[Federal Register: May 3, 2010 (Volume 75, Number 84)]
[Rules and Regulations]
[Page 23167-23186]
[DOCID:fr03my10-4]

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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 82

[EPA-HQ-OAR-2009-0351; FRL-9144-5]
RIN 2060-AP62

Protection of Stratospheric Ozone: The 2010 Critical Use
Exemption From the Phaseout of Methyl Bromide

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final rule.

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SUMMARY: This final rule authorizes uses of methyl bromide that qualify
for the 2010 critical use exemption and the amount of methyl bromide
that may be produced, imported, or supplied from existing pre-phaseout
inventory for those uses in 2010. EPA is taking action under the
authority of the Clean Air Act to reflect a recent consensus decision
taken by the Parties to the Montreal Protocol on Substances that
Deplete the Ozone Layer at the Twentieth Meeting of the Parties.

DATES: This rule is effective on May 3, 2010.

ADDRESSES: EPA has established a docket for this action identified
under EPA-HQ-OAR-2009-0351. All documents in the docket are listed on
the http://www.regulations.gov 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 will be
publicly available only in hard copy form. Publicly available docket
materials are available only through http://www.regulations.gov or in
hard copy. To obtain copies of materials in hard copy, please call the
EPA Docket Center at<PHONE_NUMBER> between the hours of 8:30 a.m.-4:30
p.m. E.S.T., Monday-Friday, excluding legal holidays, to schedule an
appointment. The EPA Docket Center's Public Reading Room address is
EPA/DC, EPA West, Room 3334, 1301 Constitution Ave., NW., Washington,
DC.

FOR FURTHER INFORMATION CONTACT: Jeremy Arling by telephone at (202)
343-9055, or by e-mail 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 Ozone
Depletion Web site of EPA's Stratospheric Protection Division at http:/
/www.epa.gov/ozone/strathome.html for further information about EPA's
Stratospheric Ozone Protection regulations, the science of ozone layer
depletion, and related topics.

SUPPLEMENTARY INFORMATION: This final 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 2010. Under the Clean Air Act, methyl bromide consumption
(consumption is defined under the CAA as production plus imports minus
exports) and production was phased out on January 1, 2005, apart from
allowable exemptions, such as the critical use exemption and the
quarantine and preshipment (QPS) exemption. With this action, EPA is
authorizing the uses that qualify for the 2010 critical use exemption
as well as specific amounts of methyl bromide that may be produced,
imported, or supplied from pre-phaseout inventory for critical uses in
2010.
    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 May 3, 2010. APA section 553(d) provides an
exception for any action that grants or recognizes an exemption or
relieves a restriction. This final rule grants an exemption from the
phaseout of methyl bromide.

Table of Contents

I. General Information
    Regulated Entities
II. What is methyl bromide?

III. What is the background to the phaseout regulations for ozone-
depleting substances?
IV. What is the legal authority for exempting the production and
import of methyl bromide for critical uses authorized by the parties
to the Montreal Protocol?
V. 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
    1. Background of Critical Use Amounts
    2. Calculation of Available Pre-Phaseout Inventory
    3. Approach for Determining Critical Use Amounts
    4. Treatment of Carryover Material
    5. Methyl Bromide Alternatives
    6. Summary of Calculations
    E. The Criteria in Decisions IX/6 and Ex. I/4
    F. Emissions Minimization
    G. Critical Use Allowance Allocations
    H. Critical Stock Allowance Allocations
    I. Stocks of Methyl Bromide
VI. Statutory and Executive Order Reviews
    A. Executive Order 12866: Regulatory Planning and Review
    B. Paperwork Reduction Act
    C. Regulatory Flexibility Act
    D. Unfunded Mandates Reform Act
    E. Executive Order 13132: Federalism
    F. Executive Order 13175: Consultation and Coordination With
Indian Tribal Governments
    G. Executive Order 13045: Protection of Children From
Environmental Health and Safety Risks
    H. Executive Order 13211: Actions 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

Regulated Entities

    Entities potentially regulated by this action are those associated
with the production, import, export, sale, application, and use of
methyl bromide covered by an approved critical use exemption.
Potentially regulated categories and entities include producers,
importers, and exporters of methyl bromide; applicators and
distributors of methyl bromide; users of methyl bromide, e.g., farmers
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 methyl bromide?

    Methyl bromide is an odorless, colorless, toxic gas which is used
as a broad-spectrum pesticide and is controlled under the CAA as a
class I ozone-depleting substance (ODS). Methyl bromide is used in the
U.S. and throughout the world as a fumigant to control a variety of
pests such as insects, weeds, rodents, pathogens, and nematodes.
Information on methyl bromide can be found at http://www.epa.gov/ozone/
mbr.
    Methyl bromide is also regulated by EPA under the Federal
Insecticide, Fungicide, and Rodenticide Act (FIFRA) and other statutes
and regulatory authority, as well as by States under their own statutes
and regulatory authority. Under FIFRA, methyl bromide is a restricted
use pesticide. Restricted use pesticides are subject to Federal and
State requirements governing their sale, distribution, and use. Nothing
in this rule implementing the Clean Air Act is intended to derogate
from 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. Entities affected by
provisions of this rule must continue to comply with FIFRA and other
pertinent statutory and regulatory requirements for pesticides
(including, but not limited to, requirements pertaining to restricted
use pesticides) when importing, exporting, acquiring, selling,
distributing, transferring, or using methyl bromide for critical uses.
The regulations in this action are intended only to implement the CAA
restrictions on the production, consumption, and use of methyl bromide
for critical uses exempted from the phaseout of methyl bromide.

III. What is the background to the phaseout regulations for ozone-
depleting substances?

    The regulatory requirements of the stratospheric ozone protection
program that limit production and consumption of ozone-depleting
substances are in 40 CFR part 82, subpart A. The regulatory program was
originally published in the Federal Register on August 12, 1988 (53 FR
30566), in response to the 1987 signing and subsequent ratification of
the Montreal Protocol on Substances that Deplete the Ozone Layer
(Montreal Protocol). The Montreal Protocol is the international
agreement aimed at reducing and eliminating the production and
consumption of stratospheric ozone-depleting substances. The U.S. was
one of the original signatories to the 1987 Montreal Protocol and the
U.S. ratified the Protocol on April 12, 1988. Congress then enacted,
and President George H.W. Bush signed into law, the Clean Air Act
Amendments of 1990 (CAAA of 1990) which included Title VI on
Stratospheric Ozone Protection, codified as 42 U.S.C. Chapter 85,
Subchapter VI, to ensure that the United States could satisfy its
obligations under the Protocol. EPA issued regulations to implement
this legislation and has since amended the regulations as needed.
    Methyl bromide was added to the Protocol as an ozone-depleting
substance in 1992 through the Copenhagen Amendment to the Protocol. The
Parties to the Montreal Protocol (Parties) agreed that each
industrialized country's level of methyl bromide production and
consumption in 1991 should be the baseline for establishing a freeze in
the level of methyl bromide production and consumption for
industrialized countries. EPA published a final rule in the Federal
Register on December 10, 1993 (58 FR 65018), listing methyl bromide as
a Class I, Group VI controlled substance, freezing U.S. production and
consumption at this 1991 baseline level of 25,528,270 kilograms, and
setting forth the percentage of baseline allowances for methyl bromide
granted to companies in each control period (each calendar year) until
2001, when the complete phaseout would occur. This phaseout date was
established in response to a petition filed in 1991 under Sections
602(c)(3) and 606(b) of the CAAA of 1990, requesting that EPA list
methyl bromide as a Class I substance and phase out its production and
consumption. This date was consistent with Section 602(d) of the CAAA
of 1990, which for newly listed Class I ozone-depleting substances
provides that ``no extension [of the phaseout schedule in section 604]
under this subsection may extend the date for termination of production
of any class I substance to a date more than 7 years after January 1 of
the year after the year in which the substance is added to the list of
class I substances.''
    At the Seventh Meeting of the Parties (MOP) in 1995, the Parties
made adjustments to the methyl bromide control measures and agreed to
reduction steps and a 2010 phaseout

date for industrialized countries with exemptions permitted for
critical uses. At that time, the U.S. continued to have a 2001 phaseout
date in accordance with Section 602(d) of the CAAA of 1990. At the
Ninth MOP in 1997, the Parties agreed to further adjustments to the
phaseout schedule for methyl bromide in industrialized countries, with
reduction steps leading to a 2005 phaseout.

IV. What is the legal authority for exempting the production and import
of methyl bromide for critical uses authorized by the parties to the
Montreal Protocol?

    In October 1998, the U.S. Congress amended the CAA to prohibit the
termination of production of methyl bromide prior to January 1, 2005,
to require EPA to bring the U.S. phaseout of methyl bromide in line
with the schedule specified under the Protocol, and to authorize EPA to
provide certain exemptions. These amendments were contained in Section
764 of the 1999 Omnibus Consolidated and Emergency Supplemental
Appropriations Act (Pub. L. 105-277, October 21, 1998) and were
codified in section 604 of the CAA, 42 U.S.C. 7671c. The amendment that
specifically addresses the critical use exemption appears at section
604(d)(6), 42 U.S.C. 7671c(d)(6). EPA revised the phaseout schedule for
methyl bromide production and consumption in a direct final rulemaking
on November 28, 2000 (65 FR 70795), which allowed for the phased
reduction in methyl bromide consumption specified under the Protocol
and extended the phaseout to 2005. EPA again amended the regulations to
allow for an exemption for quarantine and preshipment (QPS) purposes on
July 19, 2001 (66 FR 37751), with an interim final rule and with a
final rule on January 2, 2003 (68 FR 238).
    On December 23, 2004 (69 FR 76982), EPA published a final rule (the
``Framework Rule'') that established the framework for the critical use
exemption; set forth a list of approved critical uses for 2005; and
specified the amount of methyl bromide that could be supplied in 2005
from stocks and new production or import to meet the needs of approved
critical uses. EPA subsequently published rules applying the critical
use exemption framework to the 2006, 2007, 2008, and 2009 control
periods. Under authority of section 604(d)(6) of the CAA, this action
specifies the uses that will qualify as approved critical uses in 2010
and the amount of methyl bromide that may be produced, imported, or
supplied from inventory to satisfy those uses.
    This action reflects Decision XX/5, taken at the Twentieth Meeting
of the Parties in November 2008 and Decision XXI/11, taken at the
Twenty First Meeting of the Parties in November 2009. In accordance
with Article 2H(5), the Parties have issued several Decisions
pertaining to the critical use exemption. These include Decisions IX/6
and Ex. I/4, which set forth criteria for review of proposed critical
uses. The status of Decisions is addressed in NRDC v. EPA, (464 F.3d 1,
DC Cir. 2006) and in EPA's ``Supplemental Brief for the Respondent,''
filed in NRDC v. EPA and available in the docket for this action. In
this rule, EPA is honoring commitments made by the United States in the
Montreal Protocol context.

V. What is the critical use exemption process?

A. Background of the Process

    The critical use exemption is designed to permit the production and
import of methyl bromide for uses that do not have technically and
economically feasible alternatives and for which the lack of methyl
bromide would result in significant market disruption (40 CFR 82.3).
The criteria for the exemption initially appeared 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.'' These criteria are
reflected in EPA's definition of ``critical use'' at 40 CFR 82.3.
    In response to EPA's request for critical use exemption
applications published in the Federal Register on April 17, 2007 (72 FR
19197), 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, research programs into
the use of alternatives to methyl bromide, and efforts to minimize use
and emissions of methyl bromide.
    EPA's Office of Pesticide Programs reviewed 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, EPA reviewed other parameters of the
exemption applications such as dosage and emissions minimization
techniques and applicants' research or transition plans. This
assessment process culminated in the development of a document referred
to as the critical use nomination (CUN). The U.S. Department of State
has submitted a CUN annually 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 independent advisory bodies to Parties to the
Montreal Protocol, reviewed the CUNs of the Parties and made
recommendations to the Parties on the nominations. The Parties then
took Decisions to authorize 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 consulted 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 provided an opportunity for public comment on the
amounts of methyl bromide that the Agency has determined to be
necessary for critical uses and the uses that the Agency has determined
meet the criteria of the critical use exemption.
    More on the domestic review process and methodology employed by the
Office of Pesticide Programs is available in a detailed memorandum
titled ``Development of 2003 Nomination for a Critical Use Exemption
for Methyl Bromide for the United States of America,'' contained in the
docket for this rulemaking. While the particulars of the data continue
to evolve and administrative matters are further streamlined, the
technical review itself remains rigorous with careful consideration of
new technical and economic conditions.
    On January 24, 2008, the U.S. Government (USG) submitted the sixth
Nomination for a Critical Use Exemption for Methyl Bromide for the
United States of America to the Ozone Secretariat of the UNEP. This
nomination contained the request for 2010 critical uses. In February
2008, MBTOC sent questions to the USG concerning technical and economic
issues in the 2010 nomination. The USG transmitted responses to MBTOC
on

April 10, 2008. The USG provided additional written responses on April
16, 2009, to questions asked at MBTOC's meeting in Tel Aviv. These
documents, together with reports by the advisory bodies noted above,
are in the public docket for this rulemaking. The determination in this
final rule reflects the analysis contained in those documents.

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

    The December 23, 2004, Framework Rule (69 FR 76982) established the
framework for the critical use exemption program in the U.S., 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 from the phaseout of methyl bromide specific
quantities of production and import for each control period (each
calendar year), 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 (calendar year
2006), 71 FR 75386 (calendar year 2007), 72 FR 74118 (calendar year
2008), and 74 FR 19878 (calendar year 2009).
    Today's action authorizes specific critical uses for 2010 and the
amounts of Critical Use Allowances (CUAs) and Critical Stock Allowances
(CSAs) allocated for those uses. 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. 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. A CSA
is 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 critical uses authorized in this rule are the uses included in
the USG's sixth CUN and authorized by the Parties in Decision XX/5 as
well as the supplemental authorization in Decision XXI/11. EPA is
utilizing the existing regulatory framework for critical uses. This
framework is discussed in Section V.D.1 of the preamble. EPA proposed
and took comment on a modification to the existing framework to ensure
that the level of new production and import does not increase from one
year to the next. EPA is not finalizing that modification to the
existing framework in today's action because the end-of-year reported
data shows that it would be unnecessary. This is discussed in more
detail in Section V.D.3 of the preamble. EPA may consider that
modification in future CUE rulemakings.

C. Critical uses

    In Decision XX/5, taken in November 2008, the Parties to the
Protocol agreed ``to permit, for the agreed critical use categories for
2010 set forth in table C of the annex to the present decision for each
Party, subject to the conditions set forth in the present decision and
decision Ex.I/4 to the extent that those conditions are applicable, the
levels of production and consumption for 2010 set forth in table D of
the annex to the present decision which are necessary to satisfy
critical uses * * *''
    The following uses are those set forth in table C of the annex to
Decision XX/5 for the United States:
     Commodities.
     NPMA food processing structures (cocoa beans removed).\1\
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    \1\ NPMA, National Pest Management Association, includes both
food processing structures and processed foods.
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     Mills and processors.
     Dried cured pork.
     Cucurbits.
     Eggplant--field.
     Forest nursery seedlings.
     Nursery stock--fruit, nut, flower.
     Orchard replant.
     Ornamentals.
     Peppers--field.
     Strawberries--field.
     Strawberry runners.
     Tomatoes--field.
     Sweet potato slips.
    The agreed U.S. critical use levels for 2010 total 3,235,474
kilograms (kg), which is equivalent to 12.7% of the U.S. 1991 methyl
bromide consumption baseline of 25,528,270 kg. The maximum amount of
allowable new production and import for U.S. critical uses is 2,765,474
kg. This is a combination of the level in Table D of Decision XX/5,
which is 2,763,456 kg, and the level in Table B of Decision XXI/11,
which is 2,018 kg. Similarly, the maximum amount for use on critical
uses is 2,765,474 kg. This is equal to the level in Table C of Decision
XX/5, which is 2,763,456 kg (10.8% of baseline), as well as an
additional 2,018 kg authorized for 2010 in Table A of Decision XXI/11
for southeast strawberry nurseries. Both Decisions noted that these
amounts were to account for available stocks.
    EPA is allocating a total critical use exemption in 2010 of
2,983,883 kg (11.7% of baseline). This total amount is comprised of new
production or import of methyl bromide for critical uses at up to
1,955,775 kg (7.7% of baseline), and pre-phaseout inventory (i.e.,
stocks) for critical uses of up to 1,028,108 kg (4.0% of baseline).
These values differ from the proposed rule for three reasons. First,
the rate of inventory drawdown was less than EPA estimated, thus there
are ``available stocks'' for 2010. Second, EPA has updated the total
U.S. authorization, which is the starting point for the ``available
stocks'' calculation, to include the 2,018 kg authorized in November
2010 in Decision XXI/11. Further information regarding this
supplemental authorization appears in the Notice of Proposed Rulemaking
(74 FR 61084). Third, following prior practice, EPA is subtracting the
carryover amount from the authorized production amount. EPA has
adjusted the carryover to reflect late sales reports.
    This final rule modifies 40 CFR part 82, subpart A, appendix L to
reflect the agreed critical use categories identified in Decision XX/5
and Decision XXI/11 for the 2010 control period. Additionally, the
Agency is amending the table of critical uses based, in part, on the
technical analysis contained in the 2010 U.S. nomination that assesses
data submitted by applicants to the CUE program as well as public and
proprietary data on the use of methyl bromide and its alternatives. EPA
sought comment on the technical analysis contained in the U.S.
nomination (available for public review in the docket to this
rulemaking), as well as information regarding changes to the
registration or use of alternatives that have transpired after the 2010
U.S. nomination was submitted. 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. EPA received comments with regard to sulfuryl
fluoride and iodomethane. These comments did not provide any new data
justifying changes to EPA's analysis. These comments are discussed in
Section V.D.5 ``Alternatives'' of the preamble below. EPA recognizes
that as the market for alternatives evolves, the thresholds for what
constitutes ``significant market disruption'' or ``technical and
economic feasibility'' change. For example, the adoption of methyl
iodide in the southeast U.S

could transform the circumstances under which these analyses occur.
Based on the information described above, EPA is determining that the
uses in Table I: Approved Critical Uses, with the limiting critical
conditions specified, qualify to obtain and use critical use methyl
bromide in 2010:

                                         Table I--Approved Critical Uses
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                                                                                Limiting critical conditions
                                                                                that exist, or that the
                                                  Approved critical user and          approved critical user
            Approved critical uses                      location of use           reasonably expects could arise
                                                                                without  methyl bromide
                                                                                fumigation
Column A                                       Column B........................  Column C
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                                                 PRE-PLANT USES
----------------------------------------------------------------------------------------------------------------
Cucurbits....................................  (a) Growers in Delaware,          Moderate to severe soilborne
                                                Maryland, and Michigan.           disease infestation
                                               (b) Growers in Georgia and        Moderate to severe yellow or
                                                Southeastern U.S. limited to      purple nutsedge infestation.
                                                growing locations in Alabama,    Moderate to severe soilborne
                                                Arkansas, Kentucky, Louisiana,    disease infestation.
                                                North Carolina, South Carolina,  Moderate to severe root knot
                                                Tennessee, and Virginia.          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 yellow or
                                                                                purple 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.
                                               (c) Michigan growers............  Moderate to severe soilborne
                                                                                disease infestation.
----------------------------------------------------------------------------------------------------------------
Forest Nursery Seedlings.....................  (a) Growers in Alabama,           Moderate to severe yellow or
                                                Arkansas, Georgia, Louisiana,     purple nutsedge infestation.
                                                Mississippi, North Carolina,     Moderate to severe soilborne
                                                Oklahoma, South Carolina,         disease infestation.
                                                Tennessee, Texas, and Virginia.  Moderate to severe nematode
                                                                                infestation.
                                               (b) International Paper and its   Moderate to severe yellow or
                                                subsidiaries limited to growing   purple nutsedge infestation.
                                                locations in Alabama, Arkansas,  Moderate to severe soilborne
                                                Georgia, South Carolina, and      disease infestation.
                                                Texas.
                                               (c) Government-owned seedling     Moderate to severe weed
                                                nurseries in Illinois, Indiana,   infestation including purple
                                                Kentucky, Maryland, Missouri,     and yellow nutsedge
                                                New Jersey, Ohio, Pennsylvania,   infestation.
                                                West Virginia, and Wisconsin.    Moderate to severe Canada
                                                                                thistle infestation.
                                                                                Moderate to severe nematode
                                                                                infestation.
                                                                                Moderate to severe soilborne
                                                                                disease infestation.
                                               (d) Weyerhaeuser Company and its  Moderate to severe yellow or
                                                subsidiaries limited to growing   purple nutsedge infestation.
                                                locations in Alabama, Arkansas,  Moderate to severe soilborne
                                                North Carolina, and South         disease infestation.
                                                Carolina.                        Moderate to severe nematode or
                                                                                worm infestation.
                                               (e) Weyerhaeuser Company and its  Moderate to severe yellow
                                                subsidiaries limited to growing   nutsedge infestation.
                                                locations in Oregon and          Moderate to severe soilborne
                                                Washington.                       disease infestation.
                                               (f) Michigan growers............  Moderate to severe soilborne
                                                                                disease infestation.
                                                                                Moderate to severe Canada
                                                                                thistle infestation.
                                                                                Moderate to severe nutsedge
                                                                                infestation.
                                                                                Moderate to severe nematode
                                                                                infestation.
----------------------------------------------------------------------------------------------------------------
Orchard Nursery Seedlings....................  (a) Members of the Western        Moderate to severe nematode
                                                Raspberry Nursery Consortium      infestation.
                                                limited to growing locations in  Medium to heavy clay soils.
                                                Washington, and members of the   Local township limits
                                                California Association of         prohibiting 1,3-
                                                Nursery and Garden Centers        dichloropropene.
                                                representing Deciduous Tree
                                                Fruit Growers.
                                               (b) California rose nurseries...  Moderate to severe nematode
                                                                                infestation.
                                                                                Local township limits
                                                                                prohibiting 1,3-
                                                                                dichloropropene.
----------------------------------------------------------------------------------------------------------------
Orchard Replant..............................  (a) California stone fruit,       Moderate to severe nematode
                                                table and raisin grape, wine      infestation.
                                                grape, walnut, and almond        Moderate to severe soilborne
                                                growers.                          disease infestation.
                                                                                Replanted orchard soils to
                                                                                prevent orchard replant
                                                                                disease.
                                                                                Medium to heavy soils.
                                                                                Local township limits
                                                                                prohibiting 1,3-
                                                                                dichloropropene.
----------------------------------------------------------------------------------------------------------------
Ornamentals..................................  (a) California growers..........  Moderate to severe 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.
                                               (c) Michigan herbaceous           Moderate to severe nematode
                                                perennial growers.                infestation.
                                                                                Moderate to severe soilborne
                                                                                disease infestation.
                                                                                Moderate to severe yellow
                                                                                nutsedge and other weed
                                                                                infestation.
                                               (d) New York growers............  Moderate to severe soilborne
                                                                                disease infestation.
                                                                                Moderate to severe nematode
                                                                                infestation.
----------------------------------------------------------------------------------------------------------------
Peppers......................................  (a) Alabama, Arkansas, Kentucky,  Moderate to severe yellow or
                                                Louisiana, North Carolina,        purple nutsedge infestation.
                                                South Carolina, Tennessee, and   Moderate to severe nematode
                                                Virginia growers.                 infestation.
                                                                                Moderate to severe pythium
                                                                                root, collar, crown and root
                                                                                rots.
                                               (b) 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.
                                               (c) Georgia growers.............  Moderate to severe yellow or
                                                                                purple 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.
                                               (d) Michigan growers............  Moderate to severe soilborne
                                                                                disease infestation.
----------------------------------------------------------------------------------------------------------------
Strawberry Fruit.............................  (a) 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.
                                               (b) Florida growers.............  Moderate to severe yellow or
                                                                                purple nutsedge infestation.
                                                                                Moderate to severe nematode
                                                                                infestation.
                                                                                Moderate to severe soilborne
                                                                                disease infestation.
                                                                                Carolina geranium or cut-leaf
                                                                                evening primrose infestation.
                                                                                Restrictions on alternatives
                                                                                due to karst topographical
                                                                                features and soils not
                                                                                supporting seepage irrigation.
                                               (c) Alabama, Arkansas, Georgia,   Moderate to severe yellow or
                                                Illinois, Kentucky, Louisiana,    purple nutsedge infestation.
                                                Maryland, Mississippi,           Moderate to severe nematode
                                                Missouri, New Jersey, North       infestation.
                                                Carolina, Ohio, South Carolina,  Moderate to severe black root
                                                Tennessee, and Virginia growers.  and crown rot.
----------------------------------------------------------------------------------------------------------------
Strawberry Nurseries.........................  (a) California growers..........  Moderate to severe soilborne
                                                                                disease infestation.
                                                                                Moderate to severe yellow or
                                                                                purple nutsedge infestation.
                                                                                Moderate to severe nematode
                                                                                infestation.
                                               (b) North Carolina and Tennessee  Moderate to severe black root
                                                growers.                          rot.
                                                                                Moderate to severe root-knot
                                                                                nematode infestation.
                                                                                Moderate to severe yellow and
                                                                                purple nutsedge infestation.
----------------------------------------------------------------------------------------------------------------
Sweet Potato Slips...........................  (a) California growers..........  Local township limits
                                                                                prohibiting 1,3-
                                                                                dichloropropene.
----------------------------------------------------------------------------------------------------------------
Tomatoes.....................................  (a) Michigan growers............  Moderate to severe soilborne
                                                                                disease infestation.
                                                                                Moderate to severe fungal
                                                                                pathogen infestation.

                                               (b) Alabama, Arkansas, Florida,   Moderate to severe yellow or
                                                Georgia, Kentucky, Louisiana,     purple nutsedge infestation.
                                                Mississippi, North Carolina,     Moderate to severe soilborne
                                                South Carolina, Tennessee, and    disease infestation.
                                                Virginia growers.                Moderate to severe nematode
                                                                                infestation.
                                                                                Restrictions on alternatives
                                                                                due to karst topographical
                                                                                features and, in Florida,
                                                                                soils not supporting seepage
                                                                                irrigation.
                                               (c) Maryland growers............  Moderate to severe fungal
                                                                                pathogen infestation.
----------------------------------------------------------------------------------------------------------------
                                                POST-HARVEST USES
----------------------------------------------------------------------------------------------------------------
Food Processing..............................  (a) Rice millers in the U.S. who  Moderate to severe beetle,
                                                are members of the USA Rice       weevil, or moth infestation.
                                                Millers Association.             Presence of sensitive
                                                                                electronic equipment subject
                                                                                to corrosion.
                                                                                Time to transition to an
                                                                                alternative.
                                               (b) Pet food manufacturing        Moderate to severe beetle,
                                                facilities in the U.S. who are    moth, or cockroach
                                                members of the Pet Food           infestation.
                                                Institute.                       Presence of sensitive
                                                                                electronic equipment subject
                                                                                to corrosion.
                                                                                Time to transition to an
                                                                                alternative.
                                               (c) Members of the North          Moderate to severe beetle
                                                American Millers' Association     infestation.
                                                in the U.S..                     Presence of sensitive
                                                                                electronic equipment subject
                                                                                to corrosion.
                                                                                Time to transition to an
                                                                                alternative.
                                               (d) Members of the National Pest  Moderate to severe beetle or
                                                Management Association treating   moth infestation.
                                                processed food, cheese, herbs    Presence of sensitive
                                                and spices, and spaces and        electronic equipment subject
                                                equipment in associated           to corrosion.
                                                processing and storage           Time to transition to an
                                                facilities..                      alternative.
----------------------------------------------------------------------------------------------------------------
Commodities..................................  (a) California entities storing   Rapid fumigation required to
                                                walnuts, beans, dried plums,      meet a critical market window,
                                                figs, raisins, and dates (in      such as during the holiday
                                                Riverside county only) in         season.
                                                California.
----------------------------------------------------------------------------------------------------------------
Dry Cured Pork Products......................  (a) Members of the National       Red legged ham beetle
                                                Country Ham Association and the   infestation.
                                                Association of Meat Processors,  Cheese/ham skipper infestation.
                                                Nahunta Pork Center (North       Dermested beetle infestation.
                                                Carolina), and Gwaltney and      Ham mite infestation.
                                                Smithfield Inc..
----------------------------------------------------------------------------------------------------------------

    The critical uses and limiting critical conditions in Table I are
modified from the 2009 CUE as follows. First, EPA is adding ornamental
growers in New York that are subject to moderate to severe soilborne
disease or nematode infestations. This reflects a new application
submitted for the production of Anemone coronaria in greenhouses and
approved as part of the U.S. nomination of ornamentals. Greenhouse-
grown anemones in New York are facing a similar situation to other
crops in this sector. EPA anticipates the usage of methyl bromide will
be very limited, and has nominated only 272 kg for this use. Second,
EPA is removing cucurbit growers and pepper growers in Mississippi.
These two uses were not part of the CUN and therefore the Parties have
not authorized them as critical uses for 2010. Third, EPA is removing
bakeries, as they have also transitioned to methyl bromide alternatives
and thus did not submit an application for the 2010 control period.
Fourth, EPA is removing ``export to countries which do not allow the
use of sulfuryl fluoride'' as a limiting critical condition for
commodities. This limiting critical condition was established for the
first time in the 2009 CUE rule as a few countries that import
commodities treated with sulfuryl fluoride were still in the process of
establishing maximum residue levels (MRLs) for sulfuryl fluoride. All
countries to which the U.S. exports such commodities have now
established MRLs. Therefore, EPA no longer believes this to be a
limiting critical condition. EPA sought comment on these proposed
changes to the critical uses and their limiting critical conditions.
EPA received general support from two commenters to adjust the critical
uses and limiting critical conditions in the manner described above.
EPA also received one comment questioning some of the limiting critical
conditions in Table I. This commenter has raised the same questions in
past CUE rulemakings and EPA has responded to them in past rulemakings.
EPA provides a copy of those responses in this rule's response to
comments.
    EPA also proposed to remove North Carolina and Tennessee strawberry
nursery growers because the Parties had not authorized that use at the
date of the Proposed Rule. Although the U.S. nominated this use for
2010, MBTOC did not recommend this use when it recommended the other
critical uses for 2010. Iodomethane is registered for use on strawberry
nurseries in these States and the MBTOC initially concluded that this
substitute is a technologically and economically feasible methyl
bromide alternative suitable to these crops and circumstances. In
September 2009, MBTOC received the USG's supplemental request and
agreed that time is required to conduct commercial scale up of
iodomethane in this sector.

MBTOC recommended 2,018 kg for this use in 2010 and at the 21st MOP in
November 2009, the Parties authorized this as a critical use. The
Parties also increased the total authorization by 2,018 kg to meet this
need. In this final rule, EPA is adding North Carolina and Tennessee
strawberry nursery growers to the list of critical uses. EPA is
increasing the CSA amount by 2,018 kg to account for this additional
demand.
    Consistent with the 2009 CUE Rule, EPA repeats 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.
``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.

D. Critical Use Amounts

    Section V.C. of this preamble explains that Table C of the annex to
Decision XX/5 and Table B of Decision XXI/11 list critical uses and
amounts agreed to by the Parties to the Montreal Protocol. When added
together, the authorized critical use amounts for 2010 total 3,235,474
kilograms (kg), which is equivalent to 12.7% of the U.S. 1991 methyl
bromide consumption baseline of 25,528,270 kg. The maximum amount of
new production or import authorized by the Parties is 2,765,474 kg, as
set forth in Table D of Decision XX/5 (2,763,456 kg) and Table B of
Decision XXI/11 (2,018 kg), or 10.8% of baseline.
    EPA proposed to exempt limited amounts of new production and import
of methyl bromide for critical uses for 2010 in the amount of 2,275,715
kg (8.9% of baseline). EPA also proposed to allow sale of 690,464 kg
(2.7% of baseline) of existing pre-phaseout inventory for critical uses
in 2010. In this final rule, EPA is allocating fewer CUAs and more
CSAs. EPA is allocating 1,955,775 kg (7.7% of baseline) for new
production or import and up to 1,028,108 kg (4.0% of baseline) of pre-
phaseout inventory (i.e., stocks) to be used for critical uses. These
values differ from the proposed rule for three reasons. First, as
discussed below, the rate of inventory drawdown was less than EPA
estimated. Thus there are ``available stocks'' for 2010. Second, EPA is
adding 2,018 kg to the total U.S. authorized amount based on the
decision taken at the 21st MOP. The total U.S. authorized amount is the
starting point for the ``available stocks'' calculation. Third,
following prior practice, EPA is subtracting the carryover amount from
the authorized production amount. EPA has adjusted the carryover to
reflect late sales reports. The sub-sections below respond to the
comments and explain EPA's rationale for the critical use amounts for
2010.
1. Background of Critical Use Amounts
    The 2004 Framework Rule established the provisions governing the
sale of pre-phaseout inventories for critical uses, including the
concept of Critical Stock Allowances (CSAs) and a prohibition on the
sale of pre-phaseout inventories for critical uses in excess of the
amount of CSAs held by the seller. In addition, EPA noted that pre-
phaseout inventories were further taken into account through the
trading provisions that allow CUAs to be converted into CSAs. EPA did
not propose changes to these basic CSA provisions.
    Paragraph 5 of Decision XX/5 further addresses pre-phaseout
inventory of methyl bromide. The Decision states ``that a Party with a
critical use exemption level in excess of permitted levels of
production and consumption for critical uses is to make up any such
differences between those levels by using quantities of methyl bromide
from stocks that the Party has recognized to be available.'' In the
Framework Rule (69 FR 52366), EPA issued CSAs in an amount equal to the
difference between the total authorized CUE amount and the amount of
new production or import authorized by the Parties.
    In the 2006, 2007, 2008, and 2009 CUE Rules, EPA allocated CSAs in
amounts that represented not only the difference between the total
authorized CUE amount and the amount of authorized new production and
import but also an additional amount to reflect available stocks. In
the 2006 CUE Rule, EPA issued a total of 1,136,008 CSAs, equivalent to
4.4% of baseline. For 2006, the difference in the Parties' decision
between the total CUE amount and the amount of new production and
import was 3.6% of baseline. In the 2007 rule, EPA added to the minimum
amount (6.3% of baseline) an additional amount (1.2% of baseline) for a
total of 1,914,600 CSAs (7.5% of baseline). In the 2008 rule, EPA added
to the minimum amount (3.0% of baseline) an additional amount (3.8% of
baseline) for a total of 1,729,689 CSAs (6.8% of baseline). In the 2009
rule, EPA added to the minimum amount (1.2% of baseline) an additional
amount (6.3% of baseline) for a total of 1,919,193 CSAs (7.5% of
baseline). After determining the CSA amount, EPA reduced the portion of
CUE methyl bromide to come from new production and import in each of
the 2006-2009 control periods such that the total amount of methyl
bromide exempted for critical uses did not exceed the total amount
authorized by the Parties for that year.
    As established in the earlier rulemakings, EPA views the inclusion
of these additional amounts in the calculation of the year's overall
CSA level as an appropriate exercise of discretion. The Agency is not
required to allocate the full amount of authorized new production and
consumption. The Parties only agree to ``permit'' a particular level of
production and consumption; they do not--and cannot--mandate that the
U.S. authorize this level of production and consumption domestically.
Nor does the CAA require EPA to allow the full amount permitted by the
Parties. Section 604(d)(6) of the CAA does not require EPA to exempt
any amount of production and consumption from the phaseout, but instead
specifies that the Agency ``may'' create an exemption for critical
uses, providing EPA with substantial discretion.
    When determining the CSA amount for a year, EPA considers what
portion of existing stocks is ``available'' for critical uses. As
discussed in prior CUE rulemakings, the Parties to the Protocol
recognized in their Decisions that the level of existing stocks may
differ from the level of available stocks. For example, Decision IX/6
states that ``production and consumption, if any, of methyl bromide for
critical uses should be permitted only if * * * methyl bromide is not
available in sufficient quantity and quality from existing stocks.''
Decision XX/5, as well as earlier decisions, refers to use of
``quantities of methyl bromide from stocks that the Party has
recognized to be available.'' Thus, it is clear that individual Parties
have the ability to determine their level of available stocks.
Decisions XX/5 and XXI/11 further reinforce this concept by including
the phrase ``minus available stocks'' as a footnote to the United
States' authorized level of production and consumption. 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.
    EPA has employed the concept of ``available stocks'' in determining
whether to allocate additional CSAs

beyond the minimum stock amount stipulated by the Parties. In response
to stakeholder questions about how EPA derived its CSA amounts, the
2008 CUE rule established a refined approach for determining the amount
of existing methyl bromide stocks that is ``available'' for critical
uses. The approach uses a tool called the supply chain factor (SCF).
The SCF is EPA's technical estimate of the amount of methyl bromide
inventory that would be adequate to meet the need for critical use
methyl bromide after an unforeseen domestic production failure. The SCF
recognizes the benefit of allowing the private sector to maintain a
buffer in case of a major supply disruption. However, the SCF is not
intended to set aside or physically separate stocks as an inventory
reserve.
2. Calculation of Available Pre-Phaseout Inventory
    In this action, EPA is adjusting the authorized level of new
production and consumption for critical uses to account for the amount
of existing pre-phaseout inventory that is ``available'' for critical
uses. EPA is calculating the amount of existing stocks that is
available for critical uses in 2010 based on the SCF and formula
introduced in the 2008 CUE final rule (72 FR 74118). EPA is allowing
sales of the amount of existing pre-phaseout inventory that the Agency
has determined to be available for critical uses by issuing an
equivalent number of CSAs on a one-CSA-per-one-kilogram-of-methyl-
bromide basis.
    EPA calculates the amount of ``available'' stocks as follows, using
the formula adopted in the 2008 CUE rule: AS2010 =
ES2009-D2009-SCF2010, where
AS2010 is the available stocks on January 1, 2010;
ES2009 is the existing pre-phaseout stocks of methyl bromide
held in the United States by producers, importers, and distributors on
January 1, 2009; D2009 is the drawdown or estimated drawdown
of existing stocks during calendar year 2009; and SCF2010 is
the supply chain factor for 2010. In the proposed rule, EPA applied
this formula using an estimated drawdown for calendar year 2009. EPA
reached a preliminary conclusion that the calculated level of
``available stocks'' on January 1, 2010, would be a negative number.
EPA proposed to add an additional step to its determination of the
level of CSAs to be allocated in 2010 because simply taking the result
of the available stocks calculation would have resulted in an increase
in new production before pre-phaseout inventory was depleted. In
today's action, EPA is not finalizing the modified approach contained
in the proposed rule; however, EPA may consider that approach in a
future action. EPA does not need to consider the modified approach
further in this action because it has acquired end-of-year inventory
data that result in a different conclusion regarding available stocks.
As EPA did in the 2009 CUE Rule, EPA is using actual data rather than
relying on the estimate in the proposed rule. Using the formula
established in the 2008 CUE Rule and the actual inventory data, EPA
calculates that there are 1,028,108 kg of ``available stocks'' in 2010.
EPA is therefore allocating this amount as CSAs, following the approach
adopted in the 2008 CUE Rule. This calculation and others used to
determine the allocation of CUAs and CSAs can be found in the docket.
    Existing Stocks. In the above formula, ``ES2009'' refers
to pre-phaseout inventory--methyl bromide that was produced before the
January 1, 2005, phaseout date but is still held by domestic producers,
distributors, and third-party applicators. It does not include material
held by end users. ES2009 also does not include critical use
methyl bromide that was produced after January 1, 2005, and carried
over into subsequent years. Nor does it include methyl bromide produced
(1) under the QPS exemption, (2) with Article 5 allowances to meet the
basic domestic needs of Article 5 countries, or (3) for feedstock or
transformation purposes. EPA considers all pre-phaseout inventory to be
suitable for both pre-plant and post harvest uses. Similarly, EPA
considers pre-phaseout inventory to be accessible by all users,
including those in California and the Southeastern United States.
    One commenter disagrees that the entire existing inventory of pre-
phaseout stocks is available to critical users. This commenter states
that non-CUE users also use pre-phaseout inventory and that there are
now a relatively small number of methyl bromide distributors in the
U.S. EPA is aware that end users who are not approved critical users
can and do access pre-phaseout inventory. As determined in the 2008 CUE
Rule, EPA regards this material as ``available'' because it is owned by
someone other than the end user. While a distributor might choose to
sell methyl bromide to non-critical users to satisfy prior contracts or
internal business decisions, this is not the result of any EPA
regulatory constraint. Issues concerning supply of pre-phaseout
inventory are addressed in the Response to Comment Document for the
2008 CUE Rule, which is included in the docket for this rulemaking.
    Supply Chain Factor. The SCF represents EPA's technical estimate of
the amount of pre-phaseout inventory that would be adequate to meet a
need for critical use methyl bromide after an unforeseen domestic
production failure. As described in the 2008 CUE rule, and the
Technical Support Document contained in the docket to this rule, EPA
estimates that it would take 15 weeks for significant imports of methyl
bromide to reach the U.S. in the event of a major supply disruption.
Consistent with the regulatory framework used in the 2008 and 2009
rules, the SCF for 2010 conservatively reflects the effect of a supply
disruption occurring in the peak period of critical use methyl bromide
production, which is the first quarter of the year. While this 15-week
disruption is based on shipping capacity and does not change year to
year, other inputs to EPA's analysis do change each year including the
total U.S. and global authorizations for methyl bromide and the average
seasonal production of critical use methyl bromide in the U.S. Using
updated numbers, EPA estimates that critical use production in the
first 15 weeks of each year (the peak supply period) currently accounts
for approximately 63% of annual critical use methyl bromide demand for
2010. EPA, therefore, estimates that the peak 15-week shortfall in 2010
could be 2,036,000 kg (63% x 3,235,474 kg).
    As EPA stated in the 2008 and 2009 CUE Rules, the SCF is not a
``reserve'' or ``strategic inventory'' of methyl bromide but is merely
an analytical tool used to provide greater transparency. A general
discussion of the SCF is in the final 2008 CUE rule (72 FR 74118) and
further detail about the analysis used to derive the value for 2010 is
provided in the Technical Support Document in the public docket for
this rulemaking.
    Two commenters object to the use of a supply chain factor in
determining an amount of ``available stocks'' that can be used by
critical users. These commenters state that there is no basis for
making this allowance for the supposed risk of a catastrophic loss of
the methyl bromide production plant. One commenter also states that the
calculation is overly conservative because it assumes a catastrophic
loss when production is at the peak. The commenter also states that the
calculation incorrectly assumes that growers have no alternative to
methyl bromide in the event of such a loss. Finally, the commenter
states that the purpose for such a reserve is undermined by the fact
that EPA is not actually maintaining the inventory for

the event of a catastrophic loss but is instead allowing inventory to
be used by non-critical users. EPA has addressed these comments in
prior rulemakings; those responses are available in the docket for this
rulemaking.
    Two commenters also object to EPA's process of determining whether
the inventory was ``available'' through use of the supply chain factor.
These commenters request that EPA require that the inventory be
exhausted before allowing any additional new production. EPA has
addressed these comments in prior rulemakings; those responses are
available in the docket for this rulemaking.
    Estimated Drawdown. EPA proposed to estimate the drawdown of
existing stocks (the D2009 term in the above equation) by
using a simple linear fit estimation of inventory data from all
available years. In the 2009 Rule, EPA utilized end-of-year data and
did not have to estimate the drawdown. Commenters on the 2009 CUE rule
suggested additional forecasting techniques: Time series forecasting
(extrapolating past behavior into the future) and change-point
detection methods (change-point detection is the identification of
abrupt changes in the generative parameters of sequential data--looking
at data and calculating when it changes its slope). EPA did not propose
to use these methods in the 2010 Rule because they would require more
data than the six data points that EPA has on annual inventory levels.
EPA welcomed comment on these techniques for forecasting future
drawdown amounts. EPA also welcomed comment on whether the estimate
should be limited to a statistical analysis of past inventory levels or
whether EPA should collect additional data or consider other factors.
EPA suggested in the 2010 proposed rule that it could collect actual
data on stocks near the end of the calendar year through EPA's
information gathering authority under section 114 of the Clean Air Act.
Alternatively, EPA could revise the regulations to add a reporting
requirement to facilitate the early collection of this information in
future years. EPA did not receive any comments on these alternate
methods for calculating the drawdown or additional reporting
requirements.
    In the final rule, EPA is not pursuing the alternative statistical
methods of estimating drawdown discussed above because EPA has received
end-of-year reporting data. As in the 2009 CUE Rule, EPA is using
reported data and not relying on an estimate of drawdown. In addition,
the labeling for methyl bromide is currently being revised through
EPA's reregistration process under FIFRA section 4. While this does not
affect the 2010 CUE rule, it will likely change methyl bromide use
patterns and make previous years' drawdown data less predictive of
future use. It may also make it easier to estimate the amount of pre-
phaseout inventory that will be used in the future because the uses of
inventory will be constrained. This may lessen the impetus for more
frequent reporting, which was suggested by commenters. EPA is therefore
not including provisions in this rule that would require inventory
holders to report more frequently than they do now.
    One commenter states that there appeared to be an error in EPA's
estimate of the drawdown of inventory during 2009. The Technical
Support Document for the 2008 and 2009 CUE Rules state that the 2007
inventory was 7,671,000 kg. This is in contrast to the Technical
Support Document for the Proposed Rule which states that the inventory
was 7,941,000 kg. EPA explained in the 2009 CUE rule that it corrected
its assessment of the amount pre-phaseout inventory that was available
on December 31, 2006, which EPA originally stated was 7,671,091 kg. EPA
had received late data in 2007 that it did not incorporate into the
total inventory level for the year. The corrected value for the amount
of pre-phaseout inventory as of December 31, 2006, was 7,941,009 kg.
EPA clarified this in the 2009 rule because a change in the inventory
value affects any estimates used to calculate future drawdown. That
change does not affect this or last year's allocations because they are
based on reported data rather than estimates.
    Using end-of-year data, EPA calculates that the pre-phaseout methyl
bromide inventory, which was 4,271,226 kg on January 1, 2009, was drawn
down by 1,207,118 kg during 2009. This results in a pre-phaseout
inventory of 3,064,108 kg on January 1, 2010. The actual drawdown in
2009 was less than half of the rate estimated in the proposed rule
(1,207 MT compared to 2,834 MT). The pre-phaseout inventory on December
31, 2009, is thus double what the Agency calculated in the proposed
rule (3,064 MT compared to 1,437 MT).
3. Approach for Determining Critical Use Amounts
    In the proposed rule, EPA calculated ``available stocks'' using the
approach described in Section V.D.2 above. This resulted in a value
less than zero, meaning that EPA estimated that in 2010 there would no
longer be an amount of pre-phaseout inventory that meets EPA's
definition of ``available stocks.'' EPA recognized in the 2008 rule
that the formula for calculating ``available'' stocks would in some
future rulemaking yield a number less than the minimum effectively
stipulated by the Parties (the difference between the total authorized
critical use amount and the authorized amount of new production and
imports). In the preambles to the 2008 and 2009 rules, EPA indicated
that when that occurred, the Agency would issue CSAs equal to the
minimum amount stipulated by the Parties.
    In the proposed rule, EPA expressed the concern that if it were to
follow the approach set forth in the 2008 rule, new production and
import in 2010 could exceed the previous year's level. As explained in
the proposed rule, this was an additional circumstance that EPA had not
considered when the Agency previously outlined what future actions it
might take. To ensure continued progress in reducing U.S. production
and import of critical use methyl bromide, EPA proposed to limit 2010
CUAs (i.e., production and import) to the same level as in 2009. EPA
proposed to make up the remaining critical need by using its discretion
to increase the CSA allocation proportionately. EPA proposed to
allocate only the amount of CSAs necessary to make up the difference
between the overall U.S. critical need and the CUA amount in the 2009
CUE rule. Three commenters support EPA's proposal not to increase new
production from the 2009 levels while one commenter is opposed. The
comment in opposition states that it was entirely foreseeable that the
amount of new production may have to increase from one year to the
next. Second, the commenter in opposition states that the proposed
approach to limit new production fails to follow EPA's established
procedure for determining CUAs and is therefore an abuse of discretion.
    EPA is not finalizing the approach discussed in the proposed rule
in today's action because, given the year-end inventory data,
application of the existing framework will not increase the amount of
new production compared to 2009. EPA is not deciding whether or not a
policy limiting new production would be appropriate in some future year
because the situation prompting its use no longer exists for this rule.
EPA has recalculated ``available stocks'' using end-of-year inventory
data rather than using an estimate of drawdown. The pre-phaseout
inventory on December 31, 2009, is double what the Agency calculated in
the proposed rule (3,064 MT compared to 1,437 MT). As a result,

EPA now calculates that 1,028,108 kg of pre-phaseout inventory would be
``available stocks.'' In this final rule, EPA is applying its existing
framework to determining CSAs and CUAs and is not finalizing the
approach limiting new production that was discussed in the proposed
rule. EPA may consider that approach in future CUE rulemakings.
    EPA continues to recognize that at some date the inventory will be
drawn down to the SCF level and then below the SCF even if EPA sets the
CSA amount equal to the difference between the total authorized CUE
amount and the authorized new production amount. The inventory is a
finite resource: EPA has made clear in the framework rule in the
context of discussing the carryover amount that it will not allow the
inventory to increase. 69 FR 76977. With this action the Agency is
allowing 1,028,108 kg of methyl bromide to be supplied from pre-
phaseout inventory for critical uses in 2010 by issuing an equivalent
number of CSAs, and adjusting the amount of CUAs accordingly. EPA
calculates that there will be sufficient pre-phaseout inventory at the
beginning of the 2011 control period to satisfy the amount of 2011
inventory drawdown (200,000 kg) for critical uses identified by the
Parties in Decision XXI/11.
    To summarize, the critical use amounts authorized by the Parties in
Decisions XX/5 and XXI/11 for 2010 total 3,235,474 kg. The maximum
amount of authorized new production or import as set forth in those two
Decisions is 2,765,474 kg, ``minus available stocks.'' Applying the
``available stocks'' approach finalized in the 2008 CUE Rule, EPA is
expecting 1,028,108 kg of 2010 critical use needs to be met from pre-
phaseout inventory and thus is issuing CSAs in that amount. As in past
years, EPA is adjusting the amount of CUAs accordingly, so that the sum
of CUAs and CSAs is not greater than the total amount authorized by the
Parties. Under the existing framework, EPA's practice is to allocate a
total number of CUAs and CSAs that is less than the total critical use
amount authorized by the Parties as necessary to account for carry over
amounts of methyl bromide, amounts for research purposes, or for other
appropriate reasons, including updated information on alternatives.
Each of these reductions is discussed below, but only the carry over
value affects this year's allocation amount. As a result, EPA is
allowing 1,955,775 kg of new production and import for critical uses in
2010. EPA has provided these calculations in Section V.D.6 below and in
a document titled ``CUE Calculation Spreadsheet'' in the docket.
4. Treatment of Carryover Material
    As discussed in the Framework Rule, EPA does not permit the
building of stocks of methyl bromide produced or imported after January
1, 2005, under the critical use exemption. 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,'' whether pre-plant or post-harvest, 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 stocks (ES) (which applies to pre-phaseout material) because
this would lead to a double-counting of carryover amounts, and a double
reduction of critical use allowances (CUAs).
    In 2009, companies reported that 3,036,130 kg of critical use
methyl bromide were acquired through production or import in 2008. The
information reported to EPA is that 2,784,539 kg of critical use methyl
bromide were exported or sold to end-users in 2008. EPA calculates that
the carryover amount at the end of 2008 was 251,591 kg, which is the
difference between the reported amount of critical use methyl bromide
acquired in 2008 and the reported amount of exports or sales of that
material to end users in 2008 (3,036,130-2,784,539 = 251,591 kg). Using
the existing framework, EPA is applying the carryover deduction to the
new production amount as it has in all prior CUE rules. Therefore, EPA
is reducing the amount of new production by 251,591 kg. EPA calculated
the carryover amount in the proposed rule though it did not have a
direct effect on the CUA numbers given the proposed approach to limit
new production.
    One commenter states that the carryover amount calculated by EPA is
higher than the amount of unsold material. The commenter reiterates
suggestions made in prior CUE rules to change the reporting system so
that EPA could identify non-reporting companies or alternatively
calculate carryover as the amount of methyl bromide companies report as
held in inventory. EPA has responded to this comment in previous rules;
EPA's responses are available in the docket. The commenter also
requests that EPA pursue companies that it suspects are not reporting.
EPA stated in the proposed rule that it has contacted companies that it
suspects may have purchased or sold methyl bromide but had not
submitted reporting forms. EPA received a few late reports totaling
15,686 kg. As a result EPA adjusted the carryover amount in this final
rule.
    EPA's calculation of the amount of carryover at the end of 2008 is
consistent with the method used in previous CUE rules, and with the
method agreed to by the Parties in Decision XVI/6, which established
the Accounting Framework for critical use methyl bromide, for
calculating column L of the U.S. Accounting Framework. The 2008 U.S.
Accounting Framework is available in the public docket for this
rulemaking. EPA notes that the carryover value in the Accounting
Framework is higher by 17 MT than the number contained in this final
rule due to additional reports received after EPA provided the
Accounting Framework to UNEP.
5. Methyl Bromide Alternatives
    EPA considers new data regarding alternatives that were not
available at the time the U.S. Government submitted its Critical Use
Nomination (CUN) to the Parties, and adjusts the allocation for new
production accordingly. For 2010, EPA is not making further reductions
in post-harvest or pre-plant critical use allowances to reflect the
transition to alternatives because the 2010 CUN applied transition
rates for all critical use sectors. The TEAP report of October 2008
included reductions in its recommendations for critical use categories
based on the transition rates in the 2010 CUN. The TEAP's
recommendations were then considered in the Parties' 2010 authorization
amounts, as listed in Decision XX/5. Therefore, transition rates, which
account for the uptake of alternatives, have already been applied for
authorized 2010 critical use amounts.
    Furthermore, the 2012 CUN, which represents the most recent
analysis and the best available data for methyl bromide alternatives,
does not conclude that transition rates should be increased for 2010.
As the 2012 CUN reflects, the United States Government has not found
new information that supports changing the 2010 transition rates
included in the 2010 CUN and applied by MBTOC. EPA continues to gather
information about methyl bromide alternatives through the CUE
application process, and by other means.

    The 2010 CUN includes transition rates for iodomethane and there is
no new information that would suggest changing those rates. Currently,
iodomethane is registered for use in 47 States. California has not yet
decided whether to register iodomethane for use in the State. EPA did
not propose any adjustment based on iodomethane in its proposed rule.
Two commenters suggest that EPA make additional reductions to the
allocation to reflect the uptake of iodomethane. One commenter states
that EPA underestimated the uptake of iodomethane in the 2008 and 2009
CUE rules and cites the amount of iodomethane sold each year and the
size of the reduction to the allocations in the 2008 and 2009 rules.
EPA calculated the uptake of iodomethane in the critical use nomination
for 2010. EPA would revisit that calculation in this rule if new data
on market penetration or State registrations warranted such action, as
it did in the 2008 and 2009 CUE rules. The commenter fails to recognize
that the Agency has already made a reduction in the nomination. EPA has
accounted for all State registrations in the 2010 nomination and does
not believe additional reductions are warranted.
    EPA also stated in its proposed rule that it did not intend to make
any adjustments to account for the reduced production of Telone in
2009. Dow AgroSciences commented that they were seeking to increasing
production of Telone and intended to restore the availability of this
material to full levels by the end of 2009. One commenter states that
there may still be some lingering shortages. Another commenter states
that even if the supply is not fully restored, growers can use
iodomethane or methyl bromide stockpiles. EPA has received additional
information on the production and availability of Telone from Dow
AgroSciences, which the Agency has entered into the CBI portion of the
docket, and based on that data does not believe that the shortage will
continue into 2010.
    EPA received a dozen comments from pest control companies and end
users who use sulfuryl fluoride. These commenters relate their
experiences using sulfuryl fluoride and expressed support for its
further use in the post harvest sector. One commenter provided
additional data in support of sulfuryl fluoride as an effective
alternative to methyl bromide. EPA responds to the technical data in
the response to comments. Two commenters state that sulfuryl fluoride
has been demonstrated to be both effective and economical as a methyl
bromide alternative in structural fumigations. These commenters state
that EPA should therefore not authorize any structural applications as
a critical use and reduce the allocation accordingly. The 2010 CUN
reflected uptake of sulfuryl fluoride. As discussed above, EPA does not
have economic data to support an increased transition rate or a
reduction in the allocation. More information on the uptake of sulfuryl
fluoride is found in the 2010 CUN and in the response to comments
document.
    EPA continues to support research and adoption of methyl bromide
alternatives, and to request information about the economic and
technical feasibility of all existing and potential alternatives. EPA
has not received any new data that was not considered by the Parties
that would lead it to change the transition rates for 2010. Therefore,
the final rule does not make any adjustments to account for new
information on the uptake of alternatives.
6. Summary of Calculations
    The calculations described above for determining the level of new
production and critical stock allowances is summarized in the table
below:

------------------------------------------------------------------------
                                                            Kilograms
------------------------------------------------------------------------
Step 1: Calculate supply chain factor:
    U.S. authorization for 2010 in Decision XX/5......         3,233,456
    U.S. authorization for 2010 in Decision XXI/11....             2,018
    - Reduction for uptake of alternatives............                 0
    = One year's CUE need.............................         3,235,474
    x Percentage of year's production to recover from              62.9%
     production failure...............................
= Supply Chain Factor.................................         2,036,000
Step 2: Calculate available stocks:
    Existing pre-phaseout inventory on January 1, 2009         4,271,226
     (``ES2009'').....................................
    - Drawdown of inventory during 2009 (``D2009'')...         1,207,118
    - Supply Chain Factor.............................         2,036,000
= Available stocks (``AS2010'') = Critical Stock               1,028,108
 Allowance............................................
Step 3: Calculate carry over:
    Reported as produced/imported in 2008.............         3,036,130
    - Reported as sold in 2008........................         2,784,539
= Carry over..........................................           251,591
Step 4: Calculate new production:
    Total U.S. authorization for 2010 (Decisions XX/5          3,235,474
     and XXI/11)......................................
    - Critical Stock Allowance (Step 2)...............         1,028,108
    - Carryover (Step 3)..............................           251,591
    - Uptake of alternatives..........................                 0
= New production = Critical Use Allowance.............         1,955,775
------------------------------------------------------------------------

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

    Paragraphs 2 and 7 of Decision XX/5 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 2010 control
period. A discussion of the Agency's application of the criteria in
paragraph 1 of Decision IX/6 appears in sections V.A., V.C., V.D., and
V.H. of this preamble. The Agency solicited comments on the technical
and economic basis for determining that the uses listed in the proposed
rule meet the criteria of the critical use exemption (CUE). The
critical use nominations (CUNs) detail how each 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 sections V.D.,
V.G., and

V.H. 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, and EPA refers readers to the 2006 CUE final rule (71 FR
5989) as well as to the memo on the docket titled ``Development of 2003
Nomination for a Critical Use Exemption for Methyl Bromide for the
United States of America'' for further elaboration.
    The remaining considerations, 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, are addressed in the nomination
documents.
    Some of these criteria are evaluated in other documents as well.
For example, the U.S. has further considered matters regarding 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 and in ongoing consultations with industry. 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.
    The USG's approach to research changed slightly in the 2010
nomination. In previous years, while the nomination was broad enough to
cover both research and non-research uses, the USG nominated a
separate, additional amount specifically for research purposes.
However, Decision XVII/9 requested that the Parties ``endeavor to use
stocks, where available, to meet any demand for methyl bromide for the
purposes of research and development.'' Therefore, when allocating
allowances in previous years, EPA subtracted that separate research
amount from the Parties' authorized production level for the U.S. This
in effect encouraged the use of stocks for research purposes. For 2010,
the nomination was again broad enough to cover both research and non-
research uses but the USG did not nominate a separate, additional
amount specifically for research purposes. Thus, EPA did not propose to
adjust the production level to subtract this amount.
    One commenter objects to EPA encouraging researchers to use pre-
phaseout inventory. They expressed concern that a further reduction in
stocks will jeopardize growers' ability to endure a supply chain
disruption and note that the higher cost and reduced availability of
pre-phaseout inventory will harm research into alternatives if
researchers are limited to pre-phaseout inventory. Instead, EPA should
increase the level of new production that is dedicated for research
purposes. EPA responds that unlike previous years, the nomination did
not specifically dedicate an amount for research purposes, thus there
is no specific amount by which EPA could increase new production.
Second, because EPA is allowing research as a critical use, the Agency
is not limiting researchers to inventory. Use of inventory methyl
bromide for research could reduce the amounts available in case of a
supply chain disruption but EPA does not anticipate the effect will be
significant given the small amounts of methyl bromide used for
research.
    In this final rule, EPA has determined that research on the
critical use crops shown in the table in Appendix L to subpart A
remains a critical use of methyl bromide. Research on critical use
crops is fundamental to the critical use process. Decision IX/6, which
sets forth the criteria for a ``critical use'' determination, requires
ongoing research programs in order for a Party to receive critical
uses:

    (b) That production and consumption, if any, of methyl bromide
for a critical use should be permitted only if: (iii) It is
demonstrated that an appropriate effort is being made to evaluate,
commercialize and secure national regulatory approval of
alternatives and substitutes, taking into consideration the
circumstances of the particular nomination * * * Non-Article 5
Parties [e.g., the U.S.] must demonstrate that research programmes
are in place to develop and deploy alternatives and substitutes * *
*

Though the USG did not request an additional amount for 2010, the
nomination remains consistent with past nominations both in discussing
how current research affects the use and uptake of alternatives as well
as the USG's efforts to conduct research. The nomination states, ``As
noted in our previous nomination, the USG provides a great deal of
funding and other support for agricultural research, and in particular,
for research into alternatives for methyl bromide. This support takes
the form of direct research conducted by the Agricultural Research
Service (ARS) of USDA, through grants by ARS and CSREES, by IR-4, the
national USDA-funded project that facilitates research needed to
support registration of pesticides for specialty crop vegetables,
fruits and ornamentals, through funding of conferences such as MBAO,
and through the land grant university system.'' Consistent with past
practice, EPA is not listing research as a separate entry in the table
in Appendix L: however, research remains an aspect of the listed
critical uses. The USG may or may not nominate additional amounts for
research in future years. Also consistent with past rules, EPA
continues to request that researchers use pre-phaseout inventory when
possible.

F. Emissions Minimization

    Decision XX/5, paragraph 11 states that Parties shall request
critical users to 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.'' In the
judgment of USG scientists, use of virtually impermeable film (VIF)
tarps allows pest control with lower application rates while minimizing
emissions. The quantity of methyl bromide nominated by the USG reflects
the lower application rates necessary when using tarps.
    Two commenters ask EPA to require emissions minimization techniques
rather than simply encourage them. Rather than mandate emission
reduction techniques, EPA will continue to work with the U.S.
Department of Agriculture--Agricultural Research Service (USDA-ARS) to
promote the techniques on a voluntary basis. As discussed above, the
Federal government has invested substantial resources into best
practices for methyl bromide use, including emission reduction
practices. USDA-ARS has a national outreach effort to publicize the
best practices. Also, EPA continues to work on the registration of
promising methyl bromide alternatives.
    Users of methyl bromide should make every effort to minimize
overall emissions of methyl bromide to the extent consistent with State
and local laws and regulations. The Agency continues to encourage
researchers and users who are successfully utilizing such techniques to
inform EPA of their experiences and for applicants to provide such
information with their critical use applications. The Agency welcomes
information on the implementation of emission minimization techniques
and whether

and how further emissions could be reduced further.

G. Critical Use Allowance Allocations

    EPA is allocating 2010 critical use allowances for new production
or import of methyl bromide up to the amount of 1,955,775 kg (7.7% of
baseline) as shown in Table III below. Each critical use allowance
(CUA) is equivalent to 1 kg of critical use methyl bromide. 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
allocation of pre-plant and post-harvest CUAs to the entities listed
below 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 (69 FR
76982).
    The CUAs are allocated as follows:

                                Table III--Allocation of Critical Use Allowances
----------------------------------------------------------------------------------------------------------------
                                                                   2010 Critical use        2010 Critical use
                                                                  allowances for pre-      allowances for post-
                            Company                                   plant uses *            harvest uses *
                                                                      (kilograms)              (kilograms)
----------------------------------------------------------------------------------------------------------------
Great Lakes Chemical Corp. A Chemtura Company.................                1,102,380                   86,145
Albemarle Corp................................................                  453,324                   35,425
ICL-IP America................................................                  250,516                   19,576
TriCal, Inc...................................................                    7,800                      610
                                                               -------------------------------------------------
    Total **..................................................                1,814,020                  141,755
----------------------------------------------------------------------------------------------------------------
* 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 40 CFR part 82.
** Due to rounding, numbers may not add exactly.

    Paragraph six of Decision XX/5 states ``that Parties shall endeavor
to license, permit, authorize or allocate quantities of critical-use
methyl bromide as listed in tables A and C of the annex to the present
decision.'' This is similar to language in Decisions authorizing prior
critical uses. The language from these Decisions calls on Parties to
endeavor to allocate critical use methyl bromide on a sector basis.
    One commenter states that EPA should allocate specifically to each
of the Critical Use Categories as authorized by the Parties. The EPA's
``lump sum'' approach, the commenter asserts, does not guarantee that
critical users have access to methyl bromide and it instead allows
those with the greatest ability to pay to garner methyl bromide away
from other users with approved critical needs. Furthermore, this
commenter states that developers of methyl bromide alternatives need
assurance that methyl bromide will eventually exit a particular use
segment. Allowing an open market for methyl bromide allocation is an
economic disincentive for anyone developing alternatives. At a minimum,
this commenter supports distinguishing between pre-plant and post-
harvest sectors as EPA currently does.
    The Framework Rule proposed several options for allocating critical
use allowances, including a sector-by-sector approach. The Agency
evaluated the 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. For the reasons discussed in
the preamble to the 2009 CUE rule (74 FR 19894), the Agency believes
that under the approach adopted in the Framework Rule, the actual
critical use will closely follow the sector breakout listed in the
Parties' decisions. The commenters' concerns are addressed more
specifically in the response to comment document.

H. Critical Stock Allowance Allocations

    For the reasons discussed above, EPA is allocating critical stock
allowances (CSAs) to the entities listed below in Table IV for the 2010
control period in the amount of 1,028,108 kg (4.0% of baseline). This
amount reflects the application of the existing framework using end-of-
year data rather than an estimate of drawdown rates. In addition, the
calculation is based on a higher total U.S. authorization incorporating
the additional 2,018 kg authorized by the parties in Decision XXI/11
which added North Carolina and Tennessee strawberry nursery growers to
the list of critical uses.
    EPA's allocation of CSAs is based on each company's proportionate
share of the aggregate inventory. In 2006, the United States District
Court for the District of Columbia upheld EPA's treatment of company-
specific methyl bromide inventory information as confidential. NRDC v.
Leavitt, 2006 WL 667327 (D.D.C. March 14, 2006). Therefore, the
documentation regarding company-specific allocation of CSAs is in the
confidential portion of the rulemaking docket and the individual CSA
allocations are not listed in the table below. EPA will inform the
listed companies of their CSA allocations in a letter following
publication of the final rule.
    EPA received notice that Hy-Yield Bromine and its assets were
transferred to a third party named Hy-Yield products, LLC, which is
owned by Trinity Manufacturing, LLC. EPA is therefore not issuing
critical stock allowances to Hy-Yield Bromine but rather to Hy-Yield
Products in this and in subsequent rulemakings.

           Table III--Allocation of Critical Stock Allowances
------------------------------------------------------------------------
                                 Company
-------------------------------------------------------------------------
Albemarle
Bill Clark Pest Control, Inc.
Burnside Services, Inc.
Cardinal Professional Products
Chemtura Corp.
Degesch America, Inc.
Helena Chemical Co.
Hendrix & Dail
Hy-Yield Products, LLC
ICL-IP America
Industrial Fumigation Company
Pacific Ag
Pest Fog Sales Corp.
Prosource One
Reddick Fumigants
Royster-Clark, Inc.
Trical Inc.
Trident Agricultural Products
UAP Southeast (NC)
UAP Southeast (SC)
Univar

Western Fumigation
    TOTAL--1,028,108 kilograms
------------------------------------------------------------------------

I. Stocks of Methyl Bromide

    An approved critical user may purchase methyl bromide produced or
imported with CUAs as well as limited inventories of pre-phaseout
methyl bromide, the combination of which constitute the supply of
``critical use methyl bromide'' intended to meet the needs of
authorized critical uses. The Framework Rule established provisions
governing the sale of pre-phaseout inventories for critical uses,
including the concept of CSAs and a prohibition on the sale of pre-
phaseout inventories for critical uses in excess of the amount of CSAs
held by the seller. It also established trading provisions that allow
critical use allowances (CUAs) to be converted into CSAs. EPA has
retained these provisions for the 2010 control period.
    The aggregate amount of pre-phaseout methyl bromide reported as
being in inventory at the beginning of 2009 is 4,271,226 kg. EPA
calculates using end-of-year data that the aggregate inventory on
January 1, 2010, was 3,064,108 kg. As in prior years, the Agency will
continue to closely monitor CUA and CSA data. Further, as stated in the
final 2006 CUE rule, safety valves continue to exist. If an inventory
shortage occurs, EPA may consider various options including authorizing
the conversion of a limited number of CSAs to CUAs through a
rulemaking, bearing in mind the upper limit on U.S. production/import
for critical uses.
    One commenter states that EPA should not allow non-critical users
access to methyl bromide inventories. Any such action by EPA
restricting non-critical users' access to stocks under the Clean Air
Act would be discretionary. Nothing in the Protocol or the Clean Air
Act mandates that EPA limit drawdown from inventory for such uses.
Decision Ex I/3 of the Montreal Protocol, which informs Agency actions
on methyl bromide, does not require that individual Parties (such as
the U.S.) prohibit the use of stocks by users whose uses fall outside
the categories of agreed-upon critical uses. Further detail on the
issue of non-critical users' access to pre-phaseout inventory is
available in previous CUE preambles and response to comments documents
available in the docket. Though EPA is not using authorities under the
Clean Air Act to restrict the use of pre-phaseout inventory, EPA is
limiting the crops that will legally be able to use methyl bromide
through the reregistration process under FIFRA. Users of methyl bromide
must meet not only the requirements of the Clean Air Act, but also must
comply with all requirements under FIFRA, including limits on the sale
of products for pre-planting use for certain crops, and all directions
for use on product labeling. EPA disagrees that inventory methyl
bromide should not be allowed on any non-CUE crop. However, EPA has
determined that the risks posed by the use of methyl bromide, both the
acute and chronic toxicological effects as well as its ability to
deplete the ozone layer, would be unacceptable without significant risk
mitigation measures, including limiting its use to fewer crops.
    As explained in the 2008 CUE final rule, the Agency intends to
continue releasing the aggregate of methyl bromide stockpile
information reported to the Agency under the reporting requirements at
40 CFR 82.13 for the end of each control period. EPA notes that if the
number of competitors in the industry were to decline appreciably, EPA
would revisit the question of whether the aggregate is entitled to
treatment as confidential information and whether to release the
aggregate without notice. The aggregate information for 2003 through
2009 is available in the docket for this rulemaking.

VI. Statutory and Executive Order Reviews

A. Executive Order 12866: Regulatory Planning and Review

    Under Executive Order (EO) 12866 (58 FR 51735, October 4, 1993),
this action is a ``significant regulatory action.'' This action is
likely to result in a rule that may raise novel legal or policy issues.
Accordingly, EPA submitted this action to the Office of Management and
Budget (OMB) for review under EO 12866 and any changes made in response
to OMB 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 change any of those existing requirements.
However, 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 that is identified by the North American Industry
Classification System (NAICS) Code in the 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.
                                 1113--Fruit and Nut      0172--Grapes...........
                                  Tree Farming.
                                 1114--Greenhouse,        0173--Tree Nuts........
                                  Nursery, and            0175--Deciduous Tree
                                  Floriculture             Fruits (except apple
                                  Production.              orchards and farms).
                                                          0179--Fruit and Tree
                                                           Nuts, NEC.

                                                          0181--Ornamental
                                                           Floriculture and
                                                           Nursery Products.
                                                          0831--Forest Nurseries
                                                           and Gathering of
                                                           Forest Products.
Storage Uses...................  115114--Postharvest      .......................  $7 million.
                                  Crop activities
                                  (except Cotton
                                  Ginning).
                                 311211--Flour Milling..  2041--Flour and Other    500 employees.
                                                           Grain Mill Products.
                                 311212--Rice Milling...  2044--Rice Milling.....  500 employees.
                                 493110--General          4225--General            $25.5 million.
                                  Warehousing and          Warehousing and
                                  Storage.                 Storage.
                                 493130--Farm Product     4221--Farm Product       $25.5 million.
                                  Warehousing and          Warehousing and
                                  Storage.                 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 Manufacturing.  Chemicals, NEC.
----------------------------------------------------------------------------------------------------------------

    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 estimated in 2008 that this
had declined to 2,000 end users of critical use methyl bromide. 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, EPA certifies 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 will confer a benefit to
users of methyl bromide. We have therefore concluded that this rule
will 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
does 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 primarily
affect producers, suppliers, importers, exporters, and users of methyl
bromide. Thus, Executive Order 13132 does not apply to this action.

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.

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

    EPA interprets EO 13045 (62 FR 19885, April 23, 1997) as applying
only to those regulatory actions that concern health or safety risks,
such that the analysis required under section 5-501 of the EO has the
potential to influence the regulation. This action is not subject to EO
13045 because it does not establish an environmental standard intended
to mitigate health or safety risks.

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

    This final 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 action does not involve technical standards. Therefore, EPA
did not consider the use of any voluntary consensus standards.

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

    Executive Order (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 concluded that it is not practicable to determine whether
there would be disproportionately high and adverse human health or
environmental effects on minority and/or low income populations from
this final rule. EPA believes, however, that this action 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 final
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.

K. Congressional Review Act