for the nonattainment area, an
additional 0.03 tpd would be added to these values to account for
the Senior Exemption. Senior citizens are exempt from the Inspection
and Maintenance (I/M) program testing and thus 0.03 tpd (based on
2002 emissions comparisons) is used as a conservative estimate of
disbenefit.
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    Tables 1 and 2, below, show the direct impact on the on-road mobile
source emissions due to a relaxation of the federal RVP requirements
from 7.8 psi to 9.0 psi for the Atlanta fuel volatility Area. As
summarized below, on-road NOX and VOC emissions increase
when the requirement is relaxed to 9.0 psi. NOX emissions
increased by 0.29 and 0.05 tons per day (tpd) in 2018 and 2030,
respectively in the 15-county Atlanta maintenance Area. VOC emissions
also increased by 0.75 and 0.14 tpd in 2018 and 2030, respectively in
the same area. While emissions of both precursors increase with a RVP
relaxation to 9.0 psi, the increases decrease over time from 0.27
percent in 2018 to 0.13 percent in 2030 for NOX emissions
and from 1.11 percent in 2018 down to 0.39 percent in 2030 for VOC
emissions in the 15-county Atlanta maintenance Area. Even with the
small increases in emissions for the 15-county Atlanta maintenance
Area, the overall on-road emissions for NOX decrease from
106.23 tpd in 2018 to 39.60 tpd in 2030. Similarly, the overall on-road
emissions for VOC decrease from 68.35 tpd in 2018 to 35.96 tpd in 2030
in the 15-county Atlanta maintenance Area. This indicates that changes
in on-road emissions due to a relaxation of the federal RVP limit from
7.8 psi to 9.0 psi will not interfere with continued maintenance of the
2008 8-hour NAAQS in the 15-county Atlanta maintenance Area.

                       Table 1--On-Road NOX Emissions Before and After RVP Relaxation \4\
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                                                      7.8 psi
                                                   gasoline for
                                                    13 counties       9.0 psi        Emissions       Emissions
      Pollutant and region             Year         and 9.0 psi    gasoline for    increase with   increase with
                                                  gasoline for 2    15-counties   RVP relaxation  RVP relaxation
                                                   counties \5\        (tpd)           (tpd)         (percent)
                                                       (tpd)
----------------------------------------------------------------------------------------------------------------
13-county area..................            2018           94.49           94.78            0.29            0.31
                                            2020           76.49           76.70            0.21            0.28
                                            2025           55.61           55.74            0.13            0.23
                                            2030           34.74           34.78            0.05            0.14
                                            2035           29.08           29.10            0.02            0.07
                                            2040           23.43           23.42           -0.01           -0.04
2-county area...................            2018           11.45           11.45             0.0             0.0
                                            2020            9.49            9.49             0.0             0.0
                                            2025            7.16            7.16             0.0             0.0
                                            2030            4.82            4.82             0.0             0.0
                                            2035            4.36            4.36             0.0             0.0
                                            2040            3.90            3.90             0.0             0.0
15-county \6\ area..............            2018          105.94          106.23            0.29            0.27
                                            2020           85.98           86.19            0.21            0.24
                                            2025           62.77           62.90            0.13            0.21
                                            2030           39.56           39.60            0.05            0.13
                                            2035           33.44           33.46            0.02            0.06
                                            2040           27.33           27.32           -0.01           -0.04
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                         Table 2--On-Road VOC Emissions Before and After RVP Relaxation
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                                                      7.8 psi
                                                   gasoline for
                                                    13 counties       9.0 psi        Emissions       Emissions
      Pollutant and region             Year         and 9.0 psi    gasoline for    increase with   increase with
                                                  gasoline for 2    15-counties   RVP relaxation  RVP relaxation
                                                     counties          (tpd)           (tpd)         (percent)
                                                     \7\(tpd)
----------------------------------------------------------------------------------------------------------------
13-county area..................            2018           62.14           62.89            0.75            1.21
                                            2020           53.64           54.14            0.50            0.94
                                            2025           43.26           43.59            0.32            0.75
                                            2030           32.89           33.03            0.14            0.43
                                            2035           28.56           28.69            0.13            0.45
                                            2040           24.24           24.36            0.11            0.47
2-county area...................            2018            5.46            5.46             0.0             0.0
                                            2020            4.72            4.72             0.0             0.0
                                            2025            3.83            3.83             0.0             0.0
                                            2030            2.93            2.93             0.0             0.0
                                            2035            2.59            2.59             0.0             0.0
                                            2040            2.26            2.26             0.0             0.0
15-county \8\ area..............            2018           67.60           68.35            0.75            1.11
                                            2020           58.36           58.86            0.50            0.86
                                            2025           47.09           47.41            0.32            0.68
                                            2030           35.82           35.96            0.14            0.39
                                            2035           31.16           31.29            0.13            0.42
                                            2040           26.50           26.61            0.11            0.42
----------------------------------------------------------------------------------------------------------------

    Nonroad mobile sources include vehicles, engines, and equipment
used for construction, agriculture, recreation, and other purposes that
do not use roadways (e.g., lawn mowers, construction equipment, and
railroad locomotives). Georgia did not address nonroad NOX
emissions because the NONROAD model within MOVES 2014a model indicated
that the change in the RVP limit did not result in changes in
NOX emissions from nonroad sources. Therefore, Georgia did
calculate changes in nonroad VOC emissions before and after the
relaxation as shown in Table 3, below.
---------------------------------------------------------------------------

    \7\ As mentioned before, the 1 psi waiver for E10 is included in
all calculations in this table. E10 is a fuel blend with 10 percent
ethanol. Therefore, the actual input parameter is 8.8 psi and 10.0
psi. The 2-county area is not included in the original 13-county
Atlanta fuel volatility Area and was never subject to the 7.8 psi
RVP requirements. Federal RVP limits are 7.8 psi and 9.0 psi, not
including the additional 1.0 psi that applies to 10 percent ethanol
blends. Throughout the rest of the proposal we will refer to the RVP
limits as 7.8 psi and 9.0 psi.
    \8\ In final calculations for the nonattainment area, an
additional 0.03 tpd would be added to these values to account for
the Senior Exemption. Senior citizens are exempt from the I/M
program testing and thus 0.03 tpd (based on 2002 emissions
comparisons) is used as a conservative estimate of disbenefit.
    \9\ In final calculations for the nonattainment area, an
additional 0.03 tpd would be added to these values to account for
the Senior Exemption. Senior citizens are exempt from the Inspection
and Maintenance (I/M) program testing and thus 0.03 tpd (based on
2002 emissions comparisons) is used as a conservative estimate of
disbenefit.

                         Table 3--Nonroad VOC Emissions Before and After RVP Relaxation
----------------------------------------------------------------------------------------------------------------
                                                      7.8 psi
                                                   gasoline for       9.0 psi        Emissions       Emissions
                                                    13 counties    gasoline for    increase with   increase with
      Pollutant and region             Year         and 9.0 psi     15-counties   RVP relaxation  RVP relaxation
                                                  gasoline for 2       (tpd)           (tpd)         (percent)
                                                  counties (tpd)
----------------------------------------------------------------------------------------------------------------
13-county area..................            2018           45.15           45.97            0.82            1.82
                                            2020           44.74           45.58            0.84            1.88
                                            2025           46.48           47.37            0.89            1.91
                                            2030           48.23           49.17            0.94            1.95
                                            2035           51.11           52.11            1.00            1.96
                                            2040           54.00           55.06            1.06            1.96
2-county area...................            2018            1.59            1.59             0.0             0.0
                                            2020            1.51            1.51             0.0             0.0
                                            2025            1.48            1.48             0.0             0.0
                                            2030            1.46            1.46             0.0             0.0
                                            2035            1.52            1.52             0.0             0.0
                                            2040            1.59            1.59             0.0             0.0
15-county NAA \9\ area..........            2018           46.74           47.56            0.82            1.75
                                            2020           46.25           47.09            0.84            1.82
                                            2025           47.97           48.86            0.89            1.86
                                            2030           49.69           50.63            0.94            1.89
                                            2035           52.64           53.64            1.00            1.90
                                            2040           55.59           56.65            1.06            1.91
----------------------------------------------------------------------------------------------------------------

    As shown in Table 3, in the 15-county Atlanta maintenance Area,
nonroad VOC emissions increased by 0.82 tpd in 2018 from 46.75 tpd to
47.56 tpd and by 0.94 tpd in 2030 from 49.69 tpd to 50.63 tpd when the
federal RVP limit is relaxed to 9.0 psi. The nonroad VOC emissions
increase from 1.75% in 2018 to 1.89% in 2030.
    Tables 4 and 5, below show the 2014 NOX and VOC
attainment inventories from all sectors (point, area, nonroad, and on-
road) comparing the current 7.8 psi gasoline RVP to gasoline that
complies with the federal gasoline RVP limit of 9.0 psi. Georgia
calculated the change in emissions from attainment levels for both the
7.8 psi and 9.0 psi RVP gasoline and used the term ``margin'' to
indicate the amount of the decrease in tpd from attainment (2014) to
the maintenance (2030) and beyond (2040). The ``allotted'' amount is
the difference in emissions from the 7.8 psi RVP gasoline to the 9.0
psi RVP gasoline. Georgia also shows the allotted difference as a
percent.

                                        Table 4--2014 NOX Attainment Inventory Comparison 7.8 psi to 9.0 psi RVP
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                             Total NOX       Total NOX
                                          Total 2014 NOX     emissions       emissions      Current RVP     Relaxed RVP      Amount of      Percent of
                                            attainment    inventory with  inventory with  (7.8) gasoline  (9.0) gasoline      margin          margin
                  Year                       inventory     current (7.8)   relaxed (9.0)   margin (NOX)    margin (NOX)     allotted to     allotted to
                                               (tpd)       RVP gasoline    RVP gasoline        (tpd)           (tpd)         relax RVP       relax RVP
                                                               (tpd)           (tpd)                                           (tpd)
--------------------------------------------------------------------------------------------------------------------------------------------------------
2014....................................          283.09          283.09             N/A               0             N/A             N/A             N/A
2018....................................          283.09          205.86          206.15           77.23           76.94            0.29            0.38
2020....................................          283.09          181.23          181.44          101.86          101.65            0.21            0.21
2025....................................          283.09          153.16          153.29          129.93          129.80            0.13            0.10
2030....................................          283.09          125.09          125.14          158.00          157.95            0.05            0.03
2035....................................          283.09          118.67          118.69          164.42          164.40            0.02            0.01
2040....................................          283.09          112.25          112.24          170.84          170.85           -0.01            0.00
--------------------------------------------------------------------------------------------------------------------------------------------------------

                                        Table 5--2014 VOC Attainment Inventory Comparison 7.8 psi to 9.0 psi RVP
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                             Total VOC       Total VOC
                                          Total 2014 VOC     emissions       emissions      Current RVP     Relaxed RVP      Amount of      Percent of
                                            attainment    inventory with  inventory with  (7.8) gasoline  (9.0) gasoline      margin          margin
                  Year                       inventory     current (7.8)   relaxed (9.0)   margin (VOC)    margin (VOC)     allotted to     allotted to
                                               (tpd)       RVP gasoline    RVP gasoline        (tpd)           (tpd)         relax RVP       relax RVP
                                                               (tpd)           (tpd)                                           (tpd)
--------------------------------------------------------------------------------------------------------------------------------------------------------
2014....................................          266.25          266.25             N/A               0             N/A             N/A             N/A
2018....................................          266.25          246.71          248.29           19.54           17.96            1.58            8.09
2020....................................          266.25          236.32          237.67           29.93           28.58            1.34            4.48
2025....................................          266.25          225.15          226.36           41.10           39.89            1.21            2.94
2030....................................          266.25          213.97          215.06           52.28           51.19            1.08            2.07
2035....................................          266.25          210.64          211.77           55.61           54.48            1.13            2.03
2040....................................          266.25          207.31          208.48           58.94           57.77            1.17            1.99
--------------------------------------------------------------------------------------------------------------------------------------------------------

    As shown in Table 4, when the RVP is relaxed, the total
NOX emissions increase the most in 2018 by 0.29 tpd, from
205.86 tpd to 206.15 tpd. In the outyear, 2030, NOX
emissions increase slightly by 0.05 tpd, from 125.09 tpd to 125.14 tpd
when the federal RVP limit is relaxed. Although there are small
increases in NOX, overall, total NOX emissions
decrease by 170.85 tpd from the attainment year 2014 to the future year
2040.
    Table 5 shows that the total VOC emissions increase in 2018 by 1.58
tpd, from 246.71 tpd to 248.29 tpd. In the outyear 2030, VOC emissions
increase by 1.08 tpd, from 213.97 tpd to 215.06 tpd. Although there are
emissions increases in VOC when the federal RVP limit is relaxed to 9.0
psi, there is an overall downward trend in emissions from the 2014
attainment year to the 2030 maintenance year. VOC emissions decrease
from 266.25 tpd in 2014 down to 208.48 tpd in 2040 an overall decrease
of 57.77 tpd.
    Based on Tables 4 and 5, total NOX emissions in the 2014
attainment year when the RVP is relaxed to 9.0 psi trends downward from
283.09.15 tpd to 125.14 tpd. This gives a safety margin of 157.95 tpd.
The VOC safety margin is 51.19 tpd because of the downward trend from
the attainment level of 266.25 tpd to the maintenance level of 215.06
tpd with 9.0 psi RVP. A safety margin is the difference between the
attainment level of emissions (from all sources) and the projected
level of emissions (from all sources) in the maintenance plan.
    Even with the increases in nonroad VOC emissions shown in Table 3,
there is a downward trend in overall NOX and VOC. The
downward trend in the total NOX and VOC emissions in the
2014 attainment inventories indicate that the 15-county Atlanta
maintenance Area can continue to maintain the 1997 and 2008 8-hr ozone
NAAQS because overall emissions will be below the 2014 attainment
levels for the 2008 ozone NAAQS which is more than the 1997 ozone
NAAQS.\10\ Further, Georgia will need to offset the increase in
emissions of 0.29 tpd of NOX and 1.58 tpd of VOC in order to
demonstrate non-interference with the 2015 ozone NAAQS, as discussed
below. Georgia will get contemporaneous, compensating, equivalent
emissions reductions to offset the increase in emissions. Therefore,
Atlanta's ability to attain the 7-county 2015 8-hour ozone NAAQS will
not be affected. The offsets are explained in more detail later in this
Section.
---------------------------------------------------------------------------

    \10\ The 2008 ozone NAAQS is 0.075 ppm compared to the 1997
ozone NAAQS is 0.08 ppm, effectively 0.084 ppm.

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

b. Noninterference Analysis for the 2015 Ozone NAAQS

    As mentioned above, EPA determined that the 20-county Atlanta
metropolitan area attained the 1997 8-hour ozone NAAQS of 0.08 ppm,
effectively 0.084 ppm, and redesignated the area to attainment on
December 2, 2013 (78 FR 72040). EPA determined that the 15-county
Atlanta maintenance Area attained the 0.075 ppm 2008 8-hour ozone NAAQS
on July 14, 2016, and EPA redesignated the area to attainment on June
2, 2017 (82 FR 25523).
    The current 3-year design value for 2015-2017 for the Atlanta area
is 0.075 ppm,\11\ which demonstrates Atlanta is continuing to maintain
the 1997 and 2008 8-hour ozone NAAQS. The 2015 8-hour ozone NAAQS is
0.070 ppm and the 7-county Atlanta area is currently designated
nonattainment for this NAAQS as the current ozone design value is 0.075
ppm.
---------------------------------------------------------------------------

    \11\ The design value for an area is the highest 3-year average
of the annual fourth-highest daily maximum 8-hour concentration
recorded at any monitor in the area.
---------------------------------------------------------------------------

    Table 6 below shows the ozone monitoring data from monitoring
stations in Atlanta. As previously mentioned, the 7-county 2015 8-hour
ozone nonattainment area must attain the 2015 8-hour ozone NAAQS by
August 3, 2021, with air quality data for years 2018 through 2020.
Tables 4 and 5 above show the trend in emissions from the 2008 8-hour
ozone NAAQS attainment year (2014) through the maintenance year (2030).
The emissions trend shows that even with a 9.0 psi RVP fuel, emissions
remain below the attainment inventory level of 283.09 tpd for
NOX and 266.5 for VOC. NOX emissions decrease by
76.94 tpd in 2018 and even more to 101.65 tpd in 2020. By 2030,
NOX emissions will decrease by 157.95 tpd. Likewise, VOC
emissions decrease by 17.96 tpd in 2018 to 28.58 tpd in 2020. By 2030,
VOC emissions will decrease by 51.19 tpd. Based on the overall downward
trend in emissions even with a 9.0 RVP fuel, and the offsetting,
contemporaneous, compensating, equivalent, emissions reductions
obtained for the 15-county Atlanta maintenance Area to account for the
small increases due to a relaxation of the RVP requirement, EPA
believes that a relaxation of the federal RVP requirement from 7.8 psi
to 9.0 psi will not affect Atlanta's ability to attain the 2015 8-hour
ozone NAAQS. Again, a more detailed discussion regarding the offsets
and ozone sensitivities in Atlanta will be given later in the notice.

                                          Table 6--2015-2017 Design Value Concentrations for Atlanta (ppm) \12\
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                4th highest 8-hour ozone value           3-Year design
                                                                                ------------------------------------------------     values
               Location (county)                            Monitoring station                                                           ---------------
                                                                                2015            2016            2017          2015-2017
--------------------------------------------------------------------------------------------------------------------------------------------------------
Cobb...........................................  GA National Guard, McCollum Pkwy (13-             0.066           0.070           0.065           0.067
                                                  067-0003).
Coweta.........................................  University of W. Georgia at Newnan (13-           0.066           0.066           0.057           0.063
                                                  077-0002).
DeKalb.........................................  2390-B Wildcat Road Decatur (13-089-              0.071           0.074           0.068           0.071
                                                  0002).
Douglas........................................  Douglas Co. Water Auth. W. Strickland             0.070           0.071           0.066           0.069
                                                  St. (13-097-0004).
Gwinnett.......................................  Gwinnett Tech, 5150 Sugarloaf Pkwy. (13-          0.071           0.078           0.065           0.071
                                                  135-0002).
Henry..........................................  Henry County Extension Office (13-151-            0.070           0.078           0.067           0.071
                                                  0002).
Paulding.......................................  Yorkville, King Farm (13-223-0003).....           0.065           0.067              --           0.066
Rockdale.......................................  Conyers Monastery, 2625 GA Hwy. 212 (13-          0.068           0.076           0.065           0.069
                                                  247-0001).
Fulton.........................................  Confederate Ave., Atlanta (13-121-0055)           0.077           0.075           0.074           0.075
--------------------------------------------------------------------------------------------------------------------------------------------------------

c. Noninterference Analysis for the PM NAAQS
---------------------------------------------------------------------------

    \12\ These monitoring stations are representative of the air
quality in the entire Atlanta area even though not all counties in
the 7-county 2015 ozone nonattainment area have a monitoring
station.
---------------------------------------------------------------------------

    Over the course of several years, EPA has reviewed and revised the
PM2.5 NAAQS several times. On July 18, 1997, EPA established
an annual PM2.5 NAAQS of 15 micrograms per cubic meter
([mu]g/m\3\) and designated the Atlanta area nonattainment for the 1997
annual PM2.5 NAAQS on April 14, 2005 (70 FR 19844). The
Atlanta area attained the 1997 annual NAAQS and was redesignated
attainment on February 24, 2016 (81 FR 9114).
    On September 21, 2006, EPA retained the 1997 annual
PM2.5 NAAQS of 15.0 [mu]g/m\3\ but revised the 24-hour
PM2.5 NAAQS from 65.0 [mu]g/m\3\ to 35.0 [mu]g/m\3\, (71 FR
61144) effective October 17, 2006. The Atlanta area was never
designated nonattainment for the 24-hour PM2.5 NAAQS.
    On December 14, 2012, EPA strengthened the annual primary
PM2.5 NAAQS from 15 [mu]g/m\3\ to 12.0 [mu]g/m.\3\ (78 FR
3086). EPA designated Atlanta unclassifiable/attainment for the 2012
annual primary PM2.5 NAAQS (80 FR 2206) on January 15, 2015.
The current 2015-2017 design value for the annual and 24-hour
PM2.5 is 10.5 and 23.0 [mu]g/m\3\, respectively.
    The main precursor pollutants for PM2.5 are
NOX, SO2, VOC, and ammonia. As mentioned above,
relaxing the federal RVP requirements only results in small emissions
increases of VOC and NOX. Moreover, there have been a number
of studies which have indicated that SO2 is the primary
driver of PM2.5 formation in the Southeast.\13\
---------------------------------------------------------------------------

    \13\ See, e.g., Quantifying the sources of ozone, fine
particulate matter, and regional haze in the Southeastern United
States, Journal of Environmental Engineering (June 24, 2009),
available at: http://www.sciencedirect.com/science/article/pii/S0301479709001893?via%3Dihub.
---------------------------------------------------------------------------

    As previously stated, RVP does not affect the most significant
PM2.5 precursor (SO2).
    Based on this and the fact that the current PM2.5 design
values for the Atlanta area are below the level of the 2012 annual
primary and 2006 24-hour PM2.5 NAAQS, EPA is proposing to
determine that a relaxation of the federal 7.8 psi gasoline RVP limit
to 9.0 psi for the affected counties would not interfere with the
Atlanta area's ability to attain or maintain the annual primary and 24-
hour PM2.5 NAAQS in the area.

d. Noninterference Analysis for the 2010 NO2 NAAQS

    There are currently two primary nitrogen dioxide (NO2)
standards. On February 9, 2010 (75 FR 6474), EPA established a 1-Hour
NO2 standard set at 100 ppb. In 1971, an annual standard was
set at a level of 53 ppb and has remained unchanged. EPA designated all
counties in Georgia, including all of those in the Atlanta area as
unclassifiable/attainment for the 2010 NO2 NAAQS on February
17, 2012 (77 FR 95320). Currently, Atlanta's 2015-2017 design value for
the 2010 1-hour and annual NO2 NAAQS is 56.0 and 17.9 ppb,
respectively. Given that the area is well below the level of the NAAQS,
the small NO2 emissions increase from a RVP relaxation will
not interfere the area's ability to continue to attain the NAAQS. EPA
is proposing to determine that a change to a federal 9.0 psi RVP limit
for the Atlanta fuel volatility Area would not interfere with
attainment or maintenance of the 1-hour or annual NO2 NAAQS.

e. Noninterference Analysis for the SO2 NAAQS

    On June 22, 2010 (75 FR 35520), EPA revised the SO2
standard. There are both primary and secondary standards for
SO2. The primary SO2 NAAQS is a 3-year average of
the 99th percentile of the daily maximum 1-hour concentration not to
exceed 75 ppb. The secondary standard is a 3-hour concentration not to
exceed 0.5 ppm more than once per year. On December 21, 2017, EPA
designated all counties in Atlanta attainment/unclassifiable for the
2010 SO2 NAAQS effective April 9, 2018 (83 FR 1098).
    As mentioned earlier, SO2 is the driver of
PM2.5 formation and it does not influence RVP. Therefore,
based on the current designation and the 2015-2017 design value of 6.0
ppb, EPA is proposing to find that a change to federal 9.0 psi RVP
limit fuel for the Atlanta fuel volatility Area will not interfere with
attainment or maintenance of the 1-hour SO2 NAAQS.

f. Sensitivity of Ozone in Atlanta to NOX and VOC Emissions

    Control of NOX and VOC are generally considered the most
important components of an ozone control strategy, and NOX
and VOC make up the largest controllable contribution to ambient ozone
formation. However, the metro Atlanta nonattainment/maintenance area
has shown a greater sensitivity of ground-level ozone to NOX
controls rather than VOC controls. This is due to high biogenic VOC
emissions compared to anthropogenic VOC emissions in Georgia.
Therefore, implemented control measures have focused on the control of
NOX emissions. The Atlanta nonattainment/maintenance area is
NOX limited in such a way that changes in anthropogenic VOC
emissions have little effect on ozone formation.\14\
---------------------------------------------------------------------------

    \14\ As part of the Southeastern Modeling Analysis and Planning
(SEMAP) project, Georgia Institute of Technology performed an
analysis of the sensitivity of ozone concentrations in the Eastern
U.S. to reductions in emissions of both NOX and VOCs.
This analysis was based off the 2007 and 2018 SEMAP modeling which
used the Community Multi-scale Air Quality (CMAQ) model, version
5.01 with updates to the vertical mixing coefficients and land-water
interface. May 1st through September 30th was modeled using a 12-km
modeling grid that covered the Eastern U.S. Details of the modeling
platform set-up can be found in Appendix C.
---------------------------------------------------------------------------

    Sensitivities were modeled relative to 2018 emissions to evaluate
the impact of NOX and VOC reductions on daily 8-hour maximum
ozone concentrations. Each emissions sensitivity run reduced the 2018
anthropogenic NOX or VOC emissions (point, area, mobile,
nonroad, marine/aircraft/rail) within a specific geographic region by
30 percent. Georgia EPD examined the normalized sensitivities of
NOX and VOC emissions on 8-hour daily maximum ozone
concentrations (ppb ozone/TPD) at nine ozone monitors in Atlanta.\15\
---------------------------------------------------------------------------

    \15\ For further details on the approach used to calculate the
normalized sensitivities of NOX and VOC, please see
Appendix D in Georgia's submittal.
---------------------------------------------------------------------------

    The site-specific normalized NOX and VOC sensitivities
were applied to the expected emissions increases due to a relaxation of
the federal RVP limit from 7.8 to 9.0 psi. The emissions increases are
based on 2018 values and represent the largest impact as the emissions
increase will decrease each successive year. A relaxation of the
federal RVP limit results in an increase of VOC emissions of 1.58 tpd
in 2018. See Table 5. This includes nonroad vehicles and represents the
largest impact in any of the modeled years. A relaxation of the federal
RVP limit results in an increase of 0.29 tpd of NOX in 2018
in the 15-county Atlanta maintenance Area decreasing over time to near
zero by 2040. See Table 5. The corresponding ozone increases at each
monitor are found in Table 7 below and demonstrate insignificant
increases in ozone concentrations. The calculated changes in ozone
levels are well below the level of precision of the ambient ozone
monitors (1 ppb or 0.001 ppm).\16\ Since the corresponding ozone
increase at all nine monitors would only be seen at the fifth decimal
place,\17\ these small increases could not impact maintenance or
attainment of any ozone NAAQS.
---------------------------------------------------------------------------

    \16\ Ozone concentrations are reported in ppm and to three
decimal places (e.g., 0.070 ppm); any additional decimal places are
truncated.
    \17\ Because the increases in Table 7 is reported in ppb, the
changes are in the 2nd decimal place.

            Table 7--Emissions Increases Due to Relaxation of the RVP and Effects on Ozone Formation
----------------------------------------------------------------------------------------------------------------
                                             Relaxation of the RVP from 7.8 psi to 9.0               Combined
                                 -------------------------------------------------------------------------------
                                                   Corresponding
                                                  ozone increase                   Corresponding   Corresponding
             Monitor                 2018 NOX     at monitor due     2018 VOC     ozone increase  ozone increase
                                     emissions        to NOX         emissions    at monitor due    at monitor
                                  increase (tpd)   increase \18\  increase (tpd)      to VOC           (ppb)
                                                       (ppb)                      increase (ppb)
----------------------------------------------------------------------------------------------------------------
Kennesaw........................            0.29         0.02149            1.58         0.00776           0.029
Newnan..........................            0.29         0.02337            1.58         0.00278           0.026
Dawsonville.....................            0.29         0.01488            1.58         0.00009           0.015
South Dekalb....................            0.29         0.02536            1.58         0.01083           0.036
Douglasville....................            0.29         0.02311            1.58         0.00658           0.030
Confederate Ave.................            0.29         0.01864            1.58         0.01663           0.035
Gwinnett........................            0.29         0.02211            1.58         0.00417           0.026
McDonough.......................            0.29         0.02521            1.58         0.00530           0.031
Conyers.........................            0.29         0.02628            1.58         0.00521           0.031
----------------------------------------------------------------------------------------------------------------

g. Emissions Increases and Offsets From Locomotive Retrofits and School
Bus Replacements
---------------------------------------------------------------------------

    \18\ See Appendix D of the submission.
---------------------------------------------------------------------------

    As shown in Section V, Tables 4 and 5, relaxing the federal RVP
limit from 7.8 to 9.0 psi results in an increase in NOX
emissions in 2018 of 0.29 tons per day and 1.58 tons per day of VOC.
The high ozone season runs from June 1st to September 15th, which is
107 days per calendar year. 40 CFR 80.27(a)(2). This results in
equivalent emissions increases of 31.03 tons/year of NOX and
169.06 tons/year of VOC in the Atlanta fuel volatility Area during the
high ozone season.
    As discussed above, Table 7 shows ozone formation in the 15-County
Atlanta maintenance Area and the sensitivity to reductions of
NOX and VOC emissions. The Area is a NOX limited
area; therefore, the control of NOX emissions result in
greater reductions of ozone compared to control of VOC emissions. The
maximum VOC emissions increase resulting from a relaxation of the RVP
from 7.8 psi to 9.0 psi is 1.58 tons per day (169.06 tons/year). This
increase in VOC emissions can be converted to an equivalent increase in
NOX emissions based on the ratio of normalized ozone
sensitivities described in Paragraph f. as follows:

169.06 tons/year VOC * (- 0.00417ppb/TPD VOC)/(- 0.07680 ppb/TPD NOx) =
9.179 tons/year NOX

    By adding the actual NOX emissions increase to the
equivalent NOX emissions increase from VOC emissions using
the sensitivity calculation, the resulting offset NOX
emissions are:

31.03 tons/year of NOX + 9.179 tons/year of NOX
(VOC equivalent reduction) = 40.21 tons/year NOX offsets
required

    Georgia's SIP revision includes two offset measures--school bus
replacements and rail locomotive conversions--to obtain the necessary
emissions reductions. Georgia EPD has a strong school bus early
replacement program. School bus replacement projects that were
completed in 2017 using Diesel Emissions Reduction Act funding have
resulted in NOX emissions reductions of 7.20 tons per year
(tpy) in the Atlanta maintenance Area. Specifically, five old school
buses (built in 2000-2003) in Paulding County were replaced with five
2017 school buses. Also, forty old school buses (built in 1999-2003) in
Fulton County were replaced with forty 2017 school buses.\19\ The
replacements took place in 2017, which falls within the contemporaneous
timeframe. Georgia has not previously relied on these emissions
reductions to satisfy any CAA requirement.
---------------------------------------------------------------------------

    \19\ Calculations of NOX emission reductions for the
locomotives and school bus replacements are in Appendix E.
---------------------------------------------------------------------------

    The Locomotive Conversion Program consists of two components: (1)
The conversion of three older traditional switcher locomotives into
newly-available low emissions engine technology from Norfolk Southern
Railway, Inc., and (2) Norfolk Southern Railway, Inc.'s conversion of
two switchers into ``slugs'' which are driven by electrical motors
whose electricity is received from companion ``mother'' locomotives.
This configuration is referred to as mother-slug locomotives. Slugs do
not have any direct emissions. The conversion took place in December
2017, which also falls within the contemporaneous timeframe and
generated 38.81 tpy of NOX reductions. Georgia has not
previously relied on the emissions reductions from the Locomotive
Conversion Program to satisfy any CAA requirement. See Table 8 below
for a summary of the offsets.

            Table 8--NOX Emissions Increases/Offsets Required From Relaxing the RVP Standard in 2018
----------------------------------------------------------------------------------------------------------------
                                                                    Locomotive      School bus
                        Source of offset                            conversions    replacements   Total decrease
                                                                       (tpy)           (tpy)           (tpy)
----------------------------------------------------------------------------------------------------------------
NOX Emissions Decrease..........................................           38.81            7.20           46.01
----------------------------------------------------------------------------------------------------------------

    Based on the available offsets from the locomotive conversion
projects and school bus early replacement projects, Georgia EPD has
offsets in excess of the increase in emissions associated with relaxing
the federal gasoline RVP limit from 7.8 psi to 9.0 psi.

  Table 9--Emissions Increases Compared to Available Emissions Offsets
------------------------------------------------------------------------
                                                      Total
    Emissions increases due to relaxing GA RVP       offsets    Residual
                requirements (tpy)                  available   offsets
                                                      (tpy)      (tpy)
------------------------------------------------------------------------
40.21.............................................      46.01       5.80
------------------------------------------------------------------------

    The offsets available from both bus replacements and locomotive
conversions total 46.01 tpy of NOX. As shown in Table 9, the
annual NOX decrease from the locomotive conversions and
school bus replacements are more than adequate to offset the maximum
NOX and VOC emissions increases (40.21 tpy of equivalent
NOX) associated with relaxing the federal 7.8 psi RVP
requirements. There is a 5.80 ton per year residual NOX
emissions offset that will remain available.
    Georgia has demonstrated noninterference by substituting
quantifiable, permanent, surplus, enforceable and contemporaneous
measures described above to achieve equivalent emissions reductions to
offset the potential emission increases related to a relaxation of the
federal 7.8 psi RVP requirements. The locomotive conversions and school
bus replacements occurring in 2017 are surplus since they have not been
relied upon by any attainment plan or demonstration or credited in any
RFP demonstration. The converted locomotives must remain operational
for a period of ten years from the date placed into revenue service
(December 2027). The school buses replaced must be scrapped or rendered
permanently disabled or remanufactured to a cleaner emissions standard
within 90 days of replacement. Therefore, the emissions reductions
obtained are considered permanent. The emissions reductions have been
quantified. Enforceability of the emissions reductions from locomotive
conversions and school bus replacements are addressed in the contract
commitments between Georgia EPD and Norfolk Southern Railway, Inc.\20\
The locomotive and school replacements are contemporaneous since they
occurred within one year of this submittal.
---------------------------------------------------------------------------

    \20\ See Appendix E for the contract terms for the permanence of
locomotive conversions and school bus replacements.

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

h. Conclusion Regarding the Noninterference Analysis

    EPA believes that the emissions reductions from the offset measures
included in the SIP revision are greater than those needed to maintain
the status quo in air quality and are permanent, enforceable,
quantifiable, surplus, contemporaneous and equivalent. This RVP
relaxation will not worsen air quality because Georgia has provided
offsets as compensating, equivalent emissions reductions to negate the
increases in emissions from NOX and VOCs. The amount of
NOX reductions obtained from the school bus and locomotive
retrofits are more than what is needed to compensate for the small
amount of NOX and VOC increases due to relaxation of the
federal RVP requirement. In addition, the downward trend in emissions
reflected in the NOX and VOC attainment inventories
summarized in Tables 4 and 5 shows the safety margins in the
maintenance year 2030 of 157.95 tpd for NOX and 51.19 tpd
for VOC. Therefore, EPA has preliminarily determined that the SIP
revision adequately demonstrates that relaxing the 7.8 psi RVP limit
will not interfere with Atlanta's ability to attain the 2015 8-hour
ozone NAAQS or maintain the 1997 and 2008 8-hour ozone NAAQS, and will
not interfere with any other NAAQS, or with any other applicable
requirement of the CAA.

i. Analysis of Updated 2030 MVEBs

    This SIP revision includes an update to the mobile emissions
inventory and associated 2030 MVEBs due to a relaxation of the 7.8 psi
fuel to the 9.0 psi RVP fuel. Georgia used the same approach as
outlined in the June 2, 2017, EPA approval of the 2008 8-hour ozone
redesignation to determine the portion of the safety margin allocated
to the MVEBs for this SIP revision. The on-road emissions inventory and
safety margin allocation for the year 2030 were updated but the MVEB
totals themselves remain unchanged. See Table 10 below. As a result,
EPA is proposing to approve the updated MVEBs.

                         Table 10--Updated MVEBs for the Atlanta Maintenance Area (tpd)
----------------------------------------------------------------------------------------------------------------
                                                               2014                          2030 \21\
                                                 ---------------------------------------------------------------
                                                        NOX             VOC             NOX             VOC
----------------------------------------------------------------------------------------------------------------
On-Road Emissions...............................          170.15           81.76           39.63           36.01
Safety Margin Allocation........................  ..............  ..............           18.37           15.99
MVEBs with Safety Margin........................          170.15           81.76              58              52
----------------------------------------------------------------------------------------------------------------

VI. Proposed Action
---------------------------------------------------------------------------

    \21\ The 2014 on-road emissions and MVEBs in this chart are
shown for illustration purposes because no changes were made to the
2014 attainment year emissions inventory due to the relaxation.
---------------------------------------------------------------------------

    EPA is proposing to approve Georgia's August 15, 2018, SIP revision
to the 2008 8-hour ozone standard maintenance plan and corresponding
noninterference demonstration. This SIP revision includes an update to
the mobile emissions inventory (on-road and nonroad), the associated
2030 MVEBs, and the measures to offset the emissions increases due to a
relaxation of the 7.8 psi RVP requirement. All would support revisions
to the maintenance plan that Georgia will rely on for the relaxation of
the federal RVP requirement from 7.8 psi to 9.0 in the Atlanta fuel
volatility Area. EPA is proposing to find that a relaxation in the RVP
requirements for the Atlanta fuel volatility Area will not interfere
with attainment or maintenance of any NAAQS or with any other
applicable requirement of the CAA.
    EPA has preliminarily determined that Georgia's August 15, 2018,
SIP revision is consistent with the applicable provisions of the CAA,
including section 110(l). Should EPA decide to relax the 7.8 psi
federal RVP standard in the Atlanta fuel volatility Area, such action
will occur in a separate and subsequent rulemaking.

VII. Statutory and Executive Order Reviews

    Under the CAA, the Administrator is required to approve a SIP
submission that complies with the provisions of the Act and applicable
Federal regulations. See 42 U.S.C. 7410(k); 40 CFR 52.02(a). Thus, in
reviewing SIP submissions, EPA's role is to approve state choices,
provided they meet the criteria of the CAA. This action merely proposes
to approve changes to Georgia's maintenance plan emissions inventory,
the safety margins and safety margin allocations, the associated MVEBs,
and the measures used to offset the emissions increases due to relaxing
the federal RVP requirements. For that reason, this proposed action:
     Is not a significant regulatory action subject to review
by the Office of Management and Budget under Executive Orders 12866 (58
FR 51735, October 4, 1993) and 13563 (76 FR 3821, January 21, 2011);
     Is not an Executive Order 13771 (82 FR 9339, February 2,
2017) regulatory action because SIP approvals are exempted under
Executive Order 12866.
     Does not impose an information collection burden under the
provisions of the Paperwork Reduction Act (44 U.S.C. 3501 et seq.);
     Is certified as not having a significant economic impact
on a substantial number of small entities under the Regulatory
Flexibility Act (5 U.S.C. 601 et seq.);
     Does not contain any unfunded mandate or significantly or
uniquely affect small governments, as described in the Unfunded
Mandates Reform Act of 1995 (Pub. L. 104-4);
     Does not have Federalism implications as specified in
Executive Order 13132 (64 FR 43255, August 10, 1999);
     Is not an economically significant regulatory action based
on health or safety risks subject to Executive Order 13045 (62 FR
19885, April 23, 1997);
     Is not a significant regulatory action subject to
Executive Order 13211 (66 FR 28355, May 22, 2001);
     Is not subject to requirements of Section 12(d) of the
National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272
note) because application of those requirements would be inconsistent
with the CAA; and
     Does not provide EPA with the discretionary authority to
address, as appropriate, disproportionate human health or environmental
effects, using practicable and legally permissible methods, under
Executive Order 12898 (59 FR 7629, February 16, 1994).
    The SIP is not approved to apply on any Indian reservation land or
in any other area where EPA or an Indian tribe has demonstrated that a
tribe has jurisdiction. In those areas of Indian country, the rule does
not have tribal implications as specified by Executive Order 13175 (65
FR 67249, November 9, 2000), nor will it impose substantial

direct costs on tribal governments or preempt tribal law.

List of Subjects in 40 CFR Part 52

    Environmental protection, Air pollution control, Intergovernmental
relations, Incorporation by reference, Nitrogen dioxide, Ozone,
Particulate matter, Reporting and recordkeeping requirements, Volatile
organic compounds.

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

    Dated: December 21, 2018.
Mary S. Walker,
Acting Regional Administrator, Region 4.
[FR Doc. 2019-01863 Filed 2-11-19; 8:45 am]
 BILLING CODE 6560-50-P


[Federal Register Volume 80, Number 190 (Thursday, October 1, 2015)]
[Notices]
[Page 59156]
[FR Doc No: 2015-24836]

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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Food and Drug Administration

[Docket No. FDA-2015-N-0001]

Joint Meeting of the Antimicrobial Drugs Advisory Committee
(Formerly Known as the Anti-Infective Drugs Advisory Committee) and the
Drug Safety and Risk Management Advisory Committee; Notice of Meeting

AGENCY: Food and Drug Administration, HHS.

ACTION: Notice.

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

    This notice announces a forthcoming meeting of a public advisory
committee of the Food and Drug Administration (FDA). The meeting will
be open to the public.
    Name of Committees: Antimicrobial Drugs Advisory Committee
(formerly known as the Anti-Infective Drugs Advisory Committee) and the
Drug Safety and Risk Management Advisory Committee.
    General Function of the Committees: To provide advice and
recommendations to the Agency on FDA's regulatory issues.
    Date and Time: The meeting will be held on November 5, 2015, from 8
a.m. to 6 p.m.
    Location: FDA White Oak Campus, 10903 New Hampshire Ave., Bldg. 31
Conference Center, the Great Room (Rm. 1503), Silver Spring, MD 20993-
0002. Answers to commonly asked questions including information
regarding special accommodations due to a disability, visitor parking,
and transportation may be accessed at: http://www.fda.gov/AdvisoryCommittees/AboutAdvisoryCommittees/ucm408555.htm.
    Contact Person: Jennifer Shepherd, Center for Drug Evaluation and
Research, Food and Drug Administration, 10903 New Hampshire Ave., Bldg.
31, Rm. 2417, Silver Spring, MD 20993-0002,<PHONE_NUMBER>, FAX: 301-847-
8533, email<EMAIL_ADDRESS>or FDA Advisory Committee Information
Line, 1-800-741-8138<PHONE_NUMBER> in the Washington, DC area). A
notice in the Federal Register about last minute modifications that
impact a previously announced advisory committee meeting cannot always
be published quickly enough to provide timely notice. Therefore, you
should always check the Agency's Web site at http://www.fda.gov/AdvisoryCommittees/default.htm and scroll down to the appropriate
advisory committee meeting link, or call the advisory committee
information line to learn about possible modifications before coming to
the meeting.
    Agenda: The committees will discuss the risks and benefits of the
systemic fluoroquinolone antibacterial drugs for the treatment of acute
bacterial sinusitis, acute bacterial exacerbation of chronic bronchitis
in patients who have chronic obstructive pulmonary disease, and
uncomplicated urinary tract infections in the context of available
safety information and the treatment effect of antibacterial drugs in
these clinical conditions.
    FDA intends to make background material available to the public no
later than 2 business days before the meeting. If FDA is unable to post
the background material on its Web site prior to the meeting, the
background material will be made publicly available at the location of
the advisory committee meeting, and the background material will be
posted on FDA's Web site after the meeting. Background material is
available at http://www.fda.gov/AdvisoryCommittees/Calendar/default.htm. Scroll down to the appropriate advisory committee meeting
link.
    Procedure: Interested persons may present data, information, or
views, orally or in writing, on issues pending before the committees.
Written submissions may be made to the contact person on or before
October 22, 2015. Oral presentations from the public will be scheduled
between approximately 1 p.m. and 2:30 p.m. Those individuals interested
in making formal oral presentations should notify the contact person
and submit a brief statement of the general nature of the evidence or
arguments they wish to present, the names and addresses of proposed
participants, and an indication of the approximate time requested to
make their presentation on or before October 14, 2015. Time allotted
for each presentation may be limited. If the number of registrants
requesting to speak is greater than can be reasonably accommodated
during the scheduled open public hearing session, FDA may conduct a
lottery to determine the speakers for the scheduled open public hearing
session. The contact person will notify interested persons regarding
their request to speak by October 15, 2015.
    Persons attending FDA's advisory committee meetings are advised
that the Agency is not responsible for providing access to electrical
outlets.
    FDA welcomes the attendance of the public at its advisory committee
meetings and will make every effort to accommodate persons with
disabilities. If you require accommodations due to a disability, please
contact Jennifer Shepherd at least 7 days in advance of the meeting.
    FDA is committed to the orderly conduct of its advisory committee
meetings. Please visit our Web site at http://www.fda.gov/AdvisoryCommittees/AboutAdvisoryCommittees/ucm111462.htm for procedures
on public conduct during advisory committee meetings.
    Notice of this meeting is given under the Federal Advisory
Committee Act (5 U.S.C. app. 2).

    Dated: September 25, 2015.
Jill Hartzler Warner,
Associate Commissioner for Special Medical Programs.
[FR Doc. 2015-24836 Filed 9-30-15; 8:45 am]
BILLING CODE 4164-01-P


[Federal Register Volume 77, Number 19 (Monday, January 30, 2012)]
[Notices]
[Pages 4587-4588]
[FR Doc No: 2012-1890]

=======================================================================
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SECURITIES AND EXCHANGE COMMISSION

[Release No. IC-29926; File No. 812-13994]

GE Asset Management Incorporated, et al.; Notice of Application
and Temporary Order

January 24, 2012.
AGENCY: Securities and Exchange Commission (``Commission'').

ACTION: Temporary order and notice of application for a permanent order
under section 9(c) of the Investment Company Act of 1940 (``Act'').

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

    Summary of Application: Applicants have received a temporary order
exempting them from section 9(a) of the Act, with respect to an
injunction entered against GE Funding Capital Market Services, Inc.
(``GE Funding CMS'') on January 23, 2012 by the United States District
Court for the District of New Jersey (``Injunction'') until the
Commission takes final action on an application for a permanent order.
Applicants also have applied for a permanent order.
    Applicants: GE Asset Management Incorporated (``GEAM''), GE
Investment Distributors, Inc. (``GEID'') and GE Funding CMS (each an
``Applicant'' and collectively, the ``Applicants'').\1\
---------------------------------------------------------------------------

    \1\ Applicants request that any relief granted pursuant to the
application also apply to any other company of which GE Funding CMS
is or may become an affiliated person within the meaning of section
2(a)(3) of the Act (together with the Applicants, the ``Covered
Persons'').
---------------------------------------------------------------------------

    Filing Date: The application was filed on December 23, 2011, and
amended on January 23, 2012.
    Hearing or Notification of Hearing: An order granting the
application will be issued unless the Commission orders a hearing.
Interested persons may request a hearing by writing to the Commission's
Secretary and serving applicants with a copy of the request, personally
or by mail. Hearing requests should be received by the Commission by
5:30 p.m. on February 21, 2012, and should be accompanied by proof of
service on applicants, in the form of an affidavit or, for lawyers, a
certificate of service. Hearing requests should state the nature of the
writer's interest, the reason for the request, and the issues
contested. Persons who wish to be notified of a hearing may request
notification by writing to the Commission's Secretary.

ADDRESSES: Secretary, U.S. Securities and Exchange Commission, 100 F
Street NE., Washington, DC 20549-1090; Applicants: GEAM and GEID, 1600
Summer Street, Stamford, CT 06905 and GE Funding CMS, 201 High Ridge
Road, Stamford, CT 06905.

FOR FURTHER INFORMATION CONTACT: Jean E. Minarick, Senior Counsel, at
(202) 551-6811 or Daniele Marchesani, Branch Chief, at<PHONE_NUMBER>
(Division of Investment Management, Office of Investment Company
Regulation).

SUPPLEMENTARY INFORMATION: The following is a temporary order and
summary of the application. The complete application may be obtained
via the Commission's Web site by searching for the file number, or an
applicant using the Company name box, at http://www.sec.gov/search/search.htm, or by calling<PHONE_NUMBER>.

Applicants' Representations

    1. GE Funding CMS is a corporation organized under the laws of
Delaware. GE Funding CMS does not currently serve as investment
adviser, sub-adviser, or depositor of any registered investment
company, business development company (``BDC''), or principal
underwriter for any registered open-end investment company, registered
unit investment trust (``UIT'') or registered face amount certificate
company, or investment adviser of any employees' securities company, as
defined in section 2(a)(13) of the Act (``ESC'') (``Fund Service
Activities''). ``Funds'' refers to the registered investment companies,
BDCs or ESCs for which a Covered Person provides Fund Service
Activities. GE Funding CMS is an indirect, wholly-owned subsidiary of
General Electric Company (``GE''), which also directly or indirectly
wholly-owns the other Applicants. GE is a large and diversified
technology, media and financial services company that serves customers
in more than 100 countries.
    2. GEAM, a Delaware corporation, is registered as an investment
adviser under the Investment Advisers Act of 1940, as amended
(``Advisers Act''). GEAM serves as investment adviser or sub-adviser to
a number of Funds. GEID is registered as a broker-dealer under the
Securities Exchange Act of 1934, as amended (``Exchange Act''). GEID
serves as principal underwriter to a number of Funds.
    3. On January 23, 2012, the United States District Court for the
District of New Jersey entered a judgment, which included the
Injunction, against GE Funding CMS (``Judgment'') in a matter brought
by the Commission.\2\ The Commission alleged in the complaint
(``Complaint'') that from August 1999 to September 2004, personnel of
GE Funding CMS engaged in fraudulent practices and made
misrepresentations and omissions in connection with bidding on
municipal reinvestment instruments. The Complaint alleged that GE
Funding CMS engaged in fraudulent practices, misrepresentations, and
omissions that affected the prices of certain reinvestment instruments,
deprived certain municipalities of a presumption that their
reinvestment instruments were purchased at fair market value, and/or
jeopardized the tax-exempt status of certain securities. Based on the
alleged misconduct described above, the Complaint alleged that GE
Funding CMS violated section 17(a) of the Securities Act of 1933.
Without admitting or denying any of the allegations in the Complaint
(other than those relating to the jurisdiction of the District Court
over it and the subject matter, solely for purposes of this action), GE
Funding CMS consented to the entry of the Injunction and other relief,
including disgorgement, prejudgment interest, and a civil monetary
penalty.
---------------------------------------------------------------------------

    \2\ U.S. Securities and Exchange Commission v. GE Funding
Capital Market Services, Inc., Case No. 2:11-cv-07465-WJM-MF (D.N.J.
Dec. 23, 2011).

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

Applicants' Legal Analysis

    1. Section 9(a)(2) of the Act, in relevant part, prohibits a person
who has been enjoined from engaging in or continuing any conduct or
practice in connection with the purchase or sale of a security, or in
connection with activities as an underwriter, broker or dealer, from
acting, among other things, as an investment adviser or depositor of
any registered investment company or a principal underwriter for any
registered open-end investment company, registered UIT, or registered
face-amount certificate company or as investment adviser of an ESC.
Section 9(a)(3) of the Act makes the prohibition in section 9(a)(2)
applicable to a company, any affiliated person of which has been
disqualified under the provisions of section 9(a)(2). Section 2(a)(3)
of the Act defines ``affiliated person'' to include, among others, any
person directly or indirectly controlling, controlled by, or under
common control, with the other person. Applicants state that GE Funding
CMS is an affiliated person of each of the other Applicants within the
meaning of section 2(a)(3) of the Act. Applicants state that, as a
result of the Injunction, they would be subject to the prohibitions of
section 9(a) of the Act.
    2. Section 9(c) of the Act provides that the Commission shall grant
an application for exemption from the disqualification provisions of
section 9(a) of the Act if it is established that these provisions, as
applied to the Applicants, are unduly or disproportionately severe or
that the conduct of the Applicants has been such as not to make it
against the public interest or the protection of investors to grant the
exemption. Applicants have filed an application pursuant to section
9(c) seeking a temporary and permanent order exempting them and other
Covered Persons from the disqualification provisions of section 9(a).
    3. Applicants believe they meet the standard for exemption
specified in section 9(c). Applicants state that the prohibitions of
section 9(a) as applied to them would be unduly and disproportionately
severe and that the conduct of the Applicants has been such as not to
make it against the public interest or the protection of investors to
grant the exemption from section 9(a).
    4. Applicants state that the alleged conduct giving rise to the
Injunction did not involve any of the Applicants engaging in Fund
Service Activities. Applicants state that to the best of their
knowledge none of the current or former directors, officers, or
employees of the Applicants (other than GE Funding CMS) that were
involved in providing Fund Service Activities had any knowledge of or
had any involvement in the violative conduct alleged in the Complaint.
Applicants further represent that the personnel of GE Funding CMS who
had any responsibility for, or involvement in, the violations alleged
in the Complaint are no longer employed by GE Funding CMS and have had
no, and in the present or future will not have any, involvement in
providing Fund Service Activities to the Funds.
    5. Applicants state that the inability of the Applicants to engage
in Fund Service Activities would result in potentially severe financial
hardships for the Funds they serve and the Funds' shareholders.
Applicants state that they will distribute written materials, including
an offer to meet in person to discuss the materials, to the boards of
directors of the Funds (excluding for this purpose the ESCs) (the
``Boards''), including the directors who are not ``interested
persons,'' as defined in section 2(a)(19) of the Act, of such Funds,
and their independent legal counsel as defined in rule 0-1(a)(6) under
the Act, if any, describing the circumstances that led to the
Injunction, any impact on the Funds, and the application. Applicants
state that they will provide the Boards with the information concerning
the Injunction and the application that is necessary for the Funds to
fulfill their disclosure and other obligations under the federal
securities laws.
    6. Applicants also state that, if they were barred from providing
Fund Service Activities to registered investment companies and ESCs,
the effect on their businesses and employees would be severe.
Applicants state that they have committed substantial resources to
establish an expertise in providing Fund Service Activities. Applicants
further state that prohibiting them from providing Fund Service
Activities would not only adversely affect their businesses, but would
also adversely affect approximately 460 employees that are involved in
those activities. Applicants also state that disqualifying certain
Applicants from continuing to provide investment advisory services to
ESCs is not in the public interest or in furtherance of the protection
of investors. Because the ESCs have been formed for the benefit of key
employees, officers, and directors of GE and its affiliates, it would
not be consistent with the purposes of the ESC provisions of the Act to
require another entity not affiliated with GE to manage the ESCs. In
addition, participating employees of GE and its affiliates likely
subscribed for interests in the ESCs with the expectation that the ESCs
would be managed by GEAM.
    7. Applicants state that Applicants and certain other affiliated
persons of the Applicants have previously received orders under section
9(c) of the Act, as the result of conduct that triggered section 9(a),
as described in greater detail in the application.

Applicants' Condition

    Applicants agree that any order granting the requested relief will
be subject to the following condition:
    Any temporary exemption granted pursuant to the application shall
be without prejudice to, and shall not limit the Commission's rights in
any manner with respect to, any Commission investigation of, or
administrative proceedings involving or against, Covered Persons,
including without limitation, the consideration by the Commission of a
permanent exemption from section 9(a) of the Act requested pursuant to
the application or the revocation or removal of any temporary
exemptions granted under the Act in connection with the application.

Temporary Order

    The Commission has considered the matter and finds that the
Applicants have made the necessary showing to justify granting a
temporary exemption.
    Accordingly,
    It is hereby ordered, pursuant to section 9(c) of the Act, that
Applicants and any other Covered Persons are granted a temporary
exemption from the provisions of section 9(a), solely with respect to
the Injunction, subject to the condition in the application, from
January 23, 2012, until the Commission takes final action on their
application for a permanent order.

    By the Commission.
Elizabeth M. Murphy,
 Secretary.
[FR Doc. 2012-1890 Filed 1-27-12; 8:45 am]
BILLING CODE 8011-01-P