[Federal Register Volume 78, Number 140 (Monday, July 22, 2013)]
[Rules and Regulations]
[Pages 43797-43810]
[FR Doc No: 2013-17569]

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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 82

[EPA-HQ-OAR-2010-0280; FRL-9809-7]
RIN 2060-AR41

Protection of Stratospheric Ozone: The 2013 Critical Use
Exemption From the Phaseout of Methyl Bromide

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final rule.

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SUMMARY: EPA is authorizing uses that qualify for the 2013 critical use
exemption (CUE) and specifying the amount of methyl bromide that may be
produced or imported for those uses. EPA is also amending the
regulatory framework to remove certain requirements related to sale of
pre-phaseout inventory for critical uses. EPA is taking this action
under the authority of the Clean Air Act to reflect a consensus
decision taken by the Parties to the Montreal Protocol on Substances
that Deplete the Ozone Layer at the Twenty-Third Meeting of the
Parties.

DATES: This rule is effective on July 22, 2013.

ADDRESSES: EPA has established a docket for this action under Docket ID
No. EPA-HQ-OAR-2010-0280. All documents in the docket are listed on the
www.regulations.gov Web site. Although listed in the index, some
information is not publicly available, e.g., CBI or other information
whose disclosure is restricted by statute. Certain other material, such
as copyrighted material, is not placed on the Internet and is publicly
available only in hard copy form. Publicly available docket materials
are available either electronically through www.regulations.gov or in
hard copy at the Air and Radiation Docket, EPA/DC, EPA West, Room 3334,
1301 Constitution Ave. NW., Washington, DC. The Public Reading Room is
open from 8:30 a.m. to 4:30 p.m., Monday through Friday, excluding
legal holidays. The telephone number for the Public Reading Room is
(202) 566-1744, and the telephone number for the Air and Radiation
Docket is<PHONE_NUMBER>.

FOR FURTHER INFORMATION CONTACT: For further information about this
rule, contact Jeremy Arling by telephone at<PHONE_NUMBER>, or by email
at<EMAIL_ADDRESS>or by mail at U.S. Environmental Protection
Agency, Stratospheric Protection Division, Stratospheric Program
Implementation Branch (6205J), 1200 Pennsylvania Avenue NW.,
Washington, DC 20460. You may also visit the methyl bromide section of
the Ozone Depletion Web site of EPA's Stratospheric Protection Division
at www.epa.gov/ozone/mbr for further information about the methyl
bromide critical use exemption, other Stratospheric Ozone Protection
regulations, the science of ozone layer depletion, and related topics.

SUPPLEMENTARY INFORMATION: This rule concerns Clean Air Act (CAA)
restrictions on the consumption, production, and use of methyl bromide
(a Class I, Group VI controlled substance) for critical uses during
calendar year 2013. Under the Clean Air Act, methyl bromide consumption
(consumption is defined under section 601 of the CAA as production plus
imports minus exports) and production were phased out on January 1,
2005, apart from allowable exemptions, such as the critical use and the
quarantine and preshipment (QPS) exemptions. With this action, EPA is
authorizing uses that qualify for the 2013 critical use exemption as
well as specific amounts of methyl bromide that may be produced and
imported for critical uses in 2013.
    Section 553(d) of the Administrative Procedure Act (APA), 5 U.S.C.
Chapter 5, generally provides that rules may not take effect earlier
than 30 days after they are published in the Federal Register. EPA is
issuing this final rule under section 307(d)(1) of the Clean Air Act,
which states: ``The provisions of section 553 through 557 . . . of
Title 5 shall not, except as expressly provided in this section, apply
to actions to which this subsection applies.'' Thus, section 553(d) of
the APA does not apply to this rule. EPA is nevertheless acting
consistently with the policies underlying APA section 553(d) in making
this rule effective on July 22, 2013. APA section 553(d) allows an
effective date less than 30 days after publication for a rule that
``that grants or recognizes an exemption or relieves a restriction.'' 5
U.S.C. 553(d)(1). Since today's action can be considered to either
grant an exemption for limited critical uses during 2013 from the
general prohibition on production or import of methyl bromide after the
phaseout date of January 1, 2005, or relieve a restriction that would
otherwise prevent production or import of methyl bromide or sale of
pre-phaseout inventory for critical uses, EPA is making this action
effective immediately upon publication.

Table of Contents

I. General Information
    A. Regulated Entities
II. What is the critical use exemption process?
    A. Background of the Process
    B. How does this rule relate to previous critical use exemption
rules?
    C. Critical Uses
    D. Critical Use Amounts
    E. Critical Stock Allowances
    1. Determining the Level of Available Stocks
    2. Amending the Critical Stock Allowances Framework
    F. The Criteria in Decisions IX/6 and Ex. I/4

    G. Emissions Minimization
III. Statutory and Executive Order Reviews
    A. Executive Order 12866: Regulatory Planning and Review and
Executive Order 13563: Improving Regulation and Regulatory Review
    B. Paperwork Reduction Act
    C. Regulatory Flexibility Act
    D. Unfunded Mandates Reform Act
    E. Executive Order 13132: Federalism
    F. Executive Order 13175: Consultation and Coordination With
Indian Tribal Governments
    G. Executive Order 13045: Protection of Children From
Environmental Health and Safety Risks
    H. Executive Order 13211: Actions that Significantly Affect
Energy Supply, Distribution, or Use
    I. National Technology Transfer and Advancement Act
    J. Executive Order 12898: Federal Actions to Address
Environmental Justice in Minority Populations and Low-Income
Populations
    K. Congressional Review Act

I. General Information

A. Regulated Entities

    Entities and categories of entities potentially regulated by this
action include producers, importers, and exporters of methyl bromide;
applicators and distributors of methyl bromide; and users of methyl
bromide that applied for the 2013 critical use exemption including
growers of vegetable crops, fruits, and nursery stock, and owners of
stored food commodities and structures such as grain mills and
processors. This list is not intended to be exhaustive, but rather to
provide a guide for readers regarding entities likely to be regulated
by this action. To determine whether your facility, company, business,
or organization could be regulated by this action, you should carefully
examine the regulations promulgated at 40 CFR part 82, subpart A. If
you have questions regarding the applicability of this action to a
particular entity, consult the person listed in the preceding section.

II. What is the critical use exemption process?

A. Background of the Process

    Article 2H of the Montreal Protocol established the critical use
exemption provision. At the Ninth Meeting of the Parties in 1997, the
Parties established the criteria for an exemption in Decision IX/6. In
that Decision, the Parties agreed that ``a use of methyl bromide should
qualify as `critical' only if the nominating Party determines that: (i)
The specific use is critical because the lack of availability of methyl
bromide for that use would result in a significant market disruption;
and (ii) there are no technically and economically feasible
alternatives or substitutes available to the user that are acceptable
from the standpoint of environment and public health and are suitable
to the crops and circumstances of the nomination.'' EPA promulgated
these criteria in the definition of ``critical use'' at 40 CFR 82.3.
EPA recognizes that as the market for alternatives evolves, the
thresholds for what constitutes ``significant market disruption'' or
``technical and economic feasibility'' may change. Such information has
the potential to alter the technical or economic feasibility of an
alternative and could thus cause EPA to modify the analysis that
underpins EPA's determination as to which uses and what amounts of
methyl bromide qualify for the CUE.
    In addition, the Parties decided that production and consumption,
if any, of methyl bromide for critical uses should be permitted only if
a variety of conditions have been met, including that all technically
and economically feasible steps have been taken to minimize the
critical use and any associated emission of methyl bromide, that
research programs are in place to develop and deploy alternatives and
substitutes, and that methyl bromide is not available in sufficient
quantity and quality from existing stocks of banked or recycled methyl
bromide.
    In response to EPA's request for critical use exemption
applications published in the Federal Register on July 15, 2010 (75 FR
41177), applicants provided data on the technical and economic
feasibility of using alternatives to methyl bromide. Applicants also
submitted data on their use of methyl bromide, ongoing research
programs into the use of alternatives to methyl bromide in their
sector, and efforts to minimize use and emissions of methyl bromide.
    EPA reviews the data submitted by applicants, as well as data from
governmental and academic sources, to establish whether there are
technically and economically feasible alternatives available for a
particular use of methyl bromide, and whether there would be a
significant market disruption if no exemption were available. In
addition, an interagency workgroup reviews other parameters of the
exemption applications such as dosage and emissions minimization
techniques and applicants' research or transition plans. This
assessment process culminates in the development of the U.S. critical
use nomination (CUN). Annually since 2003, the U.S. Department of State
has submitted a CUN to the United Nations Environment Programme (UNEP)
Ozone Secretariat. The Methyl Bromide Technical Options Committee
(MBTOC) and the Technology and Economic Assessment Panel (TEAP), which
are advisory bodies to Parties to the Montreal Protocol, review each
Party's CUN and make recommendations to the Parties on the nominations.
The Parties then make Decisions on the authorization of critical use
exemptions for particular Parties, including how much methyl bromide
may be supplied for the exempted critical uses. As required in section
604(d)(6) of the CAA, for each exemption period, EPA consults with the
United States Department of Agriculture (USDA) and other departments
and institutions of the Federal government that have regulatory
authority related to methyl bromide, and provides an opportunity for
public comment on the amounts and specific uses of methyl bromide that
the agency is proposing to exempt.
    On February 4, 2011, the U.S. Government (USG) submitted the ninth
Nomination for a Critical Use Exemption for Methyl Bromide for the
United States of America to the Ozone Secretariat of UNEP. This
nomination contained the request for 2013 critical uses. In February
2011, MBTOC sent questions to the USG concerning technical and economic
issues in the 2013 nomination. The USG transmitted responses to MBTOC
in February, 2011. These documents, together with reports by the
advisory bodies noted above, are in the public docket for this
rulemaking. The critical uses and amounts in this final rule reflect
the analysis contained in those documents.

B. How Does this rule relate to previous critical use exemption rules?

    The December 23, 2004, Framework Rule established the framework for
the critical use exemption program in the United States, including
definitions, prohibitions, trading provisions, and recordkeeping and
reporting obligations. The preamble to the Framework Rule included
EPA's determinations on key issues for the critical use exemption
program.
    Since publishing the Framework Rule, EPA has annually promulgated
regulations to exempt specific quantities of production and import of
methyl bromide, to determine the amounts that may be supplied from pre-
phaseout inventory, and to indicate which uses meet the criteria for
the exemption program for that year. See 71 FR 5985 (February 6, 2006),
71 FR 75386 (December 14, 2006), 72 FR 74118 (December 28, 2007), 74 FR
19878 (April 30, 2009), 75 FR 23167 (May 3, 2010), 76 FR 60737
(September 30, 2011), and 77 FR 29218 (May 17, 2012).

    Today's action changes the EPA's approach for determining the
amounts of Critical Use Allowances (CUAs) to be allocated for critical
uses in 2013. A CUA is the privilege granted through 40 CFR part 82 to
produce or import 1 kg of methyl bromide for an approved critical use
during the specified control period. A control period is a calendar
year. See 40 CFR 82.3. The control period at issue in this rule is
2013. These allowances expire at the end of the control period and, as
explained in the Framework Rule, are not bankable from one year to the
next. The CUA allocation is subject to the trading provisions at 40 CFR
82.12, which are discussed in section V.G. of the preamble to the
Framework Rule.
    Today's action also removes from the regulatory framework the
restriction that limits the sale of inventory to critical uses through
allocations of Critical Stock Allowances (CSA). A CSA was the right
granted through 40 CFR part 82 to sell 1 kg of methyl bromide from
inventory produced or imported prior to the January 1, 2005, phaseout
date for an approved critical use during the specified control period.
The Framework Rule established provisions governing the sale of pre-
phaseout inventories for critical uses, including a prohibition on the
sale of pre-phaseout inventories for critical uses in excess of the
amount of CSAs held by the seller. The removal of this prohibition is
discussed in more detail below.

C. Critical Uses

    Today's action amends the table in 40 CFR part 82, subpart A,
appendix L to reflect the agreed critical use categories identified in
Decision XXIII/4. In that Decision, taken in November 2011, the Parties
to the Protocol agreed ``to permit, for the agreed critical-use
categories for 2013 set forth in table A of the annex to the present
decision for each party, subject to the conditions set forth in the
present decision and in decision Ex.I/4 to the extent that those
conditions are applicable, the levels of production and consumption for
2013 set forth in table B of the annex to the present decision which
are necessary to satisfy critical uses . . .'' The following uses are
those set forth in table A of the annex to Decision XXIII/4 for the
United States:
 Commodities
 Mills and food processing structures
 Dried cured pork
 Cucurbits
 Eggplant--field
 Nursery stock--fruit, nuts, flowers
 Orchard replants
 Ornamentals
 Peppers--field
 Strawberry--field
 Strawberry runners
 Tomatoes--field
    EPA sought comment on the technical analysis contained in the U.S.
nomination (available for public review in the docket), and information
regarding any changes to the registration (including cancellations or
registrations), use, or efficacy of alternatives that have occurred
after the 2013 U.S. CUN was forwarded.
    EPA received two comments about the critical use nomination
process. One commenter stated that the process should be based in sound
science, and be transparent, fair and objective. The nomination process
should meet the critical need for methyl bromide from the industries
and individuals that apply. The second commenter stated there is no
meaningful opportunity for an applicant that is not included in the CUN
to object or challenge the CUN.
    EPA agrees with the comment that the nomination process should be
based in sound science and meet the critical needs of the applicants.
EPA also strives to make the process transparent, fair, and objective.
EPA conducts a rigorous technical assessment of the applications and
evaluates data and current research to establish an internationally
defensible basis for the nominations. In doing so the agency works with
the State Department, USDA, state pesticide agencies, researchers,
fumigators and applicants to assess whether there are technically or
economically feasible alternatives, and whether a significant market
disruption would result from the lack of a CUE.
    The U.S. CUN is submitted on behalf of the U.S. government by the
Department of State to the Parties to the Montreal Protocol. The
Department of State has an extensive stakeholder engagement process to
solicit input on the U.S. CUN. Private parties are encouraged to
participate in that process. In the most recent round, EPA has worked
to further improve the transparency of the nomination process by
collaborating more closely with the applicants than in previous years.
Shortly after receiving the applications, EPA informed the applicants
of any obvious data gaps and scheduled meetings to discuss the needed
information. In some instances, EPA followed up with additional calls
and meetings. As a result of this technical review, EPA may determine
that an applicant has not sufficiently shown that the regulatory and
Montreal Protocol criteria for a critical use are met. After submitting
the 2015 nomination, EPA held calls with all the applicants to discuss
the technical basis for the nomination and to show how future
applications can be strengthened. EPA has posted on its Web site, and
added to the docket, a schedule detailing upcoming deadlines and past
interactions with applicants.
    In addition, EPA received comment that the agency should clarify
what constitutes a significant market disruption since the commenter
considers the term to be vague and subject to various interpretations
by EPA. The term ``significant market disruption'' is left to the
discretion of each Party to the Protocol to interpret. The agency has
previously provided its interpretation of the term, and EPA refers
readers to the preamble for the 2006 CUE rule (71 FR 5989, February 6,
2006) as well as to the memo in the docket titled ``Development of 2003
Nomination for a Critical Use Exemption for Methyl Bromide for the
United States of America'' for further elaboration. As explained in
greater detail in those documents, EPA's interpretation of this term
has several dimensions, including looking at potential effects on both
demand and supply for a commodity, evaluating potential losses at both
an individual level and at an aggregate level, and evaluating potential
losses in both relative and absolute terms.
    EPA received comment that all of the uses contained in the
nomination be authorized as critical uses for 2013. EPA agrees and is
not removing any uses, commodities or otherwise, that were nominated
and approved by the Parties for use in 2013. EPA did not receive any
data that would support removing uses that were nominated and approved
by the Parties. EPA received one comment that there should be no uses
of methyl bromide given its effect on the stratospheric ozone layer,
and one comment that CUE authorization should not impede the adoption
of alternatives. EPA disagrees that all methyl bromide use should stop
and does not believe that the CUE authorization for 2013 will impede
the continued adoption of methyl bromide alternatives. The CUN
addresses the need for methyl bromide for the 2013 critical uses,
which, as described in the nomination chapters found in the docket, are
uses for which EPA has found there are not technically and economically
feasible alternatives. In addition, the 2013 critical uses were
reviewed by the technical bodies to the Ozone Secretariat and
authorized by the Parties to the Montreal Protocol.
    EPA also received a comment that the agency should reopen the
nominations for 2013 to account for the withdrawal of iodomethane from
the U.S. market, especially if the availability of

iodomethane was the reason the USG did not nominate certain sectors. At
this point it is not possible for the USG to reopen nominations for
2013. As described in the previous section, in order to provide time
for EPA to promulgate a rule authorizing critical use exemptions for a
particular control period, the USG submits a nomination the January two
years prior to the control period at issue. In addition, if the USG had
submitted a supplemental request for 2013 this January, the Parties
would not have been able to consider it until November of 2013, which
would not provide relief to growers.
    EPA is finalizing the lists of approved critical uses and approved
critical users as proposed. First, as discussed in the proposal, EPA is
removing from Appendix L two users that did not submit applications and
therefore were not included in the U.S. nomination. These users are
California rose nursery growers and Maryland tomato growers. Second,
EPA is removing the National Pest Management Association (NPMA) food
processing as an approved critical user. The NPMA did not initially
apply to be a critical user in 2013 and the Parties have not authorized
a critical use for NPMA for 2013.
    Members of the NPMA have worked to transition from methyl bromide
to alternative practices and alternative fumigants like sulfuryl
fluoride. In January 2004, EPA registered the first food uses of
sulfuryl fluoride for control of insect pests in grain processing
facilities and in harvested and processed food commodities such as
cereal grains, dried fruits, and tree nuts. In July 2005, EPA approved
sulfuryl fluoride for treatment of additional harvested and processed
food commodities such as coffee and cocoa beans, and for fumigation of
food handling and processing facilities.
    On January 19, 2011, EPA proposed to revoke the residue limits on
food, known as tolerances, for fluoride on the food commodities
approved for treatment with sulfuryl fluoride (76 FR 3422). In response
to this proposal, the NPMA submitted a supplemental request for 2013
methyl bromide use during the open period for 2014 applications. The
USG did not include NPMA's supplemental request in the 2014 nomination
submitted to UNEP on January 31, 2012, because EPA has only proposed to
revoke the tolerances for sulfuryl fluoride and has not taken action in
any final rule. U.S. critical use nominations are based on final
decisions about alternatives. Additionally, the proposed tolerance
revocation included a staggered implementation scheme, making it
unlikely that any specific revocation will be effective in 2013.
Therefore, EPA is not finalizing NPMA as an approved critical user in
2013.
    Third, EPA is removing sectors or users that applied for a critical
use in 2013 but that the United States did not nominate for 2013. EPA
conducted a thorough technical assessment of each application and
considered the effects that the loss of methyl bromide would have for
each agricultural sector, and whether significant market disruption
would occur as a result. As a result of this technical review, the USG
determined that certain sectors or users did not meet the critical use
criteria in Decision IX/6, and the USG therefore did not include them
in the 2013 Critical Use Nomination. EPA notified these sectors of
their status in July 2011, and those letters are in the public docket
for this rule. These sectors are: members of the Southeastern Cucurbit
Consortium and cucurbit growers in Maryland and Delaware; growers in
the forest nursery sector (Southern Forest Nursery Management
Cooperative, Northeastern Forest and Conservation Nursery Association,
and Michigan seedling growers); members of the Southeastern Pepper
Consortium; members of the Southeastern Strawberry Consortium and
Florida strawberry growers; California sweet potato slip growers;
members of the Southeastern Tomato Consortium and Virginia tomato
growers. For each of these uses, EPA found that there are technically
and economically feasible alternatives to methyl bromide.
    Finally, EPA is limiting the CUE for cucurbit, eggplant, pepper,
and tomato sectors in Georgia to small growers. The EPA review of the
available information for Georgia indicates that farmers growing fewer
than 10 acres of these crops need an additional year to successfully
transition to the alternatives. These small growers do not have as much
experience with the alternatives and need to convert their equipment to
the University of Georgia (UGA) ``3-Way'' mixture (a combination of
1,3-dichloropropene, chloropicrin, and metam). The EPA conducted an
economic assessment of small growers' ability to convert their
equipment (see revised nomination, dated July 14, in the docket). The
assessment demonstrates that despite the UGA 3-Way mixture being more
affordable than methyl bromide plus chloropicrin on a per acre basis,
retrofitting farm equipment to use the UGA 3-Way mixture at a cost of
$3,450 is not affordable for growers under four acres, amortized over
10 years at 7% interest (7% is a home equity loan rate for this region
at the time the nomination was submitted; interest on agricultural
loans could be lower). However, due to variations in impacts for
individual growers and uncertainties in the assumptions used in the
economic analysis, farms smaller than 10 acres are reasonably expected
to incur negative impacts from having to covert to the UGA 3-Way
mixture. This analysis can be found in the July 14, 2011, reply to
MBTOC available in the docket to this rule. Therefore, EPA is limiting
the Georgia cucurbit, eggplant, pepper, and tomato critical uses to
small growers, which EPA defines as growers growing fewer than 10
acres.
    EPA is repeating the following clarifications made in previous
years for ease of reference. The ``local township limits prohibiting
1,3-dichloropropene'' are prohibitions on the use of 1,3-
dichloropropene products in cases where local township limits on use of
this alternative have been reached. In addition, ``pet food'' under
subsection B of Food Processing refers to food for domesticated dogs
and cats. Finally, ``rapid fumigation'' for commodities is when a buyer
provides short (two working days or fewer) notification for a purchase
or there is a short period after harvest in which to fumigate and there
is limited silo availability for using alternatives.
    EPA received a request from two commenters that the agency confirm
that being removed from the table of approved critical uses for 2013
does not preclude the use from being added back in the future. The
Agency reviews every application received each year against the CUE
criteria. The removal of a user from the list of approved critical uses
indicates that a determination was made that technically or
economically feasible alternatives exist. However, the EPA recognizes
that circumstances may change, or additional information emerge, that
could merit including that use in a future nomination. Furthermore, EPA
recognizes that in 2003 the Parties to the Montreal Protocol recognized
in Decision ExI.3 that each Party should aim at significantly and
progressively decreasing its production and consumption of methyl
bromide for critical uses with the intention of completely phasing out
methyl bromide as soon as technically and economically feasible
alternatives are available.

D. Critical Use Amounts

    Table A of the annex to Decision XXIII/4 lists critical uses agreed
to by the Parties to the Montreal Protocol. The maximum amount of new
production and consumption for U.S. critical uses,

specified in Table B of Decision XXIII/4, is 562,326 kg, minus
available stocks. This figure is equivalent to 2.2% of the U.S. 1991
methyl bromide consumption baseline of 25,528,270 kg.
    EPA received three comments supporting the proposal to allocate at
least the full amount authorized by the Parties. Two of those
commenters stated that EPA should allocate more than the amount
requested in the CUN. One commenter stated that this is appropriate
since the nomination was based on the continued availability of
iodomethane. The other commenter stated that the CUN was inadequate and
failed to reflect the need for methyl bromide as identified in the
applications that were filed. Therefore, the proposed amount is
insufficient to meet the critical needs of U.S. growers. One commenter
questioned whether it would ever be appropriate for EPA to allocate
less than the full amount authorized by the Parties.
    EPA is not allocating at or above the amount in the CUN. The CUN
itself exceeds the amount authorized by the Parties. As EPA stated in
the proposed rule, EPA views the determination of the total allocation,
up to the amount authorized by the Parties, as an appropriate exercise
of discretion. The agency will not increase the quantities in the final
rule beyond those authorized by the Parties, but may exercise its
discretion to allocate less. Article 2H(5) of the Montreal Protocol
provides that the 2005 methyl bromide phaseout shall not apply ``to the
extent the Parties decide to permit the level of production or
consumption that is necessary to satisfy uses agreed by them to be
critical uses.'' Decision XXIII/4 contains the Parties' critical use
authorization for 2013. In this rule, EPA is honoring commitments made
by the United States in the Montreal Protocol context, including
Decision XXIII/4. For 2013, EPA is allocating the full amount
authorized by the Parties.
    In the past, EPA has also made reductions to the CUA amount to
account for the amount specifically authorized for research, on the
assumption that research amounts would come from inventory. One
commenter stated that EPA failed to account for research use of methyl
bromide in the proposed rule and should return to the previously
established policy and allocate a separate research purpose allocation.
EPA responds that the 2013 CUN did not include, and the Parties did not
authorize, a separate amount for research, as had been done in prior
years. As discussed in more detail in the 2011 CUE final rule (76 FR
60736, 60743, September 30, 2011), EPA views research as part of the
nomination for each individual critical use. Therefore, EPA is not
making any adjustments for research, carryover, or the uptake of
alternatives.
    Carryover Material The Parties in paragraph 6 of Decision XXIII/4
``urge parties operating under critical-use exemptions to put in place
effective systems to discourage the accumulation of methyl bromide
produced under the exemption.'' EPA regulations prohibit methyl bromide
produced or imported after January 1, 2005, under the critical use
exemption from being added to the existing pre-2005 inventory.
Quantities of methyl bromide produced, imported, exported, or sold to
end-users under the critical use exemption in a control period must be
reported to EPA the following year. EPA uses these reports to calculate
the amount of methyl bromide produced or imported under the critical
use exemption, but not exported or sold to end-users in that year. EPA
deducts an amount equivalent to this ``carryover'' from the total level
of allowable new production and import in the year following the year
of the data report. Carryover material (which is produced using
critical use allowances) is not included in EPA's definition of
existing inventory (which applies to pre-2005 material) because this
would lead to a double-counting of carryover amounts, and a double
reduction of critical use allowances (CUAs).
    All critical use methyl bromide that companies reported to be
produced or imported in 2011 was sold to end users. The information
reported to EPA is that 1,499 MT of critical use methyl bromide was
produced or imported in 2011. Slightly more than the amount produced or
imported was actually sold to end-users. This additional amount was due
to distributors selling material that was carried over from the prior
control period. Therefore, EPA is applying the carryover deduction of 0
kg to the new production amount. EPA's calculation of the amount of
carryover at the end of 2011 is consistent with the method used in
previous CUE rules, and with the method agreed to by the Parties in
Decision XVI/6 for calculating column L of the U.S. Accounting
Framework. Past U.S. Accounting Frameworks, including the one for 2011,
are available in the public docket for this rulemaking.
    Uptake of Alternatives Under the existing framework, EPA considers
data on the availability of alternatives that it receives following
submission of each nomination to UNEP. In previous rules EPA has
reduced the total CUE amount when a new alternative has been
registered. When an alternative is withdrawn, EPA will not increase the
total CUE amount above the amount authorized by the Parties. However,
the section on critical stock allowances below discusses how EPA is
responding to the withdrawal of iodomethane.
    Since the USG submitted the 2013 CUN, Dimethyl Disulfide (DMDS) has
been registered in additional states. In July 2010, EPA registered DMDS
to control nematodes, weeds, and pathogens in tomatoes, peppers,
eggplants, curcurbits, strawberries, ornamentals and forest nursery
seedlings, and onions. The CUN considered only a limited uptake of DMDS
in 2013 as only a few states had registered DMDS and it was not
registered in either California or Florida. EPA received comment that
DMDS is now registered in twenty-seven states, including Georgia and
Florida. The commenter requests that EPA reduce the new production/
import allocation to reflect the increased registrations and to reflect
the success that growers have had in transitioning to alternatives
generally. EPA also received one comment supporting the proposal not to
make reductions for DMDS in the Southeast. The commenter also stated
that even if California were to register DMDS, growers would transition
cautiously to ensure it works for their circumstances.
    EPA is not making a reduction to the new production/import
allocation based on these additional state registrations. As discussed
below, 91% of the amount authorized for 2013 is for critical uses in
California, which has not yet registered DMDS. Growers in Florida
account for less than 3% of the authorized amount. EPA anticipates that
the uptake of DMDS in Florida will therefore not significantly affect
total demand for critical use methyl bromide.
    EPA does not believe that the progress California and Florida
strawberry growers have made in transitioning to alternatives means, as
one commenter suggests, that the EPA should reduce the allocation
amounts in the 2013 rule. EPA recognizes that strawberry growers are
successfully transitioning to alternatives, and the CUE allocation for
strawberries has been declining as that transition has occurred. EPA
has considered the transition made to date, and the ability of
strawberry growers to further transition, when developing the
nomination. Transition rates for alternatives have already been applied
for authorized 2013 critical use amounts through the nomination and
authorization process.
    One commenter stated that the proposed rule did not take into
account

the proposed tolerance revocation of sulfuryl fluoride. As EPA has
stated in prior rules, this allocation rule is based on the current
status of alternatives and is limited to 2013. The proposed tolerance
revocation includes a staggered implementation scheme so that it is
unlikely that any specific revocation will be effective as soon as 2013
(76 FR 3447). Therefore, EPA has not based the allocation amounts for
2013 on any anticipated impacts of that proposal on methyl bromide use.
    In summary, EPA is exempting 562,326 kg of new production and
import of methyl bromide for critical uses in 2013. EPA is allocating
allowances to the four companies that hold baseline allowances. The
allocation, as in previous years, is in proportion to those baseline
amounts, as shown in the table at 40 CFR 82.8(c)(1).
    Paragraph 3 of Decision XXIII/4 states ``that parties shall
endeavor to license, permit, authorize or allocate quantities of methyl
bromide for critical uses as listed in table A of the annex to the
present decision.'' This is similar to language in prior Decisions
authorizing critical uses. These Decisions call on Parties to endeavor
to allocate critical use methyl bromide on a sector basis. The
Framework Rule proposed several options for allocating critical use
allowances, including a sector-by-sector approach. The agency evaluated
various options based on their economic, environmental, and practical
effects. After receiving comments, EPA determined that a lump-sum, or
universal, allocation, modified to include distinct caps for pre-plant
and post-harvest uses, was the most efficient and least burdensome
approach that would achieve the desired environmental results, and that
a sector-by-sector approach would pose significant administrative and
practical difficulties. EPA received one comment supporting the
continued use of the universal allocation approach. For the reasons
discussed in the preamble to the 2009 CUE rule (74 FR 19894), the
agency believes that the approach adopted in the Framework Rule is the
most appropriate approach and that it is likely the actual critical use
will closely follow the sector breakout listed in the Parties'
decisions.

E. Critical Stock Allowances

    Decision XXIII/4 indicates that the United States' permitted level
of production and consumption for 2013 is 562,326 kg minus ``available
stocks.'' As part of this rulemaking, EPA considered what amount, if
any, of existing stocks may be available to critical users during 2013.
1. Determining the Level of Available Stocks
    Individual Parties have the ability to determine their level of
available stocks. The Parties to the Protocol recognized in their
Decisions that the amount of available stocks may differ from the total
amount of existing stocks. Decision XXIII/4 states that ``production
and consumption of methyl bromide for critical uses should be permitted
only if methyl bromide is not available in sufficient quantity and
quality from existing stocks[hellip]'' In addition, earlier Decisions
refer to the use of ``quantities of methyl bromide from stocks that the
Party has recognized to be available.'' Decision XXIII/4 reinforces
this concept by including the phrase ``minus available stocks'' as a
footnote to the United States' authorized level of production and
consumption in Table B.
    Section 604(d)(6) of the CAA does not require EPA to adjust the
amount of new production and import to reflect the availability of
stocks; however, as explained in previous rulemakings, making such an
adjustment is a reasonable exercise of EPA's discretion under this
provision. Pre-phaseout inventory, or ``stocks,'' refers to methyl
bromide that was produced using consumption allowances prior to the
2005 phaseout date under the Clean Air Act and the Montreal Protocol.
It does not include methyl bromide that was produced after January 1,
2005, under the critical use exemption and carried over into subsequent
years. Nor does it include methyl bromide produced 1) under the
quarantine and preshipment (QPS) exemption, 2) with Article 5
allowances to meet the basic domestic needs of Article 5 countries, or
3) for feedstock or transformation purposes.
    The aggregate amount of pre-phaseout methyl bromide reported as
being in inventory at the end of 2012 is 627,066 kg. As explained in
the 2008 CUE Rule, EPA intends to continue releasing aggregate methyl
bromide inventory data reported to the agency under the reporting
requirements at 40 CFR 82.13 at the end of each control period. If the
number of competitors in the industry were to decline appreciably, EPA
may revisit the question of whether the aggregate is entitled to
treatment as confidential information and whether to release the
aggregate without notice. EPA did not propose to change the treatment
of submitted information but welcomes information concerning the
composition of the industry. The aggregate information for 2003 through
2013 is available in the docket.
    Consistent with EPA's past practice, and our commitments to the
Parties, EPA considered the level of ``available stocks'' that may be
allocated in this rulemaking. EPA requested comments on two approaches
for determining how many CSAs to allocate. Under the first approach,
the agency would calculate ``available stocks'' as either 5% or 0% of
the existing inventory, as was reported to EPA on January 1, 2012. The
second approach would be to continue using the existing framework of
estimating drawdown and a supply chain factor. EPA is finalizing the
first approach but finds that no stocks are available to meet the
critical demand for 2013. Therefore, EPA is not issuing CSAs in this
final rule.
    In this final rule, EPA is rejecting the older approach of using
the existing framework to estimate drawdown. In the 2012 Final Rule,
EPA recognized that our ``estimates [of available stocks] have become
increasingly inexact in characterizing actual drawdown of pre-phaseout
inventory, as the amounts in inventory have declined over time. EPA
intends to consider the adequacy of using this formula to assess
`available stocks' in a future action.''
    Initially, the drawdown estimate was a simple linear model based on
past years' rates. EPA modified the approach in the 2009 CUE Rule when
it became apparent that the inventory was decreasing exponentially
rather than linearly. EPA noted that the slowing rate of drawdown was
based mostly on the business decisions of the companies that hold pre-
phaseout inventory, and included aspects that are difficult for EPA to
know or quantify, such as honoring long-term relationships with non-CUE
customers or holding inventory in response to price fluctuations. To
refine the analysis in subsequent rules EPA separately analyzed the use
of inventory on critical uses, for which there are a set number of
allowances, and non-critical uses, for which there are not.
    Despite increased specificity, precise estimates still proved
elusive. In successive years, EPA substantially overestimated inventory
drawdown. In the 2012 Rule, EPA estimated a drawdown of 1,110,633 kg,
when the actual drawdown was half that amount, or 556,794 kg. The
results of the methodology using the updated data were sufficiently
different that EPA considered providing additional notice and the
opportunity to comment to incorporate them into the final allocation
rule. EPA is concerned that as the total amount of both the U.S.
authorization and the pre-phaseout stocks become smaller, efforts to
perfect

EPA estimates in this area will delay needed rulemaking. The fact that
the agency's projections consistently over-estimate the amount of
inventory that will be drawn down is evidence that the approach
substantially over-estimates the availability of pre-phaseout stocks.
    EPA believes constraints on the ability of critical users to
acquire and use stocks may become worse due to a recent change in the
geographic distribution of critical users. In the past, EPA has
considered all pre-phaseout inventory to be available to all users,
regardless of location. This assumption, as discussed in the 2009 CUE
rule (74 FR 19887, April 30, 2009), was based on the fact that
inventory is held in California and the Southeast, the two primary
critical use growing regions, as well as other locations around the
country. While the geographic distribution of inventory generally
remains the same, the authorized critical uses have shifted to
California over the last two years. In the 2011 control period, 49% of
the total authorization was for pre-plant uses in California and 38%
was for pre-plant uses in the Southeast. In 2013, this ratio is 91% and
4% respectively.\1\ EPA believes that inventory held in the Southeast
may not be equally available to critical users in California. Unlike
newly produced or imported material, which enters nationwide
distribution networks, inventory is mostly held by regional
distributors. EPA received comment that the first priority of these
distributors is to maintain the supply and service obligations they
have to their customers within the geographic areas where they operate.
---------------------------------------------------------------------------

    \1\ EPA treats company-specific methyl bromide inventory
information as confidential and believes that disaggregating the
inventory data by geographic area could potentially reveal CBI. EPA
solicited comment on this issue but did not propose to release data
showing how much inventory is located in or near California.
However, even in the absence of specific inventory data broken down
by region, EPA believes that the fact that over 90% of critical use
is in California is relevant to judging the availability of existing
stocks.
---------------------------------------------------------------------------

    EPA proposed to allocate CSAs equal to 5% of the January 1, 2012,
reported inventory, which is equal to 62,444 kg. EPA based this
percentage on historic patterns of use. Since 2006, the amount of prior
year inventory used through the expenditure of CSAs has ranged from 8%
to 26%. EPA proposed an amount less than the historic pattern in an
effort to ensure that the amount allocated for 2013 would be available
to critical users in that year.
    EPA also solicited comment on allocating 0 kg from stocks. EPA was
particularly interested in comments from critical stock allowance
holders who would be barred under the existing framework from selling
inventory to critical users in 2013 absent an allocation of CSAs. EPA
stated it was interested in learning whether an allocation at or close
to 0 kg would prevent the drawdown of stocks or prevent the fulfillment
of contracts or commitments to sell pre-phaseout inventory in 2013. EPA
also sought comment on whether the restriction at 40 CFR 82.4(p) that
limits the sale of inventory to critical uses through the CSA
allocation should be lifted.
    One commenter agreed that the prior calculation was unacceptably
time consuming, unwieldy and prone to inaccuracies. This commenter
stated that, especially with the withdrawal of iodomethane, EPA should
authorize the full amount of critical use methyl bromide authorized by
the Parties, and that even that amount may be insufficient to meet the
needs of growers. However, this commenter also stated that a limited
amount of CSAs is still appropriate to provide registrants and
distributors flexibility to meet the needs of all growers. Therefore,
this commenter supported the proposal to allocate 5% of the prior
year's starting inventory.
    One commenter stated that the full amount for critical uses should
come from new production. This commenter points out that the private
parties holding stocks are the only ones who can decide to make them
available, and states that it would be unreasonable to reduce the
amount of new production due to those stocks. Another commenter stated
that it was important for existing stocks to be available for drawdown,
since otherwise stocks will never be used.\2\
---------------------------------------------------------------------------

    \2\ The commenter also stated that the stocks of methyl bromide
should be available to non-critical uses. This commenter disagrees
with EPA's Reregistration Eligibility Decision that resulted in the
removal of various non-exempt uses from the methyl bromide product
labels. This comment is beyond the scope of this rulemaking.
---------------------------------------------------------------------------

    EPA has considered all of these comments, and recent developments
related to the critical use of methyl bromide, and has determined that
it will allocate the full amount of the critical use authorization to
new production, but also lift the prohibition on selling stocks of
methyl bromide for critical uses without a CSA.
    EPA intends for the entire allocation of critical use allowances
and critical stock allowances to be expended to meet each year's
critical demand. However, the total allocation of critical stock
allowances has never been used. In fact, typically one third to one
half of the critical stock allowances allocated each year remains
unexpended. EPA believes there is demand for methyl bromide given the
fact that there was no carryover in 2010 and 2011. This means that all
the methyl bromide that was produced or imported for critical uses for
those years was used. However, 40% of the 2010 and 30% of the 2011
critical stock allowance allocations were not used.
    Consistent with these data, comments to this and past allocation
rules state that the existing inventory is not actually available to
users because of reductions in the number of distributors and market
decisions by distributors to sell inventory to current customers or
hold inventory for future use. The recent concentration of critical
uses in California may also mean that stocks in the Southeast are even
more unavailable as a practical matter for critical users. The data
show that inventory is continually less ``available'' than EPA
estimated. At the same time, meeting the demand for critical use methyl
bromide is especially important for 2013 due to the withdrawal of
iodomethane. In light of these circumstances, including the facts that
the agency is unable to require the sale of inventory to meet the
critical demand and there is evidence that inventory will not be sold
to meet that demand, EPA is determining that there are not stocks
available to be allocated for 2013. Therefore, EPA is allocating 0 CSAs
for 2013.
2. Amending the Critical Stock Allowance Framework
    For the reasons discussed above, EPA believes, as a practical
matter, existing stocks of methyl bromide are not available for
critical users in 2013. However, at the same time, EPA agrees that it
would not be appropriate to completely prohibit use of existing stocks,
since EPA does not believe that stocks should be held indefinitely. EPA
solicited comment on whether the prohibition on selling stocks of MeBr
for a critical use without a CSA should be lifted. After consideration
of comments, EPA is lifting the prohibition.
    One provision in the framework rule, 40 CFR 82.4(p), limits the
amount of pre-phaseout methyl bromide that can be sold for critical
uses to the amount of critical stock allowances held by that
distributor. EPA developed the concept of critical stock allowances in
the Framework Rule to meet the requirement of Decision Ex I/3(3). That
Decision states that ``a Party using stocks under paragraph 2 above
shall prohibit the use of stocks [for critical uses][hellip] when
amounts from stocks combined with allowable production

and consumption for critical uses exceed the total level for that Party
set forth in annex II A to the present report.''
    As discussed in the Framework Rule, EPA read Decision Ex I/3(3) as
calling for limits on the use of stocks for approved critical uses in
order to receive the benefit of new production and import in that
Decision for 2005. However, Decision Ex I/3(3) was only applicable to
the 2005 control period. Subsequent Decisions by the Parties
authorizing critical uses and new production and import amounts for
later control periods did not contain similar language. For the reasons
discussed herein, EPA no longer believes that the restrictions
established by EPA to meet the requirements of Decision Ex I/3(3)
remain appropriate. EPA believes this approach is consistent with
Decision XXIII/4 which authorizes an amount of new production and
import of methyl bromide for 2013 but does not call for limits on the
total use of methyl bromide for critical uses.
    Several changes relevant to the drawdown of the pre-phaseout
inventory have occurred since 2004. When the critical use exemption was
being established by the Parties, the United States made assurances
that it would responsibly manage the inventory. At that time, the
inventory was 16,422 MT which is 26 times greater than the level of
inventory today. The United States and other Parties were concerned
that this large amount of inventory could overwhelm the critical use
exemption. EPA therefore limited the use of inventory on critical uses
through the issuance of critical stock allowances.
    Since that time, EPA has taken further steps to restrict the use of
stocks through FIFRA labeling changes. Under the reregistration
decision for methyl bromide, EPA removed all but seven non-critical
``Group II uses'' from the pre-plant methyl bromide labels. Four of
those seven uses were cancelled as of December 31, 2012, two will be
removed at the end of 2013, and the last will be removed at the end of
2014. As these Group II uses are removed from product labels, and as
the number of critical uses decreases, the demand for pre-phaseout
inventory will continue to decline. The decreasing number of uses and
geographical limitations on critical use discussed above may also lead
to a slowing in the rate of inventory drawdown.
    Together these two actions have the potential to significantly
limit the use of inventory. However it is clear that the concerns
expressed through Decision Ex I/3(3), to restrict the use of stocks,
has also changed. Decision XXII/6, which authorized critical uses for
2012, stressed that ``parties should reduce their stocks of methyl
bromide retained for employment in critical-use exemptions to a minimum
in as short a time period as possible.'' EPA believes that ending the
restriction on the use of stocks for critical uses is appropriate to
avoid a situation, either now or in the future, where the inventory
becomes practically inaccessible. If this occurs, there will be few
uses of inventory and stocks could remain indefinitely.
    To implement this change EPA is removing the restrictions at Sec.
82.4(p)(ii) and (iii). In addition, EPA is removing the reference to
CSAs from the definition of ``critical use methyl bromide.'' EPA
believes additional conforming changes may be appropriate but will
address those changes in a future rulemaking.
    EPA also requested comment on potential mechanisms within the Clean
Air Act or other statutory authorities to respond to the withdrawal of
iodomethane, and other unforeseen or emergency situations. EPA received
three comments requesting that the agency undertake a rulemaking to
implement Decision IX/7 regarding emergency uses of methyl bromide. One
commenter noted that EPA announced in 2000 that it would draft a rule
for emergency uses, which would be separate from its authority to grant
emergency or crisis exemptions under FIFRA section 18. The commenter
noted that clarification of the process for emergency uses, whether
through section 18 or through additional rulemaking, is warranted since
previous section 18 exemptions had been granted for methyl bromide
prior to the 2005 phase-out.
    As EPA noted in the notice of proposed rulemaking and elsewhere,
this rule implements the Clean Air Act's requirement to phase out
consumption and production of methyl bromide, subject to the critical
use exemption. Nothing in this rule is intended to derogate from FIFRA
or provisions in any other Federal, State, or local laws or regulations
governing actions including, but not limited to, the sale,
distribution, transfer, and use of methyl bromide.
    The commenter went on to note that Australia and Canada have also
utilized the Decision IX/7 emergency exemption provision of the
Montreal Protocol. Another commenter notes that unforeseen shortages of
methyl bromide alternatives could have the same effect as other
emergency conditions that may warrant use exemptions.
    This spring EPA held discussions with USDA and the Department of
State on whether emergency situations may arise that warrant the use of
methyl bromide and other tools that could potentially address immediate
and unforeseen needs for methyl bromide.

F. The Criteria in Decisions IX/6 and Ex. I/4

    Paragraphs 1 and 4 of Decision XXIII/4 request Parties to ensure
that the conditions or criteria listed in Decisions Ex. I/4 and IX/6,
paragraph 1, are applied to exempted critical uses for the 2013 control
period. A discussion of the agency's application of the criteria in
paragraph 1 of Decision IX/6 appears in Section II of this preamble.
EPA solicited comments on the technical and economic basis for
determining that the uses listed in this rule meet the criteria of the
critical use exemption. The CUNs detail how each proposed critical use
meets the criteria listed in paragraph 1 of Decision IX/6, apart from
the criterion located at (b)(ii), as well as the criteria in paragraphs
5 and 6 of Decision Ex. I/4.
    The criterion in Decision IX/6(1)(b)(ii), which refers to the use
of available stocks of methyl bromide, is addressed in section II.E. of
this preamble. The agency has previously provided its interpretation of
the criterion in Decision IX/6(1)(a)(i) regarding the presence of
significant market disruption in the absence of an exemption.
    The remaining considerations are addressed in the nomination
documents including: the lack of available technically and economically
feasible alternatives under the circumstance of the nomination; efforts
to minimize use and emissions of methyl bromide where technically and
economically feasible; the development of research and transition
plans; and the requests in Decision Ex. I/4(5) and (6) that Parties
consider and implement MBTOC recommendations, where feasible, on
reductions in the critical use of methyl bromide and include
information on the methodology they use to determine economic
feasibility.
    Some of these criteria are evaluated in other documents as well.
For example, the United States has considered the adoption of
alternatives and research into methyl bromide alternatives, criterion
(1)(b)(iii) in Decision IX/6, in the development of the National
Management Strategy submitted to the Ozone Secretariat in December
2005, updated in October 2009. The National Management Strategy
addresses all of the aims specified in Decision Ex.I/4(3) to the extent
feasible and is available in the docket for this rulemaking.

    There continues to be a need for methyl bromide in order to conduct
the research required by Decision IX/6. A common example is an outdoor
field experiment that requires methyl bromide as a standard control
treatment with which to compare the trial alternatives' results. As
discussed in the preamble to the 2010 CUE rule (75 FR 23179, May 3,
2010), research is a key element of the critical use process. Research
on the crops shown in the table in Appendix L to subpart A remains a
critical use of methyl bromide. While researchers may continue to use
newly produced material for field, post-harvest, and emission
minimization studies requiring the use of methyl bromide, EPA
encourages researchers to use pre-phaseout inventory. EPA also
encourages distributors to make inventory available to researchers, to
promote the continuing effort to assist growers to transition critical
use crops to alternatives.

G. Emissions Minimization

    Previous decisions have stated that critical users shall employ
emission minimization techniques such as virtually impermeable films,
barrier film technologies, deep shank injection and/or other techniques
that promote environmental protection, whenever technically and
economically feasible. EPA developed a comprehensive strategy for risk
mitigation through the 2006 Reregistration Eligibility Decision (RED)
for methyl bromide, which is implemented through restrictions on how
methyl bromide products can be used. This approach requires that methyl
bromide labels include directions that treated sites be tarped except
for California orchard replant where EPA instead requires deep (18
inches or greater) shank applications. The RED also incorporated
incentives for applicators to use high-barrier tarps, such as virtually
impermeable film (VIF), by allowing smaller buffer zones around those
sites. In addition to minimizing emissions, use of high-barrier tarps
has the benefit of providing pest control at lower application rates.
The amount of methyl bromide nominated by the United States reflects
the lower application rates necessary when using high-barrier tarps,
where such tarps are allowed.
    EPA will continue to work with the U.S. Department of Agriculture--
Agricultural Research Service (USDA-ARS) and the National Institute for
Food and Agriculture (USDA-NIFA) to promote emission reduction
techniques. The federal government has invested substantial resources
into best practices for methyl bromide use, including emission
reduction practices. The Cooperative Extension System, which receives
some support from USDA-NIFA provides locally appropriate and project-
focused outreach education regarding methyl bromide transition best
practices. Additional information on USDA research on alternatives and
emissions reduction can be found at: http://www.ars.usda.gov/research/programs/programs.htm?NP_CODE=308 and http://www.csrees.usda.gov/fo/methylbromideicgp.cfm.
    Users of methyl bromide should continue to make every effort to
minimize overall emissions of methyl bromide to the extent consistent
with State and local laws and regulations. EPA also encourages
researchers and users who are using such techniques to inform EPA of
their experiences and to provide such information with their critical
use applications.

III. Statutory and Executive Order Reviews

A. Executive Order 12866: Regulatory Planning and Review and Executive
Order 13563: Improving Regulation and Regulatory Review

    Under Executive Order (EO) 12866 (58 FR 51735, October 4, 1993),
this final rule is a ``significant regulatory action'' because it was
deemed to raise novel legal or policy issues. Accordingly, EPA
submitted this action to the Office of Management and Budget (OMB) for
review under Executive Orders 12866 and 13563 (76 FR 3821, January 21,
2011) and any changes made in response to interagency recommendations
have been documented in the docket for this action.

B. Paperwork Reduction Act

    This action does not impose any new information collection burden.
The application, recordkeeping, and reporting requirements have already
been established under previous critical use exemption rulemakings and
this action does not add any new requirements. The Office of Management
and Budget (OMB) has previously approved the information collection
requirements contained in the existing regulations at 40 CFR part 82
under the provisions of the Paperwork Reduction Act, 44 U.S.C. 3501 et
seq. and has assigned OMB control number 2060-0482. The OMB control
numbers for EPA's regulations in 40 CFR are listed in 40 CFR part 9.

C. Regulatory Flexibility Act

    The RFA generally requires an agency to prepare a regulatory
flexibility analysis of any rule subject to notice-and-comment
rulemaking requirements under the Administrative Procedure Act or any
other statute unless the agency certifies that the rule will not have a
significant economic impact on a substantial number of small entities.
Small entities include small businesses, small organizations, and small
governmental jurisdictions. For purposes of assessing the impacts of
this rule on small entities, small entity is defined as: (1) A small
business as defined by the Small Business Administration's regulations
at 13 CFR 121.201 (see Table below); (2) a small governmental
jurisdiction that is a government of a city, county, town, school
district or special district with a population of less than 50,000; and
(3) a small organization that is any not-for-profit enterprise which is
independently owned and operated and is not dominant in its field.

----------------------------------------------------------------------------------------------------------------
                                                                                NAICS Small business size
                                                                                standard  (in number of
              Category                     NAICS Code               SIC Code           employees or millions of
                                                                                dollars)
----------------------------------------------------------------------------------------------------------------
Agricultural production............  1112--Vegetable and     0171--Berry Crops.....  $0.75 million.
                                      Melon farming.         0172--Grapes..........
                                     1113--Fruit and Nut     0173--Tree Nuts.......
                                      Tree Farming.          0175--Deciduous Tree
                                     1114--Greenhouse,        Fruits (except apple
                                      Nursery, and            orchards and farms)..
                                      Floriculture           0179--Fruit and Tree
                                      Production.             Nuts, NEC..

                                                             0181--Ornamental
                                                              Floriculture and
                                                              Nursery Products.
                                                             0831--Forest Nurseries
                                                              and Gathering of
                                                              Forest Products..
Storage Uses.......................  115114--Postharvest     2041--Flour and Other   $7 million.
                                      Crop activities         Grain Mill Products.   500 employees.
                                      (except Cotton         2044--Rice Milling....  500 employees.
                                      Ginning).              4225--General           $25.5 million.
                                     311211--Flour Milling.   Warehousing and        $25.5 million.
                                     311212--Rice Milling..   Storage.
                                     493110--General         4221--Farm Product
                                      Warehousing and         Warehousing and
                                      Storage.                Storage.
                                     493130--Farm Product
                                      Warehousing and
                                      Storage.
Distributors and Applicators.......  115112--Soil            0721--Crop Planting,    $7 million.
                                      Preparation, Planting   Cultivation, and
                                      and Cultivating.        Protection.
Producers and Importers............  325320--Pesticide and   2879--Pesticides and    500 employees.
                                      Other Agricultural      Agricultural
                                      Chemical                Chemicals, NEC.
                                      Manufacturing.
----------------------------------------------------------------------------------------------------------------

    Agricultural producers of minor crops and entities that store
agricultural commodities are categories of affected entities that
contain small entities. This rule only affects entities that applied to
EPA for an exemption to the phaseout of methyl bromide. In most cases,
EPA received aggregated requests for exemptions from industry
consortia. On the exemption application, EPA asked consortia to
describe the number and size distribution of entities their application
covered. EPA estimated that 3,218 entities petitioned EPA for an
exemption for the 2005 control period. EPA revised this estimate in
2011 down to 1,800 end users of critical use methyl bromide. EPA
believes that the number continues to decline as growers cease applying
for critical uses. Since many applicants did not provide information on
the distribution of sizes of entities covered in their applications,
EPA estimated that, based on the above definition, between one-fourth
and one-third of the entities may be small businesses. In addition,
other categories of affected entities do not contain small businesses
based on the above description.
    After considering the economic impacts of this rule on small
entities, I certify that this action will not have a significant
economic impact on a substantial number of small entities. In
determining whether a rule has a significant economic impact on a
substantial number of small entities, the impact of concern is any
significant adverse economic impact on small entities, since the
primary purpose of the regulatory flexibility analyses is to identify
and address regulatory alternatives ``which minimize any significant
economic impact of the proposed rule on small entities.'' (5 U.S.C.
603-604). Thus, an agency may certify that a rule will not have a
significant economic impact on a substantial number of small entities
if the rule relieves a regulatory burden, or otherwise has a positive
economic effect on all of the small entities subject to the rule. Since
this rule exempts methyl bromide for approved critical uses after the
phaseout date of January 1, 2005, this action confers a benefit to
users of methyl bromide. EPA estimates in the Regulatory Impact
Assessment found in the docket to this rule that the reduced costs
resulting from the de-regulatory creation of the exemption are
approximately $22 million to $31 million on an annual basis (using a 3%
or 7% discount rate respectively). We have therefore concluded that
this rule would relieve regulatory burden for all small entities.

D. Unfunded Mandates Reform Act

    This action contains no Federal mandates under the provisions of
Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), 2 U.S.C.
1531-1538 for State, local, or tribal governments or the private
sector. The action imposes no enforceable duty on any State, local or
tribal governments or the private sector. Instead, this action provides
an exemption for the manufacture and use of a phased out compound and
would not impose any new requirements on any entities. Therefore, this
action is not subject to the requirements of sections 202 or 205 of the
UMRA. This action is also not subject to the requirements of section
203 of UMRA because it contains no regulatory requirements that might
significantly or uniquely affect small governments.

E. Executive Order 13132: Federalism

    This action does not have federalism implications. It will not have
substantial direct effects on the States, on the relationship between
the national government and the States, or on the distribution of power
and responsibilities among the various levels of government, as
specified in Executive Order 13132. This rule is expected to affect
producers, suppliers, importers, and exporters and users of methyl
bromide. Thus, Executive Order 13132 does not apply to this rule. In
the spirit of Executive Order 13132, and consistent with EPA policy to
promote communications between EPA and State and local governments, EPA
specifically solicited comment on this action from State and local
officials.

F. Executive Order 13175: Consultation and Coordination With Indian
Tribal Governments

    This action does not have tribal implications, as specified in
Executive Order 13175 (65 FR 67249, November 9, 2000). This rule does
not significantly or uniquely affect the communities of Indian tribal
governments nor does it impose any enforceable duties on communities of
Indian tribal governments. Thus, Executive Order 13175 does not apply
to this action. EPA specifically solicited additional comment on this
action from tribal officials.

G. Executive Order No. 13045: Protection of Children From Environmental
Health and Safety Risks

    This action is not subject to EO 13045 (62 FR 19885, April 23,
1997) because it is not economically significant as defined in EO
12866, and because the Agency does not believe the environmental health
or safety risks addressed by this action present a disproportionate
risk to children. This rule affects the level of environmental
protection equally for all affected populations without having any
disproportionately high and adverse human health or environmental
effects on any population.

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

    This rule is not a ``significant energy action'' as defined in
Executive Order 13211, ``Actions Concerning Regulations That
Significantly Affect Energy Supply, Distribution, or Use'' (66 FR 28355
(May 22, 2001)) because it is not likely to have a significant adverse
effect on the supply, distribution, or use of energy. This rule does
not pertain to any segment of the energy production economy nor does it
regulate any manner of energy use. Therefore, we have concluded that
this rule is not likely to have any adverse energy effects.

I. National Technology Transfer and Advancement Act

    Section 12(d) of the National Technology Transfer and Advancement
Act of 1995 (``NTTAA''), Public Law 104-113, 12(d) (15 U.S.C. 272 note)
directs EPA to use voluntary consensus standards in its regulatory
activities unless to do so would be inconsistent with applicable law or
otherwise impractical. Voluntary consensus standards are technical
standards (e.g., materials specifications, test methods, sampling
procedures, and business practices) that are developed or adopted by
voluntary consensus standards bodies. NTTAA directs EPA to provide
Congress, through OMB, explanations when the agency decides not to use
available and applicable voluntary consensus standards. This rulemaking
does not involve technical standards. Therefore, EPA did not consider
the use of any voluntary consensus standards.

J. Executive Order 12898: Federal Actions To Address Environmental
Justice in Minority Populations and Low-Income Populations

    Executive Order (EO) 12898 (59 FR 7629 (Feb. 16, 1994)) establishes
federal executive policy on environmental justice. Its main provision
directs federal agencies, to the greatest extent practicable and
permitted by law, to make environmental justice part of their mission
by identifying and addressing, as appropriate, disproportionately high
and adverse human health or environmental effects of their programs,
policies, and activities on minority populations and low-income
populations in the United States.
    EPA has determined that this rule does not have disproportionately
high and adverse human health or environmental effects on minority or
low-income populations, because it affects the level of environmental
protection equally for all affected populations without having any
disproportionately high and adverse human health or environmental
effects on any population, including any minority or low-income
population. Any ozone depletion that results from this rule will impact
all affected populations equally because ozone depletion is a global
environmental problem with environmental and human effects that are, in
general, equally distributed across geographical regions in the United
States.

K. Congressional Review Act

    The Congressional Review Act, 5 U.S.C. 801 et seq., as added by the
Small Business Regulatory Enforcement Fairness Act of 1996, generally
provides that before a rule may take effect, the agency promulgating
the rule must submit a rule report, which includes a copy of the rule,
to each House of the Congress and to the Comptroller General of the
United States. EPA will submit a report containing this rule and other
required information to the U.S. Senate, the U.S. House of
Representatives, and the Comptroller General of the United States prior
to publication of the rule in the Federal Register. A Major rule cannot
take effect until 60 days after it is published in the Federal
Register. This action not a ``major rule'' as defined by 5 U.S.C.
804(2). This rule will be effective July 22, 2013.

List of Subjects in 40 CFR Part 82

    Environmental protection, Chemicals, Exports, Imports, Ozone
depletion.

    Dated: July 16, 2013.
Bob Perciasepe,
Acting Administrator.

    For the reasons stated in the preamble, 40 CFR Part 82 is amended
as follows:

PART 82--PROTECTION OF STRATOSPHERIC OZONE

0
1. The authority citation for part 82 continues to read as follows:

    Authority: 42 U.S.C. 7414, 7601, 7671-7671q.

0
2. Section 82.3 is amended by revising the definition of ``Critical use
methyl bromide'' to read as follows:

Sec.  82.3  Definitions for class I and class II controlled substances.

* * * * *
    Critical use methyl bromide means the class I, Group VI controlled
substance produced or imported through expending a critical use
allowance or that portion of inventory produced or imported prior to
the January 1, 2005 phaseout date that is sold only for approved
critical uses.
* * * * *

0
3. Section 82.4 is amended by revising paragraph (p)(1) to read as
follows:

Sec.  82.4  Prohibitions for Class I controlled substances.

* * * * *
    (p) * * *
    (1) No person shall sell critical use methyl bromide without first
receiving a certification from the purchaser that the quantity
purchased will be sold or used solely for an approved critical use.
Every kilogram of critical use methyl bromide sold without first
obtaining such certification constitutes a separate violation of this
subpart.
* * * * *

0
4. Section 82.8 is amended as follows:
0
a. Revising paragraph (c) introductory text;
0
b. Revising the table in paragraph (c)(1);
0
c. Removing and reserving paragraph (c)(2).

Sec.  82.8  Grant of essential use allowances and critical use
allowances.

* * * * *
    (c) Effective January 1, 2005, critical use allowances are
apportioned as set forth in paragraph (c)(1) of this section for the
exempted production and import of class I, Group VI controlled
substances specifically for those approved critical uses listed in
appendix L to this subpart for the applicable control period. Every
kilogram of production and import in excess of the total number and
type of unexpended critical use allowances held for a particular type
of use constitutes a separate violation of this subpart.
    (1) * * *

----------------------------------------------------------------------------------------------------------------
                                                                   2013 Critical use        2013 Critical use
                                                                  allowances for pre-      allowances for post-
                            Company                                   plant uses *            harvest uses *
                                                                      (kilograms)              (kilograms)
----------------------------------------------------------------------------------------------------------------
Great Lakes Chemical Corp. A Chemtura Company.................                  323,564                   18,162
Albemarle Corp................................................                  133,057                    7,469
ICL-IP America................................................                   73,530                    4,127
TriCal, Inc...................................................                    2,289                      129
���������������������������������������������������������������
    Total **..................................................                  532,440                  29,886
----------------------------------------------------------------------------------------------------------------
* For production or import of Class I, Group VI controlled substance exclusively for the Pre-Plant or Post-
  Harvest uses specified in appendix L to this subpart.
** Due to rounding, numbers do not add exactly.

    (2) [Reserved]

0
5. Appendix L to Subpart A is revised to read as follows:

 Appendix L to Subpart A of Part 82--Approved Critical Uses and Limiting
     Critical Conditions for Those Uses for the 2013 Control Period
------------------------------------------------------------------------
          Column A                  Column B              Column C
------------------------------------------------------------------------
   Approved Critical Uses       Approved Critical     Limiting Critical
                                User and Location      Conditions that
                                      of Use          exist, or that the
                                                      approved critical
                                                       user reasonably
                                                     expects could arise
                                                        without methyl
                                                     bromide fumigation:
------------------------------------------------------------------------
                             PRE-PLANT USES
------------------------------------------------------------------------
Cucurbits...................  Georgia growers on    Moderate to severe
                               fewer than 10 acres.  yellow or purple
                                                     nutsedge
                                                     infestation.
                                                    Moderate to severe
                                                     soilborne disease
                                                     infestation.
                                                    Moderate to severe
                                                     root knot nematode
                                                     infestation.
Eggplant....................  (a) Florida growers.  Moderate to severe
                                                     yellow or purple
                                                     nutsedge
                                                     infestation.
                                                    Moderate to severe
                                                     soilborne disease
                                                     infestation.
                                                    Restrictions on
                                                     alternatives due to
                                                     karst topographical
                                                     features and soils
                                                     not supporting
                                                     seepage irrigation.
                              (b) Georgia growers   Moderate to severe
                               on fewer than 10      yellow or purple
                               acres.                nutsedge
                                                     infestation.
                                                    Moderate to severe
                                                     nematode
                                                     infestation.
                                                    Moderate to severe
                                                     pythium collar,
                                                     crown and root rot.
                                                    Moderate to severe
                                                     southern blight
                                                     infestation.
                                                    Restrictions on
                                                     alternatives due to
                                                     karst topographical
                                                     features.
Nursery Stock (Fruit, Nut,    Members of the        Moderate to severe
 Flower).                      California            nematode
                               Association of        infestation.
                               Nursery and Garden   Medium to heavy clay
                               Centers               soils.
                               representing         Local township
                               Deciduous Tree        limits prohibiting
                               Fruit Growers.        1,3-
                                                     dichloropropene.
Orchard Replant.............  California stone      Moderate to severe
                               fruit, table and      nematode
                               raisin grape, wine    infestation.
                               grape, walnut, and   Moderate to severe
                               almond growers.       soilborne disease
                                                     infestation.
                                                    Replanted orchard
                                                     soils to prevent
                                                     orchard replant
                                                     disease.
                                                    Medium to heavy
                                                     soils.
                                                    Local township
                                                     limits prohibiting
                                                     1,3-
                                                     dichloropropene.
Ornamentals.................  (a) California        Moderate to severe
                               growers.              soilborne disease
                                                     infestation.
                                                    Moderate to severe
                                                     nematode
                                                     infestation.
                                                    Local township
                                                     limits prohibiting
                                                     1,3-
                                                     dichloropropene.

                              (b) Florida growers.  Moderate to severe
                                                     weed infestation.
                                                    Moderate to severe
                                                     soilborne disease
                                                     infestation.
                                                    Moderate to severe
                                                     nematode
                                                     infestation.
                                                    Restrictions on
                                                     alternatives due to
                                                     karst topographical
                                                     features and soils
                                                     not supporting
                                                     seepage irrigation.
Peppers.....................  (a) Florida growers.  Moderate to severe
                                                     yellow or purple
                                                     nutsedge
                                                     infestation.
                                                    Moderate to severe
                                                     soilborne disease
                                                     infestation.
                                                    Moderate to severe
                                                     nematode
                                                     infestation.
                                                    Restrictions on
                                                     alternatives due to
                                                     karst topographical
                                                     features and soils
                                                     not supporting
                                                     seepage irrigation.
                              (b) Georgia growers   Moderate to severe
                               on fewer than 10      yellow or purple
                               acres.                nutsedge
                                                     infestation.
                                                    Moderate to severe
                                                     nematode
                                                     infestation, or
                                                     moderate to severe
                                                     pythium root and
                                                     collar rots.
                                                    Moderate to severe
                                                     southern blight
                                                     infestation, crown
                                                     or root rot.
                                                    Restrictions on
                                                     alternatives due to
                                                     karst topographical
                                                     features.
Strawberry Fruit............  California growers..  Moderate to severe
                                                     black root rot or
                                                     crown rot.
                                                    Moderate to severe
                                                     yellow or purple
                                                     nutsedge
                                                     infestation.
                                                    Moderate to severe
                                                     nematode
                                                     infestation.
                                                    Local township
                                                     limits prohibiting
                                                     1,3-
                                                     dichloropropene.
                                                    Time to transition
                                                     to an alternative.
Strawberry Nurseries........  California growers..  Moderate to severe
                                                     soilborne disease
                                                     infestation.
                                                    Moderate to severe
                                                     yellow or purple
                                                     nutsedge
                                                     infestation.
                                                    Moderate to severe
                                                     nematode
                                                     infestation.
Tomatoes....................  (a) Florida growers.  Moderate to severe
                                                     yellow or purple
                                                     nutsedge
                                                     infestation
                                                    Moderate to severe
                                                     soilborne disease
                                                     infestation.
                                                    Moderate to severe
                                                     nematode
                                                     infestation.
                                                    Restrictions on
                                                     alternatives due to
                                                     karst topographical
                                                     features and soils
                                                     not supporting
                                                     seepage irrigation.
                              (b) Georgia growers   Moderate to severe
                               on fewer than 10      yellow or purple
                               acres.                nutsedge
                                                     infestation
                                                    Moderate to severe
                                                     soilborne disease
                                                     infestation.
                                                    Moderate to severe
                                                     nematode
                                                     infestation.
                                                    Restrictions on
                                                     alternatives due to
                                                     karst topographical
                                                     features.
------------------------------------------------------------------------
                            POST-HARVEST USES
------------------------------------------------------------------------
Food Processing.............  (a) Rice millers in   Moderate to severe
                               the U.S. who are      beetle, weevil, or
                               members of the USA    moth infestation.
                               Rice Millers         Presence of
                               Association.          sensitive
                                                     electronic
                                                     equipment subject
                                                     to corrosion.
                                                    Time to transition
                                                     to an alternative.
                              (b) Pet food          Moderate to severe
                               manufacturing         beetle, moth, or
                               facilities in the     cockroach
                               U.S. who are          infestation.
                               members of the Pet   Presence of
                               Food Institute.       sensitive
                                                     electronic
                                                     equipment subject
                                                     to corrosion.
                                                    Time to transition
                                                     to an alternative.
                              (c) Members of the    Moderate to severe
                               North American        beetle infestation.
                               Millers'             Presence of
                               Association in the    sensitive
                               U.S.                  electronic
                                                     equipment subject
                                                     to corrosion.
                                                    Time to transition
                                                     to an alternative.

Commodities.................  California entities   Rapid fumigation
                               storing walnuts,      required to meet a
                               dried plums, figs,    critical market
                               raisins, and dates    window, such as
                               (in Riverside         during the holiday
                               county only) in       season.
                               California.
Dry Cured Pork Products.....  Members of the        Red legged ham
                               National Country      beetle infestation.
                               Ham Association and  Cheese/ham skipper
                               the Association of    infestation.
                               Meat Processors,     Dermested beetle
                               Nahunta Pork Center   infestation.
                               (North Carolina),    Ham mite
                               and Gwaltney and      infestation.
                               Smithfield Inc.
------------------------------------------------------------------------

[FR Doc. 2013-17569 Filed 7-19-13; 8:45 am]
BILLING CODE 6560-50-P