[Federal Register: October 24, 2008 (Volume 73, Number 207)]
[Proposed Rules]
[Page 63408-63419]
[DOCID:fr24oc08-25]

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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[EPA-R09-OAR-2008-0677; FRL-8734-2]

Approval and Promulgation of Implementation Plans; State of
California; 2003 State Strategy and 2003 South Coast Plan for One-Hour
Ozone and Nitrogen Dioxide

AGENCY: U.S. Environmental Protection Agency (EPA).

ACTION: Proposed rule.

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SUMMARY: EPA is proposing to approve one state implementation plan
(SIP) revision, and to approve in part and to disapprove in part a
second SIP revision, submitted by the California Air Resources Board to
provide for attainment of the one-hour ozone standard and maintenance
of the nitrogen dioxide standard in the Los Angeles-South Coast Air
Basin. The two SIP revisions include the 2003 State Strategy and the
2003 South Coast SIP, both of which were submitted on January 9, 2004.
    With respect to the 2003 State Strategy, EPA is proposing to
approve the commitment by the State to develop and propose near-term
defined measures sufficient to achieve specific emissions reductions in
the South Coast and to continue implementation of an existing measure.
With respect to the 2003 South Coast SIP, EPA is proposing to approve
certain elements, and to disapprove other elements. The plan elements
that are proposed for disapproval are not required under the Clean Air
Act because they represent revisions to previously-approved SIP
elements, and thus, the disapprovals will not affect the requirements
for the State to have an approved SIP for these SIP elements.
Therefore, the disapprovals, if finalized, would not trigger sanctions
clocks nor EPA's obligation to promulgate a Federal implementation
plan.
    EPA is proposing these actions under provisions of the Clean Air
Act regarding EPA action on SIP submittals and plan requirements for
nonattainment areas.

DATE: Any comments must arrive by November 24, 2008.

ADDRESSES: Submit comments, identified by docket number EPA-R09-OAR-
2008-0677, by one of the following methods:
     Federal eRulemaking Portal: www.regulations.gov. Follow
the online instructions.
     E-mail<EMAIL_ADDRESS>     Mail or deliver: Marty Robin, Office of Air Planning (AIR-
2), U.S. Environmental Protection Agency Region IX, 75 Hawthorne
Street, San Francisco, CA 94105.
    Instructions: All comments will be included in the public docket
without change and may be made available online at www.regulations.gov,
including any personal information provided, unless the comment
includes Confidential Business Information (CBI) or other information
whose disclosure is restricted by statute. Information that you
consider CBI or otherwise protected should be clearly identified as
such and should not be submitted through www.regulations.gov or e-mail.
www.regulations.gov is an ``anonymous access'' system, and EPA will not
know your identity or contact information unless you provide it in the
body of your comment. If you send e-mail directly to EPA, your e-mail
address will be automatically captured and included as part of the
public comment. If EPA cannot read your comment due to technical
difficulties and cannot contact you for clarification, EPA may not be
able to consider your comment.
    Docket: The index to the docket for this action is available
electronically at www.regulations.gov and in hard copy at EPA Region
IX, 75 Hawthorne Street, San Francisco, California. While all documents
in the docket are listed in the index, some information may be publicly
available only at the hard copy location (e.g., copyrighted material),
and some may not be publicly available in either location (e.g., CBI).
To inspect the hard copy materials, please schedule an appointment
during normal business hours with the contact listed in the FOR FURTHER
INFORMATION CONTACT section below.

FOR FURTHER INFORMATION CONTACT: Wienke Tax, Air Planning Office (AIR-
2), U.S. Environmental Protection Agency, Region IX,<PHONE_NUMBER>,
<EMAIL_ADDRESS>
SUPPLEMENTARY INFORMATION: Throughout this document, ``we,'' ``us'' and
``our'' refer to EPA.

Table of Contents

I. Summary of Today's Proposed Action
II. Background
    A. Introduction
    B. 1994 South Coast Ozone SIP and State Strategy
    C. 1999 State Update to the South Coast Ozone SIP
    D. 1997 South Coast AQMP and 1997/1999 South Coast Ozone SIP
    E. 2003 State Strategy
    F. 2003 South Coast SIP
III. Review of the 2003 State Strategy and 2003 South Coast SIP
    A. Procedural Requirements
    B. Base Year and Projected Baseline Emissions Inventory
    C. Control Measures and Contingency Measures
    1. State's Defined Measures
    2. District's Near-Term Control Measures, Annual Emissions
Reductions Commitment, and Contingency Measure
    3. District's Black Box Emissions Reduction Commitment
    4. Black Box Emissions Reduction Assignment to the Federal
Government
    D. Attainment Demonstration
    E. Quantitative Milestones and Reasonable Further Progress (RFP)
    F. Transportation Control Measures To Offset Growth in Motor
Vehicle Emissions
    G. Nitrogen Dioxide Maintenance Demonstration
    H. Motor Vehicle Emissions Budgets (MVEBs)
IV. Public Comment and Final Action
V. Statutory and Executive Order Reviews

I. Summary of Today's Proposed Action

    In today's action, under the Clean Air Act (CAA or ``Act''), we are
proposing to approve one state implementation plan (SIP) revision, and
to approve in part and to disapprove in part, a second SIP revision,
submitted by the California Air Resources Board (ARB) to provide for
attainment of the one-hour ozone national ambient air quality standard
(NAAQS) and for maintenance of the nitrogen dioxide NAAQS in the Los
Angeles-South Coast Air Basin Area (South Coast).\1\ The two SIP
revisions include the Final 2003 State and Federal Strategy (``2003
State Strategy'') and the 2003 revisions to the SIP for ozone and
nitrogen dioxide in the South Coast Air Basin (``2003 South Coast
SIP''), both of which were submitted by ARB on January 9, 2004. These
SIP revisions were developed in recognition of a need for additional
emissions reductions to attain the one-hour ozone NAAQS than had been
planned for in the late 1990s, and to establish new motor vehicle
emissions budgets (MVEBs) for transportation conformity.
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    \1\ The area referred to as ``Los Angles-South Coast Air Basin''
(South Coast Air Basin or ``South Coast'') includes Orange County,
the southwestern two-thirds of Los Angeles County, southwestern San
Bernardino County, and western Riverside County. For a precise
description of the boundaries of the Los Angeles-South Coast Air
Basin, see 40 CFR 81.305.
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    With respect to the 2003 State Strategy, we are proposing to
approve the commitments by ARB to develop and propose for adoption 15
near-term defined control measures, and the commitment by the
California Bureau of Automotive Repair to develop and propose one near-
term defined control measure sufficient to achieve specified emissions
reductions in the South

Coast. We are also proposing to approve the continuation of the
existing SIP pesticide strategy assigned to the California Department
of Pesticide Regulation.
    With respect to the 2003 South Coast SIP, we are proposing to
approve the base year and projected baseline emissions inventories, the
South Coast Air Quality Management District's (District's or SCAQMD's)
commitment to adopt and implement near-term stationary and mobile
source control measures (with the exception of ``FSS-05--Mitigation Fee
Program for Federal Sources'') and commitment to achieve aggregate
emission reductions through a schedule of rule adoption and
implementation, the District's contingency measure (``CTY-01--
Accelerated Implementation of Control Measures''), the District's
``black box'' emission reduction commitment,\2\ the vehicle emissions
offset demonstration, and the nitrogen dioxide maintenance
demonstration and related motor vehicle emissions budgets (MVEBs).
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    \2\ ``Black box'' commitment refers to the provisions under CAA
section 182(e)(5) that anticipate development of new control
techniques or improvement of existing control technologies.
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    Also, in connection with the 2003 South Coast SIP, we are proposing
to disapprove the District commitment to adopt one particular control
measure (``FSS-05--Mitigation Fee Program for Federal Sources''); the
``black box'' emissions reduction assignment to EPA; the revised rate-
of-progress and attainment demonstrations; and the ozone MVEBs.
    The primary rationale for proposing approval of certain control
measures and the specific SIP elements described above is that they
would strengthen the SIP by adding to, or updating, SIP elements
previously approved by EPA. The reasons for proposing disapproval of
the other specified elements of the 2003 South Coast SIP include
incorrect rate-of-progress calculation methods and the withdrawal by
ARB of the state emissions reductions commitments in the 2003 State
Strategy that were relied upon in the 2003 South Coast SIP. No
sanctions clocks or Federal implementation plan (FIP) requirement would
be triggered by our disapprovals, if finalized, because the plan
revisions that are the subject of the proposed disapprovals represent
revisions to previously-approved SIP elements that EPA determined met
the CAA requirements, and thus, the revisions are not required under
the Clean Air Act.

II. Background

A. Introduction

    Ground-level ozone is formed when oxides of nitrogen
(NOX), volatile organic compounds (VOC), and oxygen react in
the presence of sunlight, generally at elevated temperatures.\3\
Strategies for reducing smog typically require reductions in both VOC
and NOX emissions.
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    \3\ California plans sometimes use the term Reactive Organic
Gases (ROG) for VOC. These terms are essentially synonymous. For the
sake of simplicity, we use the term VOC herein to mean either VOC or
ROG.
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    Ozone causes serious health problems by damaging lung tissue and
sensitizing the lungs to other irritants. When inhaled, even at very
low levels, ozone can cause acute respiratory problems; aggravate
asthma; cause temporary decreases in lung capacity of 15 to 20 percent
in healthy adults, cause inflammation of lung tissue, lead to hospital
admissions and emergency room visits; and impair the body's immune
system defenses, making people more susceptible to respiratory
illnesses, including bronchitis and pneumonia. Children are most at
risk from exposure to ozone because they breathe more air per pound of
body weight than adults; their respiratory systems are still developing
and thus more susceptible to environmental threats; and children
exercise outdoors more than adults in the high-ozone months of summer.
    In 1979, under section 109 of the CAA, EPA established a primary,
health-based NAAQS for ozone: 0.12 parts per million (ppm) averaged
over a 1-hour period. See 44 FR 8220 (February 9, 1979). In 1997, EPA
revised the ozone NAAQS by establishing an 8-hour ozone NAAQS of 0.08
ppm. See 62 FR 38856 (July 18, 1997). Since submittal of the 2003 State
Strategy and 2003 South Coast SIP, EPA has revoked the 1-hour ozone
NAAQS, effective June 15, 2005, see 69 FR 23951 (April 30, 2004), and
tightened the 8-hour ozone NAAQS to 0.075 ppm, see 73 FR 16436 (March
27, 2008). The nitrogen dioxide NAAQS is 0.053 ppm, annual average. See
40 CFR 50.11.
    Despite significant progress over the years, ozone concentrations
in the South Coast continue to be the highest in the country. Over the
2005-2007 period, the expected number of exceedances relative to the
now-revoked 1-hour ozone NAAQS is 13.3 days per year (at the Crestline
monitor), and the design value is 0.164 ppm (at Crestline).\4\ With
respect to the 8-hour ozone NAAQS, over the same period, the design
value is 0.122 ppm.\5\ In contrast to ozone, concentrations of nitrogen
dioxide (NO2) in the South Coast continue to be well below the NO2
NAAQS. For instance, in 2005, the highest annual concentrations
measured in the South Coast were less the 60 percent of the nitrogen
dioxide NAAQS based on data reported in the 2007 South Coast Air
Quality Management District (AQMP) (June 2007).
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    \4\ For the 1-hour ozone standard, the expected number of
exceedances refers to the number of days per calendar year with
maximum hourly average concentrations above 0.12 ppm averaged over a
three-year period. The standard is attained in an area when the
expected number of exceedances is equal to or less than 1 at all
stations. The design value for an area, which characterizes the
severity of the air quality problem, is represented by the highest
design value at any individual ozone monitoring site (i.e., the
highest of the fourth highest 1-hour daily maximums in a given
three-year period with complete monitoring data).
    \5\ The air quality design value for the 8-hour ozone NAAQS is
the 3-year average of the annual fourth highest daily maximum 8-hour
ozone concentration.
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B. 1994 South Coast Ozone SIP and State Strategy

    The CAA was substantially amended in 1990 to establish new planning
requirements and attainment deadlines for the NAAQS, including 1-hour
ozone. Under section 107(d)(1)(C) of the Act, areas designated
nonattainment prior to enactment of the 1990 amendments, including the
South Coast, were designated nonattainment by operation of law. The
South Coast was classified as extreme nonattainment for 1-hour ozone,
with an attainment deadline no later than November 15, 2010. The South
Coast was also designated as ``nonattainment'' for nitrogen dioxide,
respirable particulate matter (PM10), and carbon monoxide (CO).
    The District adopted an ozone plan on September 9, 1994, as part of
the 1994 South Coast Air Quality Management Plan (``1994 South Coast
AQMP''). ARB supplemented the District plan with State measures and
submitted it as a revision to the California SIP on November 15, 1994.
On July 10, 1996, ARB submitted an extensive revision to the South
Coast control measure adoption schedule to adjust for slippage in the
plan's initial implementation. On January 8, 1997 (62 FR 1150), we
finalized approval of the South Coast ozone plan, including the ozone
portions of the 1994 South Coast AQMP, as amended in 1996, and the
State measures (``1994 Ozone SIP'').\6\ The plan also contained
``Federal measures,'' which the State wished us to adopt and

implement in order to reduce emissions from mobile sources.\7\
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    \6\ We approved some of the State and District measures in the
plan earlier. See particularly 60 FR 43379 (August 21, 1995).
    \7\ In response to this assignment, we established a Public
Consultative Process to identify the best options for achieving
further emissions reductions from mobile source controls, at least
to the extent they are needed for attainment of the 1-hour ozone
NAAQS in the South Coast. In connection with the establishment of
this process, both EPA and ARB made commitments regarding
appropriate future emissions reductions. Please see EPA's final
approval of the 1994 ozone SIP for a discussion of the ``Federal
measures,'' and our rationale, at that time, for establishing the
Public Consultative Process (62 FR 1152-5, 1184-6).
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C. 1999 State Update to the South Coast Ozone SIP

    On July 23, 1999 (64 FR 39923), we approved an update to the South
Coast portion of the 1994 Ozone SIP, reporting on implementation of
ARB's control measures in the 1994 SIP and the contribution from
Federal mobile source controls undertaken as part of the Public
Consultative Process. We also updated our own commitment and approved a
new ARB commitment to adopt by December 31, 2001, control measures
needed to achieve any additional reductions which were determined to be
appropriate for ARB. Please consult the final approval document and our
proposed approval (64 FR 30276, June 7, 1999) for more details on the
update, the ``Federal measures,'' and the Public Consultative Process
on national mobile source measures.

D. 1997 South Coast AQMP and the 1997/1999 South Coast Ozone SIP

    The South Coast Air Quality Management District (SCAQMD, or
``District'') adopted a completely revised plan on November 8, 1996
(``1997 South Coast AQMP''), and ARB submitted the revision on February
5, 1997. The 1997 South Coast AQMP was not federally required for
ozone, but was adopted by the District to address, in a comprehensive
fashion, Federal and State requirements for particulate matter, carbon
monoxide, and nitrogen dioxide, and State requirements for an ozone
plan update. The 1997 South Coast AQMP revised the emissions inventory,
modeling, and local control commitments in the attainment
demonstration, but did not revise the State SIP commitments adopted in
the 1994 Ozone SIP. The 1997 South Coast AQMP included a maintenance
plan and redesignation request for the nitrogen dioxide NAAQS, and EPA
approved the plan and redesignation request in 1998. See 63 FR 39747
(July 24, 1998).
    The District amended the ozone portion of the 1997 South Coast AQMP
on December 10, 1999 (``1999 South Coast AQMP Ozone Amendment''), and
ARB submitted the plan to us on February 4, 2000. We approved the ozone
portion of the 1997 South Coast AQMP, as amended in 1999, on April 10,
2000 (65 FR 18903), and refer to the amended plan as the 1997/1999
South Coast Ozone SIP.
    Specifically, in our April 2000 final rule, we approved the
baseline and projected emissions inventories and attainment
demonstration as contained in the 1997 South Coast AQMP, and we
approved the following elements in the 1999 South Coast AQMP Ozone
Amendment: District commitments to adopt and implement near-term and
intermediate-term control measures; the District's commitment to adopt
and implement ``black box'' control measures; the District's commitment
to achieve overall emissions reductions for the years 1999-2008; the
District's commitment to implement those measures that had been adopted
in regulatory form between 1994 and 1999; the rate-of-progress plan for
the 1999, 2002, 2005, 2008 and 2010 milestone years; the amendment to
the attainment demonstration in the 1997 South Coast AQMP for ozone;
and the motor vehicle emissions budgets. Upon the effective date of our
approval of the 1997/1999 South Coast Ozone SIP, this plan replaced and
superseded the 1994 Ozone SIP for the South Coast Air Basin with the
exception of the State control measures for mobile sources, consumer
products, and pesticides, and EPA's commitment to take part in the
Public Consultative Process as discussed in the previous section of
this document.

E. 2003 State Strategy

    On October 23, 2003, ARB adopted the Final 2003 State and Federal
Strategy for the California SIP (``2003 State Strategy''). The 2003
State Strategy consists of the Proposed 2003 State and Federal Strategy
for the California SIP (released August 25, 2003), as modified by ARB
in the resolution approving the strategy. The modifications to the
proposed strategy are set forth in attachment A to ARB Board Resolution
03-22. The 2003 State Strategy identifies ARB's regulatory agenda to
reduce ozone and particulate matter in California by 2010 and was
submitted to update and replace the State's control measure commitments
in the 1994 Ozone SIP, as modified in 1999 for the South Coast.
    As submitted, the 2003 State Strategy includes four components
affecting the South Coast: (1) State agency commitments to pursue 20
new defined near-term control measures to reduce emissions from mobile
sources and consumer products, and to continue implementation of the
existing SIP commitment to reduce VOC emissions from pesticide use; (2)
State agency annual adoption commitments to achieve at least 50 tons
per day (tpd) VOC and 59 tpd NOX emissions reduction in the
South Coast in 2010 from these or other near-term measures; \8\ (3) ARB
commitment to identify and adopt strategies by 2008 to achieve an
additional 97 tpd combined VOC and NOX reductions in the
South Coast through, in part, the evaluation of 21 additional control
concepts between 2004-2006 and adoption of those found to be feasible
as SIP measures on a specified schedule; and (4) ARB's ``black box''
commitment to reduce emissions in the South Coast by 118-233 tpd of VOC
and 0-159 tpd of NOX by 2010 for ``black box'' emissions
reductions.\9\ ARB submitted the 2003 State Strategy to us on January
9, 2004. On February 18, 2004, EPA found the 2003 State Strategy to be
complete.
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    \8\ ARB's annual adoption commitment represents a commitment to
adopt and implement near-term measures to achieve, at a minimum, the
VOC and NOX emissions reductions in tpd in the South
Coast in 2010. Each year from 2003 through 2006 has a separate
adoption commitment for VOC and NOX. For example, ARB's
commitment for 2003 is to adopt near-term measures in that year that
in the aggregate achieve at least 10 tpd VOC and 11 tpd
NOX emissions reductions in 2010 in the South Coast.
Under this commitment, reductions in excess of the minimum
commitment for a given year may be applied to the commitment for
subsequent years.
    \9\ The range is based on how much of the 97 tpd commitment is
achieved from VOC versus NOX, and EPA action on a Federal
emissions reduction assignment in the 2003 South Coast AQMP for 18
tpd VOC and 68 tpd NOX by 2010.
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    By letter dated February 13, 2008, ARB withdrew certain elements of
the 2003 State Strategy that relate to the South Coast. Specifically,
ARB withdrew four specific defined near-term measures, the State agency
annual adoption commitments described above,\10\ the ARB commitment to
identify and adopt strategies by 2008 to achieve an additional 97 tpd
combined VOC and NOX reductions in the South

Coast,\11\ and ARB's ``black box'' commitment described above. For the
South Coast, the remaining component of the 2003 State Strategy is the
State agency commitments to pursue 16 new defined near-term control
measures (and to continue implementation of the existing SIP commitment
to reduce VOC emissions from pesticide use).\12\ We are addressing the
remaining commitments for the South Coast in the 2003 State Strategy in
today's action.
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    \10\ In ARB's February 13, 2008 letter, ARB indicated that it
was withdrawing the Commitment to Reduce Emissions via Adoption
Schedule for the South Coast Air Basin outlined in Section I.D.1,
Table I-6 of the Proposed 2003 State and Federal Strategy for the
California SIP (released August 25, 2003); however, in adopting the
2003 State Strategy, the ARB Board (via Resolution 03-22) modified
the commitment by increasing the total related emissions reduction
commitment to a total of 50 tpd VOC and 59 tpd NOX in the
South Coast in 2010. See table A-5 of attachment A to ARB Resolution
03-22. ARB clarified, in a letter dated October 14, 2008, that the
reference in the February 13th letter was in error and that it
intended to withdraw the commitment to reduce emissions via adoption
schedule for the South Coast as modified in Resolution 03-22.
    \11\ We interpret ARB's withdrawal of the 97 tpd combined VOC
plus NOX element of the long-term strategy for the South
Coast to include withdrawal of the commitment to evaluate the
feasibility of 21 concepts for adoption as SIP measures listed in
attachment A-1 to ARB Resolution 03-22.
    \12\ Certain other components of the 2003 State Strategy relate
to the San Joaquin Valley, and were proposed for action in a
separate rulemaking.
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F. 2003 South Coast SIP

    On August 1, 2003, the District approved the 2003 South Coast Air
Quality Management Plan and submitted the final plan (``2003 South
Coast AQMP'') to ARB on October 15, 2003. The 2003 South Coast AQMP
includes revisions to the 1997 South Coast AQMP for PM10, CO, and NO2,
and revisions to the 1997/1999 South Coast Ozone SIP. Specifically,
with respect to the 1-hour ozone NAAQS, the 2003 South Coast AQMP
updates the emissions inventories, the local control measure element,
including the transportation control measures (TCMs) element,\13\ the
ROP and attainment demonstrations, and the motor vehicle emissions
budgets. With respect to NO2, the 2003 South Coast AQMP updates the
maintenance plan and related motor vehicle emissions budget. The ozone
portion of the 2003 South Coast AQMP relies on emission reduction
commitments in the 2003 State Strategy, described above, and assigns
the Federal Government the responsibility of achieving 18 tpd VOC and
68 tpd NOX by 2010 in the South Coast, as the Federal
Government's share of the ``black box'' strategy.
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    \13\ By letter dated October 14, 2008, ARB withdrew the TCM
portion of the 2003 South Coast AQMP.
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    The 2003 South Coast AQMP includes a primary attainment strategy
(option 1) that sets emission targets based on reductions from local,
State, and Federal elements but also includes an alternative strategy
(option 2) that excludes reductions from Federal sources and modifies
the attainment emission targets if EPA does not accept the District's
primary attainment strategy. Under option 2, the 2003 South Coast AQMP
relaxes the NOX control target by 68 tpd NOX and
assigns the 18 tpd (assigned to the Federal Government under option 1)
to ARB.
    On October 23, 2003, ARB adopted the 2003 South Coast AQMP, as
modified in ARB Resolution 03-23 (``2003 South Coast SIP''). In
Resolution 03-23, ARB adopted a modified version of ``option 1'' by
adopting a backstop whereby, if EPA were to find the Federal assignment
unacceptable, the ARB obligates itself to cover the related 18 tpd VOC
and 68 tpd NOX emissions reductions as part of its ``black
box'' commitment. In Resolution 03-23, ARB also rejected one
contingency measure included in the AQMP (CTY-04--``Enhanced Oxygenated
Fuels Content''), and modified the VOC and NOX MVEBs.
    On January 9, 2004, ARB submitted the 2003 South Coast SIP. On
February 18, 2004, EPA found the 2003 South Coast AQMP to be complete.
On March 11, 2004, we found the MVEBs in the 2003 South Coast SIP
adequate for transportation conformity purposes. See 69 FR 15325 (March
25, 2004). Since then, the CO budgets in the 2003 South Coast SIP have
been superseded by final EPA approval of the 2005 South Coast CO
Maintenance Plan (discussed below), and the ozone budgets have been
superseded by EPA's adequacy determination on 8-hour ozone budgets in
the 2007 South Coast SIP (see 73 FR 28110, May 15, 2008; as corrected
on 73 FR 34837, June 18, 2008).
    To date, we have taken final action to approve the PM10
portion of the 2003 South Coast SIP, see 70 FR 69081 (November 14,
2005), but have not taken action on any other portions of the plan.
With respect to the CO portion of the plan, while we have not taken
action on the CO portion of the 2003 South Coast SIP, we have taken
action to approve a later-submitted plan, the 2005 South Coast CO
Maintenance Plan, and have taken action to approve ARB's redesignation
request for the South Coast to ``attainment'' for CO. See 72 FR 26718
(May 11, 2007). We consider the submittal and approval of the CO
maintenance plan and redesignation request to supersede the CO portion
of the 2003 South Coast SIP and plan to take no further action on CO
portion of the plan.\14\ Today's document addresses the remaining
portions of the 2003 South Coast SIP (i.e., the ozone and NO2 portions
of the plan).
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    \14\ The principal purpose, other than updating the CO portion
of the 1997 South Coast AQMP, for developing and submitting the CO
portion of the 2003 South Coast SIP was to provide the basis for a
CO maintenance plan. See page 10 of the District's Carbon Monoxide
Redesignation Request and Maintenance Plan (February 2005) (``2005
CO Maintenance Plan''). That purpose has already been served by
virtue of our approval of the 2005 CO Maintenance Plan in May 2007.
Also, we note that the 2005 CO Maintenance Plan, which we have now
approved, carries forward emissions estimates and projections, and a
modeled attainment demonstration, from the 2003 South Coast AQMP as
further evidence of the supersession of the CO portion of the 2003
South Coast AQMP.
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III. Review of the 2003 State Strategy and 2003 South Coast SIP

A. Procedural Requirements

    CAA section 110(l) requires revisions to a SIP to be adopted by the
state after reasonable notice and public hearing. EPA has promulgated
specific requirements for SIP revisions in 40 CFR part 51, subpart F.
    The ARB provided the requisite notice and public comment periods
prior to adoption of the 2003 State Strategy. Notices for a public
hearing to be held on September 24-25, 2003 (later postponed to October
23, 2003), and for the availability of the Draft 2003 State Strategy,
were published on August 25, 2003. At its October 23, 2003 Board
hearing, ARB adopted the 2003 State Strategy as a revision to the
California SIP, and submitted the revision to EPA for approval on
January 9, 2004.
    The SCAQMD provided the requisite notice and public comment periods
prior to adoption of the 2003 South Coast AQMP. The Draft 2003 South
Coast AQMP was released for public comment on February 5, 2003, and
proposed modifications to the draft plan, as well as responses to
comments on the draft plan, were released for public comment in June
2003. Notices for five public hearings held on various dates in July
2003 and on August 1, 2003, and for the availability of the revised
Draft 2003 South Coast AQMP, were published on June 6, 2003. At the
August 1, 2003 Governing Board meeting, the District adopted the 2003
South Coast AQMP and submitted the plan to ARB shortly thereafter. ARB
adopted the plan, with certain modifications, as a revision to the
California SIP on October 23, 2003 in accordance with state law, and
submitted the revision to EPA for approval on January 9, 2004.
    The SIP submittal packages for the 2003 State Strategy and the 2003
South Coast SIP include evidence of public notices and hearings, agency
responses to public comments, and evidence of District and ARB
adoptions as described above. Based on review of these materials, we
find that the State has met the procedural requirements of CAA section
110(l) and 40 CFR part 51, subpart F for submittal of the two SIP
revisions.

B. Base Year and Projected Baseline Emissions Inventory

    CAA sections 172(c)(3) and 182(a)(1) require nonattainment areas to
submit a comprehensive, accurate, and current inventory of actual
emissions from all sources, in accordance with guidance provided by the
EPA. The inventory is to represent emissions during the appropriate
season; for example, ozone precursor (VOC and NOX)
inventories are to represent summer weekday emissions. See EPA's
General Preamble for implementation of title I of the CAA Amendments of
1990, 57 FR 13498 (April 16, 1992) (``General Preamble''), at 13502.
EPA guidance for 1-hour ozone SIP emission inventories includes, in
addition to the General Preamble: ``Procedures for the Preparation of
Emission Inventories for Carbon Monoxide and Precursors of Ozone,
Volume I: General Guidance for Stationary Sources,'' EPA-450/4-91-016;
and ``Procedures for Emission Inventory Preparation, Volume IV: Mobile
Sources,'' EPA-450/5-91-026d Revised.
    In 2000, we approved the base and future year (summer season)
emissions inventories in the 1997 South Coast AQMP as meeting the
requirements of CAA sections 172(c)(3) and 182(a)(1). See 65 FR 18903,
at 18904 (April 10, 2000). In 1998, we approved the base and future
year (winter season) emissions inventories in the 1997 South Coast AQMP
for the purposes of the NO2 maintenance plan. See 63 FR
39747 (July 24, 1998). The 2003 South Coast AQMP contains revised base
and future year emissions inventories for ozone precursors, VOC and
NOX (summer season), and for NOX (winter season,
for NO2 planning purposes). The District describes the basis
for the revisions in the inventories in chapter 3 of the 2003 South
Coast AQMP. More detail is provided in appendix III of the plan.
    The emissions inventories in the 2003 South Coast AQMP reflect
estimates of emissions from numerous source subcategories within four
major categories of sources, i.e., point, area, off-road, and on-road.
The plan presents annual average day inventories, as well as planning
inventories (summer for ozone and winter for NO2), for 1995,
1997, 2000, 2002, 2003, 2005, 2006, 2007, 2008, 2010, and 2020. The
plan also includes a reconstructed emissions inventory for 1990, the
base year for air quality planning under the CAA Amendments of 1990.
    The inventories reflect updated demographic data, and vehicle
activity forecasts, as well as updated calculation methods. The on-road
emissions were calculated using ARB's EMFAC2002 emission factors \15\
and the transportation activity data provided by the Southern
California Association of Governments (SCAG) from their 2001 Regional
Transportation Plan. Emissions estimates from off-road vehicle
categories (e.g., trains, ships, construction equipment) were developed
using ARB's OFF-ROAD emissions model, which calculates emissions from
more than 100 types of off-road sources.
---------------------------------------------------------------------------

    \15\ On April 1, 2003, EPA approved EMFAC2002 for use in SIP
development and required its use in transportation conformity
analyses in California (68 FR 15720). On January 18, 2008, we
approved an updated version of EMFAC, EMFAC2007, for use by
California state and local governments to meet CAA requirements. See
73 FR 3464. We are proposing approval of the revised emissions
inventories that rely on the earlier version of EMFAC because the
earlier version was the one approved at the time when the 2003 South
Coast SIP was submitted to EPA.
---------------------------------------------------------------------------

    Area source emissions were jointly developed by ARB and the
District for a total of 350 categories. For 1997, reported data are
used for point sources emitting more than 4 tons per year of any one of
the criteria air contaminants (i.e., VOC, NOX,
SOX, or particulate matter) except for CO for which the data
reporting threshold is 100 tons per year). (See Appendix III of 2003
South Coast AQMP.) The future emission forecasts are based on
demographic and economic growth projections provided by SCAG, and take
into account emission reductions resulting from ARB and District
regulations adopted by October 31, 2002.
    The emissions inventory requirements of CAA sections 172(c)(3) and
182(a)(1) were met in the 1994 Ozone Plan, and then, as amended, in the
1997 South Coast AQMP. Based on our review of the inventory
documentation included in the 2003 South Coast AQMP, we find that the
emission inventories in the 2003 South Coast AQMP are also
comprehensive, accurate, and current at the time the SIP was submitted,
and improved relative to those that are in the approved SIP.
Accordingly, we propose to approve the base and future year emissions
inventories (summer and winter seasons) in the 2003 South Coast AQMP as
meeting the requirements of CAA sections 172(c)(3) and 181(a)(1).

C. Control Measures and Contingency Measures

    The CAA requires that SIPs ``shall include enforceable emission
limitations, and such other control measures, means or techniques * *
*, as well as schedules and timetables for compliance, as may be
necessary or appropriate to provide for attainment * * * by the
applicable attainment date * * *.'' CAA section 172(c)(6). The CAA also
allows areas classified as extreme to include ``provisions * * * which
anticipate development of new control techniques or improvement of
existing control technologies, * * * if the State demonstrates * * *
that--(A) such provisions are not necessary to achieve the incremental
emission reductions required during the first 10 years after the date
of the enactment of the Clean Air Act Amendments of 1990; and (B) the
State has submitted enforceable commitments to develop and adopt
contingency measures to be implemented * * * if the anticipated
technologies do not achieve planned reductions.'' CAA section
182(e)(5). The latter provisions which anticipate development of new
control techniques or improvement of existing control technologies are
often referred to as the ``black box.''
1. State's Defined Measures
    In 1997, we approved all of the State's control measures contained
in the 1994 Ozone SIP that EPA had not previously approved. See 62 FR
1150 at 1183 (January 8, 1997). EPA's 1997 approval included assignment
of specific emissions reductions by nonattainment area and milestone
year for all of the State control measures, including those previously
approved, under section 110(k)(3), 182(e)(5), and 301(a) of the CAA. In
1999, we approved a revision to the State's commitment to achieve long-
term emissions reductions in the South Coast at the close of the Public
Consultative Process. See 64 FR 39923, at 39926-39927 (July 23, 1999).
    ARB intended the 2003 State Strategy, as submitted on January 9,
2004, to update and entirely replace the State's control strategy
contained in the 1994 Ozone SIP (as modified in 1999 for the South
Coast); however, as noted previously, on February 13, 2008, ARB
withdrew key components of the strategy with respect to the South
Coast, including the near-term annual emissions reductions commitments,
additional emissions reduction commitment for the South Coast, and the
``black box'' emissions reduction commitment. Therefore, with these key
components missing, we do not interpret the remaining component the
2003 State Strategy (i.e., commitment for near-term defined measures)
as replacing the ozone control strategy, but rather as a set of new
measures to achieve additional emissions reductions in the South Coast
by the 1-hour ozone NAAQS attainment date of 2010.
    The remaining component of the 2003 State Strategy is a commitment
by ARB

to have its staff submit to the Board and propose for adoption the
control measures set forth in Table 1.\16\ Under the 2003 State
Strategy, the ARB staff proposal for each control measure must, at a
minimum, achieve the estimated emission reductions set forth in Table 1
of this document (derived from the 2003 State Strategy, ARB Resolution
03-22, Attachment A-6, Table I-7). Where a range of estimated emission
reductions is shown, the ARB staff proposal must, at a minimum, achieve
the lower end of the range of reductions. ARB's Board then must take
action on or before the action dates set forth in Table 1, but such
action by the Board may include any action within its discretion. The
measures themselves are discussed in detail in sections II and III of
the Proposed 2003 State and Federal Strategy for California SIP (August
25, 2003). We note that, based on Table 1-3 in the Final 2007 South
Coast AQMP (June 2007) and further investigation by EPA as to the
status of ARB's rulemakings, we believe that ARB staff proposals were
submitted to the Board for most of the 15 obligations listed in Table 1
and that ARB has taken action on such proposals. Similarly we believe
that the Bureau of Automotive Repair (BAR) has fulfilled its one
obligation.
---------------------------------------------------------------------------

    \16\ In the case of control measure LT/MED-DUTY-2, the
commitment is not ARB's, but rather, the Bureau of Automotive
Repair's (BAR's) commitment. BAR's commitment to adopt the measure
is documented in appendix I-1 of the Proposed 2003 State and Federal
Strategy for the California State Implementation Plan (August 25,
2003).

                          Table 1--Defined State Measures To Be Developed and Proposed
                 [Source: 2003 State Strategy, ARB Resolution 03-22, Attachment A-6, Table I-7]
----------------------------------------------------------------------------------------------------------------
                                                                                Expected reductions  (south
                                                         Final     Implementation           coast 2010)
      Strategy (agency)                 Name          action date       date      ------------------------------
                                                                                VOC            NOX
----------------------------------------------------------------------------------------------------------------
LT/MED-DUTY-1 (ARB)..........  Replace or Update             2005      2007-2008   0-20..........  0-20.
                                Emission Control
                                Systems on Existing
                                Passenger Vehicles.
LT/MED-DUTY-2 (BAR)..........  Improve Smog Check to    2002-2005      2002-2006   5.6-5.8.......  8.0-8.4.
                                Reduce Emissions
                                from Existing
                                Passenger and Cargo
                                Vehicles.
ON-RD HVY-DUTY-1 (ARB).......  Augment Truck and Bus         2003           2005   0-0.1.........  0.
                                Highway Inspections
                                with Community-Based
                                Inspections.
ON-RD HVY-DUTY-3 (ARB).......  Pursue Approaches to     2003-2006      2004-2010   1.4-4.5.......  16-21.
                                Clean Up the
                                Existing and New
                                Truck/Bus Fleet.
OFF-RD CI-1 (ARB)............  Pursue Approaches to     2004-2008      2006-2010   2.3-7.8.......  8-10.
                                Clean Up the
                                Existing Heavy-Duty
                                Off-Road Equipment
                                Fleet (Compression
                                Ignition Engines).
OFF-RD LSI-1 (ARB)...........  Set Lower Emission       2004-2005           2007   0.............  0.8.
                                Standards for New
                                Off-Road Gas
                                Engines(Spark-
                                Ignited Engines 25
                                hp and Greater).
OFF-RD LSI-2 (ARB)...........  Clean Up Off-Road Gas         2004      2006-2012   0.8-2.0.......  2-4.
                                Equipment Through
                                Retrofit Controls
                                and New Emissions
                                Standards (Spark-
                                Ignited Engines 25
                                hp and Greater).
SMALL OFF-RD-1 (ARB).........  Set Lower Emission            2003           2005   1.9...........  0.2.
                                Standards for New
                                Handheld Small
                                Engines and
                                Equipment (Spark-
                                Ignited Engines
                                under 25 hp such as
                                Weed Trimmers, Leaf
                                Blowers, and
                                Chainsaws).
SMALL OFF-RD-2 (ARB).........  Set Lower Emission            2003           2007   6.3-7.4.......  0.6-1.9.
                                Standards for New
                                Non-Handheld Small
                                Engines and
                                Equipment (Spark-
                                Ignited Engines
                                under 25 hp such as
                                Lawnmowers).
MARINE-1 (ARB)...............  Pursue Approaches to     2003-2005           2005   0.1...........  2.7.
                                Clean Up the
                                Existing Harbor
                                Craft Fleet--Cleaner
                                Engines and Fuels.
MARINE-2 (ARB)...............  Pursue Approaches to     2003-2005      2003-2010   0.1...........  0.1.
                                Reduce Land-Based
                                Port Emissions--
                                Alternative Fuels,
                                Cleaner Engines,
                                Retrofit Controls,
                                Electrification,
                                Education Programs,
                                Operational Controls.
FUEL-2 (ARB).................  Set Low-Sulfur                2003           2006   Enabling......  Enabling.
                                Standards for Diesel
                                Fuel for Trucks/
                                Buses, Off-Road
                                Equipment, and
                                Stationary Engines.
CONS-1 (ARB).................  Set New Consumer         2003-2004           2006   2.3...........  0.
                                Products Limits for
                                2006.
CONS-2 (ARB).................  Set New Consumer         2006-2008      2008-2010   8.5-15........  0.
                                Products Limits for
                                2008-2010.
FVR-1 (ARB)..................  Increase Recovery of          2003           2007   0-0.1.........  0.
                                Fuel Vapors from
                                Aboveground Storage
                                Tanks.
FVR-2 (ARB)..................  Recover Fuel Vapors      2006-2009      2006-2010   0-0.1.........  0.
                                from Gasoline
                                Dispensing at
                                Marinas.
PEST-1\1\ (DPR)..............  Implement Existing     ...........      1996-2010   Base-line.....  N/A.
                                Pesticide Strategy.
----------------------------------------------------------------------------------------------------------------
Potential Range for Defined Near-Term State Measures.............................  33.3-72.9.....  38.4-69.1
----------------------------------------------------------------------------------------------------------------
\1\ We interpret our approval of this measure as maintaining the status quo with respect to the existing
  pesticide strategy (i.e., the SIP will continue to reflect the strategy as approved by EPA in 1997).

    Assuming that the remaining component of the 2003 State Strategy
adds to, but does not replace, the existing SIP ozone strategy, we
propose to approve the State commitments with respect to the near-term
defined measures listed in table 1 as described above as strengthening
the SIP.\17\ We propose to approve the State's commitments with respect
to the near-term defined measures, not as fulfilling any particular
requirement under the CAA, but as a strengthening of the South Coast
portion of the California SIP. As such, our proposed approval is made
under CAA sections 110(k)(3) and 301(a).
---------------------------------------------------------------------------

    \17\ In the alternative, if ARB indicates an intention to
replace the existing SIP ozone strategy by the commitment for near-
term measures shown in table 1 of this document, then we propose to
disapprove the set of defined measures on the basis that the State
has not provided a demonstration that replacement of the existing
SIP ozone strategy by the set of measures in table 1 would not
interfere with attainment or maintenance of the NAAQS or any other
applicable requirement of the Act. See CAA section 110(l).
---------------------------------------------------------------------------

2. District's Near-Term Control Measures, Annual Emissions Reductions
Commitment, and Contingency Measure
    In 2000, under CAA section 110(k)(3), we approved the District's
commitment to adopt and implement the short- and intermediate-term
control measures in the 1997/1999 South Coast Ozone SIP by the dates
specified to achieve the identified emissions reductions, and the
District's commitment to adopt and implement control measures to
achieve the identified annual emissions reduction commitments for 1999
to 2008.\18\
---------------------------------------------------------------------------

    \18\ Our approval made enforceable the District's commitment to
achieve the overall emissions reduction schedule and creates the
possibility of District control measure adjustments and
substitutions under the approved SIP, so long as the overall
emission reductions obligations are met.
---------------------------------------------------------------------------

    The 2003 South Coast AQMP includes an updated list of commitments
for those District control measures that remain from the 1997/1999
South Coast Ozone SIP, and a set of new District commitments to adopt
near-term control measures. See table 2 of this document. Consistent
with the approach in the 1997/1999 South Coast SIP, the District
commits to meet the adoption dates, implementation dates, and emission
reduction targets shown in table 2 (derived from table 4-1 of the 2003
South Coast AQMP), unless a measure, in whole or in part, is determined
to be infeasible.
    Also consistent with the 1997/1999 South Coast SIP, the District
includes in the 2003 plan an additional enforceable commitment to
achieve aggregate emission reductions through a schedule of rule
adoption and implementation for specific years. See table 3 of this
document. Under the 2003 South Coast AQMP, the District reserves the
right to substitute measures listed in table 2 (of this document) with
other measures, provided that the given measure is found to be
infeasible and that the overall equivalent emission reductions by
adoption and implementation dates shown in tables 3 and 4 (of this
document) are maintained. Based on table 1-2 of the 2007 South Coast
AQMP (June 2007), we believe that most of the District's near-term
commitments with respect to control measures for which emission
reductions targets are identified have been met.

                           Table 2--District's Near-Term VOC and NOX Control Measures
                                   [Source: 2003 South Coast AQMP, Table 4-1]
----------------------------------------------------------------------------------------------------------------
                                                                                Reduction
                Control measure                             Title of control measure              target 1 (tons/
                                                                                day)
----------------------------------------------------------------------------------------------------------------
                           Remaining 1997/1999 South Coast Ozone Plan Control Measures
----------------------------------------------------------------------------------------------------------------
CTS-07........................................  Further Emission Reductions from Architectural               8.5
                                                 Coatings and Cleanup Solvents (Rule 1113) (VOC).
CTS-10........................................  Miscellaneous Industrial Coatings and Solvent                3.0
                                                 Operations (VOC).
FUG-05........................................  Emission Reductions from Fugitive Emissions                  2.0
                                                 Sources (VOC).
MSC-01........................................  Promotion of Lighter Color Roofing and Road                  TBD
                                                 Materials and Tree Planting Programs (All
                                                 Pollutants).
MSC-03........................................  Promotion of Catalyst-Surface Coating Technology             TBD
                                                 Programs (All Pollutants).
PRC-07........................................  Industrial Process Operations (VOC).............             2.0
WST-01 \2\....................................  Emission Reductions from Livestock Waste (VOC)..             4.8
WST-02 \3\....................................  Emission Reductions from Composting.............             1.2
FSS-04 \4\....................................  Emission Charges of $5,000 per Ton of VOC for                TBD
                                                 Stationary Sources Emitting Over 10 Tons per
                                                 Year (VOC).
FLX-01........................................  Economic Incentive Programs.....................             TBD
----------------------------------------------------------------------------------------------------------------
                                              New Control Measures
----------------------------------------------------------------------------------------------------------------
CMB-10........................................  Additional NOX Reductions for RECLAIM (NOX).....             3.0
MSC-05........................................  Truck Stop Electrification (NOX)................             2.1
MSC-07........................................  Natural Gas Fuel Specifications (NOX)...........             TBD
MSC-08........................................  Further Emission Reductions from Large VOC                   TBD
                                                 Sources (VOC).
FSS-05 \5\....................................  Mitigation Fee Program for Federal Sources (All              TBD
                                                 Pollutants).
FSS-06........................................  Further Emission Reductions from In-Use Off-Road             TBD
                                                 Vehicles and Equipment (VOC, NOX, PM10).
FSS-07........................................  Emission Fee Program for Port-related Mobile                 TBD
                                                 Sources (All Pollutants).
                                               -----------------------------------------------------------------
    Total.....................................  VOC.............................................            21.5
                                               -----------------------------------------------------------------
                                                NOX.............................................             5.1
----------------------------------------------------------------------------------------------------------------
\1\ The emission reductions estimates are based on the 2010 planning inventory in the 2003 South Coast AQMP. The
  District notes that the actual reductions are subject to change during the rulemaking process based on the
  latest available emission inventory data.
\2\ Previously approved in connection with the PM10 portion of the 2003 South Coast AQMP. See 70 FR 69081
  (November 14, 2005).
\3\ Previously approved in connection with the PM10 portion of the 2003 South Coast AQMP. See 70 FR 69081
  (November 14, 2005).
\4\ The measure is intended to achieve reductions after the 2010 attainment date.
\5\ Proposed for disapproval herein.

    Based on our review of the District's updated strategy in the 2003
South Coast AQMP for achieving near-term emissions reductions, and the
progress the District has achieved to date in implementing the
measures, we propose to approve the District's commitment to adopt the
near-term measures listed in table 2 (except for FSS-05, as described
below) and commitment to achieve aggregate emissions reductions through
the rule and adoption schedule shown in table 3.

 Table 3--District's Near-Term VOC and NOX Emissions Reductions Commitment To Be Achieved Through Rule Adoption
                                              and Implementation 1
                                   [Source: 2003 South Coast AQMP, Table 4-8A]
----------------------------------------------------------------------------------------------------------------
                                                          VOC                                 NOX
                                         -----------------------------------------------------------------------
                  Year                                          Based on                            Based on
                                              Based on       implementation       Based on       implementation
                                            adoption date         date          adoption date         date
----------------------------------------------------------------------------------------------------------------
2002....................................               0.6  ................  ................  ................
2003....................................              16.9               0.6  ................  ................
2004....................................               2.0  ................               3.0  ................
2005....................................               2.0  ................               2.1  ................
2006....................................  ................               4.8  ................  ................
2007....................................  ................               2.0  ................               2.1
2008....................................  ................              12.1  ................  ................
2009....................................  ................  ................  ................  ................
2010....................................  ................               2.0  ................               3.0
    Total...............................              21.5              21.5               5.1               5.1
----------------------------------------------------------------------------------------------------------------
\1\ In tons per day based on the 2010 planning inventory in the 2003 South Coast AQMP.

    Like the State defined control measures discussed above, we propose
to approve the District's updated strategy for near-term emissions
reductions in the 2003 South Coast AQMP, not as fulfilling any
particular requirement under the CAA, but as a strengthening of the
South Coast portion of the California SIP. As such, our proposed
approval is made under CAA sections 110(k)(3) and 301(a).
    One particular District control measure, FSS-05 (``Mitigation Fee
Program for Federal Sources''), assigns to EPA the responsibility of
adopting a mitigation fee program. See page 4-17 of the 2003 South
Coast AQMP. Under this program, the mitigation fee would be paid by the
owners of such sources as aircraft, ocean-going vessels, trains, and
pre-empted off-road equipment (that are under the jurisdiction of EPA)
through EPA rulemaking and/or EPA grants to the District. The District
would then use the monies collected to implement strategies for both
federal and non-federal sources to achieve equivalent reductions for
SIP purposes. We propose to disapprove this particular control measure
on the grounds that States are not given the authority under the CAA to
assign emission reductions responsibilities to the Federal Government.
For a detailed discussion of EPA's view on ``federal assignments,'' see
EPA's final rule approving the 1994 Ozone SIP (62 FR 1150, at 1152-1155
(January 8, 1997).
    Under the 2003 South Coast AQMP, the expected progress in meeting
the AQMP attainment goals, measured in terms of emission reductions, is
verified through the annual auditing program called the Reasonable
Further Progress (RFP) program. In the event the RFP program shows that
the implementation of the plan is not providing adequate progress and
the interim emission reduction goals have not been met, the District
must take action to bring forward measures that are scheduled for later
adoption or implementation, or to implement certain other contingency
measures. See section 2 of appendix IV-A of the 2003 South Coast AQMP.
With respect to progress towards the 1-hour ozone NAAQS, the 2003 South
Coast AQMP includes one contingency measure, CTY-01--Accelerated
Implementation of Control Measures, that would accelerate the starting
implementation date for the stationary and mobile source control
measures that have implementation dates on and after 2004. The original
and revised (i.e., under CTY-01) starting implementation dates of the
stationary and mobile source control measures affected by the
contingency measure are shown in table 2 of chapter 9 of the 2003 South
Coast AQMP. As noted above, we believe that most of the District's
near-term commitments to adopt defined measures have been met.
    Based on our review of contingency measure strategy, and the
progress the District has achieved to date in implementing the
measures, we propose to approve CTY-01 (except for the individual FSS-
05, which we are proposing to disapprove for the reasons given above)
as a strengthening of the South Coast portion of the California
SIP.\19\ As such, our proposed approval is made under CAA sections
110(k)(3) and 301(a).
---------------------------------------------------------------------------

    \19\ We are proposing in this document to disapprove the rate-
of-progress demonstration in the 2003 South Coast AQMP, but we note
that CTY-01, by its terms, could be triggered under the District's
RFP program regardless of our action on the ROP demonstration.
---------------------------------------------------------------------------

3. District's Black Box Emissions Reduction Commitment
    In 2000, we approved the District's commitment to adopt and
implement the long-term ``black box'' control measures in the 1997/1999
South Coast Ozone Plan by the dates specified to achieve the identified
emissions reductions under CAA sections 110(k)(3) and 182(e)(5). See 65
FR 18903, at 18905 (April 10, 2000).
    In the 1997/1999 South Coast SIP, the District calculated that the
remaining portion of its ``black box'' commitment amounted to 28 tpd of
VOC. In the 2003 South Coast AQMP, the District contends that, after
implementation of its proposed near-term measures, the District would
be exceeding its emission target in the 1997/1999 South Coast SIP by
about 65 tpd of VOC. As such, the District's ``black box'' commitment
in the 1997/1999 South Coast SIP of 28 tpd has been fulfilled.
Nonetheless, in view of the magnitude of the reductions now understood
to be needed for attainment of the 1-hour ozone NAAQS in the South
Coast, the District has adopted an additional ``black box'' commitment
of

31 tpd as shown in table 4 of this document.

 Table 4--District's Black Box VOC Emission Reductions Commitment To Be
            Achieved Through Rule Adoption and Implementation
               [Source: 2003 South Coast AQMP, Table 4-8B]
------------------------------------------------------------------------
                                      VOC (2010 planning inventory, tons/
                                                     day)
                                     -----------------------------------
                Year                                        Based on
                                          Based on       implementation
                                        adoption date        date 1
------------------------------------------------------------------------
2005................................               4.0  ................
2006................................              10.0  ................
2007................................              10.0               3.0
2008................................               7.0              10.0
2009................................  ................              11.0
2010................................  ................               7.0
                                     -----------------------------------
  Total.............................              31.0              31.0
------------------------------------------------------------------------
\1\ Represents the final, full implementation date; typically a rule
  contains multiple implementation dates.

    As described in the 2003 South Coast AQMP (appendix IV-A, section
1, group 8), the District's ``black box'' commitment is organized into
two tiers. The first tier targets (but is not limited to) stationary
source categories including miscellaneous industrial coatings and
solvent operations, fugitive sources, and industrial process
operations. The second tier targets all stationary source categories
for which feasible reductions can be identified. We propose to approve
the District's new ``black box'' commitment in the 2003 South Coast
AQMP, not as fulfilling any particular requirement under the CAA, but
as a strengthening of the South Coast portion of the California SIP. As
such, our proposed approval is made under CAA sections 110(k)(3) and
301(a).
4. Black Box Emissions Reduction Assignment to the Federal Government
    Lastly, the 2003 South Coast AQMP allocates a portion of the
``black box'' to the Federal Government. The ``federal assignment'' in
the 2003 South Coast AQMP calls for the Federal Government to achieve
emissions reductions of 68 tpd NOX and 18 tpd VOC in the
South Coast by 2010. As discussed above in connection with District
measure FSS-05, we propose to disapprove this assignment on the grounds
that States are not given the authority under the CAA to assign
emission reductions responsibilities to the Federal Government.

D. Attainment Demonstration

    All 1-hour ozone areas classified as serious or above must
demonstrate attainment ``as expeditiously as practicable'' but not
later than dates specified in CAA section 181(a), which establishes for
extreme areas a deadline of November 15, 2010. For purposes of
demonstrating attainment, CAA section 182(c)(2)(A) requires serious,
severe, and extreme areas to use photochemical grid modeling or an
analytical method EPA determines to be as effective.
    In 2000, we approved the attainment demonstration for the 1-hour
ozone NAAQS in the 1997 South Coast AQMP, as amended by the District in
1999, as meeting the requirements of CAA sections 182(c)(2) and (e).
See 65 FR 18903, at 18905 (April 10, 2000). The District revised the 1-
hour ozone attainment demonstration in the 2003 South Coast AQMP in
light of updated emissions inventories that show higher mobile source
emissions than prior projections and updated modeling that indicates a
lower carrying capacity in the air basin. The District describes the
methods, assumptions and results of the modeling effort in chapter 5 of
the main body of the AQMP and provides more details on the modeling
effort in appendix V.
    The 2003 South Coast AQMP's modeled attainment demonstration for 1-
hour ozone relies upon emission reductions from the ARB's control
strategy as set forth in the 2003 State Strategy, most of which was
withdrawn by ARB on February 13, 2008. As a result, we need not conduct
a detailed review of the modeling to conclude that the 2003 South Coast
AQMP does not meet the CAA section 182(c)(2)(A) requirement for a
demonstration of attainment of the 1-hour ozone NAAQS by the applicable
attainment date (in this case, 2010). EPA proposes to disapprove the
ozone plan with respect to the attainment demonstration requirements of
CAA section 182(c)(2)(A), because of the deficiencies in the control
measure portions of the plan resulting from the withdrawal of the
State's emission reduction commitments in the 2003 State Strategy.

E. Quantitative Milestones and Reasonable Further Progress (RFP)

    CAA section 172(c)(2) requires nonattainment area plans to provide
for reasonable further progress (RFP) which is defined in section
171(1) as such annual incremental reductions in emissions as are
required in part D or may reasonably be required by the Administrator
in order to ensure attainment of the relevant NAAQS by the applicable
date.
    CAA section 182(c)(2) require that serious and above area SIPs
include rate-of-progress (ROP) quantitative milestones that are to be
achieved every 3 years after 1996 until attainment. For ozone areas
classified as serious and above, section 182(c)(2) requires that the
SIP must provide for reductions in ozone-season, weekday VOC emissions
of at least 3 percent per year net of growth averaged over each
consecutive 3-year period. This is in addition to the 15 percent
reduction over the first 6-year period required by CAA section
182(b)(1) for areas classified as moderate and above. The CAA requires
that these milestones be calculated from the 1990 inventory after
excluding, among other things, emission reductions from ``[a]ny measure
related to motor vehicle exhaust or evaporative emissions promulgated
by the Administrator by January 1, 1990'' and emission reductions from
certain federal gasoline volatility requirements. CAA section
182(b)(1)(B)-(D). EPA has issued

guidance on meeting 1-hour ozone ROP requirements. See General Preamble
at 13516 and ``Guidance on the Post-1996 Rate-of-Progress Plan and the
Attainment Demonstration,'' EPA-452/R-93-015, OAQPS, EPA, February 18,
1994 (corrected).
    CAA section 182(c)(2)(C) allows for NOX reductions which
occur after 1990 to be used to meet the post-1996 ROP emission
reduction requirements, provided that such NOX reductions
meet the criteria outlined in the CAA and EPA guidance. The criteria
require that: (1) The sum of all creditable VOC and NOX
reductions must meet the 3 percent per year ROP requirement; (2) the
substitution is on a percent-for-percent of adjusted base year
emissions basis for the relevant pollutant; and (3) the sum of all
substituted NOX reductions cannot be greater than the
cumulative NOX reductions required by the modeled attainment
demonstration. See General Preamble at 13517 and ``NOX
Substitution Guidance,'' OAQPS, EPA, December 1993. Our guidance in the
General Preamble states that by meeting the specific ROP milestones
discussed above, the general RFP requirements in CAA section 172(c)(2)
will also be satisfied. See the General Preamble at 13518.
    In 2000, we approved the revised ROP demonstration for the
milestone years 1999, 2002, 2005, 2008, and 2010 in the 1999 amendment
to the 1997 South Coast AQMP, as meeting the requirements of CAA
sections 172(c)(2) and 182(c)(2). See 65 FR 18903, at 18905 (April 10,
2000). The 2003 South Coast AQMP includes a revised demonstration for
milestone years 2005, 2008, and 2010. See pages 6-6 through 6-9 of the
AQMP. The revised ROP demonstration in the 2003 South Coast AQMP does
not rely on emissions reductions from any new control measures in the
plan but relies only on VOC and NOX emission reductions from
existing District and ARB rules. For the milestone years 2005 and 2008,
the ROP demonstration shows that baseline VOC emission levels are below
the target levels. In 2010, however, the VOC reductions in the baseline
are insufficient to meet the target, and thus, the plan relies in part
on NOX substitution.
    Our review of the ROP demonstration in the 2003 South Coast AQMP
reveals a flaw in the calculation method. The demonstration purports to
adjust emissions for the base year (1990) to remove the benefit of the
pre-1990 Federal motor vehicle control program (FMVCP) and certain
federal gasoline volatility requirements, as is required under the CAA,
but the adjustment in the ROP table for NOX (table 6-3b in
the AQMP) has been set at zero, which cannot be correct. Given the
minimal explanation for how the adjustment was determined, we can only
presume that the same calculation method was used for the VOC table
(table 6-3a). Therefore, we conclude that the calculation methods used
to demonstrate rate-of-progress for 2005, 2008, and 2010 are incorrect,
and on that basis, we propose to disapprove the revised rate-of-
progress demonstration in the 2003 South Coast AQMP as failing to meet
the requirements of CAA sections 172(c)(2) and 182(c)(2).

F. Transportation Control Measures To Offset Growth in Motor Vehicle
Emissions

    Section 182(d)(1)(A) of the CAA requires nonattainment areas
classified as severe or above to adopt and submit transportation
control measures (TCMs) sufficient to offset any growth in emissions
from growth in vehicle-miles-traveled (VMT) or number of vehicle trips
and to provide for ROP. EPA's interpretation of this provision allows
areas to satisfy the requirement if they demonstrate that emissions
from motor vehicles decline each year through the attainment year. See
the General Preamble at 13521-13522. The 2003 South Coast SIP refers to
the TCMs in appendix IV-C of the 2003 South Coast AQMP as the basis for
compliance with the CAA requirement in section 182(d)(1)(A). See page
6-10 of the 2003 South Coast AQMP. As noted in section II.E of this
document, the TCM portion of the 2003 South Coast AQMP, including
appendix IV-C, was withdrawn, and thus, it cannot serve as the basis
for meeting the requirement.
    However, by letter dated September 10, 2008, the District provided
supplemental motor vehicle emissions data drawn largely from emissions
inventory estimates presented in appendix III of the 2003 South Coast
AQMP. See letter from Elaine Chang, DrPH, Deputy Executive Officer,
SCAQMD, to Matt Haber, Deputy Director, Air Division, EPA Region IX,
September 10, 2008. Based on the emission data presented in appendix
III of the South Coast AQMP and the supplemental information provided
by SCAQMD on September 10th, we find that baseline motor vehicle
emissions in the South Coast decline each year from 2003 to the
attainment year (2010), and that, as a result, no TCMs need be included
in the plan to offset motor vehicle emissions for the purposes of CAA
section 182(d)(1)(A). We therefore propose to approve the 2003 South
Coast SIP, as supplemented on September 10, 2008, as meeting the TCM
offset requirement under CAA section 182(d)(1)(A).

G. Nitrogen Dioxide Maintenance Demonstration

    In 1998, EPA approved the nitrogen dioxide maintenance plan that
was included as an element of the 1997 South Coast AQMP. The 2003 South
Coast SIP updates the original maintenance plan with more current air
monitoring data and emissions estimates and projections. See page 6-11
of the 2003 South Coast AQMP. In support of its conclusion that the
updated plan demonstrates maintenance of the nitrogen dioxide NAAQS,
SCAQMD refers to ambient monitoring data that continues to show
concentrations below the NAAQS and to the downward trend in baseline
NOX emissions.
    Based on our review of the monitoring data presented in chapter 2
of the 2003 South Coast AQMP, which show a maximum concentration in
2001 among the 23 monitoring stations of less than 80% of the NAAQS,
and the emissions estimates presented in chapter 3, which show a
decline from nearly 1,300 tpd (winter season) of NOX in
1997, to 1,000 tpd in 2006, to 820 tpd in 2010, we agree with SCAQMD
that the 2003 South Coast AQMP demonstrates maintenance of the nitrogen
dioxide NAAQS.\20\ Therefore, we propose to approve the update of the
NO2 maintenance demonstration in the 2003 South Coast SIP.
---------------------------------------------------------------------------

    \20\ Unlike ozone, which peaks in the South Coast in the summer
and early fall months, NO2 generally peaks in the late
fall and winter months. The use of a planning inventory (winter
season) rather than an annual-average inventory to update the
maintenance demonstration for the annual NO2 NAAQS is
consistent with the original NO2 maintenance
demonstration from the 1997 South Coast AQMP, which we approved in
1998 (63 FR 39747, July 24, 1998). In the 1997 South Coast AQMP, the
District demonstrated maintenance of the annual NO2 NAAQS
using a linear rollback approach and baseline planning inventories
(winter season) for NOX to project future-year annual
NOX concentrations from baseline annual NOX
concentrations for several key locations in the South Coast
representative of areas with historically higher NO2
concentrations. Projected future-year annual NO2
concentrations were then determined from projected annual
NOX concentrations using average NO2/
NOX ratios measured at the key locations. See chapter 1
of appendix V to the 1997 South Coast AQMP (November 1996).
---------------------------------------------------------------------------

H. Motor Vehicle Emissions Budgets (MVEBs)

    Under section 176(c) of the CAA, transportation plans, programs and
projects in nonattainment or maintenance areas that are funded or
approved under title 23 U.S.C. and the Federal Transit Laws (49 U.S.C.
Chapter 53) must conform to the applicable SIP.

In short, a transportation plan and program are deemed to conform to
the applicable SIP if the emissions resulting from the implementation
of that transportation plan and program are less than or equal to the
MVEBs established in the control strategy SIPs for the attainment year,
ROP years, maintenance year and other analysis years. See, generally,
40 CFR part 93.
    On March 11, 2004, we found the NOX and VOC MVEBs for
ozone, and the NOX MVEB for nitrogen dioxide, in the 2003
South Coast SIP to be adequate for transportation conformity purposes.
Letter from Deborah Jordan, EPA to Catherine Witherspoon, ARB, March
11, 2004. A table attached to the letter summarized our adequacy
determination. Our notice of adequacy for these budgets was published
in the Federal Register on March 25, 2004 at 69 FR 15325 and was
effective 15 days later, on April 9, 2004. We are now proposing to
disapprove the VOC and NOX MVEBs for 1-hour ozone, and to
approve the NOX MVEB for nitrogen dioxide, for
transportation conformity purposes.
    With respect to ozone, we propose to disapprove the VOC and
NOX budgets based on our proposed disapprovals of the 1-hour
ozone ROP and attainment demonstrations as discussed above. As such, we
conclude that the VOC and NOX MVEBs in the 2003 South Coast
SIP, when considered together with all other emissions sources, are not
consistent with applicable requirements for RFP and attainment for the
1-hour ozone NAAQS because the plan revision as a whole does not
provide for RFP and attainment. While we are proposing to disapprove
these 1-hour ozone budgets into the SIP, it should be noted that they
would not be used for future conformity determinations even if we were
to approve them. This is because EPA has revoked the 1-hour ozone
standard and transportation conformity determinations are no longer
required for that air quality standard, and because we have already
found VOC and NOX MVEBs adequate for the 8-hour ozone
standard. See 73 FR 28110 (May 15, 2008), as corrected at 73 FR 34837
(June 18, 2008).
    With respect to nitrogen dioxide, we propose to approve the
NOX MVEB of 686 tpd (winter season) for years 2003 and
2010.\21\ Use of a planning inventory (winter) in the 2003 South Coast
AQMP as the basis for the updated maintenance demonstration (and
corresponding NOX MVEB) for the annual NO2 NAAQS
is consistent with the approach we approved in the original
NO2 maintenance plan from the 1997 South Coast AQMP, as
discussed above. The NOX MVEB is shown in table 6-7 of the
2003 South Coast AQMP, and, as shown in that table, the NOX
MVEB for nitrogen dioxide reflects baseline 2003 motor vehicle
emissions (shown in more detail in table C-5 in attachment C to
appendix III of the 2003 South Coast AQMP), and as reduced slightly by
the emissions reductions attributed to the District's adopted employer-
based trip reduction rule (District rule 2202) and State-adopted
vehicle inspection and maintenance program (I/M) improvements not
accounted for in the baseline motor vehicle estimate. The baseline
motor vehicle estimates are based on ARB's motor vehicle emissions
factor model, EMFAC2002, which was approved by EPA on April 1, 2003 (68
FR 15720) and the most recent planning and vehicle activity data then
available.\22\
---------------------------------------------------------------------------

    \21\ In table 6-7 of the 2003 South Coast AQMP, a footnote to
the NOX MVEB states: ``2003 budget applicable to future
years, including the last year of maintenance plan (i.e., 2010).''
We interpret this language as establishing a MVEB for year 2003 and
for year 2010 and not as establishing a budget for each intervening
year and the years after 2010. An interpretation otherwise would be
unreasonable in that it would necessitate a conformity determination
for NO2 by SCAG for each of the intervening years and for
an indeterminate number of future years.
    \22\ On January 18, 2008, we approved an updated version of
EMFAC, EMFAC2007, for use by California state and local governments
to meet CAA requirements. See 73 FR 3464. We are proposing approval
of the NOX budgets for NO2 in the 2003 South
Coast AQMP despite the fact that they reflect an earlier-approved
version of EMFAC (EMFAC2002) because the earlier version was the one
approved at the time when the 2003 South Coast SIP was submitted to
EPA.
---------------------------------------------------------------------------

    The baseline emissions inventories, which reflect baseline motor
vehicle emissions as well as baseline emissions for all other source
categories, show a decline in NOX emissions through 2010,
and even if motor vehicle emissions estimates in 2010 were equal to the
2003 MVEB of 686 tpd, overall baseline NOX emissions in 2010
would still be less than the corresponding estimate for 2003, an
attainment year, and thus we find the NOX MVEB for 2003,
when considered with all other emissions sources, to be consistent with
continued maintenance of the nitrogen dioxide NAAQS through 2010.

IV. Public Comment and Final Action

    Under section 110(k)(3) of the CAA, and for the reasons discussed
above, EPA proposes the following action on the 2003 State Strategy, as
submitted on January 9, 2004:
    (1) Approval of commitments by State agencies to develop and
propose 16 near-term defined control measures (15 for ARB and 1 for
BAR) to achieve specified emissions reductions in the South Coast as
listed in table 1 of this document and the continuation of the existing
pesticide strategy.
    Also under section 110(k)(3) of the CAA, and for the reasons
discussed above, EPA proposes the following actions on the 2003 South
Coast SIP, as submitted on January 9, 2004:
    (1) Approval of base year and projected baseline emission
inventories under CAA sections 172(c)(3) and 182(a)(1);
    (2) Approval of the District's commitment to adopt and implement
near-term control measures as shown in table 2 of this document (except
FSS-05), the District's commitment to achieve emissions reduction
through a schedule of adoption and implementation as shown in table 3
of this document, and the District's contingency measure CTY-01
(``Accelerated Implementation of Control Measures''), as strengthening
the SIP;
    (3) Disapproval of District control measure FSS-05 (``Mitigation
Fee Program for Federal Sources'') that assigns control measure
responsibility to the Federal Government;
    (4) Approval of District's ``black box'' VOC emission reduction
commitment of 31 tpd;
    (5) Disapproval of the ``black box'' emission reduction commitment
of 68 tpd of NOX and 18 tpd of VOC assigned to the Federal
Government;
    (6) Disapproval of the attainment demonstration because control
measures upon which the demonstration relies have been withdrawn;
    (7) Disapproval of the reasonable further progress demonstration
because the calculations do not properly account for the emissions
reductions from the pre-1990 FMVCP and certain federal gasoline
volatility requirements;
    (8) Approval of the demonstration that no TCM offsets are required
under CAA section 182(d)(1)(A) based on baseline motor vehicle
emissions projections as supplemented by the District;
    (9) Approval of the revised nitrogen dioxide maintenance
demonstration based on the downward trend in baseline NOX
emissions;
    (10) Disapproval of the 1-hour ozone (VOC and NOX) motor
vehicle emissions budgets in the wake of proposed disapprovals of the
rate-of-progress and attainment demonstrations; and
    (11) Approval of the nitrogen dioxide motor vehicle emissions
budget of 686 tpd (year 2003), winter planning inventory.

    No sanctions clocks or FIP requirement would be triggered by our
disapprovals, if finalized, because the approved SIP already contains
the plan elements that we are proposing to disapprove. A disapproval of
the revisions to the already-approved elements would not alter the fact
that the SIP already meets these statutory requirements.
    EPA is soliciting public comments on the issues discussed in this
document and will accept comments for the next 30 days. These comments
will be considered before taking final action.

V. Statutory and Executive Order Reviews

    Under the Clean Air Act, the Administrator is required to approve a
SIP submission that complies with the provisions of the Act and
applicable Federal regulations. 42 U.S.C. 7410(k); 40 CFR 52.02(a).
Thus, in reviewing SIP submissions, EPA's role is to approve state
choices, provided that they meet the criteria of the Clean Air Act.
Accordingly, this action merely proposes to approve state law as
meeting Federal requirements and does not impose additional
requirements beyond those imposed by state law. For that reason, this
proposed action:
     Is not a ``significant regulatory action'' subject to
review by the Office of Management and Budget under Executive Order
12866 (58 FR 51735, October 4, 1993);
     Does not impose an information collection burden under the
provisions of the Paperwork Reduction Act (44 U.S.C. 3501 et seq.);
     Is certified as not having a significant economic impact
on a substantial number of small entities under the Regulatory
Flexibility Act (5 U.S.C. 601 et seq.);
     Does not contain any unfunded mandate or significantly or
uniquely affect small governments, as described in the Unfunded
Mandates Reform Act of 1995 (Pub. L. 104-4);
     Does not have Federalism implications as specified in
Executive Order 13132 (64 FR 43255, August 10, 1999);
     Is not an economically significant regulatory action based
on health or safety risks subject to Executive Order 13045 (62 FR
19885, April 23, 1997);
     Is not a significant regulatory action subject to
Executive Order 13211 (66 FR 28355, May 22, 2001);
     Is not subject to requirements of Section 12(d) of the
National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272
note) because application of those requirements would be inconsistent
with the Clean Air Act; and
     Does not provide EPA with the discretionary authority to
address, as appropriate, disproportionate human health or environmental
effects, using practicable and legally permissible methods, under
Executive Order 12898 (59 FR 7629, February 16, 1994).
    In addition, this proposed rule does not have tribal implications
as specified by Executive Order 13175 (65 FR 67249, November 9, 2000),
because the SIP is not approved to apply in Indian country located in
the state, and EPA notes that it will not impose substantial direct
costs on tribal governments or preempt tribal law.

List of Subjects in 40 CFR Part 52

    Environmental protection, Air pollution control, Intergovernmental
relations, Oxides of nitrogen, Ozone, Reporting and recordkeeping
requirements, Volatile organic compounds.

    Dated: October 15, 2008.
Wayne Nastri,
Regional Administrator, Region IX.
[FR Doc. E8-25468 Filed 10-23-08; 8:45 am]

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