according to the modeling guidance for attainment demonstrations, may not be possible in all cases. Because the availability of information and the causes of international pollution vary significantly from one area to another, EPA continues to believe that the best approach for addressing international transport is for States to work with EPA on an area by area basis to determine what is the best available information and the best method for analysis that fits the unique situation for each area.

Regarding consideration under section 179B of the impact on attainment of smoke from crop burning activities in Southern Mexico and Central America, in many cases it may not be possible to confidently quantify the impacts to the total ozone loadings from individual foreign sources that are hundreds or even thousands of miles from the U. S. border. PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 97 Particularly since 1998, when spring fires in Mexico and Central America were very severe, EPA has received much information about the potential impacts from such occurrences on ozone and PM levels in the United States. A prime lesson learned from those experiences is that a well designed,

detailed analysis is required before one can estimate the degree of influence from such fires. In many cases,

sufficient data will not exist to draw such a conclusion.

Case by case consultation between EPA and the State will help determine how best to consider this information in attainment planning.

With respect to the applicability of section 179B to areas affected by emissions from very distant, foreign sources, EPA currently has not taken a position. If and when there are any SIP submittals that request a section 179B dispensation on such a basis, EPA will examine those submittals on a case by case basis, including focusing on the sufficiency of the technical demonstration, in order to make a determination of section 179B applicability.

The EPA considers international transport of pollution an important issue. The EPA is engaged in several international efforts that will allow us to better understand the linkages between air pollution sources in other countries PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 and their impacts on public health and air quality in the United States. The EPA has cooperative agreements with both Canada and Mexico to investigate international border transport. The information generated by these partnerships will assist States in evaluating international transport affecting 8 hour nonattainment areas.

End Of Moved Text , we noted that a number of State air agency representatives had voiced concern about intrastate transport of ozone and precursor emissions and asked EPA to address this concern.

We indicated that the CAA requires individual States, as an initial matter, to deal with intrastate transport. We also pointed out that a State could recommend designation of nonattainment areas that are large enough to encompass upwind and downwind areas of the State and require that the individual jurisdictions work together on an attainment plan that accounts for transport and results in attainment by the attainment date for the entire nonattainment area. We also solicited comments on other ways of addressing intrastate transport within the context of the CAA provisions.

FR additional provisions for addressing intrastate transport for the reasons stated in the proposal. However, as indicated in the Phase 1 rule published on April 30, 2004,

for subpart 1 areas, States and EPA could consider intrastate PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 99 transport in determining the attainment date for an area.

( Intrastate transport also could be considered in determining the attainment date that is as expeditious as practicable for subpart 2 areas, but if that date were later than allowed for the area's classification, the state would need to request bump up of the area to a higher classification for that date to be approvable.) Responses Text Was Moved From Here: 5 Response: As provided in the proposed rule ( 68 FR 32829) we agree with the commenters that States have the obligation and authority to address the transport of pollution from one area of the State to a different area.

Comment: comments recommended an intrastate transport classification. Response: Our response to those comments is in the response to comment document for the Phase 1 notice of April 30, 2004. Docket document OAR 2003 0079 0717; p.

68.) 3. How will EPA address transport of ground level ozone and its precursors for [...] international transport?

Text Moved Here: 3 forprovide additionalbeyond that allowedEnd Of Moved Text Text Moved Here: 4 End Of Moved Text PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 100 Text Was Moved From Here: 6 b. FR Aswe are not setting forth any regulatory provisions related to international. Section 179B of the CAA applies for these purposes. We continue to recommend that States confer with the appropriate EPA Regional Office to establish on a case by case basis the technical requirements for analyses to support showings under section 179B. These analyses will be subject to public comment duringState and federal SIP processes.

Responses Comment.

Text Moved Here: 5 within a State togetherEnd Of Moved Text Text Moved Here: 6 ( U. S.) affected U. SEnd Of Moved Text SS. U. Sor PM U. SU. S D. How will EPA address requirements for modeling and attainment demonstration SIPs for areas implementing the 8

hour ozone standard?

[ Section VI. H. of June 2, 2003 proposed rule ( 68 FR 32830); section 51 § 51.908 in draft and final regulatory text.] PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 101 As noted in the proposal, an attainment demonstration SIP consists of ( 1) technical analyses to locate and identify sources of emissions that are causing violations of the 8

hour NAAQS within nonattainment areas ( i. e., analyses related to the emissions inventory required for the nonattainment area), ( 2) adopted measures with schedules for implementation and other means and techniques necessary and appropriate for attainment, ( 3) commitments, in some cases, to perform a midcourse review ( n MCR), and ( 4) contingency measures required under section 172( c)( 9) of the CAA that can be implemented without further action by the State or the Administrator to cover failures to meet RFP milestones and/ or attainment. The final rule retains three of these four elements, the exception being the requirement for a commitment to perform an MCR. As noted below, EPA will assess whether an MCR is needed on a case by case basis in reviewing individual attainment demonstrations.

In the Phase 1 final rRule, section 51 § 51.908 contained only the requirement related to the timing of implementation of the emissions reductions needed for attainment. In today's final rule, that provision is retained as paragraph ( d) of section 51 § 51.908, and other requirements related to modeling and attainment demonstrations appear in the PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 102 remaining paragraphs of section 51 § 51.908. The draft regulatory text made available in August 2003 included 51.904( b)( 2), regarding subpart 1 areas that request an attainment date of three years or less. That issue was not addressed in Phase 1, but will be addressed here. For completeness and organizational purposes, we now include that provision in section 51.908, as it makes sense to include it in the same location in the rule as the other regulatory provisions regarding attainment demonstration requirements and submittal dates.

In the proposal, we also solicited public comment on the guidance related to multi pollutant assessments ( as discussed below), areas with earlier and later attainment dates, MCR,

modeling guidance, and multi State nonattainment areas.

These topics are discussed below. Associated with the attainment demonstration also are the RFP/ ROP plans and the SIP submission concerning RACM, both of which we discussed elsewhere in the preamble to the proposed rule and which are discussed in later sections of this preamble.

1. Areas with early attainment dates a. Background The proposal noted that under section 182( a), marginal areas, which have a maximum attainment date of 3 years or PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 9Even though the June 2, 2003 proposal contained the reference to the 0.005 ppm criterion, the draft regulatory text issued for public comment did not contain a reference to this criterion.

103 less after designation, are not required to perform a complex modeling analysis using photochemical grid modeling. We noted that areas covered under either subpart 1 or 2 with ozone concentrations close to the level of the NAAQS ( e. g.,

within 0.005 parts per million ( ppm)) 9, will most likely come into attainment within 3 years after designation as nonattainment without any additional local planning as a result of national and/ or regional emission control measures that are scheduled to occur. We noted that regional scale modeling for national rules, such as the NOx SIP Call and Tier II motor vehicle tailpipe standards, projects major ozone benefits for the 3 year period of 2004 2006.

Attainment for many areas classified as marginal is further indicated by subsequent modeling used to support proposal of the CAIR. This 3 year period coincides with the period that would be used to determine whether an area attains the 8 hour standard within 3 years after designation for areas classified as marginal.

If existing modeling for a marginal area does not indicate the area will attain with the current planned PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 104 control measures, EPA encouraged the areas to request reclassification to moderate and encouraged the State or Tribe to develop an attainment demonstration using photochemical grid modeling. ( See 68 FR 32831; June 2,

2003.) Even though modeling is not required, it may be prudent.

In the proposal, we postulated that for subpart 1 areas,

3 years is not enough time to perform the detailed photochemical grid modeling needed to develop the demonstration and to then complete the regulatory process needed to adopt and implement control measures sufficiently before the attainment date. Three years is generally adequate time to perform the modeling analysis and other parts of the process save implementation. Additional time is generally needed to implement the control measures.

Sincenoted that many subpart 1 areas are projected through regional modeling to come into attainment within three3 years after designation with current control programs, it would not be reasonable to require these areas to expend the amount of resources needed to perform a complex modeling analysis.

Therefore, we proposed that no additional modeled attainment demonstration would be required for areas with air quality observations close to the level of the standard as described PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 105 above and where regional or national modeling exists and that is appropriate for use in the areato demonstrates the area will attain the 8 hour standard within 3 years after designation ( i. e., based on data from 2004 2006).

We proposed that areas subject only to subpart 1 may request an attainment date no later than 3 years following designation for the 8 hour NAAQS by submitting within 1 year of the designation a SIP that demonstrates the area will attain within 3 years following designation. The demonstration must include modeling results and analyses that the State is relying on to support its claim. Such modeling must be consistent with EPA guidance and must be appropriate for the area.

b. Summary of Ffinal Rule The final rule generally follows the approach of the proposal. A subpart 1 area may rely on acceptable available modeling to obtainrule Although we proposed that subpart 1 areas requesting an attainment date of 3 years or less after the effective date of the designation. Thus, the rule does not require the area to submit a separate local modeledwithin 3 years after designation should submit their attainment demonstration within 12 months, we have removed that provision from the PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 106 final rule because it is unnecessary. That is, a subpart 1 area is free to choose submit its attainment demonstration at any time prior to the 3 year due date. As is the case with all required attainment demonstrationdemonstrations, the demonstration must be submitted no later than 3 years following designation and must be appropriate for use in the area. We anticipate that most of thesubpart 1 areas that meet these criteria and thus are potentially eligible for an early attainment date will be included in the modeling analyses conducted by areas with later attainment dates.

States are encouraged to use these available analyses, as well as any future EPA national or regional modeling, as opportunities to review the impact control programs will have on areas with early attainment dates. 2 Although the proposal set forth a criterion that only areas whose base year design value is within 0.005 ppm of the standard level could rely on acceptable available modeling to obtain an attainment date of 3 years or less after designation, we do not believe that criterion is necessary and is therefore not included in the final rule.

For subpart 1 areas that wish to take advantage of this provision, the State must submit within 18 months after the effective date of the designation a SIP that demonstrates the PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 10If an assessment indicates that a regional modeling analysis is not applicable to a particular nonattainment area, additional local modeling would be required.

107 area will attain within 3 years following designation. Even though the proposal called for submission within 1 year after designation, the fact that this phase 2 final rule has been issued later than anticipated has led us to allow an additional 6 months for the submission. However, we recommend that the demonstration be submitted as soon as possible. The demonstration must include modeling results and analyses that the State or Tribe is relying on to support its claim. Such modeling should be consistent with EPA guidance and should be applicable and appropriate for the area. 10 If acceptable available modeling does not demonstrate attainment within three years after the area's designation,

the area would need to submit a local modeled attainment demonstration.

The draft regulatory text ( section 51.908( a)) was structured such that no attainment demonstration was needed for subpart 1 areas that received an attainment date within 3 years after the effective date of the nonattainment designation. However, this was misleading, since the draft 51.904( b)( 2) provision that affected these areas required a PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 108 demonstration of attainment within 3 years after designation.

The final regulatory text in 51.908( f) clarifies this point.

c. Comments and Responses Comment: Several commenters recommended that the requirement for attainment demonstrations from all subpart 1 areas be eliminated.

Response: Section 172( c)( 1) clearly requires that nonattainment areas ". . . shall provide for attainment of the national primary ambient air quality standards." To meet this requirement, a State must demonstrate that the area will attain by a specified date and identify and adopt the control measures that will bring the area into attainment. We see no authority for waiving this requirement for areas. However,

we do believe, that in light of the CAA's provisions for areas classified as marginal under subpart 2, that it is appropriate to rely on existing national and regional modeling for this demonstration for subpart 1 areas that are similar to marginal areas in terms of the severity of the air pollution problem and the time needed for attainment.

Comment: What are the requirements for subpart 1 areas requesting attainment dates within 3 years of designation?

Response: Subpart 1 areas that request an attainment date within 3 years of designation must submit within 18 PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 109 months after the effective designation date anmust submit their attainment demonstration as specified in the rule.

These areas should begin to work immediately with the appropriate regional office to establish modeling protocols and agreements on the technical analyses need to support its claim. demonstrations within 3 years after designation.

2. Areas with later attainment dates a. Background For areas with attainment dates of more than 3 years after designation, regardless of whether they are covered under subpart 1 or subpart 2 ( except marginal areas), we proposed to require them to submit an attainment demonstration SIP. This proposal was reflected in section 51 § 51.908( b) and ( c) of the draft regulatory text. We stated that local, regional and national modeling developed to support Federal or local controls could be used provided the modeling is consistent with EPA's modeling guidance. Several States have invested considerable time and resources in regional 8 hour ozone modeling projects following this guidance. Where exceedances of the 8 hour ozone standard are more pervasive and widespread than they were for the 1 hour ozone standard, we recommended that States work together in multi State modeling efforts and leverage off work under PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 11U. S. EPA, ( XXXMONTH NEEDED 2005), Guidance on the Use of Models and Other Related Analyses in Attainment Demonstrations for the 8 Hour Ozone NAAQS, EPA 454/ R 04 005, http:// www. epa. gov/ ttn/ scram, ( Modeling Guidance, File name:

110 development and resources spent on these projects. This will be most beneficial in developing attainment demonstrations to achieve attainment.

b. Summary of Ffinal Rrule ASubpart 1 areas with attainment dates later than 3 years after designation, such asnd areas classified as moderate or higher under section 51 § 51.903, are required to submit an attainment demonstration no later than 3 years after the effective date of designation for the 8 hour ozone NAAQS. For example, aAreas with attainment dates later than 3 years after designation ( whoseand effective date of designation isof June 15, 2004) are required to submit an attainment demonstration no later than June 15, 2007. These demonstrations shallmust be consistent with Aappendix W. For the review of technical adequacy, we will generally rely on our most recent modeling guidance at the time the modeled attainment demonstration is performed. We will be making available a final version of the modeling guidance related to developing attainment demonstrations for the 8 hour ozone standard. 11 Local, regional and national modeling developed PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 FINAL8HR).

111 to support Federal or local controls may be used provided the modeling is consistent with EPA's modeling guidance.

c. Comments and Rresponses We received no comments on this topic per se; comments on the timing of submission of attainment demonstrations is discussed elsewhere. We noted in the proposal that comments on the modeling guidance were welcome at any time and that we would consider those comments in any future revision of theat document. We noted that comments submitted on the modeling guidance document would not be docketed as part of this rulemaking, nor would a comment/ response summary of these comments be a part of the final 8 hour ozone implementation rule since they will not affect the rule itself. We will address those comments at the time we issue the final modeling guidance.

3. Multi State nonattainment areas a. Background As discussed in the June 2003 proposal, section 182( j)

of the ActCAA defines a multi State ozone nonattainment area as an ozone nonattainment area, portions of which lie in two or more States. Section 182( j)( 1)( A) and ( B) set forth PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 112 certain requirements for such areas. First, each State in which a multi State ozone nonattainment area lies must take all reasonable steps to coordinate the implementation of the required revisions to SIPs for the given nonattainment area [ section 182( j)( 1)( A)]. Next, section 182( j)( 1)( B) requires the States to use photochemical grid modeling or any other equally effective analytical method approved by us for demonstrating attainment. We are prevented by section 182( j)

from approving any SIP revision submitted under that section if a State has failed to meet the above requirements.

To address the provisions of section 182( j)( 1)( A),

States that include portions of a multi State ozone nonattainment area should develop a joint work plan as evidence of early cooperation and integration. The work plan should include a schedule for developing the emissions inventories, and the attainment demonstration for the entire multi State area. Each State within a multi State ozone nonattainment area is responsible for meeting all the requirements relevant to the given area. Care should be taken to coordinate strategies and assumptions in a modeled area with those in other, nearby modeled areas in order to ensure that consistent, plausible strategies are developed. PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 113 Section 182( j)( 2) for multi State nonattainment areas recognizes that one State may not be able to demonstrate attainment for the nonattainment area if other States in which portions of the nonattainment area are located do not adopt and submit the necessary attainment plan for the area.

In such cases, even though the area as a whole would not be able to demonstratehave an approvable attainment demonstration, the sanction provisions of section 179 shallwill not apply in the portion of the nonattainment area located in a State that submitted an attainment plan.

b. Summary of final rule As discussed in the proposal, State partners involved in a multi State ozone nonattainment area must work together to perform the appropriate modeling analyses to identify control measures that will enable the area to achieve attainment as expeditiously as practicable. Each State will be responsible for its portion of the control program and therefore will be held accountable for controls identified for implementation within its State boundaries. The modeling analyses should encompass the entire multi sState nonattainment area as well as adjacent counties which may contribute to the nonattainment problem. State plans should address local transport within the region and its contribution to PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 114 nonattainment in the multi state area. Consideration of long range transport and its contributions to nonattainment is discussed in section IV. B. of this preamble. TMulti State nonattainment areas are subject to the same modeling and attainment demonstration requirements of the final rule that apply to multi State nonattainmentall other areas, including areas covered under subpart 1. Marginal multi State nonattainment areas do not have to submit a modeled attainment demonstration because section 182( a) exempts marginal areas from the requirement to submit an attainment demonstration.

c. Comments and Rresponses Comment: Several commenters encouraged us to clearly define in the rule how multi State nonattainment areas will be treated if all or a portion of an area is governed bysubject only to subpart 1. One of these commenters requested a clarification that photochemical grid modeling will not be required for multi State areas classified under Ssubpart 1 or areas that are classified as marginal. The commenter's reasoning was that such modeling is unnecessary since they are close to achieving the 8 hour NAAQS and will be in attainment before the modeling can be completed. PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 115 Response: We agree with these commenters that since section 182( a) exempts marginal areas from the requirement to submit an attainment demonstration, such areas need not develop an attainment demonstrationperform photochemical grid modeling.

We recognize that Ssection 182( j) of the CAA requires that multi State areas use photochemical grid modeling as part of their attainment demonstrations but that Ssection 172 ( Ssubpart 1 areas) of the CAA does not require photochemical grid modeling. For subpart 1 areas that do not seek an attainment date of three years or less after designation, wWe make no distinction between multi State and single State subpart 1 nonattainment areas. However, subpart 1 nonattainment areas are required to submit an attainment demonstration that relies on photochemical grid modeling,

either one that has already been performed that is appropriate for use in the area, or a new one. We do not believe that techniques other than those based on photochemical grid modeling will provide credible assurance that an area will achieve the 8 hour ozone standard by the area's attainment date.

Comment: One commenter requested that we perform the modeling for the multi sState areas. Two commenters stated PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 12ICF Consulting/ SAI, S. Douglas, et. al. " Use of Regional Scale Modeling to support 8 Hour Ozone Assessments", 2004, AWMA, Indianapolis, ID, Technical Report.

116 that if any additional photochemical modeling is required for such areas pursuant to CAA 182( j)( 1)( B), then EPA should refine previous modeling; perform new modeling; or approve a less resource intensive, alternate method that fulfills the requirement. The commenters asserted that we should assist the States in coordinating the development of the attainment/ maintenance plans and ensure that areas involving multiple EPA Regions are not hampered by jurisdictional conflicts and inconsistencies.

Response: We have alreadyIn developing CAIR, we conducted regional scale modeling for many of the potential nonattainment areas that involve multiple States. The modeling results will be madeare available for States to assess whether the regional modeling results are applicablesuitable for local attainment demonstrations ( ICF Consulting/ SAI, S. Douglas, et. al. " Use of Regional Scale Modeling to support 8 Hour Ozone Assessments", 2004, AWMA,

Indianapolis, ID, Technical Report). 12 If an assessment indicates that a regional modeling analysis is not applicable to a particular nonattainment area, additional local modeling PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 13As noted above in the discussion of subpart 1 areas with early attainment dates, although the draft regulatory text ( section 51in § 51.908( a) was structured such that no attainment demonstration was needed for subpart 1 areas that received an attainment date within 3 years after the effective date of the nonattainment designation, this was misleading, since the draft 51 § 51.904( b)( 2) provision that affected these areas required a demonstration of attainment 117 would be required. If additional photochemical modeling is required for such areas, then the States involved should refine previous modeling or perform new modeling to support a local attainment demonstration. We will assist and work with States to coordinate the development of the attainment/ maintenance plans.

4. Role of modeling guidance in attainment demonstrations a. Background The proposal noted that section 182( b)( 1)( A) requires ozone nonattainment areas to develop an attainment demonstration which provides for reductions in VOC and NOx emissions " as necessary to attain the national primary ambient air quality standard for ozone." Section 172( c),

requires areas covered under subpart 1 to demonstrate attainment. For a subpart 1 area that does not qualify for an attainment date within 3 years after designation, we proposed to require the State to develop and submit a modeled attainment demonstration. 13 PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 within 3 years after designation. The final regulatory text in 51 § 51.908( f) clarifies this point.

14U. S. EPA, ( 1991), Guideline for Regulatory Application of the Urban Airshed Model, EPA 450/ 4 91 013. Available at: http:// www. epa. gov/ scram001/ tt25. htm ; see document DRAFT8HR.

118 We noted that section 182( c)( 2)( A) provides that for serious and higher classified areas the " attainment demonstration must be based on photochemical grid modeling or any other analytical method determined by the Administrator,

in the Administrator's discretion, to be at least as effective." A photochemical grid model should meet several general criteria for it to be a candidate for consideration in an attainment demonstration. We noted that, unlike in previous guidance, 14 we did not propose recommending a specific photochemical grid model for use in the attainment demonstration for the 8 hour NAAQS for ozone. At present,

there is no single model which has been extensively tested and shown to be clearly superior or easier to use than other available models. Criteria for attainment demonstrations are contained in 40 CFR 51.112, including appendix W ( i. e.,

" EPA's Guideline on Air Quality Models", Models," 68 FR 18440,

April 15, 2003). Appendix W refers to EPA's " Use of Models and Other Analyses in Attainment Demonstrations for the 8 PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 15U. S. EPA, ( May 1999), Draft Guidance on the Use of Models and Other Analyses in Attainment Demonstrations for the 8 Hour Ozone NAAQS, EPA 454/ R 99 004, http:// www. epa. gov/ ttn/ scram, ( Modeling Guidance, File name: DRAFT8HR).

119 Hour Ozone NAAQS" and lists a set of general requirements that an air quality model should meet to qualify for use in an attainment demonstration for the 8 hour ozone NAAQS. 15 The proposal described alternatives available to the States and the scope and coverage of the draft guideline. The draft regulatory text of 2003 addressed this requirement in section 51 § 51.908( d).

We noted that we were planning to make substantial changes to the draft version of this document before finalizing the attainment demonstration aspects of the implementation rule. We said we welcomed public comments on the guidance at any time and would consider those comments in any future revision of the document. However, we said we would not consider comments on the technical merits of the modeling guidance in this present rulemaking.

b. Summary of Ffinal Rrule The final rule requires each attainment demonstration to be consistent with Aappendix W of this part. We will generally review the demonstrations for technical merit using PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 16See 40 CFR 51 § 51.900( g) for definition.

120 EPA's most recent modeling guidance at the time the modeledmodeling relied on in the attainment demonstration is performed. This guidance will generally have the State provide ( 1) technical analyses to locate and identify sources of emissions that are causing violations of the 8 hour NAAQS within nonattainment areas, ( 2) adopted measures with schedules for implementation and other means and techniques necessary and appropriate for attainment that are needed for attainment, with implementation no later than the beginning of the attainment year ozone season16 ( e. g., prior to 2009 ozone season for areas with June 15, 2010 attainment dates),

and ( 3) contingency measures required under section 172( c)( 9)

of the CAA that can be implemented without further action by the State or the Administrator to cover emissions shortfalls in RFP plans and failures to attain.

c. Comments and Rresponses Comment: One commenter recommended that EPA must ensure that attainment demonstrations are based on scientifically valid regional air shedairshed modeling rather than scientifically invalid linear proportional rollback and weight of evidence methods. PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 17U. S. EPA, ( May 1999), Draft Guidance on the Use of Models and Other Analyses in Attainment Demonstrations for the 8 Hour Ozone NAAQS, EPA 454/ R 99 004, http:// www. epa. gov/ ttn/ scram, ( Modeling Guidance, File name: DRAFT8HR).

121 Response: Criteria for attainment demonstrations are contained in 40 CFR 51 § 51.112, including appendix W ( i. e.,

" EPA's Guideline on Air Quality Models", 68 FR 18440, April 15, 2003). Appendix W cites EPA's " Use of Models and Other Analyses in Attainment Demonstrations for the 8 Hour Ozone NAAQS" and describes a set of general criteria that an air quality model and its application should meet to qualify for use in an attainment demonstration for the 8 hour ozone NAAQS. 17 The draft guidance was developed through a collaborative process, which included review from the scientific community, and it has been revised to reflect recent review comments. The procedures described are considered a scientifically valid use of regional and urban airshed modeling. The modeled attainment test makes use of the model derived relationship between ozone and its precursors. It does not, as is the case with proportional rollback, assume equal proportions of the precursors will provide an equally proportional reduction in ozone. For PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 18U. S. EPA, ( XXX MONTH NEEDED 2005), Guidance on the Use of Models and Other Related Analyses in Attainment Demonstrations for the 8 Hour Ozone NAAQS, EPA 454/ R 04 005, http:// www. epa. gov/ ttn/ scram, ( Modeling Guidance, File name: FINAL8HR)

122 example, it does not assume that 20 percent reduction in precursors will provide 20 percent improvement in ozone.

The guidance also identifies additional data which, if available, should enhance the credibility of model results and results of other analyses used in a weight of evidence determination. The EPA believes use of weight of evidence is appropriate as do many in the scientific community. Weight of evidence is a credible approach for considering inherent uncertainties in a modeling application. As noted above, we will be making available a final version of the modeling and attainment demonstration guidance for the 8 hour ozone standard. 18 Comment: All attainment demonstrations should be subject to the same rigorous standards.

Response: The EPA envisions that the final 8 hour ozone modeling guidance will be available for use by the majority of subpart 1 areas and subpart 2 areas classified as moderate and above. However, due to the unique nature of the ozone problem in many areas, EPA will accept various applications PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 123 of the guidance. Although EPA anticipates all areas will follow the guidance closely there will be variation based on availability of new and improved data methods and field study data. The EPA is always striving to make best use of available data and improvements in methodologies as the science and our understanding of ozone formation and transport in different parts of the country increases.

Unique to many areas is the source receptor configuration,

level of precursor data collected and the model's ability to simulate unique factors influencing the formation and transport of ozone. As more information becomes available in particular areas, EPA expects more rigorous demonstrations will be provided. Areas close to attaining the standard for which there is a better understanding of the meteorology and the relationships between precursor emissions and ozone may not require as much rigor. These decisions will be made on a case by case basis and the public will be able to express their views during the State SIP development and EPA review process.

Comment: The EPA cannot adopt or change the 1999 Draft Guidance, use it for regulatory purposes, or require States to use it for regulatory purposes, without subjecting it to separate notice and comment rulemaking. PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 124 Response: The EPA is not adopting the Guidance as a rule. The EPA plans to use the current ( 2005) guidance and future updates as a benchmark for reviewing the technical analysis submitted in support of 8 hour ozone attainment demonstrations. The guidance document is not a regulation.

Therefore, it does not impose binding, enforceable requirements on any party, and may not apply to a particular situation based upon the circumstances. The EPA and State decision makers have the discretion to adopt approaches on a case by case basis that differ from this guidance where appropriate. Any decisions by the EPA regarding adequacy of a particular SIP to meet the 8 hour ozone NAAQS will be based on the CAA and our regulations. Therefore, interested parties are free to raise questions and objections about the appropriateness of the application of this guidance to a particular situation during the State SIP development and EPA review process.

Comment: One commenter requested an opportunity to review and comment on the revised guidance prior to the " final" release.

Response: States, Tribes and others were given an opportunity to comment on the proposed changes in therevised draft guidance prior to release. Also, EPA received PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 125 additional comments on the draft guidance during the comment period on the implementation rule. The EPA has reviewed and considered the comments and will be releasing the final guidance. For more information and updates to the modeling guidance for ozone visit EPA's Technology Transfer Network Support Center for Regulatory Air Models ( TTN/ SCRAM) on the internet, http:// www. epa. gov/ ttn/ scram/). Even though the guidance will be issued in final form shortly, EPA is always open to suggestions for future improvements to the guidance,

including the incorporation of methodologies and procedures that increase accuracy and credibility of results. Such suggestions may be made to EPA regional or headquarters modeling contacts listed at the above TTN/ SCRAM web site.

Comment: The EPA should carefully consider the resources that will be needed to perform the requisite modeling for multiple areas in many States.

Response: States/ Tribes are encouraged to share and leverage resources currently being used in regional model applications that affect multiple areas. There is much opportunity for common use of data and methodologies among the modeling requirements for the regional haze program, the PM2.5 attainment demonstrations and the ozone attainment demonstrations that should make the overall exercise less PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 126 onerous. States and Tribes are encouraged to model multiple precursor strategies for multiple areas and review their efficacy for all three programs.

Comment: Any photochemical grid model utilized must either be in the public domain or licensed for unlimited use by any person for purposes of modeling within the area.

Response: The EPA modeling guidance supports this comment which is addressed in section 11 of the modeling guidance. " Applicable models" may be used, if they are nonproprietary A " non proprietary" model is one whose source code is available for free or for a reasonable cost.

Further, the user must be free to revise the code to perform diagnostic analyses and/ or to improve the model's ability to describe observations in a credible manner.

Comment: One commenter recommended that EPA update its guidance in 40 CFR 51 Aappendix W to include a discussion of the role of weight of evidence as part of a modeling demonstration, and to make any updates in Aappendix W subject to public review.

Response: In regard to the role of weight of evidence,

EPA does not plan to revise Aappendix W. Use of weight of evidence is dependent on local information only available when the technical analysis for a specific model application PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 127 is under development. Therefore, use of weight of evidence is reviewedconsidered on a case by case basis as the appropriate Regional Office works with the State as it develops its SIP and, once submitted, during the State adoption process and during EPA's SIP approval process. Any weight of evidence analysis is available for public review.

5. Mid course review ( MCR)

a. Background The proposal noted that a MCR provides an opportunity to assess whether a nonattainment area is or is not making sufficient progress toward attainment of the 8 hour ozone standard, as predicted in its attainment demonstration. We noted that a commitment to perform a MCR is a critical element of an attainment demonstration that employs a longterm projection period and relies on weight of evidence.

Because of the uncertainty in long term projections, we said we believed such attainment demonstrations need to contain provisions for periodic review of monitoring, emissions, and modeling data to assess the extent to which refinements to emission control measures are needed.

A number of States participated in a consultative process with EPA, which resulted in the development of the 1 PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 19Memorandum of March 28, 2002, from Lydia N. Wegman and J. David Mobley, re: " Mid Course Review Guidance for the 1 Hour Ozone Nonattainment Areas that Rely on Weight of Evidence for Attainment Demonstration." Located at URL: http:// www. epa. gov/ scram001/ guidance/ guide/ policymem33d. pdf .

128 hour MCR guidance. 19 We noted that we would update the 1 hour MCR policy and technical guidance to include 8 hour metrics and that we were soliciting comment on appropriate revisions.

We proposed that the final MCR guidance incorporating 8 hour metrics would be available at the time we issue our final implementation rule.

The proposal briefly described the procedure for performing a MCR. The proposal noted that States would not have to commit in advance to adopt new control measures as a result of the MCR process. Based on the MCR, if we determine sufficient progress has not been made, we would determine whether additional emissions reductions are necessary from the State( s) in which the nonattainment area is located or upwind States or both. We would then require the appropriate State( s) to adopt and submit new measures to bring about the necessary emissions reductions within a specified period. We anticipated that these findings would be made as calls for SIP revisions under section 110( k)( 5) and, therefore, the period for submission of the measures would be no longer than PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 129 18 months after the EPA finding. Thus, we proposed that States complete the MCR three3 or more years before the applicable attainment date to ensure that any additional controls that may be needed can be adopted in sufficient time to reduce emissions by the start of the ozone season in the attainment year.

b. Summary of Final Rule Areasfinal rule The final regulatory text does not contain a requirement for the mid course review. In reviewing attainment demonstrations from individual States, however EPA will assess the need for a mid course review for areas with an attainment date beyond 6 years after the effective date of the area's designation are also required to commit to perform a MCR midway between the due date for itsin the context of whether the attainment demonstration SIP and the area's attainment date. ( Thus, moderate areas are not required to commit to perform a MCR.) and any weight of evidence analysis is supportable without a commitment by the State to perform a mid course review.

The 8 hour ozone modeling guidance ( EPA, 2004) is expected to identify measurements and activities to support subsequent reviews of an attainment demonstration SIP ( i. e., PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 20Memorandum of March 28, 2002, from Lydia N. Wegman and J. David Mobley, re: " Mid Course Review Guidance for the 1 Hour Ozone Nonattainment Areas that Rely on Weight of Evidence for Attainment Demonstration." Located at URL: http:// www. epa. gov/ scram001/ guidance/ guide/ policymem33d. pdf 130 MCR), such as improvements in air quality monitoring,

meteorology and emission measurements. Even though the proposal noted that we expected to revise the existing 1 hour mid course review guidance, EPA now believes the 1 hour mid course review guidance coupled with the 8 hour modeling guidance provides sufficient guidance. States should consult with EPA prior to using a methodology other than the one developed through the public consultative process.

Guidance for performing a MCR for the 1 hour ozone NAAQS identifies several methods for reviewing whether the existing SIP is sufficient for the area to attain by its attainment date. 20 These guidance documents should provide adequate information for developing protocols for performing MCRs for the 8 hour ozone NAAQS. States/ Tribes should prepare protocols which identify analyses and data bases to be used to support a MCR and discuss these with the appropriate EPA Regional Office prior to performing a MCR. If we determine that additional guidance is needed, we will issue updated PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 131 guidance in a time frametimeframe suitable to support the timely completion of MCRs.

c. Comments and Responses Comment: Requiring the MCR 3 or more years prior to the attainment date is not reasonable or feasible for some areas.

The EPA needs to recognize that for moderate and lower classifications the MCR would be due at the time of the SIP submittal. MCR'sMid course review should be required only for areas with nonattainment classifications of serious or greater, as at least 3 years of monitored data are required for a MCR, after the implementation of controls. One commenter recommended that EPA make the MCR process part of the requirements for RFP and ROP.

Response: EPA is requiring each nonattainment area with an attainment date greater than 6 years after the effective date of the area's designation to complete and submit to EPA a MCR midway between the due date for itsThe final regulatory text does not require a mid course review; as noted above,

EPA will assess on a case by case basis whether a mid course review would be needed in the context of a particular attainment demonstration SIP and the area's attainment date.

This requirement is applicable to areas classified under subpart 1 and subpart 2. Thus, areas classified as marginal PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 132 or moderate under subpart 2 would not be required to commit to a MCR. Areas classified under subpart 2 as serious or above would be required to perform a MCR.

Comment: One commenter recommended that EPA make the MCR process part of the requirements for RFP and ROP.

Response: EPA believes the State may develop a coordinated RFP/ MCR analysis to assess progress in both emission reductions and reductions in ambient ozone concentrations.

However, the RFP requirement and milestone reductions and milestone compliance demonstrations under section 182 paragraphs ( b)( 1), ( c)( 2) and ( g) set forth specific timing that may or may not match the timing of the required MCR submission.

Comment: The EPA should develop proper analysis techniques so that meteorological conditions do not affect a nonattainment area's perceived progress towards attainment.

A MCR should also include an evaluation of ozone transport into the nonattainment area and control implementation in upwind areas.

Response: Assessments of transport are covered in the MCR guidance. The EPA is improving methods for determining the ozone trends and how they are affected by meteorology.

The latest information will be made available. PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 21Memorandum of March 28, 2002, from Lydia N. Wegman and J. David Mobley, re: " Mid Course Review Guidance for the 1 Hour Ozone Nonattainment Areas that Rely on Weight of Evidence for Attainment Demonstration." Located at URL: http:// www. epa. gov/ scram001/ guidance/ guide/ policymem33d. pdf 133 Comment: The EPA needs to release the revised MCR guidance before the final rule is issued in order for it to be reviewed and commented on during the public comment period.

Response: The final rule does not incorporate any MCR guidance by reference. The 8 hour ozone modeling guidance ( U. S. EPA, 2004) is expected to identify measurements and activities to support subsequent reviews of an attainment demonstration SIP ( i. e., MCR), such as improvements in air quality monitoring, meteorology and emission measurements.

Guidance for performing a MCR for the 1 hour ozone NAAQS identifies several methods for reviewing whether a SIP is on track to attain within prescribed time limits. 21 These guidance documents should provide adequate information for developing protocols for performing MCRs for the 8 hour ozone NAAQS. States/ Tribes should prepare protocols which identify analyses and data bases to be used to support a MCR and discuss these with the appropriate EPA Regional Office prior to performing a MCR. If we determine that additional PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 22Use of models that are capable of simulating transport and formation of multiple pollutants simultaneously. For example, for ozone and fine particles, it is critical that the model simulate photochemistry, which includes interactions among the pollutants and their precursors.

134 guidance is needed, we will issue updated guidance in a time frametimeframe suitable to support completion of MCR's within established deadlines.

6. Multi pollutant assessments ( one atmosphere modeling) 22)

a. Background The proposal noted that many factors affecting formation and transport of secondary fine particles ( i. e., PM2.5 components) are the same as those affecting formation and transport of ozone.

The proposal, therefore, noted that models and data analysis intended to address visibility impairment need to be capable of simulating transport and formation of both secondary fine particles and ozone. At a minimum, modeling should include previously implemented or planned measures to reduce ozone, secondary fine particles, and visibility impairment. An integrated assessment of the impact controls have on ozone, secondary fine particles, and regional haze provides safeguards to ensure ozone controls will not PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 135 preclude optimal controls for secondary fine particles and visibility impairment.

The concept of modeling control impacts on all three programs is further strengthened by the alignment of the implementation process for ozone and secondary fine particles. As the dates for attainment demonstration and planning SIPs for the three programs are anticipated to be fairly close, the practicality of using common data bases and analysis tools for all three programs is viable and encourages use of shared resources.

The proposal noted that States that undertake multipollutant assessments as part of their attainment demonstration would assess the impact of their ozone attainment strategies on secondary fine particles and visibility or perform a consistent analysis for ozone,

secondary fine particles, and visibility. To facilitate such an effort, we encouraged States to work closely with established regional haze Regional Planning Organizations ( RPOs) and the jurisdictions responsible for developing PM2.5 implementation plans. We encouraged States to perform similar multi pollutant assessments as part of their ozone attainment demonstrations, considering the control programs that are in place at the time of the assessment. Multi PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 136 pollutant assessments are discussed elsewhere in this proposed rulemaking.

b. Summary of final rule There is no regulatory text on the issue of multipollutant assessments, but we recommend the following:

Attainment demonstration modeling should include previously implemented or planned measures to reduce ozone, secondary fine particles, and visibility impairment.

An integrated assessment of the impact controls have on ozone, secondary fine particles, and regional haze is encouraged to promote efficiencies in strategies for achieving all three goals.

States are also encouraged to use common data bases and analysis tools for all three programs and work closely with established regional haze RPOs and the jurisdictions responsible for developing PM2.5 implementation plans.

States are encouraged to follow EPA's lead and perform similar multi pollutant assessments as part of their ozone attainment demonstrations, considering the control programs that are in place at the time of the assessment. PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 137 c. Comments and Rresponses Comments: The EPA received several comments on the recommendation that States perform multi pollutant assessments as part of their ozone attainment demonstrations.

Almost all of the comments agreed with the basic rationale behind encouraging an analysis of the expected ozone, PM2.5,

and visibility impacts of a given set of air quality control measures associated with an 8 hour ozone attainment demonstration. The comments differed on whether multipollutant assessments should be required or only encouraged.

The commenters who urged EPA to encourage rather than require a multi pollutant assessment provided reasons for why they believe a multi pollutant assessment is not possible at this time. One commenter indicated that the proposal was unclear as to whether the multi pollutant assessments were required.

One commenter recommended that EPA require, in certain unspecified cases, nonattainment areas to perform an integrated control strategy assessment to ensure that ozone controls will not preclude optimal controls for secondary fine particles and visibility impairment. Conversely,

several other commenters expressed the opinion that the multi pollutant assessment should not be a requirement of an ozone attainment demonstration. Several reasons were offered PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 138 for why the assessment should remain optional: 1) that the state of the science for assessing PM2.5 and visibility is not yet sufficient for providing meaningful input to the regulatory process, 2) that the additional resources necessary to model the atmosphere as a single system would resulted in an undue burden on the States, and 3) that requiring a PM2.5 and visibility assessment would result in delayed attainment due to the additional time necessary to complete such an analysis.

Response: The EPA continues to believe that encouraging, but not requiring, multi pollutant assessments is the most sound approach for total air quality management given the schedule by which ozone attainment demonstrations are legally required. Much progress has been made on improving the available PM2.5 models and inputs to these models over the past three3 years. As a result, EPA believes that the available tools are able to support air quality planning. Further improvements are likely over the next 1

3several years; much of which will be driven by the RPO's.

By working closely with the appropriate RPO's, States can reduce the burden associated with one atmosphere modeling analyses. However, EPA recognizes however, that many States have already invested resources in an ozone only modeling PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 139 platform analysis which is typically conducted over a finite number of episode days and for geographic regions that are typically less than ( in time) and smaller than ( in space)

what might be required in a multi pollutant assessment. By encouraging States to consider such assessments, EPA hopes to speed the process of the transition to more integrated air quality planning tools while yielding sound multi pollutant control strategies. It is prudent for areas to perform these multi pollutant assessments earlier as it will lessen the planning burden in the long term since later planning activities for PM2.5 and regional haze will need to consider the effects of emission control measures adopted for the ozone attainment plan.

7. What baseline emission inventory should be used for the attainment demonstration?

[ Not addressed in the June 2, 2003 proposal; section 51 § 51.909 of the draft regulatory text.]

The June 2, 2003 proposal did not discuss baselines for purposes of the attainment demonstration. ( It did, however,

discuss baselines for RFP demonstrations.) Section 51.909 of the draft regulatory text, however, would have established 2002 provided that 2002 should be used as the baseline emission inventory year for purposes of both RFP and the PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 23EPA guidance on baseline years is found in the memorandum of November 18, 2002, from Lydia Wegman and Peter Tsirigotis, " 2002 Base Year Emission Inventory SIP Planning: 8 hr Ozone, PM2.5 and Regional Haze Programs." This document is available at the following web site: http:// www. epa. gov/ ttn/ oarpg/ meta. 442.1.2002baseinv. pdf. That document noted, " The EPA is aware that some areas have already begun on a voluntary basis to model for purposes of the 8 hour ozone standard. These areas may continue to use modeling from previous base years for each set of meteorological episode conditions for use in their SIP submittals if these studies are still applicable for an attainment demonstration." attainment demonstration for areas with an effective date of designation of June 15, 2004. We recognize, however, that some areas have already begun to perform modeling for their attainment demonstrations using baseline year inventories earlier than the 2002 inventory, and because the 2002 inventory may not be in a format to readily be used for photochemical grid modeling. 23 Therefore, the final rule does not specify a baseline for purposes of the attainment demonstration and modeling. TAs discussed more fully in the section of the preamble regarding RFP, the specification of 2002 as a baseline year for RFP purposes ( for for areas with an effective date of designation of June 15, 2004) appears in the RFP provisions of 40 CFR 51 § 51.910. Section 51.909 remains reserved.

E. What requirements for RFP should apply under the 8 hour ozone standard? PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 24Note that section 51 § 51.900 provides the following definitions: ( p) Reasonable further progress ( RFP) means for the purposes of the 8 hour NAAQS, the progress reductions required under section 172( c)( 2) and section 182( b)( 1) and ( c)( 2)( B) and ( c)( 2)( C) of the CAA. ( q) Rate of progress ( ROP) means for purposes of the 1 hour NAAQS, the progress reductions required under section 172( c)( 2) and section 182( b)( 1) and ( c)( 2)( B) and ( c)( 2)( C) of the CAA.

141 [ Section VI. I. of June 2, 2003 proposed rule ( 68 FR 32832); sections 51 § 51.909 and 51 § 51.910 in draft; section 51 § 51.910( d) in final regulatory text.]

1. General Ddiscussion a. Background As noted in the June 2, 2003 proposal, section 172( c)( 2), which is located in subpart 1, requires State plans for nonattainment areas to require RFP. Section 171( 1)

of the CAA defines RFP to mean " such annual incremental reductions in emissions of the relevant air pollutant as are required by this part [ part D of title I] or may reasonably be required by the Administrator for the purpose of ensuring attainment of the applicable [ NAAQS] by the applicable date."

Subpart 2 provides more specific RFP requirements for ozone areas classified under Ssection 181.24 In particular,

subpart 2 specifies the base year emissions inventory upon PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 142 which RFP is to be planned for and implemented, the increments of emissions reductions required over specified time periods, and the process for determining whether the RFP milestones were achieved.

Subpart 2 does not specify RFP requirements for marginal areas. Section 182( b)( 1)( A) mandates a 15 percent VOC emission reduction, accounting for growth, between 1990 and 1996 for moderate and above ozone nonattainment areas.

Furthermore, section 182( c)( 2)( B) of the CAA requires each serious and above ozone nonattainment area to submit a SIP revision providing for an actual VOC emission reduction of at least 3 percent per year averaged over each consecutive 3

year period beginning in 1996 until the area's attainment date ( the post 1996 ROP plan). Section 182( c)( 2)( C) of the CAA allows for substitution of NOx for VOC emissions reductions in the post 1996 ROP plan. The EPA's policy, NOx Substitution Guidance ( December 15, 1993; available at http:// www. epa. gov/ ttn/ oarpg/ t1pgm. html), addresses the substitution of NOx emissions reductions for VOC emissions reductions. The baseline emissions inventory for determining the required ROP reductions is specified as 1990.

The requirements for RFP under subparts 1 and 2, as described above, are the minimum required for an area. More PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 143 reductions may be necessary for attainment within the nonattainment area or where the area contributes to a nonattainment problem in a downwind area in the State..

Moreover, an upwind area that contributes to nonattainment in a downwind area in the same State may need more reductions in a shorter time in order for the downwind area to reach attainment by its required attainment date.

b. Summary of Final RFP and ROP Features. Many areas may have significant creditable reductions as a result of federal motor vehicle and non road rules, the NOx SIP Call, and the Clean Air Interstate Rule. With the statutory exceptions enumerated above, assured emissions reductions that will occur in an area after the base year can be credited toward meeting an RFP emission reduction milestone.

To reduce interstate ozone transport, the CAIR ( described above in section IV. B.) established statewide ozone season NOx budgets for 25 States and the District of Columbia ( eastern part of the United States where all 8 hour nonattainment areas are classified as moderate or below). As noted above, the first phase of NOx reductions under CAIR starts in 2009 ( covering 2009 2014); the second phase of NOx reductions begins in 2015 ( covering 2015 and thereafter). PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 144 With respect to timing of reductions, the following table shows how summertime NOx reductions from local CAIR sources that will be achieved by May 1, 2009, or earlier can assist in demonstrating RFP.

Type of 8 hour nonattainment area RFP Requirement* Relationship of CAIR and RFP Subpart 1 areas with attainment dates within 5 years of designation Meet RFP through showing of expeditious attainment No separate RFP requirement, so creditability of CAIR reductions not relevant Subpart 1 areas with attainment dates 6 10 years from designation Must demonstrate RFP through their attainment date CAIR reductions in 2009 or earlier can help fulfill RFP requirement Subpart 2 marginal areas No subpart 2 RFP requirement for marginal areas Not relevant PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 145 Subpart 2 moderate and above areas that previously achieved 15% RFP for 1 hour ozone standard Subject to subpart 1 RFP; must demonstrate RFP through their attainment date CAIR NOx reductions in 2009 or earlier can help fulfill RFP requirement Subpart 2 moderate and above areas that did not implement 15% VOC reductions for 1

hour ozone standard 15% VOC reduction required between 2002 and 2008;

continued progress required through attainment date CAIR 2009 NOx reductions can help demonstrate continued progress after 2008 to attainment date.

* RFP requirement descriptions in table are abbreviated; RFP requirements are more precisely described elsewhere in preamble and rule text.

CAIR provisions do not require emission reductions prior to January 1, 2009. However, some sources may elect to apply CAIR level NOx controls earlier than that date. If such controls are made enforceable in the SIP ( e. g., through a permit restriction adopted into the SIP or specific rule), PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 146 the State may take RFP credit for such emission reductions for the period ending December 31, 2008.

The RFP provisions in the Act for both subpart 1 and subpart 2 areas require that actual emissions be reduced from the baseline to the milestone year. Therefore, only projected actual emission reductions may be credited toward the State's RFP obligation. In developing their RFP plans,

States will have to provide their best estimate of the CAIRaffected sources that are expected to actually apply controls to meet the CAIR requirements and those that are expected to meet CAIR through holding allowances and not actually reducing emissions.

Local CAIR NOx reductions by May 1, 2015, could assist in meeting RFP in the event an area received an attainment date extension to 2015 or beyond.

b. Summary of final RFP features We are adopting nearly all the approaches set forth in our proposed rule for the various 8 hour RFP issues. We are making exceptions to those issues for which convincing arguments were presented by commenters for a suitable alternative or where, through reassessment of the issue, EPA was able to develop a better option that still maintains the integrity of the original proposal. The issues for which we PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 147 have adopted new approaches are: a) the timing of the submission of the RFP plan; b) the structuring of RFP requirements in subpart 1 areas; c) the implementation of RFP in areas designated for the 8 hour ozone standard that entirely or in part encompass an area that was designated nonattainment for the 1 hour ozone standard; and d) the allowing of substitution of controls from outside the nonattainment area within 100 kilometers ( km) for VOC and 200 km for NOx. These changes are discussed in the sections below.

In developing an approach for addressing the RFP requirements for the 8 hour ozone standard, we are adopting the following:

° The same baseline year would be used both to address growth ( in emissions, vehicle miles traveled ( VMT) or otherwise) and to calculate the RFP target level. The baseline year of 2002 applies for areas with an 8 hour ozone nonattainment designation effective in June 2004.

° Emissions reductions from outside the nonattainment area up to 100 km for VOC and 200 km for NOx ( and Statewide for areas that are part of a regional strategy) would be allowed consistent with the concepts in EPA's existing PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 25Memorandum of December 29, 1997 from Richard D. Wilson to Regional Administrators, Regions I X re " Guidance for Implementing the 1 Hour Ozone and Pre Existing PM10 NAAQS." Located at URL: http:// www. epa. gov/ ttn/ oarpg/ t1/ memoranda/ iig. pdf . This policy recognized that VOC emissions up to 100 km and NOx emissions up to 200 km from the nonattainment area could be relied on for RFP. Those distances used resulted from FACA discussions cited earlier and generally represent transport of 1 to 2 days. We still believe it is appropriate to allow this credit. However, as noted below, because we received concerns about this policy outside the rulemaking process, we are in the process of subjecting this policy to a technical review and may revise it in light of that review.

148 December 1997 interim implementation policy for 1 hour ozone NAAQS. 25 ° For areas classified under subpart 2, the RFP requirements specified in subpart 2 would apply, namely a 15 percent VOC emission reduction, accounting for growth, in the first 6 years after the baseline year for moderate and above ozone nonattainment areas. In addition, for areas classified as serious and above, the RFP provisions in subpart 2 require a VOC or NOx emission reduction of at least three percent per year averaged over each consecutive 3 year period beginning 6 years after the baseline year. ( See section 182( c)( 2)( B)). Areas classified under subpart 2 as marginal, which are required to attain 3 years following PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 149 classification, are subject only to such RFP as necessary to attain.

We believe the periods for RFP under subpart 2 for the 8 hour ozone NAAQS should run from the date of the baseline year, and would be equivalent to the periods Congress established in subpart 2, which applied for the 1 hour NAAQS.

Thus, the first 15 percent reduction would be required for the 6  year period starting after the end of the last day of the baseline year ( i. e., January 1, 2003  December 31,

2008). The first 3 year period for the subsequent ( average of) three percent per year emission reduction requirement in serious and higher areas would begin 6 years after the end of the last day of the baseline year ( January 1, 2009  December 31, 2011). However, the last period for any area would end on the attainment date for the area.

° Many areas subject to subpart 1 are subject only to such RFP as necessary to attain. For areas with attainment dates 5 years or less after designation, emissions reductions needed for attainment must be implemented by the beginning of the full ozone season prior to the attainment date ( or about 4 years after designation) to enable a SIP to demonstrate attainment as expeditiously PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 26With today's rulemaking, this provision is now codified as 40 CFR 51 § 51.908( d).

27E. g., if the area's attainment date is 2014, and a total of 30 percent reduction is needed between the end of 2008 and the attainment date ( a 6  year period) to reach attainment, roughly 15 percent must be achieved during the first 3 years ( 2009, 2010, 2011), and the remaining 15 percent over the next 3 years ( 2012, 2013, 2014). The actual percentage would have to be calculated based on the number of days.

150 as practicable within 5 years after designation ( See 40 CFR 51 § 51.908). 26). Under the final rule, RFP would be met by emissions reductions needed for attainment by the attainment date. This approach is similar to the approach of subpart 2 RFP for areas classified as marginal. For subpart 1 areas with attainment dates beyond 5 years after designation, the RFP SIP would first have to provide for a 15 percent emission reduction ( either NOx and/ or VOC) from the baseline year within 6 years after the baseline year. For each subsequent 3 year period out to the attainment date, the RFP SIP would have to provide for an additional increment of progress equal to at least the amount of emissions reductions that would be roughly proportional to the time between the end of the first RFP increment and the attainment date. 27 PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 151 ° New moderate areas would have to submit RFP plans within 3 years after designation and obtain the emissions reductions within 4 years after designation ( 6 years after the baseline year 2002).

° Allow credit after the 2002 base year for future reductions from any Federal and regional measures promulgated after 1990 ( except those measures that were not creditable under the CAA's creditablility provisions).

° Allow use of the " Clean Data Policy".

c. Comments and responses This set of comments and responses on our proposal on RFP are of a general nature. Comments and responses on specific topics appear with the sections below on those topics.

Comment: One commenter stated that EPA's proposed 8

hour ozone rule would sharply slow momentum to implement health protective emission reduction strategies in areas with unhealthful air quality. It would curtail the effectiveness of transportation conformity in areas with inadequate air quality, including both old and new ozone nonattainment areas. It would do this by proposing to eliminate any PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 152 further RFP requirements for pollution reduction in existing 1 hour ozone areas.

Response: The EPA has developed anti backsliding provisions to ensure continuing progress toward attainment of the ozone NAAQS. Under these provisions, areas that are nonattainment for the 8 hour standard must continue to meet most obligations for the 1 hour standard, including RFP requirements. Those provisions ( adopted as part of the Phase 1 rule published April 30, 2004) will ensure areas maintain progress in achieving emissions reductions in areas with unhealthful air quality.

Comment: Another commenter recommends that EPA not strictly interpret the CAA requirement of a 15 percent reduction in VOC in the first 6 years. If reductions in VOC would not assist the area in progress toward attainment and if an area can provide an analysis that it is at least as sensitive to NOx controls, then the area should be able to reduce NOx emissions for RFP requirements.

Response: We addressed in general those comments that recommended alternatives to the mandatory measures of subpart 2 ( which includes the RFP requirement) in the response to comments above under the topic, " Should prescribed requirements of subpart 2 apply in all 8 hour nonattainment PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 153 areas classified under subpart 2, or is there flexibility in application in certain narrowly defined circumstances?" We conclude in that section that EPA has no discretion to broadly waive mandatory requirements. However, we noted that case law may provide support for case by case waivers where implementation of a measure would produce an absurd result.

Comment: One commenter stated that EPA should consider highly reactive VOC reductions that achieve ozone reductions equivalent to an average of 3 percent per year reduction of VOC and/ or NOx as meeting RFP requirements.

Response: The Clean Air Act'sCAA's RFP provisions do not appear to provide for variations in the required percent reduction in VOC based on differences of reactivity of the various VOC compounds. However, EPA is participating with a group called the Reactivity Research Working Group, along with representatives from States, industry and universities,

to study the scientific aspects of reactivity and to try to determine if more cost  effective and greater ozone reductions can be achieved through use of the concept. The requirement to obtain the required percent reduction of total VOCs remains, and if EPA decides to propose a change, it would be undertaken in a separate rulemaking action. PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 154 2. For subpart 2 areas, shouldWhat is the initial 15 percentcontent and timing of the plan for addressing the RFP requirement be limited to VOC emissionss under section 182( b)( 1) for areas covered under subpart 2??

[ Section VI. I. 3 of June 2, 2003 proposed rule ( 68 FR 32833); section 51 § 51.910( a)( 1)( ii) of the draft and final regulatory text.]

a. Background.

a. Background Currently, for many areas of the country, particularly in the Eastern U. S. outside major metropolitan areas, there is a greater need for NOx reductions rather than VOC reductions to bring about reduced ozone concentrations.

However, under the prescribed requirements of subpart 2 of the CAA, NOx substitution is only allowed for the post 1996 RFP requirement ( three percent per year averaged over 3 years), not for the initial 15 percent RFP requirement. We proposed 2 options to address this issue.

( i) Option 1. Continue to require 15 percent VOC reductions within 6 years after the baseline year for all areas designated moderate and above for the 8 hour ozone NAAQS.

After 6 years, all serious and above areas would be required PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 155 to achieve a nine percent reduction in VOC and/ or NOx emissions every 3 years, i. e., an average of three percent per year, until attainment.

( ii) Option 2. For those areas that have approved 15 percent plans for their 1 hour ozone SIPs, an additional 15 percent VOC reduction is not necessary. Areas that are classified as moderate under the 8 hour standard that have already implemented their 15 percent plans under their 1 hour ozone SIPs would be considered to have met the statutory 15 percent requirement and RFP for the first 6 years from the baseline year and would be covered under the more generic RFP requirements of subpart 1. Subpart 1 RFP requirements are discussed below. Areas that are classified as serious and above under the 8 hour standard that have already implemented their 15 percent plans under the 1 hour ozone standard would have to include in their SIPs an RFP plan that would achieve an average of three percent per year of VOC and/ or NOx over each 3 year period starting at the end of the baseline year out to their attainment year. We recognized in the proposal that it would be difficult to adopt and implement emission controls that would provide for the first nine percent emission reduction within 3 years after nonattainment designation. Therefore, consistent with what Congress did PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 156 under section 182( b)( 1), we proposed to allow the first RFP increment to be averaged over 6 years. We proposed that an area classified serious or above submit its RFP plan within 2 years after designation such that it provides for 18 percent emissions reductions ( VOC and/ or NOx) over the first 6 years from the baseline year ( January 1, 2003 to December 31, 2008)

and t. Then, within 3 years after designation, submit a plan that provides nine percent emissions reductions ( VOC and/ or NOx) over each of the next 3 year periods until the area's attainment date ( i. e., from January 1, 2009 to the attainment date). The proposal noted that this option recognizes previous efforts by areas that submitted 15 percent plans as required under the 1 hour ozone NAAQS and provides flexibility to States to use a mix of NOx and VOC reductions as appropriate to meet the additional ROP/ RFP requirements.

We noted that we believe that the statute can be interpreted to require the mandatory 15 percent VOC reduction only once for a given area. Once 15 percent VOC reduction requirements have been met, an area could actually have to achieve greater emissions reductions, i. e., an average of three percent per year, but could choose either VOC or NOx reductions as appropriate. We indicated in the proposal that we preferred this second option because it provides more flexibility for PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 157 the RFP plan to be consistent with the area's needs in attaining the standard and the draft regulatory text incorporated this option.

b. Summary of Final Rule.

The final rule incorporates the second option noted in the Background above, as adjusted in response to comment,

namely, that for those areas that are composed entirely of areas and that have approved 15 percent plans for their 1

hour ozone SIPs, an additional 15 percent VOC reduction is not necessary. Areas that are classified as moderate under the 8 hour standard and that are composed entirely of areas that have already implemented their 15 percent plans under their 1 hour ozone SIPs would be considered to have met the statutory 15 percent VOC emission reduction requirement.

RFPReasonable further progress for the first 6 years from the baseline year would be covered under the more generic RFP requirements of subpart 1 (. As discussed below). , the subpart 1 requirement would depend on the moderate area's attainment date as follows:

° Subpart 2 areas that have an attainment date within 5 years after their 8 hour designation, for which all portions of the area have previously met their 15 percent requirements under the 1 hour standard, will PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 28As discussed below in section 5 ( the discussion of the timing of submission of the RFP plan) the RFP plan would 158 only be subject to subpart 1 RFP requirements, which will be satisfied with the measures that demonstrate attainment as expeditiously as practicable, these areas will not be developing RFP plans separate from their attainment plans.

° Subpart 2 areas that have an attainment date beyond 5 years after their 8 hour designation, for which all portions of the area have previously met their 15 percent requirements under the 1 hour standard, will only be subject to subpart 1 RFP requirements, which will be satisfied with a plan to demonstrate 15 percent emission reductions ( which may be either VOC or NOx or a combination of both) from 2002 to 2008, and any additional emission reductions needed for attainment beyond 2008.

Areas that are serious would have to meet 3 percent reductions per year averaged over 6 years for the first increment and then averaged over each three year3 year period out to the attainment year. 28 PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 have to be submitted within 3 years after designation ( not 2 years as proposed).

159 c. Comments and responses Comment: One commenter expressed concern that for a number of Ssubpart 2 areas that are also existing 1 hour nonattainment areas, especially those dominated by mobile source emissions and/ or those with existing stringent stationary source controls, it may be difficult to achieve another 18 percent precursor emission reduction within 6 years from the baseline year and then an additional 3 percent per year precursor reduction after that until the area's attainment date. Specific areas were mentioned such as the South Coast District of California and the Houston Galveston Area, which the commenter indicated will be well beyond best available control technology ( BACT) controls and in some cases at or near lowest achievable emission rate ( LAER) NOx controls on stationary sources making them dependent on mobile source fleet turnover for SIP RFP emissions reductions. The commenter further suggested that EPA should have available approved policy options that allow areas in such predicaments to maintain approved SIPs if emissions reductions are not available to meet RFP requirements and/ or if available emission reduction techniques might be PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 160 counterproductive to other local and regional air quality goals.

Response: We addressed in general those comments that recommended alternatives to the mandatory measures of subpart 2 ( which includes the RFP requirement) in the response to comments above under the topic, " Should prescribed requirements of subpart 2 apply in all 8 hour nonattainment areas classified under subpart 2, or is there flexibility in application in certain narrowly defined circumstances?" We conclude in that section that EPA has no discretion to broadly waive mandatory requirements. However, we noted that case law may provide support for case by case waivers where implementation of a measure would produce an absurd result.

Comment: Another commenter supported EPA's efforts to recognize the previous efforts of areas to meet ROP requirements under the 1 hour standard. The commenter concurs with EPA's preferred option, which allows States the flexibility to chose a combination of NOx and VOC strategies to meet ROP/ RFP requirements consistent with an area's need to meet the standard.

Response: We agree with the commenter that if an area has already met the 15 percent VOC emission reduction requirement for the 1 hour standard, the area should not be PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 161 required to meet that requirement a second time for the 8

hour standard but instead will be subject to the other applicable RFP provisions of the ActCAA.

Comment: One commenter preferred Option 1 as more protective of air quality and more consistent with the requirements of the CAA. Option 1 would require States to develop RFP plans based on severity and local situation.

Option 2 has some attractive features by recognizing progress that States have already made. Option 2 is problematic,

however, because it relies on plans developed based on 1990 to 1996 emissions. This time period has passed.

One commenter believed EPA to be completely without authority to waive the 15 percent RFP plan requirement, which is an explicit mandate of subpart 2. A 15 percent ROP plan under the 1 hour standard cannot possibly satisfy the 15 percent RFP plan obligation for the 8 hour standard, because the new RFP requirement is designed to implement a revised NAAQS and is measured from a different baseline year. They further believe that EPA offers no plausible legal rationale for waiving the 15 percent ROP requirement, and, indeed, none exists. Moreover, although the agency proposed to require RFP demonstrations for the first 6 years for serious and severe areas, there is no lawful or rational basis for PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 162 exempting moderate areas from this statutory requirement.

Allowing States to rely on their 1 hour 15 percent ROP demonstrations is further unsupportable because those demonstrations are almost certainly no longer valid.

Response: The EPA acknowledges that under subpart 2 we must require 15 percent VOC reductions for all moderate and above areas, but we maintain that if an area has met this requirement while subject to section 182( b)( 1)( A) under the 1 hour standard, they will not have to meet it again for the 8 hour standard. The EPA believes that the CAA is quite clear that the SIP must provide for a 15 percent reduction in baseline VOC emissions for some period after 1990 in an area subject to section 182( b)( 1)( A), and , consequently, the SIP for any area newly subject to section 182( b)( 1)( A) must provide for a 15 percent reduction in VOC baseline emissions.

But, EPA disagrees that the CAA plainly requires that the SIP for an area must require a second 15 percent reduction in VOC baseline emissions under a revised ozone standard. The EPA believes that section 182( b)( 2)( A) plainly limits our discretion only to the extent that we cannot let the SIP for any area classified as moderate or worse for the 8 hour standard avoid a demonstration that the SIP contains sufficient measures to achieve a 15 percent reduction in VOC PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 163 baseline emissions or to allow NOx substitution for the initial RFP demonstration requirement of section 182( b)( 1)( A).

If serious and above areas do nothave already meet the 15 percent requirement, again under the 1 hour standard, they must meet the next RFP requirement, namely, section 182( c)( 2)( B) RFP requirement, which will achieve greater reductions, that is. e., 3 percent per year over 6 years for a total of 18 percent, but they can meet it with either VOC or NOx reductions. For moderate areas that have already met the 15 percent VOC emission reduction requirement for the 1 hour standard, EPA believes appropriate RFP under subpart 1 should be achieved. For purposes of RFP under subpart 1, there is nothing that limits such reductions to only VOC reductions.

This provision simply requires reasonable annual incremental reductions towards attainment by the applicable attainment date, and this could be achieved by either VOC or NOx emissions reductions or a combination of both.

Section 182( b)( 1)( A) is the only statutory provision that limits State discretion to substitute NOx reductions for VOC reductions. This applies only for purposes of the initial 15 percent reduction requirement for the 6 year period after the baseline year. PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 164 Congress mandated that areas classified as moderate and above for ozone must submit a SIP revision after 1990 to get a 15 percent reduction in baseline VOC emissions under CAA section 182( b)( 1)( A).

Therefore any area, except any part which is covered by an approved 15 percent VOC reduction plan in the applicable SIP, that is classified as moderate or above nonattainment for the 8 hour standard must submit a SIP that provides for a 15 percent reduction in baseline emissions.

The EPA believes that the CAA does not clearly require a second 15 percent VOC only reduction under a revised ozone NAAQS in an area that ( 1) is designated nonattainment or maintenance for the 1 hour standard at the time the area was designated nonattainment for the 8 hour standard and classified as moderate, and ( 2) is already covered by a 15 percent reduction plan in the approved SIP for at least all of the area within the boundaries of the 8 hour nonattainment area. Such an area has met the literal requirement set forth in section 182( b)( 1)( A). EPA concludes that we must require such an area to do the following depending upon its 8 hour classification: The final rule, therefore, provides the following: PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 165 If classified as moderate, areas under the 8 hour standard that have already implemented their 15 percent plans under their 1 hour ozone SIPs would be considered to have met the statutory 15 percent requirement and RFP for the first 6 years from the baseline year would be covered under the more generic RFP requirements of subpart 1, which is discussed below in the preamble.

If classified as serious or higher for the 8 hour standard, EPA believes that the 3 per centpercent per year average reduction requirement of section 182( c)( 2) would still apply, except that EPA would require that the SIP for such serious and above areas must provide for 18 percent emissions reductions over the first 6 years after the baseline year and then 9 percent over each of the next 3 year periods until the area's attainment date. The EPA is not waiving the 15 percent requirement for areas that have satisfied that requirement in their initial 15 percent emission reduction performed under the 1 hour standard.

These areas will continue to make reductions with the 3 percent per year incremental emission reductions. The 15 percent reduction requirement still remains valid for areas that never did the initial 15 percent emission reduction. PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 166 Comment: Another commenter believed the Ssubpart 2 provisions of the CAA do not allow for NOx for VOC substitutions for the initial 15 percent RFP requirements.

Response: The EPA believes that the statute allows the substitution of NOx for VOC under certain circumstances. The EPA does not believe it is able to allow substitution of NOx reductions for the initial 15 percent VOC reductions requirement, but the CAA does allow States to use both VOC and NOx for the 3 percent reductions thereafter.

Comments on draft regulatory text Comment: Another commenter generally supported the RFP provisions in this section, suggestingbut suggested that in subsection ( a)( 1)( ii)( A) [ of draft section 51 § 51.910] we insert the bolded as shown here:

" An area classified as moderate or higher that has the same boundaries as an area for which EPA fully approved a 15 percent plan for the 1 hour NAAQS is not subject to section 182( b)( 1) of the ActCAA for the 8 hour NAAQS, but instead   ( A) If classified as moderate, is subject to RFP under section 172( c)( 2) of the ActCAA and shall meet that obligation by submitting 3 years after the effective date of its designation a SIP revision that provides for implementation of all emission reductions of VOCs and/ or PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 167 NOxNOx needed for attainment by the beginning of the ozone season in the area's attainment year." The commenter claimed this language is consistent with the approach EPA has taken in other provisions of this draft.

Response: The commenter's concern is noted. Section 51.910 has been restructured for reasons noted elsewhere in this preamble and nowit addresses the commenter's concern.

Comment: One other commenter suggested that if it is shown that reduction of one precursor would be more beneficial than reduction of another, then the area should be allowed to substitute. They recommended that EPA allow NOx substitution for VOC for any ROP or RFP requirements, not just those for areas designated serious or worse for ozone.

They also suggested that Section 51 § 51.910( a)( 3) of the draft regulatory text be revised to allow ( even if conditional) NOx reductions to be substituted for VOC reductions ( for any ROP or RFP requirement) whenever such reductions would " result in a reduction in ozone concentrations at least equivalent to that which would result from the amount of VOC emission reductions required."

Response: We addressed in general those comments that recommended alternatives to the mandatory measures of subpart 2 ( which includes the VOC only 15 percent RFP requirement) in PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 168 the response to comments above under the topic, " Should prescribed requirements of subpart 2 apply in all 8 hour nonattainment areas classified under subpart 2, or is there flexibility in application in certain narrowly defined circumstances? We concluded there that EPA had no discretion to broadly waive mandatory subpart 2 requirements. However,

we noted that case law may provide support for case by case waivers where implementation of a measure would produce an absurd result.

3. What baseline year should be required for the emissions inventory for the RFP requirement?

[ Section VI. I. 4. of June 2, 2003 proposed rule ( 68 FR 32833); section 51 § 51.909 of the draft regulatory text;

section 51 § 51.910( d) of the final regulatory text.]

a. Background.

The baseline inventory for RFP ( under subpart 2) is used as the starting point for the determination of a target level of emissions for the future year RFP and as the baseline from which creditable reductions are determined. We designated ozone nonattainment areas in April 2004. Under the " Consolidated Emissions Reporting Rule" ( 67 FR 39602, June 10, 2002) revised emissions inventories are required for the years 2002 and 2005; therefore, we proposed to require use of PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 29Memorandum of November 18, 2002, from Lydia Wegman and Peter Tsirigotis, " 2002 Base Year Emission Inventory SIP Planning: 8 hr Ozone, PM2.5 and Regional Haze Programs." This document is available at the following web site: http:// www. epa. gov/ ttn/ oarpg/ meta. 442.1.2002baseinv. pdf.

30Memorandum of November 18, 2002, from Lydia Wegman and Peter Tsirigotis, " 2002 Base Year Emission Inventory SIP 169 the 2002 inventory as the baseline inventory for the RFP requirement. This would be the most recent inventory available at the time of designation. We issued a memorandum identifying 2002 as the anticipated emissions inventory base year for the SIP planning process to address the 8 hour ozone and the PM2.5 standards. 29 b. Summary of Final Rule.

As set forth in our proposed rule, for areas designated nonattainment under the 8 hour ozone NAAQS with an effective date of June 15, 2004, we are requiring States to use the 2002 inventory as the baseline inventory for the RFP requirement for areas designated nonattainment in 2004. As noted in the proposal, the inventory for the 2002 calendar year would be the most recently available inventory at the time of designation in 2004. We noted that we had issued a memorandum identifying 2002 as the anticipated emission inventory base year for the SIP planning process to address the 8 hour ozone and the PM2.5 standards. 30 PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 Planning: 8 hr Ozone, PM2.5 and Regional Haze Programs." This document is available at the following web site: http:// www. epa. gov/ ttn/ oarpg/ meta. 442.1.2002baseinv. pdf.

31E. g., where the effective date of the first designation to nonattainment for an area under the 8 hour ozone NAAQS is after June 1, 2007 but before June 1, 2010, the baseline inventory will be for calendar year 2005.

170 The baseline emissions inventory is calculated as of the effective date of an area's nonattainment designation using the most recent calendar year for which a complete inventory is required to be submitted to EPA under subpart A of this part. Under subpart A, States are required to submit a comprehensive inventory on 3 year cycles by 17 months after the close of the reporting period. Thus, the 2002 inventory was due 17 months after the December 31, 2002 close of the latest 3 year cycle, i. e., was due by June 1, 2004. For those areas designated nonattainment for the 8 hour ozone NAAQS effective June 15, 2004 ( 69 FR 23858, April 30, 2004),

the baseline emissions inventory shall be based on the calendar year 2002 because the 2002 inventory was due under subpart A of this part prior to the time of designation. For areas with an effective nonattainment designation in the future, the baseline inventory will be for the calendar year of the most recent triennial inventory as of the date of designation. 31 PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 171 c. Comments and responses Comment: One commenter is convinced that EPA has misread the statute as requiring that the 6 year time period for achieving a 15 percent reduction in moderate areas or for achieving an 18 percent reduction in serious areas starts with the baseline year. Instead, the commenter believes that the statute requires that the 6 year time period begins with the date of designation, rather than the date of the most recent completed VOC inventory. The commenter maintains that the starting point for the 6 year period obviously affects the ending point, and under EPA's interpretation there would not be a meaningful period of time available to accomplish the reductions required in serious areas. Another commenter noted that the 18 percent reduction for serious areas would have to be achieved by 2008. This is 6 years after the base year. The commenter noted that the 2 years that would remain after SIP submission ( from the proposed SIP due date of 2006 until 2008) would be totally inadequate to achieve either the 15 percent reduction in VOCs or the 18 percent reduction in VOCs and/ or NOx. The commenter noted the ActCAA provides for submission of RFP plans within 3 years ( from 1990) in section 182( b)( 1)( A) and 4 years in section 182( c)( 2). PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 172 Another commenter agreed there is a reasonable basis to select 2002 as the date of emissions inventories for purpose of establishing creditable reductions from the inventory.

States are not required by the CAA to adopt the year of the nonattainment designation for the 8 hour standard as the basis for their planning, even though that was the case under the 1990 CAA Amendments. The commenter claims there are a variety of measures that would be implemented after 2002 that local jurisdictions would like to be able to account for as new emissions reductions in their modeling demonstrations.

The commenter claims that this in part is justified on the basis of the 1997 revisions to the ozone NAAQS, including maximum achievable control technology ( MACT) reductions and NOx SIP Call/ 126 rule reductions. The commenter thus believes that reductions between these years " should count."

In addition, this was the most recent quality assured/ quality controlled inventory used to support the proposed nonattainment designations on July 15, 2003. Even if EPA allows States to show that air quality improved between 2001

2003 for purposes of final designations, it will be on the basis of reductions from these earlier inventories.

Another commenter referred to EPA's proposal language regarding the RFP SIP that would have required submission of PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 173 the RFP plan within 2 years after designation. They stated that EPA is missing the point in that the attainment and RFP submission dates established in subpart 2 are to allow States a sufficient amount of time to achieve the mandated goals.

That commenter referred to another alternative that would amend the proposal to require a 1990, rather than 2002 baseline for those areas not having a previously approved 15 percent RFP plan. They further commented that although a 1990 baseline would not eliminate the planning burden associated with this requirement, it would go far towards minimizing the necessary additional work.

Response: The EPA has decided to establish 2002 as the baseline year for the 8 hour ozone implementation rule in conformity with both the language of the CAA and the inventory year cycle. Of reasonable importance is the need to maintain consistency with the periodic inventory for use in various milestone considerations such as rate

ofprogressROP compliance demonstration, attainment, and contingency plans. In addition, there should be little if any difference in the result in terms of emissions reductions needed to demonstrate timely attainment. If we use 2002, the baseline may be higher but areas can take credit for any 2002 2004 measures. If we use 2004, the baseline may be PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 174 lower but areas can't take credit for measures that produce emissions reductions between 2002 2004. Depending on the area, the difference should be minimal in terms of the difference in the amount of reductions needed to reach attainment and what new measures are necessary to get there.

Also, EPA selected this baseline year at the request of many States to allow areas to take credit for emissions reductions achieved in the 2002 2004 period as a result of numerous recently adopted fFederal and State measures. We believe it is reasonable to select an inventory year for which States were already required to produce an inventory rather than requiring States to produce an additional inventory ( e. g.,

for 2004) that is not otherwise required. Moreover, the use of an inventory for the designation year would cause delay,

as it would take the States 1 2 years after the end of 2004 to produce the inventory.

We disagree with the commenters who urged use of the 1990 inventories. Use of the 1990 baseline would be unreasonable now since it would have to be substantially recalculated due to changes in emission calculating methodologies. Furthermore, a 1990 inventory was only required for nonattainment areas as of enactment of the 1990 CAAACAA Amendments and therefore may not exist for a number PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 175 of areas that are currently designated nonattainment for the 8 hour standard.

Comment: A comment on draft regulatory text section 51 § 51.909 noted that EPA specified various program milestone dates, which were derived from the relationship of these dates to the expected date of initial designation. The commenter recommends deleting all such specific date references from the regulation, to avoid the need for revising regulations if the initial designations are not concluded as expected. This should be replaced by a generic approach, for example by requiring the most recent year's data to be used as the baseline in the second sentence of section 51 § 51.909. Deleting the calendar specific dates would not change the result if the designations occur as planned, yet would allow for more recent data to be used if factors beyond the agency's control create a delay in designations. This approach also will allow the regulation to apply to future area designation changes, such as areas that are redesignated nonattainment at some point in the future. Such specific dates are more appropriately included as examples in agency guidance or within the preamble of a final rule with a discussion of how they are derived. The regulation itself should retain only the generic relationship PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 32We note that even though the draft regulatory text was structured to place the specification of the baseline year for RFP ( as well as for attainment demonstrations) in section 51 § 51.909, the final rule places the RFP baseline year requirement in section 51 § 51.910.

176 between the milestone and the effective date of designation,

which is the approach taken elsewhere in the rule.

Response: Because the designations have already taken effect at this point, we believe removing the 2002 specification may only be confusing to some. The final version of rule ( now section 51 § 51.910( d)) provides specificity regarding the appropriate baseline year for subsequent nonattainment designations. 32 4. Should moderate and higher classified areas be subject to prescribed additional RFP requirements prior to their attainment date?

[ Section VI. I. 5 of June 2, 2003 proposed rule ( 68 FR 32834); no draft or final regulatory text.]

a. Background.

As noted in the proposal, for areas initially classified moderate and higher under the 1 hour ozone standard, the baseline inventory was defined as 1990 in the CAA Amendments.

Therefore, the 6 year period for the initial 15 percent RFP requirement ended in the same year as the attainment date for PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 177 moderate areas, viz., 1996. For areas classified moderate and higher under the 8 hour ozone standard, however, we proposed that the 15 percent RFP target level of emissions would be calculated for the 6 year period after the 2002 baseline year, i. e., 2003 2008. Moderate areas would be required to meet an attainment date no later than 6 years after the area is designated nonattainment for the 8 hour standard. Since the effective date of designation of nonattainment areas is June 15, 2004, the outside statutory attainment date would be June 15, 2010. This leaves approximately a 1 1/ 2 year gap between the end of the 6 year period for the 15 percent RFP requirement ( i. e., December 31,

2008) and the maximum statutory attainment date. If we were to also require moderate areas to obtain an additional three percent per year emission reduction beyond 2008 for the one and a half1 1/ 2 additional years out to 2010, the RFP requirement could be more than what we believe Congress intended for moderate areas under subpart 2. Additional three percent per year reductions were only required for serious and higher classified 1 hour ozone nonattainment areas. We proposed that the only specific RFP requirement applicable for moderate areas is the 15 percent VOC requirement between the end of 2002 and the end of 2008. PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 178 However, section 172( c)( 2) also applies which requires areas to meet RFP generally. Therefore, a moderate area would still also have to provide any additional emissions reductions   VOC and/ or NOx   needed to provide for attainment by the area's attainment date. In proposing this approach for this circumstance, we interpreted the subpart 1 RFP requirement to mean that the area must achieve whatever further reduction is needed for attainment in the remaining period prior to the attainment date ( 2009 through June 15,

2010).

We proposed that serious and higher classified areas would need to provide in their SIPs an additional average of three percent per year emission reduction over each subsequent 3 year period beyond the initial 6 year period through the attainment year, consistent with what Congress specified in section 182( c)( 2)( B) of the CAA.

b. Summary of Final Rule.

In the final rule, we are taking the approach we proposed. Moderate areas are not subject to any additional prescribed emissions reductions for RFP but instead must provide for any additional emissions reductions ( VOC/ NOx)

needed to provide for attainment by the beginning of the PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 33We note that areas must implement controls prior to the beginning of the last ozone season preceding the attainment date. For moderate areas designated as of June 15, 2004, such reductions would be needed by the beginning of the 2009 ozone season.

179 ozone season prior to the area's attainment date. 33 Serious and higher classified areas would need to provide in their SIPs an additional average of three percent per year emission reduction over each subsequent 3 year period beyond the initial 6 year period through the attainment year.

c. Comments and responses Comment: One commenter suggested that following the statutory timetable rather than the one proposed by EPA would eliminate the problem of how to handle the " 1 1/ 2 ½ year gap between the end of the 6 year period for the 15 percent RFP requirement ( i. e., December 31, 2008, as proposed by EPA) and the attainment date." The commenter continued by saying that no such gap is contemplated by subpart 2, which provides in section 18l( b)( l) that moderate areas' attainment dates and their 15 percent VOC RFP date are to be the same: 6 years after their designation and classification.

Response: We do not believe the ActCAA requires the end of the 15 percent RFP period and the attainment date to be the same. The ActCAA does provide, however, that the 15 PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 180 percent emission reductions under section 182( b)( 1)( A) must be accomplished within 6 years of a base year. We have in a previous discussion above determined that 2002 is the most appropriate baseline year for RFP purposes. Therefore, if a moderate areas needs additional emissions reductions beyond 2008 for attainment, there will continue to be a need for additional emissions reductions between the end of that 6

year period and the beginning of the ozone season prior to the attainment date.

Comment: Another commenter noted the proposal states that the only specific RFP requirement applicable for moderate areas is the 15 percent VOC requirement between the end of 2002 and the end of 2008. However, section 172( c)( 2)

also applies, requiring areas to meet RFP generally.

Therefore, a moderate area would still also have to provide any additional emissions reductions VOC and/ or NOx, i. e.,

whatever is needed to provide for attainment by the beginning of the ozone season prior to the area's attainment date. The commenter agrees that any additional emissions reductions needed to achieve attainment are the only reductions that should be required of moderate areas.

Response: We agree with the commenter, and our rule requires that for purposes of meeting RFP beyond 2008 until PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 181 the area's attainment date, moderate areas must obtain such specific annual reductions in VOC and NOx emissions as necessary to attain by the area's attainment date.

5. What is the timing of the submission of the RFP plan?

[ Section VI. I. 6 of June 2, 2003 proposed rule ( 68 FR 32834); section 51 § 51.910 of the draft and final regulatory text ( several locations).]

a. Background.

As noted in the proposal, section 182( b)( 1) requires that moderate and higher classified areas submit their 15 percent RFP plans within 3 years after 1990. Obviously,

applying the statute as written is absurd, since we are well past that date. The ActCAA uses identical language for identifying areas' attainment dates under subpart 2. In our pPhase 1 rule, for purposes of attainment dates for the 8

hour NAAQS, we interpreted the CAA's language referring to the date of enactment of the 1990 CAA Amendments to mean the date of designations for the 8 hour standard. We noted in the proposal that if we applied the same interpretation for RFP plans, i. e., that they should be submitted within 3 years after the area's nonattainment designation date ( i. e., in 2007 if we designate in 2004), the plans would have to be implemented within 1 year after submission to ensure the 15 PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 182 percent emissions reductions are achieved by the end of the relevant 6 year period ( i. e., December 2008). We indicated concern that this might not provide sources with sufficient time to achieve the reductions by the required deadline.

Therefore, we proposed that the RFP SIP be submitted within 2 years after nonattainment designation   namely by 2006. This would provide for 2 years for the State to develop and submit its RFP plan, and another 2 years for the control measures to be implemented.

We also proposed that an area classified serious or above submit its ROP plan within 2 years after designation that provides for 18 percent emissions reductions ( VOC and/ or NOx) over the first 6 years from the baseline year and then submit within 3 years after designation a ROP plan that provides nine percent emissions reductions ( VOC and/ or NOx)

over each of the next 3 year periods until the area's attainment date.

b. Summary of Final Rule.

In the final rule, we are taking a different approach than proposed in light of concerns raised by States in public comments that they would need more than 2 years for development, adoption and submission of RFP plans for the increment of progress over the first 6 years after the PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 183 baseline year. The EPA agrees with the several commenters who urged that 3 years was more consistent with the ActCAA.

Additionally, 3 years is a more reasonable time period for submission because it allows States the necessary time to move regulatory actions through their legislative processes and allows States to consider RFP in conjunction with their attainment demonstrations. Therefore, for moderate and higher classified areas, the first RFP SIP must be submitted within 3 years after the area's nonattainment designation.

For areas with a June 15, 2004 effective date, for the 8 hour designations, the SIP would be due by June 15, 2007. This would provide up to 3 years for States to develop and submit RFP plans, and 1 additional year ( until the end of 2008) for control measures to be implemented. The RFP SIP for any remaining 3 year periods out to the attainment date beyond the first 6 years would be submitted with the attainment demonstration, i. e., within 3 years after designation.

However, since States maintain the flexibility to submit plans early to provide more time for implementation of their SIP control measures, we recommend that States complete their RFP plans as soon as possible after designation to provide as much time as possible for sources to implement the emissions reductions. PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 184 c. Comments and responses Comment: Several commenters opposed EPA's proposal to shorten to 2 years the statutory 3 year period for development and submittal of 15 percent VOC RFP plans. They claim this proposal violates the guarantee of 3 years for plan development to the State in section 182( b)( l)( A) and is contrary to EPA's basic proposed principle that [ quoting from the proposal] " subpart 2 SIP submittals will be due as a general matter by the same period of time after designation and classification under the 8 hour standard as provided in subpart 2 for areas designated and classified at the time of enactment of the 1990 CAA." The commenters contended that Ssubpart 2 gives EPA no authority to shorten the statutory 3

year period. In contrast, Congress in Ssubpart 1 authorized EPA to set a schedule for nonattainment SIP submissions,

which may be no later than 3 years after designation.

Congress therefore knew how to give EPA discretion to shorten SIP submission deadlines according to the commenters; it did not do so in Ssubpart 2.

Concerning the timing of submission of the RFP plan,

another commenter was concerned that the States may not have sufficient photochemical modeling and ambient air analyses to indicate the best mix of RFP SIP controls. Additionally, in PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 185 areas dominated by mobile source emissions, it may not be feasible to implement control measures to achieve the RFP target within the next 2 years as EPA has suggested. The commenter suggested that EPA have policy options available that allow areas in such predicaments to maintain approved SIPs if emissions reductions are not available to meet RFP requirements and/ or if available emission reduction techniques might be counterproductive to other local and regional air quality goals.

Another commenter stated revisions to State emission reduction measures cannot be adopted and implemented easily in a two year2 year time period because they require administrative action and frequently State legislation to approve. This period can lengthen when proposed measures like enhanced vehicle inspection and maintenanceI/ M involve controversial actions affecting the public. Logistically, a State must establish a regulation by administrative action with public input before ( though sometimes after) such a measure is approved by the State's legislature. A number of jurisdictions' legislatures are only in regular session to consider such measures several months or, in alternate years.

Thus, it is unreasonable for States to have only 2 years from their nonattainment designations to adopt new measures. PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 186 Another commenter referenced the case NRDC v. EPA, 22 F. 3d 1125, 1135 ( D. C. Cir., 1994), where the Court considered the propriety of EPA's extension of the deadlines by which States had to submit elements of their SIPs. The Court upheld EPA's decision to extend the deadline for compliance with a procedural requirement of the ActCAA given EPA's failure to meet its own deadline for providing certain necessary guidance to the States. The Court allowed EPA to use the extraordinary remedy of a deadline extension in this instance because Congress would have intended that the deadline be extended to provide a party the full statutory time for acting on the agency guidance. The commenter contended that Ssection 182( b)( 1) does not give EPA the discretion to set a shorter time period than three3 years, it only allows a State to make its submission early if it so desires. The commenter referenced CAA section 126( c) where EPA may set a compliance deadline " as expeditiously as possible, but in no case later than 3 years after the date of such finding."

One commenter noted that CAA section 182( b)( 1)( A) as modified by section 181( b)( 1) requires for moderate areas that the RFP SIP be submitted 3 years after designation. The commenter disagreed with the RFP plan requirement to submit PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 187 the plan 2 years after the effective date of the nonattainment designation as not being consistent with or supported by these CAA Ssections. The resources involved in developing, proposing and adopting any SIP revision are not insignificant. In order to ensure the most efficient use of resources, the commenter contended that EPA should not require this SIP revision sooner than the submission of the attainment demonstration, 3 years after the effective date of the designations. Allowing States 3 years to submit the RFP plan is consistent with existing CAA requirements.

Response: After consideration of the comments, we have changed the final rule to be consistent with the approach advocated in a number of comments. In consideration of the 2004 designation and the need to achieve the 2008 RFP reductions by December 2008, it seems reasonable to EPA that States first be given sufficient time after designation to formulate RFP plans and then adequate time to meet the RFP demonstration after the RFP plan is due. Therefore, the final rule allows States up to 3 years after designation to submit their RFP SIPs; however, w. We recommend that States complete their RFP plans as soon as possible after designation to provide as much time as possible for sources to achieve the emissions reductions. PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 188 6. How should CAA restrictions on creditable measures be interpreted? Which national measures should count as generating emissions reductions credit toward RFP requirements?

[ Section VI. I. 7 of June 2, 2003 proposed rule ( 68 FR 32834); section 51 § 51.910( a)( 4) of the draft regulatory text;

section 51 § 51.910( a)( 3) of the final regulatory text.]

a. Background.

Section 182( b)( 1) contains provisions that limit creditability toward meeting RFP for certain limited emission reduction measures required prior to the enactment of the CAA Amendments of 1990. We noted in the proposal that we believe these specific restrictions should continue to apply for purposes of the 8 hour NAAQS. The proposal noted that Congress intended to prevent areas from taking credit for RFP only for those specific measures that were already adopted and in place ( or required to be in place) prior to the date of enactment of the CAA Amendments of 1990 ( November 15,

1990). We said that this same logic holds true for the RFP requirement as it applies to the 8 hour ozone standard,

namely preventing credit toward the mandatory RFP percent reductions for continuing reductions from those specific measures cited in the CAA that were already adopted and in PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 189 place ( or required to be adopted and in place) prior to the date of enactment of the CAA Amendments of 1990. There is no indication in the CAA that this exclusion should be changed.

Congress mandated many emissions reductions in the 1990 Amendments with no indication that they should not be credited to meeting RFP or attainment of any existing or revised NAAQS. Therefore, we proposed that all emissions reductions that occur from all Federal and any other measures not otherwise identified in section 182( b)( 1)( D) and that occur after the baseline emissions inventory year would be creditable for the RFP requirement. A number of examples demonstrating emissions reductions that would be creditable toward the RFP requirement were set forth in our proposal.

b. Summary of Ffinal Rrule.

We are taking the approach we proposed, under which all emissions reductions that occur after the baseline emissions inventory year are creditable for purposes of the RFP requirements in this section except as specifically provided in section 182( b)( 1)( C) and ( D) and section 182( c)( 2)( B) of the ActCAA. These provisions exclude emissions reductions from four categories identified above in the background. The restriction imposed by section 182( b)( 1)( D) limits crediting reductions from the following four categories: PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 190 ° Corrections to SIPs: corrections to or additions of reasonable available control technology ( RACT) rules as required by CAA section 182( a)( 2)( A).

° Corrections to SIPs: corrections to vehicle inspection maintenance ( I/ M) programs for areas where the SIP included or was required to include a schedule for I/ M implementation under the CAA in effect immediately before November 15, 1990.

° Regulations concerning Reid Vapor Pressure ( RVP)

promulgated by EPA before November 15, 1990 or required to be promulgated under CAA section 211( h).

° Motor vehicle exhaust or evaporative emissions measures promulgated by EPA by January 1, 1990.

c. Comments and responses Comment: One commenter supported EPA's proposal to credit towards RFP requirements all emissions reductions,

which occur after the baseline emissions inventory year ( 2002) from all Federal, and any other measures not otherwise identified under Ssection 182( b)( 1)( D). This would include reductions from cleaner fuels and engines, reductions from on going 1 hour SIP controls and VOC reductions from implementation of MACT standards after the baseline year.

The commenter stated that this proposed approach would be PREDECISIONAL DRAFT   DO NOT QUOTE, CITE OR DISTRIBUTE draft 7/ 8/ 05 191 critical in a number of areas that already have stringent stationary source controls and/ or in areas dominated by mobile source emissions.

Response: The EPA acknowledges this comment of support for our final action.

Comment: Another commenter believed that early voluntary emissions reductions prior to 2003, and not required under the CAA, should also be creditable toward RFP requirements. The commenter recommended that EPA's final rule clarify that States be allowed credit for RFP for early voluntary emissions reductions occurring prior to 2003. As a company that has proactively taken measures to reduce nitrogen oxide ( NOx) emissions through innovative Combustion Initiative ( an enhanced efficiency technology), the commenter believed that EPA's regulations should take these efforts into account as they have resulted in real improvements to air quality. Another commenter stated that companies who made voluntary reductions prior to 2003 would be penalized for having undertaken such voluntary measures and, thus disallowing credit for these reductions provides disincentives for voluntary reductions.