[Federal Register Volume 76, Number 127 (Friday, July 1, 2011)]
[Rules and Regulations]
[Pages 38747-38808]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-14981]



[[Page 38747]]

Vol. 76

Friday,

No. 127

July 1, 2011

Part II





Environmental Protection Agency





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40 CFR Parts 49 and 51





Review of New Sources and Modifications in Indian Country; Final Rule

Federal Register / Vol. 76 , No. 127 / Friday, July 1, 2011 / Rules 
and Regulations

[[Page 38748]]


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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Parts 49 and 51

[EPA-HQ-OAR-2003-0076; FRL-9320-2]
RIN 2060-AH37


Review of New Sources and Modifications in Indian Country

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final rule.

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SUMMARY: The EPA is finalizing a Federal Implementation Plan (FIP) 
under the Clean Air Act (CAA or Act) for Indian country. The FIP 
includes two New Source Review (NSR) regulations for the protection of 
air resources in Indian country. The first rule applies to new and 
modified minor stationary sources (minor sources) and to minor 
modifications at existing major stationary sources (major sources) 
throughout Indian country. The second rule (nonattainment major NSR 
rule) applies to new and modified major sources in areas of Indian 
country that are designated as not attaining the National Ambient Air 
Quality Standards (NAAQS). These rules will be implemented by EPA or a 
delegate Tribal agency assisting EPA with administration of the rules, 
until replaced by an EPA-approved implementation plan.

DATES: This final rule is effective on August 30, 2011.

ADDRESSES: The EPA has established a docket for this action under 
Docket ID No. EPA-HQ-OAR-2003-0076. All documents in the docket are 
listed on the http://www.regulations.gov Web site. Although listed in 
the index, some information is not publicly available, e.g., CBI or 
other information whose disclosure is restricted by statute. Certain 
other material, such as copyrighted material, is not placed on the 
Internet and will be publicly available only in hard copy form. 
Publicly available docket materials are available either electronically 
through http://www.regulations.gov or in hard copy at the Air and 
Radiation Docket and Information Center, EPA/DC, EPA West, Room 3334, 
1301 Constitution Ave., NW., Washington, DC. The Public Reading Room is 
open from 8:30 a.m. to 4:30 p.m., Monday through Friday, excluding 
legal holidays. The telephone number for the Public Reading Room is 
(202) 566-1744 and the telephone number for the Air and Radiation 
Docket and Information Center is (202) 566-1742.

FOR FURTHER INFORMATION CONTACT: Ms. Jessica Monta[ntilde]ez, Air 
Quality Policy Division, Office of Air Quality Planning and Standards 
(C504-03), U.S. Environmental Protection Agency, Research Triangle 
Park, North Carolina 27711, telephone number (919) 541-3407, facsimile 
number (919) 541-5509, e-mail address: montanez.jessica@epa.gov.

SUPPLEMENTARY INFORMATION: The information in this preamble is 
organized as follows:

I. General Information
    A. Does this action apply to me?
    B. Where can I get a copy of this document and other related 
information?
II. Overview of the Final Rules
III. Background
    A. What is the New Source Review (NSR) program?
    1. What are the general requirements of the major NSR program?
    2. What are the general requirements of the minor NSR program?
    B. What is the basis for EPA's authority to implement CAA 
programs in Indian country?
    C. What is the status of the NSR air quality programs in Indian 
country?
    D. What consultation and outreach has been done with Tribal 
leaders and representatives?
IV. Final Minor NSR Program for Indian Country
    A. General Provisions Under the Minor NSR Program
    1. What is a minor source and which minor sources are subject to 
this rule?
    a. Minor Source Definition
    b. Determining Applicability for New Minor Sources
    2. What is a modification and which modifications are subject to 
this rule?
    a. Definition of ``Modification''
    b. Determining Applicability for Modifications
    3. What are the minor NSR thresholds?
    4. What emissions units and activities at minor sources are 
exempt from this rule?
    B. Site-Specific Permits
    1. What are the requirements for permit applications?
    2. What technical reviews must the reviewing authority conduct?
    a. Control Technology Review
    b. Air Quality Impacts Analysis (AQIA)
    3. What are the permit content requirements?
    a. Emissions Limitations
    b. Monitoring, Recordkeeping and Reporting
    c. Other Permit Content Requirements
    4. What are the permit issuance procedures, permit term and 
public participation requirements?
    a. Permit Issuance Process
    b. Permit Term
    c. Public Participation Requirements
    5. What are the provisions for final action on a permit, permit 
reopenings, administrative permit revisions and administrative and 
judicial review procedures?
    a. Final Action on a Permit
    b. Permit Reopenings
    c. Administrative Permit Revisions
    d. Administrative and Judicial Review Procedures
    C. General Permits
    1. What is a ``General Permit''?
    2. What is the process for issuing general permits?
    3. For what categories will general permits be issued?
    4. What are the permit content requirements for general permits?
    5. What is the process that you may use for obtaining coverage 
under a general permit?
    D. Synthetic Minor Source Permits
    E. Case-by-Case MACT Determinations Under Section 112(g) of the 
Act
    F. Treatment of Existing Minor Sources Under the Final Minor NSR 
Program
V. Final Major NSR Program for Nonattainment Areas in Indian Country
    A. What are the requirements for major source permitting?
    B. How is EPA addressing the lack of available offsets in Indian 
country?
    1. Economic Development Zone Option
    2. Appendix S, Paragraph VI Option
    C. How do I meet the statewide compliance certification 
requirement of the Act and Appendix S?
    D. What are the public participation requirements of this 
program?
    E. What are the provisions for final action on a permit, permit 
reopenings and administrative and judicial review procedures?
    1. Final Action on a Permit
    2. Permit Reopenings
    3. Administrative and Judicial Review Procedures
    F. How is EPA revising Appendix S?
VI. Legal Basis, Statutory Authority and Jurisdictional Issues
    A. What is the basis for EPA's authority to implement these NSR 
programs in Indian country?
    B. How does a Tribe receive delegation to assist EPA with 
administration of the Federal minor and major NSR rules?
    C. What happens to permits previously issued by states to 
sources in Indian country?
VII. Implementation Issues
    A. Are Tribes allowed to collect fees for NSR permitting?
    B. Who retains enforcement authority in Indian country?
    C. What is the implementation schedule for the final rules?
VIII. Statutory and Executive Order Reviews
    A. Executive Order 12866: Regulatory Planning and Review
    B. Paperwork Reduction Act
    C. Regulatory Flexibility Act (RFA)
    D. Unfunded Mandates Reform Act
    E. Executive Order 13132: Federalism
    F. Executive Order 13175: Consultation and Coordination With 
Indian Tribal Governments
    G. Executive Order 13045: Protection of Children From 
Environmental Health & Safety Risks
    H. Executive Order 13211: Actions That Significantly Affect 
Energy Supply, Distribution or Use

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    I. National Technology Transfer and Advancement Act
    J. Executive Order 12898: Federal Actions To Address 
Environmental Justice in Minority Populations and Low-Income 
Populations
    K. Congressional Review Act
IX. Statutory Authority

I. General Information

A. Does this action apply to me?

    Entities potentially affected by this final rule include owners and 
operators of emission sources in all industry groups located in Indian 
country, EPA and Tribal governments that are delegated administrative 
authority to assist EPA with the implementation of these Federal 
regulations. Categories and entities potentially affected by this 
action are expected to include:

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                                                  Examples of regulated
             Category               NAICS \a\           entities
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Industry.........................        21111  Oil and gas production/
                                                 operations.
                                        211111  Crude petroleum and
                                                 natural gas extraction
                                        211112  Natural gas liquid
                                                 extraction.
                                        212321  Sand and gravel mining.
                                         22111  Electric power
                                                 generation.
                                        221210  Natural gas
                                                 distribution.
                                         22132  Sewage treatment
                                                 facilities.
                                         23899  Sand and shot blasting
                                                 operations.
                                        311119  Animal food
                                                 manufacturing.
                                          3116  Beef cattle complex,
                                                 slaughter house and
                                                 meat packing plant.
                                        321113  Sawmills.
                                        321212  Softwood veneer and
                                                 plywood Manufacturing.
                                         32191  Millwork (wood products
                                                 mfg).
                                        323110  Printing operations
                                                 (lithographic).
                                        324121  Asphalt hot mix.
                                          3251  Chemical preparation.
                                         32711  Clay and ceramics
                                                 operations (kilns).
                                         32732  Concrete batching plant.
                                          3279  Fiber glass operations.
                                        331511  Casting foundry (Iron).
                                          3323  Fabricated structural
                                                 metal.
                                        332812  Surface coating
                                                 operations.
                                          3329  Fabricated metal
                                                 products.
                                         33311  Machinery manufacturing.
                                         33711  Wood kitchen cabinet
                                                 manufacturing.
                                         42451  Grain elevator.
                                         42471  Gasoline bulk plant.
                                          4471  Gasoline station.
                                         54171  Professional, scientific
                                                 and technical services.
                                        562212  Solid waste landfill.
                                         72112  Other (natural gas-fired
                                                 boilers).\b\
                                        811121  Auto body refinishing.
Federal government...............       924110  Administration of Air
                                                 and Water Resources and
                                                 Solid Waste Management
                                                 Programs.
State/local/Tribal government....       924110  Administration of Air
                                                 and Water Resources and
                                                 Solid Waste Management
                                                 Programs.
------------------------------------------------------------------------
\a\ North American Industry Classification System.
\b\ Used NAICS code designated for casino hotels. However, the projected
  new and modified sources listed under ``other (natural gas-fired
  boilers)'' include not only boilers at casino hotels, but also new
  sources listed as ``boilers'' and new Tribal government facilities
  assumed to have natural gas fired boilers.

    This table is not intended to be exhaustive, but rather provides a 
guide for readers regarding entities likely to be regulated by this 
action. To determine whether your facility is regulated by this action, 
you should examine the applicability criteria in the final minor and 
major NSR programs for Indian country, 40 CFR 49.151 through 49.161 and 
through 49.175, respectively. If you have any questions regarding the 
applicability of this action to a particular entity, contact the person 
listed in the preceding FOR FURTHER INFORMATION CONTACT section.

B. Where can I get a copy of this document and other related 
information?

    In addition to being available in the docket, an electronic copy of 
this final rule will also be available on the World Wide Web. Following 
signature by the EPA Administrator, a copy of this final rule will be 
posted in the regulations and standards section of our NSR home page 
located at http://www.epa.gov/nsr and on the Tribal air home page at 
http://www.epa.gov/oar/tribal.

II. Overview of the Final Rules

    The EPA is ensuring that air resources in Indian country will be 
protected in the manner intended by the Act by establishing a 
preconstruction permitting program for new or modified minor sources, 
minor modifications at major sources, and new major sources or major 
modifications in nonattainment areas. In addition, we are establishing 
a minor source permitting mechanism for major sources that wish to 
voluntarily limit emissions to become synthetic minor sources \1\ and 
for approving case-by-case maximum achievable control technology (MACT) 
determinations.\2\ Prior to this action, there has been no

[[Page 38750]]

Federal permitting mechanism for minor sources in Indian country and 
for major sources in areas of Indian country that are designated as not 
attaining the NAAQS. These final rules will fill this regulatory gap. 
In addition, these rules will provide regulatory certainty to allow for 
environmentally sound economic growth in Indian country.
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    \1\ Sources located within the exterior boundaries of Indian 
reservations in Idaho, Oregon and Washington can apply for a non-
title V operating permit to establish synthetic minor status under 
the FIPs applicable to those reservations until this rule becomes 
effective. See 40 CFR 49.139 and 40 CFR part 49, subpart M. However, 
after the effective date of this rule, sources seeking synthetic 
minor status within the exterior boundaries of Indian reservations 
in these three states as well as the rest of Indian country must 
apply for synthetic minor source permits under the provisions of 
this rule.
    \2\ Section 112(g)(2)(B) of the Act provides that you may not 
construct or reconstruct a major source of HAPs unless the 
appropriate permitting authority determines that MACT for new 
sources will be met. If the Administrator has not established a MACT 
standard for the source category, the Act requires that MACT be 
determined on a case-by-case basis. See Section IV.E. of this 
preamble for more information on case-by-case MACT determinations.
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    The minor NSR rule applies to new and modified minor sources and to 
minor modifications at major sources. New minor sources with a 
potential to emit (PTE) equal to or greater than the minor NSR 
thresholds or modifications at minor sources with allowable emissions 
increases equal to or greater than the minor NSR thresholds must apply 
for and obtain a minor NSR permit prior to commencing construction of 
the new source or modification. At an existing major source, if a 
proposed modification does not qualify as a major modification (which 
would be subject to major NSR) based on the actual-to-projected-actual 
test, it is considered a minor modification and is subject to the minor 
NSR program requirements, if the net emissions increase from the 
actual-to-projected-actual test is equal to or exceeds the minor NSR 
thresholds listed in Table 1 of section IV.A.3 of this preamble. A 
major source with such a minor modification must apply for and obtain a 
minor NSR permit prior to commencing construction of the minor 
modification. In addition, these sources must install and operate 
control technology as determined by the reviewing authority on a case-
by-case basis. At the discretion of the reviewing authority, such 
sources may also be required to submit air quality impact analyses as 
part of their permit applications. For minor sources, as an alternative 
to a site-specific permit, some sources can request for coverage under 
a general permit.\3\
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    \3\ As described in section IV.C of this preamble, a general 
permit is a preconstruction permit that may be applied to a number 
of similar emission units or sources. The purpose of a general 
permit is to simplify the permit issuance process for similar 
facilities so that a reviewing authority's limited resources need 
not be expended for site-specific permit development for such 
facilities.
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    This rule will also allow otherwise major sources in Indian country 
to voluntarily accept emission limitations on their PTE to become 
``synthetic minor sources.'' Synthetic minor sources may include 
sources that emit regulated NSR pollutants and/or hazardous air 
pollutants (HAPs) \4\ and any limitations on PTE must be enforceable as 
a practical matter (that is, both legally and practicably enforceable) 
as defined in this regulation under 40 CFR 49.152(d). The practice of 
creating synthetic minor sources to avoid major NSR and title V is 
common under most state and local minor NSR permitting programs. 
However, outside of Idaho, Oregon and Washington, no such minor source 
permitting mechanism has been available in Federal regulations for 
Indian country, which discouraged sources that could qualify as 
synthetic minors from locating in areas of Indian country outside these 
three states. We therefore believe that inclusion of this provision in 
the final rules will significantly benefit Tribes by encouraging larger 
sources that can qualify as synthetic minors to locate in Indian 
country, thereby promoting environmentally sound economic growth.
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    \4\ In such cases, these sources will be subject to the minor 
NSR regulations under 40 CFR 49.151-49.165 and/or the applicable 
area source regulations under 40 CFR part 63. These sources will not 
be subject to the major NSR regulations under 40 CFR 52.21 (PSD) and 
40 CFR 49.166 through 49.175 (nonattainment major NSR), the major 
source MACT regulations under 40 CFR part 63 and/or the title V 
operating permit regulations. For information on when a major HAP 
source can obtain federally enforceable limits on its potential to 
emit, see the policy memorandum titled: ``Potential to Emit for MACT 
Standards--Guidance on Timing Issues,'' John S. Seitz, EPA, May 16, 
1995.
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    Synthetic minor sources will undergo site-specific permitting; that 
is, general permits will not be issued to synthetic minor sources. 
However, we intend to develop general permits for some common types of 
emissions units and minor sources to streamline the permitting process. 
The initial establishment of the general permit will include control 
technology review and associated emission limits. Thus, sources will 
not be required to conduct a case-by-case control technology review 
when they apply for coverage under a general permit.
    Under the nonattainment major NSR rule, affected sources are 
required to comply with the provisions of 40 CFR part 51, Appendix S, a 
transitional rule which generally applies to areas that do not have an 
approved nonattainment major NSR program for a particular pollutant in 
their State Implementation Plan (SIP). Sources subject to this rule 
must meet requirements for Lowest Achievable Emission Rate (LAER) 
control technology, emissions offsets and compliance certification.
    We are adopting these final rules after further evaluation of the 
proposed provisions and consideration of the public comments. On August 
21, 2006 (71 FR 48696), EPA proposed the ``Review of New Sources and 
Modifications in Indian Country'' (i.e., Tribal NSR rules). EPA also 
held an extensive outreach and consultation period (described in 
section III.D of this preamble), along with an extensive public comment 
period that ended on March 20, 2007. The comments provided detailed 
information specific to Indian country and the final rules incorporate 
many of the suggestions we received. We respond to many of these 
comments in explaining our rationale for the final rules, which is 
described in sections IV through VII.
    The final rules adopt many elements of the proposal, but differ 
from the proposal in several important respects. For the minor NSR 
rule, we had proposed a 30-day public comment period for the initial 
establishment of the general permit and also proposed that coverage of 
individual sources under general permits would not undergo a public 
comment period. In the final rule, to address concerns from Tribes, we 
have slightly changed the proposed notification provisions. A source 
that wants to request coverage under the general permit will be 
required to submit such request to the reviewing authority. At the same 
time, the source owner must also submit a copy of this request to the 
Tribe in the area where the source is locating. We will also post 
notice of the coverage request under a general permit on our Web site. 
During our review of your request for coverage under the general 
permit, commenters can only notify us of any concerns about the 
eligibility of your source to obtain coverage under that general permit 
and not on any other issue. For the minor NSR rule, we had also 
proposed Plantwide Applicability Limitations (PALs) and project 
netting. A minor source PAL would have been a source-wide limitation on 
allowable emissions of a regulated NSR pollutant expressed in tons per 
year (tpy) that was enforceable as a practical matter. However, we are 
not finalizing minor source PALs after consideration of the comments we 
received. At this time, we are also not finalizing project netting, the 
calculation of the total emissions increase that would result from a 
proposed modification by summing both the increases and decreases 
resulting from the modification, since we decided not to take final 
action on project netting for the major NSR program. (See Prevention of 
Significant Deterioration (PSD) and Nonattainment New Source Review 
(NSR): Aggregation and Project Netting; 74 FR 2376.)
    Regarding the proposed list of emissions units and activities that 
will be exempted from the minor NSR program, we are finalizing an 
amended list. This list takes into consideration the comments received 
and the recent

[[Page 38751]]

developments in greenhouse gas regulations. We are also committing to 
the development of a supplemental rule to determine if additional 
exempted units/activities should be added to the list.
    Furthermore, to address commenters' concerns about EPA's ability to 
issue minor NSR permits on a timely basis, we have decided to phase in 
the implementation dates of these rules. For example, we are delaying 
the implementation date of this rule for new and modified true minor 
sources by the earlier of 6 months after the general permit for a 
source category is published in the Federal Register or 36 months from 
the effective date of this rule, that is, September 2, 2014. Existing 
true minor sources will not be subject to the requirements of the minor 
NSR program until they propose a modification. However, true minor 
sources will be required to register within 18 months from the 
effective date of this rule, that is, by March 1, 2013, or within 90 
days after the source begins operation, whichever is later (see section 
VII.C of this preamble for more details on these provisions).
    For the major NSR rule, we are not finalizing the proposed Appendix 
S, paragraph VI as an option for offset \5\ waivers due to certain 
comments raising concerns with implementation of this waiver. Relative 
to the compliance certification requirement,\6\ we are finalizing a 
state-wide compliance requirement consistent with section 173(a)(3) of 
the Act.
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    \5\ Under the CAA, emissions reductions (offsets) from existing 
sources in the area of the proposed source (whether or not under the 
same ownership) are obtained such that there will be reasonable 
progress towards attainment of the applicable NAAQS. See section 
173(a)(1) of the Act.
    \6\ Also under the CAA, a permit applicant must certify that all 
existing major sources owned or operated by the applicant (or any 
entity controlling, controlled by or under common control with the 
applicant) in the same state as the proposed source are in 
compliance with (or under a federally-enforceable compliance 
schedule for) all applicable emission limitations and standards 
under the Act. See section 173(a)(3) of the Act.
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    We are finalizing the minor NSR and the nonattainment major NSR 
permit programs pursuant to section 110(a)(2)(C), part D of title I and 
section 301(d) of the Act.

III. Background

A. What is the New Source Review (NSR) program?

1. What are the general requirements of the major NSR program?
    The major NSR program contained in parts C and D of title I of the 
Act is a preconstruction review and permitting program applicable to 
new major sources and major modifications at such sources. In areas not 
meeting health-based NAAQS and in ozone transport regions (OTR), the 
program is implemented under the requirements of part D of title I of 
the Act. We call this program the ``nonattainment'' major NSR program. 
In areas meeting the NAAQS (``attainment'' areas) or for which there is 
insufficient information to determine whether they meet the NAAQS 
(``unclassifiable'' areas), the NSR requirements under part C of title 
I of the Act apply. We call this program the Prevention of Significant 
Deterioration (PSD) program. Collectively, we also commonly refer to 
these programs as the major NSR program. These rules are contained in 
title 40 of the Code of Federal Regulations (CFR), Sec. Sec.  51.165, 
51.166, 52.21 and 52.24 (40 CFR 51.165, 51.166, 52.21 and 52.24) and 40 
CFR part 51, Appendices S and W.
    For newly constructed, ``greenfield'' sources, the determination of 
whether a source is subject to the major NSR program is based on the 
source's PTE. The Act, as implemented by our rules, sets applicability 
thresholds for major sources in both attainment and nonattainment 
areas. For nonattainment areas, these thresholds are 100 tpy of any 
pollutant subject to regulation under the Act or smaller amounts, 
depending on the nonattainment classification. For attainment areas the 
thresholds are 100 or 250 tpy, depending on the source type.\7\ A new 
source with a PTE at or above the applicable threshold amount 
``triggers,'' or is subject to, major NSR.
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    \7\ Sources listed in section 169(l) of the Act are subject to a 
threshold of 100 tpy (see 40 CFR 52.21(b)(1)(i)(a)). All other 
sources are subject to a 250 tpy threshold. (See 40 CFR 
52.21(b)(1)(i)(b).) In addition, under the recently finalized 
``Greenhouse Gas Tailoring Rule,'' greenhouse gases will be phased 
into the PSD program with higher applicability thresholds (75 FR 
31514).
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    For existing major sources, major NSR applies to a major 
modification. For a modification to be major, the following three 
criteria have to be met:
    (1) A physical change in or change in the method of operation of a 
major source must occur;
    (2) The increase in emissions resulting from this change must be 
significant (equal to or above the significance levels defined in 40 
CFR 52.21(b)(23) for PSD or 40 CFR part 51, Appendix S, paragraph 
II.A.10 for nonattainment major NSR); and
    (3) The increase in emissions resulting from the change must result 
in a significant net emissions increase. In other words, when the 
increase from the project is added to other contemporaneous increases 
and decreases in actual emissions \8\ at the source, the net emissions 
increase must be significant (equal to or above the significance levels 
defined in 40 CFR 52.21(b)(23) for PSD or 40 CFR part 51, Appendix S, 
paragraph II.A.10 for nonattainment major NSR).
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    \8\ In approximate terms, ``contemporaneous'' emissions 
increases or decreases are those that have occurred between the date 
5 years immediately preceding the proposed physical or operational 
change and the date that the increase from the change occurs. See 40 
CFR 52.21(b)(3)(ii) for PSD. For nonattainment major NSR, see, 40 
CFR part 51, Appendix S, paragraph II.A.6(ii).
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    Major sources and major modifications subject to nonattainment 
major NSR must apply state-of-the-art emissions control technologies, 
including any pollution prevention measures, to achieve the lowest 
achievable emission rate. The lowest achievable emission rate is based 
on the most stringent emission limitation in the implementation plan of 
any state or achieved in practice, for the source category under 
review.
    Each major source subject to nonattainment major NSR must also 
offset its emissions increase by obtaining emissions reductions from 
other sources in the area or in an area of equal or higher 
nonattainment classification that contributes to nonattainment in the 
proposed major source's area. The ratio of the offset relative to the 
proposed increase must be at least one-to-one and is based on the 
severity of the area's nonattainment classification. For ozone and 
particulate matter less than or equal to 10 microns in aerodynamic 
diameter (PM10), the more polluted the air is where the 
source is locating or expanding, the greater the required offset ratio 
is. The emissions reductions to be used as offsets must be surplus (not 
otherwise required by the Act), quantifiable, Federally enforceable and 
permanent. See sections 173(a) and (c) of the Act and 40 CFR 
51.165(a)(3).
    Additionally, each nonattainment major NSR permit applicant must 
also conduct an analysis of alternative sites, sizes, production 
processes and environmental control techniques demonstrating that the 
benefits of the proposed emissions source significantly outweigh the 
environmental and social costs of its location, construction or 
modification. Moreover, each nonattainment major NSR permit applicant 
must demonstrate that all other major sources under her/his control in 
the same state are in compliance or on a schedule of compliance with 
all emission limitations and standards of the Act.

[[Page 38752]]

    Under the PSD program for attainment areas, a major source or 
modification must apply Best Available Control Technology (BACT), which 
may be based on pollution prevention techniques. In addition, the 
source must analyze the impact of the project on ambient air quality to 
assure that no violation of the NAAQS or PSD increments will result and 
must analyze impacts on soil, vegetation and visibility. Sources or 
modifications that would impact Class I areas (e.g., national parks) 
may be subject to additional requirements to protect air quality 
related values (AQRVs) that have been identified for such areas.
2. What are the general requirements of the minor NSR program?
    Section 110(a)(2)(C) of the Act requires that every SIP include a 
program to regulate the construction and modification of stationary 
sources, including a permit program as required by parts C and D of 
title I of the Act, to ensure attainment and maintenance of the NAAQS. 
Parts C and D address the major NSR program for major sources and the 
permitting program for minor sources is addressed by section 
110(a)(2)(C) of the Act. We commonly refer to the latter program as the 
minor NSR program. A minor source means a source whose PTE is lower 
than the major NSR applicability threshold for a particular pollutant 
as defined in the applicable nonattainment major NSR program or PSD 
program.
    States must develop minor NSR programs to attain and maintain the 
NAAQS and the Federal requirements for state minor NSR programs are 
outlined in 40 CFR 51.160 through 51.164. These Federal requirements 
for minor NSR programs are considerably less prescribed than those for 
major sources and as a result there is a larger variation of 
requirements in the state minor NSR programs.
    Furthermore, Section 110(a)(2)(C) of the Act provides us with a 
broad degree of discretion in developing a program to regulate new and 
modified minor source construction activities in Indian country.

B. What is the basis for EPA's authority to implement CAA programs in 
Indian country?

    The Tribal Authority Rule (TAR) authorizes eligible Indian Tribes 
to implement EPA-approved nonattainment major NSR (part D of title I of 
the Act), PSD (part C of title I of the Act) and other programs under 
the Act in the same manner as states. This is accomplished when Indian 
Tribes develop Tribal Implementation Plans (TIPs), which are plans 
similar to SIPs. If a Tribe develops a TIP to implement a CAA program, 
the TIP, once it is approved, will replace the Federal program as the 
requirement for that area of Indian country and the Tribe will become 
responsible for implementing that particular program. However, if 
Indian Tribes are unable or choose not to include a CAA program such as 
NSR in a TIP, we will implement the program under these rules.
    The Act provides us with broad authority to protect air resources 
throughout the Nation, including air resources in Indian country. See, 
for example, the preamble discussion for the proposed and final TAR (59 
FR 43956, 43958-61, August 25, 1994; 63 FR 7254, 7262-64, February 12, 
1998) and the preamble discussion for the proposed revisions to the 
part 71 Federal operating permits program for Indian country (62 FR 
13748, 13750, March 21, 1997). In the preambles to the proposed and 
final TAR, we discussed generally the legal basis under the Act for EPA 
and Tribal regulation of sources of air pollution in Indian country. We 
concluded that the Act constitutes a statutory delegation of Federal 
authority to eligible Tribes over all sources of air pollution within 
the exterior boundaries of their reservations.
    Further, under the Act, Tribes may also apply to administer Tribal 
air quality programs for non-reservation areas over which they can show 
jurisdiction.\9\ See 63 FR 7254-7259; 59 FR 43958-43960; Arizona Public 
Service Co. v. EPA, 211 F.3d 1280 (DC Cir. 2000), cert. den., 532 U.S. 
970 (2001).
---------------------------------------------------------------------------

    \9\ We believe that in the context of programs under the Act, 
states generally lack the authority to regulate air quality in 
Indian country as defined in 18 U.S.C. 1151. See Alaska v. Native 
Village of Venetie Tribal Government, 522 U.S. 520, 527 fn. 1 (1998) 
(``Generally speaking, primary jurisdiction over land that is Indian 
country rests with the Federal Government and the Indian tribe 
inhabiting it and not with the States.''), California v. Cabazon 
Band of Mission Indians, 480 U.S. 202 (1987) and HRI v. EPA, 198 
F.3d 1224 (10th Cir. 2000); see also discussion in EPA's final rule 
for the federal operating permits program (64 FR 8251-8255, February 
19, 1999). To provide additional certainty to regulated entities, we 
believe it is helpful to clarify the extent to which state NSR 
programs have force in Indian country. We interpret past approvals 
and delegations of NSR programs as not extending to Indian country 
unless the state has made an explicit demonstration of jurisdiction 
over Indian country and we have explicitly approved or delegated the 
state's program for such area. This is consistent with Congress' 
requirement that we approve state and tribal programs only where 
there is a demonstration of adequate authority. See sections 
110(a)(2)(E), 110(o) and 301(d) of the Act and 40 CFR part 49. Since 
states generally lack the authority to regulate air resources in 
Indian country, we do not believe it would be appropriate for us to 
approve state programs under the Act as covering Indian country 
where there has not been an explicit demonstration of adequate 
jurisdiction and where we have not explicitly indicated our intent 
to approve the state program for an area of Indian country. In state 
NSR program approvals and delegations, we generally were not faced 
with state assertions of authority to regulate sources in Indian 
country. However, to the extent states or others may have 
interpreted our past approvals or delegations that were not based on 
explicit demonstrations of adequate authority and did not explicitly 
grant approval in Indian country as approvals to operate NSR 
programs in Indian country, we wish to clarify any such 
misunderstanding.
---------------------------------------------------------------------------

    In the preamble to the TAR, we also concluded that the Act 
authorizes us to protect air quality throughout Indian country. See 63 
FR 7262, 59 FR 43960-43961 citing sections 101(b)(1), 301(a) and 301(d) 
of the Act.
    In addition, section 301(a) of the Act provides us broad authority 
to issue such regulations as are necessary to carry out the mandates of 
the Act. Several provisions of the Act call for Federal implementation 
of a program where, for example, a state or in this case a Tribe, fails 
to adopt a program or adopts an inadequate program. See, for example, 
sections 110(c)(1), 502(d)(3) and 502(i)(4) of the Act. These 
provisions exist in part to ensure that the benefits of the Act are 
realized throughout the United States, whether or not local governments 
choose to participate in implementing the Act. Especially in light of 
the problems associated with transport of air pollution across state 
and Tribal boundaries, it follows that Congress intended that we have 
the authority to operate a Federal program in the absence of an 
adequately implemented EPA-approved program. See, for example, 59 FR 
43958-61, August 25, 1994; 62 FR 13750, March 21, 1997 and 63 FR 7262-
64, February 12, 1998.
    This interpretation is most evident from Congress' grant of 
authority to the EPA under section 301(d)(4) of the Act. Section 
301(d)(4) authorizes the Administrator to directly administer 
provisions of the Act so as to achieve the appropriate purpose where 
Tribal implementation of those provisions is inappropriate or 
administratively infeasible. We determined that it is inappropriate to 
subject Tribes, among other things, to the mandatory submittal 
deadlines and to the related Federal oversight mechanisms in section 
110(c)(1) of the Act, which are triggered when we make a finding that 
states have failed to meet required deadlines or disapprove a state 
plan submittal. See 40 CFR 49.4(d).
    By determining that Tribes should not be treated similarly to 
states for purposes of the specific FIP obligation under section 
110(c)(1) of the Act, we are not relieved of the general obligation

[[Page 38753]]

under the Act to ensure the protection of air quality throughout the 
Nation, including throughout Indian country. Rather, consistent with 
the provisions of sections 301(a) and 301(d)(4) of the Act, we 
expressed our intent to promulgate without unreasonable delay such FIP 
provisions as are necessary or appropriate to protect air quality if 
Tribal efforts do not result in adoption and approval of Tribal plans 
or programs. See 63 FR 7265, 40 CFR 49.11.
    Under section 301(d)(4) of the Act, Congress authorized the EPA to 
maintain the territorial approach by implementing the Act in Indian 
country in the absence of an EPA-approved program. We believe that 
Congress authorized us, consistent with our Indian policy, to avoid the 
checker-boarding of Indian reservations based on land ownership by 
Federally implementing the Act over all reservation sources in the 
absence of an EPA-approved Tribal program. See S. Rep. No. 228, 101st 
Cong., 1st Sess. 79 (1989) (implementation of the Act to be in a manner 
consistent with EPA's Indian policy). In addition, section 301(d)(4) 
authorized us to implement the Act in non-reservation areas of Indian 
country in order to fill any gap in program coverage and to ensure an 
efficient and effective transition to EPA-approved programs.
    Our interpretation of section 301(d) of the Act as authorizing our 
implementation throughout Indian country is also supported by the 
legislative history. See S. Rep. No. 228, 101st Cong., 1st Sess. 80 
(1989) (noting that section 301(d) of the Act authorizes the EPA to 
implement provisions of the Act throughout ``Indian country'' when 
there is no approved Tribal program); Id. at 80 (noting that criminal 
sanctions are to be levied by the EPA, ``consistent with the Federal 
government's general authority in Indian country''); Id. at 79 (the 
purpose of section 301(d) of the Act is to ``improve the environmental 
quality of the air within Indian country in a manner consistent with 
the EPA Indian Policy'').
    Therefore, with these final rules, we will exercise our authority 
to administer the minor NSR permitting program and the nonattainment 
major NSR program in Indian country, which is generally the area over 
which a Tribe may potentially receive approval of programs under the 
Act. As noted in the final TAR, we interpret the Act as establishing a 
territorial approach to implementation of the Act within Indian country 
by delegating to eligible Tribes authority over all reservation sources 
without differentiating among the various categories of on-reservation 
lands (63 FR 7254-7258). In addition, the Act authorizes eligible 
Tribes to implement Tribal programs under the Act in non-reservation 
areas over which a Tribe has jurisdiction, generally including all 
areas of Indian country (63 FR 7258-7259).
    In order to further our commitment to use our authority under the 
Act to protect air quality throughout Indian country by directly 
implementing the Act's requirements, we are now exercising the 
rulemaking authority entrusted to us by Congress to directly implement 
the minor NSR permitting program and nonattainment major NSR permitting 
program throughout all areas of Indian country. See generally, Chevron 
USA, Inc. v. NRDC, 467 U.S. 837, 842-45 (1984).

C. What is the status of the NSR air quality programs in Indian 
country?

    No Tribe is currently administering an EPA-approved PSD program. 
Therefore, EPA has been implementing a FIP for major sources in 
attainment areas and has been issuing PSD permits in Indian country. 
See 40 CFR 52.21. For the nonattainment major NSR program or the minor 
NSR program in Indian country, no Tribes have been administering an 
EPA-approved nonattainment major NSR program and only a few Tribes have 
been administering EPA-approved minor NSR programs.\10\ In addition, 
there has been no FIP in place to implement these programs until now. 
Hence, there was a regulatory gap in Indian country. This final rule 
will allow us to address that gap and more fully implement the NSR 
program in Indian country. We are finalizing the minor NSR program at 
40 CFR 49.151 through 49.165 and the nonattainment major NSR program at 
40 CFR 49.166 through 49.175 and these programs will continue to apply 
except where we explicitly approve an implementation plan for such 
programs for a specific area in Indian country.\11\ The requirements 
finalized under these rules do not apply to State permitting programs.
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    \10\ For example, the St. Regis Mohawk Tribe has in place an 
EPA-approved TIP that includes provisions for minor NSR and 
synthetic minor permitting (See http://www.srmtenv.org/pdf_files/airtip.pdf). In addition, the Gila River Indian Community has 
developed a TIP that includes a minor NSR program (See http://www.epa.gov/region9/air/actions/gila-river.html).
    \11\ Although many states have developed regulatory programs for 
minor sources, those programs do not apply in Indian country unless 
explicitly approved by EPA for such areas.
---------------------------------------------------------------------------

    As we stated previously, sections 301(d) and 110(o) of the Act give 
the Tribes the authority to develop their own Tribal programs and we 
encourage eligible Tribes to develop their own minor and nonattainment 
major NSR programs for incorporation into TIPs. However, we understand 
that not all Tribes have the resources to design and implement NSR 
programs; therefore, in the absence of an EPA-approved program, this 
final rulemaking provides a Federal program for implementing the minor 
NSR and the major NSR program in nonattainment areas of Indian country. 
Tribes may use this program as a model if they choose to develop their 
own Tribal Implementation plans and obtain our approval.
    Since, in most cases and in the absence of an EPA-approved program, 
it would be neither practical nor administratively feasible for us to 
develop and implement a separate program for each area of Indian 
country,; these final rules will implement a flexible FIP for Indian 
country that provides new and modified minor sources and major sources 
in nonattainment areas with procedures to demonstrate that they will be 
operating in a manner that is protective of air resources and the 
NAAQS. In addition, these rules will ensure that any economic growth 
occurring in Indian country will be in harmony with the preservation of 
Clean Air Act resources.

D. What consultation and outreach has been done with Tribal leaders and 
representatives?

    Prior to undertaking this rulemaking, we sought to include Tribes 
early in the rulemaking process. On June 24, 2002, we sent 
approximately 500 letters to Tribal leaders seeking their 
recommendations for effective consultation and their involvement in 
developing these rules.
    We received responses from 75 Tribes. Of these 75 Tribes, 69 
designated an environmental staff member to work with us on developing 
the rules. Aside from the designated staff, many Tribal leaders asked 
that we keep them informed of our progress through e-mail, meetings 
with the EPA Regional Offices, newsletters and Web sites. In addition, 
53 percent of the Tribal leaders also requested direct phone calls or 
conference calls to discuss the subject and 16 percent of the 
respondents requested face-to-face consultation. Of these, six Tribes 
requested senior EPA staff to meet with Tribal leaders.
    As a result of this feedback, we developed a consultation plan that 
included three meetings held at the reservations of the Menominee Tribe 
in Wisconsin, the Mohegan Tribe in Connecticut and the Chehalis Tribe 
in Washington. A fourth meeting was held

[[Page 38754]]

in conjunction with the Institute of Tribal Environmental 
Professionals' (ITEP) 10th anniversary meeting in Flagstaff, Arizona. 
In addition to conducting these meetings, we also visited Tribal 
environmental staff in Indian country. Over 30 Tribes attended these 
meetings. We also participated in numerous national and regional forums 
including the National Tribal Forums sponsored by the ITEP, two 
National Tribal Air Association meetings and meetings with Tribal 
consortia, such as the National Tribal Environmental Council, United 
Southern and Eastern Tribes, Inter-Tribal Environmental Council, Inter 
Tribal Council of Arizona and others.
    Although much of our effort focused on outreach to the Tribes, we 
also interacted with state and local air pollution control agencies 
during development of these rules. We had two meetings with the State 
and Territorial Air Pollution Program Administrators and the 
Association of Local Air Pollution Control Officers (STAPPA/ALAPCO) to 
present the draft rules.\12\
---------------------------------------------------------------------------

    \12\ This organization has since changed its name to the 
National Association of Clean Air Agencies (NACAA).
---------------------------------------------------------------------------

    We considered feedback from all stakeholders and proposed the 
``Review of New Sources and Modifications in Indian Country'' rules on 
August 21, 2006 (71 FR 48696). However, Tribal government 
representatives expressed concerns that the long gap between 
consultation/outreach and action by the Agency undermined the 
effectiveness of these interactions. Thus, after proposal of the rule, 
we started an extensive outreach program in the years 2006 and 2007 to 
inform and seek comments from the public, especially Tribes.
    We again sent over 500 letters to Tribal leaders to inform them 
about the proposal. We did not receive any formal responses to these 
letters and did not receive any request for formal consultation from 
the Tribes, but they contacted us either through e-mail or phone calls 
and asked to keep them informed of our progress through e-mail, 
meetings, training sessions, newsletters and/or Web sites. To enhance 
understanding of the proposal and what it would mean for Indian 
country, we supplemented the 2006 outreach efforts by holding four 
training sessions using Web conferencing not only for Tribes, but also 
for EPA Regional Offices, air program managers and Tribal 
organizations. We also held training sessions in 2006 and at the 
request of the Tribes for interested Tribal and other environmental 
professionals at the Pechanga Band of Luise[ntilde]o Indians in 
California and Salt River Pima-Maricopa Indian Community in Arizona. In 
addition, we held training sessions for all interested parties at EPA 
Region V's Tribal Air Meeting in Illinois (2006) and EPA's Region X's 
office in Washington (2007).
    We participated in numerous national and regional forums including 
the forums sponsored by the Institute of Tribal Environmental 
Professionals, the National Tribal Air Association and at meetings with 
Tribal consortia, such as the United Southern and Eastern Tribes. We 
also interacted with state and local air pollution agencies during this 
outreach period and had meetings with the NACAA.
    Furthermore, we extended and reopened the comment period for the 
proposed rules twice (from November 20, 2006 to January 19, 2007 and 
from January 19, 2007 to March 20, 2007) at the request of the Tribes. 
During this time, we also recorded and presented a webcast video for 
all interested stakeholders to train more environmental professionals 
about the NSR program and the rules themselves.
    To address the concern about the long gap between the proposal and 
finalization of the rules and to ensure that the Tribes are aware of 
the proposed rules and their provisions, we held a series of meetings 
in 2010 with the National Tribal Operations Committee, interested 
Regional Tribal Operations Committees and interested Tribal 
environmental staff. In 2011, we sent letters to all Tribes to ask them 
about their interest in an additional round of consultation and 
outreach and, based on their responses, we have conducted consultation 
and outreach meetings with several Tribes. These meetings included a 
face-to-face meeting in Denver, Colorado with a number of Tribes within 
EPA Region VIII and four conference calls with Tribes from across the 
country.
    After these rules are promulgated, we intend to conduct similar 
outreach efforts with all stakeholders, including extensive training to 
facilitate easier implementation of the rules.

IV. Final Minor NSR Program for Indian Country

    This rulemaking finalizes provisions for a minor NSR program in 
Indian country, codified at 40 CFR 49.151 through 49.165. The program 
includes requirements for preconstruction review for minor sources and 
minor modifications, general permits and synthetic minor source 
permits. The minor NSR program also serves as a mechanism for case-by-
case MACT determinations and establishes a registration system for 
existing minor sources to improve the Tribal source emission inventory.
    Our primary goal in developing this program is to ensure that air 
resources in Indian country will be protected in the manner intended by 
the Act. In addition, we seek to establish a flexible preconstruction 
permitting program for minor sources in Indian country that is 
comparable to similar programs in neighboring states in order to create 
a more level regulatory playing field for owners and operators within 
and outside of Indian country.
    This final rulemaking is not intended to establish a new set of 
minimum criteria that a Tribe or a state would need to follow in 
developing its own minor source permitting program. Rather, these rules 
simply represent how we will implement the program in Indian country in 
the absence of an EPA-approved Tribal implementation plan. However, if 
a Tribe is developing its own program, this can serve as one example of 
a program that meets the objectives and requirements of the Act. This 
final minor source permitting program addresses, on a national level, 
many environmental and regulatory issues that are specific to Indian 
country. We understand that different Tribes may face different issues 
and may therefore, like states developing SIPs, choose to develop TIPs 
tailored to their individual Tribal circumstances and needs. This rule 
will allow Tribes to develop their own TIPs, consistent with the 
overarching requirement that the Tribe ensure that the TIP will not 
interfere with any applicable requirement of the CAA.

A. General Provisions Under the Minor NSR Program

1. What is a minor source and which minor sources are subject to this 
rule?
a. Minor Source Definition
    We are finalizing under 40 CFR 49.152 that a minor source, for the 
purposes of this rule, means a source, not including the exempt 
emissions units and activities listed in Sec.  49.153(c), that has the 
potential to emit regulated NSR pollutants in amounts that are less 
than the major source thresholds in 40 CFR Sec.  49.167 or Sec.  52.21, 
as applicable, but equal to or greater than the minor NSR thresholds in 
Sec.  49.153. The potential to emit includes fugitive emissions, to the 
extent that they are quantifiable, only if the source belongs to one of 
the source categories listed in 40 CFR part 51, Appendix S, paragraph 
II.A.4(iii) or 52.21(b)(1)(iii), as applicable.

[[Page 38755]]

    A source's PTE for a pollutant is expressed in tpy and generally is 
calculated by multiplying the maximum hourly emissions rate in pounds 
per hour (lbs/hr) times 8,760 hours (which is the number of hours in a 
year) and dividing by 2,000 (which is the number of pounds in a ton). 
If a source is restricted by permit conditions that limit its emissions 
and are enforceable as a practical matter (as defined in 40 CFR 
49.152), its PTE (and allowable emissions) are calculated based on the 
permit restrictions.
    For the NSR program in Indian country, the major source thresholds 
are defined in the PSD program (see 40 CFR 52.21) and in the 
nonattainment major NSR program being finalized in this action (see 40 
CFR 49.167), as applicable. These thresholds may differ in attainment 
areas and nonattainment areas for the same pollutant. For example, in 
attainment areas the major source threshold for nitrogen oxides 
(NOX) is 250 tpy, unless the source belongs to a source 
category that is listed in the major NSR rules (see 40 CFR 
52.21(b)(1)(i)(a)), in which case the major source threshold is 100 
tpy. In contrast, the major source threshold for NOX in 
ozone nonattainment areas can vary from 10 tpy in an extreme ozone 
nonattainment area to 100 tpy in a marginal ozone nonattainment area 
(see 40 CFR part 51, Appendix S, paragraph II.A.4(i)). The final rule 
establishes minor NSR thresholds as discussed in section IV.A.3 of this 
preamble.
    This minor source definition differs from the definition in the 
proposal by providing the following clarifications. We clarified that 
de minimis exceptions (i.e., minor NSR thresholds) and insignificant 
source categories or activities being finalized under this rule are not 
considered minor sources for purposes of this rule and eliminated the 
sentence in the proposed definition that stated the term ``minor 
stationary source applies independently to each regulated NSR pollutant 
that the source has the potential to emit.''
    A few commenters asked us to accommodate in the minor source 
definition references to the de minimis exceptions (i.e., minor NSR 
thresholds) and insignificant source categories or activities being 
finalized under this rule and we believe it is appropriate to do so. In 
addition, since the source can only be a minor source if the PTE of all 
regulated NSR pollutants for that source are less than the 
corresponding major source thresholds, we deleted from the definition 
the statement that read: ``the term `minor stationary source' applies 
independently to each regulated NSR pollutant that the source has the 
potential to emit.''
    Furthermore, we have amended the minor source definition to specify 
that the PTE of a source includes fugitive emissions, to the extent 
that they are quantifiable, only if the source belongs to one of the 
source categories listed in 40 CFR 52.21(b)(1)(iii) (for PSD) and 40 
CFR part 51, Appendix S, paragraph II.A.4(iii) (for nonattainment major 
NSR) of the major NSR rules pursuant to section 302(j) of the Act. This 
action is explained further in the next section.
b. Determining Applicability for New Minor Sources
    As stated in the proposal, in all NSR applicability determinations, 
you must evaluate each regulated NSR pollutant individually because the 
area where your source is located may be attainment for some pollutants 
and nonattainment for others. For a given new source or modification, a 
particular pollutant may be subject to review under PSD, nonattainment 
major NSR or minor NSR or may not be subject to any of these programs.
    For proposed new sources, the first step is to calculate the 
potential to emit of each regulated NSR pollutant. The second step is 
to determine whether the source is subject to the applicable major NSR 
program (i.e., 40 CFR 49.167 or 40 CFR 52.21 for nonattainment and 
attainment areas, respectively) with respect to each regulated NSR 
pollutant. Under the nonattainment major NSR program, this step is 
repeated for each regulated NSR pollutant the source has the potential 
to emit. Under the PSD program, if the source's potential to emit is 
greater than the major source threshold for one pollutant, then PSD 
applies to any other regulated NSR pollutants for which the potential 
to emit is above the level defined as ``significant'' in the PSD 
regulations.\13\ The significance level is typically lower than the 
major source threshold; for example, the significance level for 
PM10 is 15 tpy while the major source threshold is 100 or 
250 tpy.
---------------------------------------------------------------------------

    \13\ The significance levels are defined in 40 CFR 52.21(b)(23).
---------------------------------------------------------------------------

    If your proposed new source is not subject to major NSR for a 
particular regulated NSR pollutant, the next step is to determine 
whether the source is subject to the requirements of this minor NSR 
rule for that pollutant, i.e., if the source's potential to emit of the 
pollutant is equal to or greater than the applicable minor NSR 
threshold listed in Table 1 of this final rule. These steps are 
repeated for every regulated NSR pollutant the source has the potential 
to emit. However, for a source to be considered a minor source, the PTE 
of all regulated NSR pollutants must be less than the corresponding 
major source threshold.
    In determining if the source's potential to emit of a pollutant is 
equal to or greater than the applicable minor NSR threshold listed in 
Table 1 of this final rule, fugitive emissions will be included to the 
extent that they are quantifiable, only if the source belongs to one of 
the source categories listed pursuant to section 302(j) of the Act 
(i.e., the source categories listed in 40 CFR part 51, Appendix S, 
paragraph II.A.4(iii) and in 40 CFR 52.21(b)(1)(iii)).
    We are finalizing this provision after seeking comment in the 
proposal as to whether in calculating the emission levels for 
applicability purposes, you should include fugitive emissions, to the 
extent they are quantifiable, for all sources or include them only for 
source categories listed pursuant to section 302(j) of the Act or 
exclude them for all sources.
    Commenters who supported the approach of including fugitive 
emissions for all sources believed that the mandate of the minor NSR 
program is based on protection of air quality throughout the nation. 
Additionally, they believed that fugitive emissions are a large 
proportion of the air pollutants in Indian country and therefore EPA 
must require fugitive emissions to be included in determining 
applicability. However, many commenters argued that fugitive emissions 
at minor sources are minuscule and a requirement to include them would 
be excessive. Some of these commenters believed that the costs for 
complying with minor NSR for fugitive emissions could potentially be 
substantial and that fugitive emissions are inherently difficult to 
quantify. In addition, one commenter added that fugitive emissions 
should only be included for source categories listed under section 
302(j) of the Act, citing an extensive analysis of the history of 
regulating fugitive emissions under NSR.
    Based on the comments received, we are finalizing provisions that 
require including fugitive emissions in the minor NSR applicability 
determination, to the extent that they are quantifiable, only if the 
source belongs to one of the source categories listed pursuant to 
section 302(j) of the Act (i.e., the source categories listed in 40 CFR 
part 51, Appendix S, paragraph II.A.4(iii) and in 40 CFR 
52.21(b)(1)(iii)), for the following reasons.
    For the source categories listed pursuant to section 302(j) we have 
historically identified these source

[[Page 38756]]

categories as having the potential to significantly degrade air quality 
and it has been demonstrated to be reasonable and cost effective for 
sources in these categories to quantify and include their fugitive 
emissions in applicability determinations. We will continue to require 
these source types to quantify fugitive emissions in determining 
applicability of minor NSR. While some other source categories also 
contribute significantly to air pollution, we have thus far not 
required counting their fugitive emissions in determining applicability 
because of unreasonable economic costs associated with doing so (See 54 
FR 48879).
    We have the discretion under CAA section 110(a)(2)(c) to follow a 
similar approach in the minor source program as long as the NAAQS are 
protected and we are using that discretion because we believe it would 
be unreasonably cumbersome and costly to expect the wide variety of 
minor source types not on the section 302(j) list to be able to 
quantify their fugitive emissions.
    Without discounting the fact that fugitive emissions from 
individual sources or source categories may be significant contributors 
to air pollution, we believe that, as a whole, the air quality impacts 
of emissions from the number of sources that would likely be excluded 
from minor NSR because of exclusion of their fugitive emissions are 
likely to be small and therefore not commensurate with the regulatory 
and economic burden we would impose on minor sources in Indian country 
if we were to require the estimation of fugitive emissions for all 
minor sources and subject them to permitting based on those emissions. 
This is especially the case since we are developing a program that 
applies generically to sources in Indian country regardless of whether 
fugitive emissions from major or minor sources are a significant source 
of air pollution in a specific location. Given this diversity and the 
potential costs, our approach strikes a reasonable balance.
    Finally, this approach in our final rule is consistent with how 
fugitive emissions are treated in some state minor source programs. 
Therefore, we are finalizing the new minor source applicability 
requirements mainly as proposed and under 40 CFR 49.153(a).
2. What is a modification and which modifications are subject to this 
rule?
a. Definition of ``Modification''
    Under this final rule, a modification means any physical or 
operational change that would cause an increase in the allowable 
emissions of a minor source or an increase in the actual emissions 
(based on the applicable test under the major NSR program) of a major 
source for any regulated NSR pollutant or that would cause the emission 
of any regulated NSR pollutant not previously emitted. Allowable 
emissions of a minor source include fugitive emissions, to the extent 
that they are quantifiable, only if the source belongs to one of the 
source categories listed in 40 CFR 52.21(b)(1)(iii) for PSD and 40 CFR 
part 51, Appendix S, paragraph II.A.4(iii) for nonattainment major NSR. 
The following exemptions apply:
     A physical or operational change does not include routine 
maintenance, repair or replacement.\14\
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    \14\ ``For over two decades,'' EPA has interpreted ``the RMRR 
exclusion as limited to de minimis circumstances.'' New York v. EPA, 
443 F.3d 880, 884 (DC Cir. 2006), cert. denied 127 S. Ct.2127 (2007) 
(citing Alabama Pow. Co, v. Costle, 636 F.2d 323 (DC Cir 1980)). 
EPA's historic policy is that ``in determining whether proposed work 
at an existing facility is `routine,' EPA makes a case-by-case 
determination by weighting the nature, extent, purpose, frequency 
and cost of the work, as well as other relevant factors, to arrive 
at a common-sense finding.'' Memorandum from Don R. Clay, Acting 
Assistant Administrator, Office of Air and Radiation, U.S. EPA, 
``Applicability of Prevention of Significant Deterioration (PSD) and 
New Source Performance Standards (NSPS) Requirements to the 
Wisconsin Electric Power Company (WEPCO) Port Washington Life 
Extension Project'' (Sep. 9, 1988) (http://www.epa.gov/region07/air/nsr/nsrmemos/wpco2.pdf). EPA further explained these factors in 
letter dated May 23, 2000 from Francis X. Lyons, Regional 
Administrator, Region V, U.S. EPA, to Henry Nickel, Counsel for the 
Detroit Edison Company, Hunton & Williams (http://www.epa.gov/region07/air/nsr/nsrmemos/detedisn.pdf).
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     An increase in the hours of operation or in the production 
rate is not considered an operational change unless such change is 
prohibited under any permit condition that is enforceable as a 
practical matter (as defined in 40 CFR 49.152).
     A change in ownership at a stationary source.
     The emissions units and activities listed in 40 CFR 
49.153(c).
    We are finalizing this definition under 40 CFR 49.152 after 
requesting comments as to whether the term modification should be based 
on an increase in allowable emissions or actual emissions.
    Commenters who supported our proposal to adopt a definition of the 
term ``modification'' based on an increase in allowable emissions 
(allowable-to-allowable test) believed that this test would be a 
simpler test than the actual-to-projected-actual test that applies to 
the major NSR program; it will be less costly, less time consuming and 
less complicated for Tribal minor sources and it is legal under the CAA 
and consistent with some state and local minor NSR programs that we 
have approved in SIPs pursuant to section 110 of the Act. On the other 
hand, commenters who opposed the allowable emissions test believed that 
this test is less stringent than the alternative tests and/or it is 
contrary to the Act and recent court decisions. They also believed that 
the allowable-to-allowable test will be inconsistent with the major NSR 
program and it does not ensure that the NAAQS are achieved (i.e., it 
could lead to unreviewed increases in emissions that would be 
detrimental to air quality). Furthermore, some of these commenters 
believed that an allowable-to-allowable test will not capture those 
sources that escape major NSR review and suggested the use of an 
actual-emissions-based test which could include an actual-to-potential, 
actual-to-projected-actual or an actual-to-future-actual test.
    For the most part, we agree with those commenters that endorsed the 
concept of defining the term modification for the minor NSR program as 
a change in allowable emissions. As we stated in the proposal (71 FR 
48696), we evaluated the three basic types of applicability tests 
(actual-to-potential, actual-to-projected-actual and allowable-to-
allowable) and determined that the allowable-to-allowable test is the 
most suitable for Indian country because, apart from being a simple 
test, it will help with implementation of the program for the minor 
sources in Indian country that, to date, have little experience with 
air regulations. Since minor sources in Indian country have been 
unregulated until now, many of these sources have not kept track of 
actual emissions data, making the initial application of any test based 
on actual emissions virtually impossible. In addition, we understand 
that some state minor NSR programs use an allowable-to-allowable test 
which would make this program for Indian country consistent with the 
programs in these states.
    In addition and as we discussed in the proposal preamble, we 
believe that we have the discretion to use an allowable-to-allowable 
test for this minor NSR program because the statutory basis for minor 
NSR is section 110(a)(2)(C) of the Act. By contrast, parts C and D of 
title I of the Act provide the statutory basis for the major NSR 
program and refer to section 111(a)(4) of the Act (the definition of 
``modification'' for purposes of the new source performance standards 
(NSPS)) in defining ``modification'' for purposes of the major NSR 
program. The DC Circuit Court of Appeals has ruled that, based on the 
wording of the definition of

[[Page 38757]]

``modification'' in section 111(a)(4) of the Act, the applicability of 
major NSR to modifications must be based on changes in actual emissions 
(State of New York v. U.S. EPA, 413 F. 3d 3 (DC Cir. 2005). However, 
that reasoning based on the definition in section 111 of the Act does 
not apply to minor source permitting because the statutory basis for 
the minor NSR program is section 110(a)(2)(C) of the Act, which does 
not define or refer to a definition of ``modification.'' Thus, we 
believe that we have discretion in defining the term for the minor NSR 
program in Indian country and we do not believe that the decision of 
the DC Circuit Court of Appeals applies to the minor NSR program.
    To address the concerns of those commenters who expressed that the 
allowable-to-allowable test is less stringent than an actual-emissions-
based test or that this test is at odds with section 110(a)(2)(C) of 
the Act, we commit to conducting a study to collect actual emissions 
data for a period of 5 years from the minor source registration program 
\15\ we are finalizing with this rule to assess the feasibility of 
implementing an actual-emissions-based test. If our study concludes 
that adequate actual emissions data are available for minor sources, we 
will consider undertaking a rulemaking to adopt an actual-emissions-
based test within 2 years from the end of the 5-year study period.
---------------------------------------------------------------------------

    \15\ We are requiring minor sources to register within 18 months 
from the effective date of this rule. See section IV.F of this 
preamble for more details about the registration program.
---------------------------------------------------------------------------

    Furthermore, because of our concern that some minor modifications 
at major sources might escape review under the minor NSR program as 
proposed, we are finalizing that the applicability of the minor NSR 
program to minor modifications at major sources be based on the actual-
to-projected-actual test used in the applicable major NSR program. 
Thus, in the final rule, if a proposed modification at an existing 
major source does not qualify as a major modification (which would be 
subject to major NSR) based on the actual-to-projected-actual test, it 
is considered a minor modification and is subject to the minor NSR 
program if the net emissions increase from the actual-to-projected-
actual test is equal to or exceeds the minor NSR thresholds listed in 
Table 1 in section IV.A.3 of this preamble. The rationale for using an 
allowable-to-allowable test for modifications at minor sources in 
Indian country--that actual emissions data are not available for minor 
sources and an actual-emissions-based test would be beyond the 
capabilities of many minor sources--does not apply to modifications at 
major sources. We believe this approach will be simpler and more 
efficient than an approach requiring the use of a second, allowable-to-
allowable test for the minor NSR program. Hence, we are revising the 
definition of modification under 40 CFR 49.152 accordingly.
    We are also making a change to the definition of modification 
related to the treatment of fugitive emissions. Now this definition 
includes provisions to account for fugitive emissions, to the extent 
they are quantifiable, only if the source belongs to one of the source 
categories listed pursuant to section 302(j) of the Act (see previous 
section for details on why we are including fugitive emissions in the 
minor NSR applicability determinations).
b. Determining Applicability for Modifications
    To determine if your proposed physical or operational change is 
subject to the minor NSR program (see final 49.153(a)(1)(ii) and 
49.153(b)), you must first determine whether the change is subject to 
the applicable major NSR program (i.e., 40 CFR part 51, Appendix S or 
40 CFR 52.21 for nonattainment and attainment areas, respectively). For 
physical or operational changes at your existing major source, you 
would determine whether the modification qualifies as a major 
modification using the procedures in the applicable major NSR program 
(i.e., the actual-to-projected-actual applicability test). In addition 
and as discussed in the previous section, if the change does not 
qualify as a major modification under that test, it is considered a 
minor modification if the net emissions increase from the actual-to-
projected-actual test is equal to or greater than the minor NSR 
thresholds listed in Table 1 of section IV.A.3 of this preamble. A 
major source with such a minor modification must apply for and obtain a 
minor NSR permit prior to commencing construction of the minor 
modification.
    For a physical or operational change at your existing minor source, 
you will first determine if the change qualifies as a major source by 
itself (e.g., when a source owner adds one or more large emissions 
units to his minor source) using the provisions of the applicable major 
NSR program (see, e.g., 40 CFR 52.21(b)(1)(i)(c)). If it is, then the 
change is subject to the applicable major NSR program.
    For modifications at existing minor sources that do not qualify as 
major sources by themselves, the total increase in allowable emissions 
resulting from the proposed change at your source, including fugitive 
emissions to the extent they are quantifiable, only if the source 
belongs to one of source categories listed pursuant to section 302(j) 
of the Act, would be the sum of the following:
     For each new emissions unit that is to be added, the 
emissions increase would be the potential to emit of the unit.
     For each emissions unit with an allowable emissions limit 
that is to be changed or replaced, the emissions increase would be the 
allowable emissions of the emissions unit after the change or 
replacement minus the allowable emissions prior to the change or 
replacement. However, this may not be a negative value. If the 
allowable emissions of an emissions unit would be reduced as a result 
of the change or replacement, use zero in the calculation.
     For each unpermitted emissions unit (i.e., a unit without 
any enforceable permit conditions) that is to be changed or replaced, 
the emissions increase would be the allowable emissions of the unit 
after the change or replacement \16\ minus the potential to emit prior 
to the change or replacement.\17\ However, this may not be a negative 
value. If the allowable emissions of an emissions unit would be reduced 
as a result of the change or replacement, use zero in the calculation.
---------------------------------------------------------------------------

    \16\ The minor NSR permit for the modification must include an 
annual allowable emissions limit for each affected emissions unit 
per final 40 CFR 49.155(a)(2). The post-change allowable emissions 
limit can be the uncontrolled potential to emit or can be lower 
depending on the outcome of the reviewing authority's control 
technology review as well as any other restrictions that you propose 
for the emissions unit (e.g., for purposes of NSR applicability).
    \17\ It is necessary to use potential to emit since these 
emissions units will not have an allowable emissions limit prior to 
the change.
---------------------------------------------------------------------------

    If the total increase in allowable emissions resulting from your 
proposed modification at your minor source causes an increase in 
allowable emissions for one or more regulated NSR pollutants above the 
applicable minor NSR threshold (see Table 1 in section IV.A.3 of this 
preamble), the modification is subject to this program. See final 40 
CFR 49.153(b).
    If the total allowable emissions increase from your modification is 
less than the corresponding minor NSR threshold listed in Table 1, the 
modification is not subject to this minor NSR rule. Under this 
scenario, if a permitted allowable emissions limit of one or more 
emissions units increases, you must apply for an administrative permit 
revision to amend the allowable

[[Page 38758]]

emissions limit for that emissions unit(s). See section IV.B.5 of this 
preamble or final 40 CFR 49.153(a)(2) and 49.159(f) for more 
information on administrative permit revisions.
    At proposal, we asked for comments as to whether minor sources in 
Indian country should be allowed to take credit for concurrent 
emissions reductions that would result from a proposed modification 
under the concept commonly known as ``project netting.'' \18\
---------------------------------------------------------------------------

    \18\ As proposed, ``project netting'' means that both increases 
and decreases in allowable emissions are summed when determining the 
total emission increase that would result from a proposed 
modification.
---------------------------------------------------------------------------

    Several commenters supported our proposal to allow ``project 
netting'' in the minor NSR program for determining whether a proposed 
project qualifies as a modification. However, we are not finalizing the 
``project netting'' concept at this time to be consistent with our 
position in the major NSR program (See final rule titled: ``Prevention 
of Significant Deterioration (PSD) and Nonattainment New Source Review 
(NSR): Aggregation and Project Netting'' January 15, 2009 (74 FR 
2376)).
3. What are the minor NSR thresholds?
    As proposed, the ``minor NSR thresholds'' in this final rule 
establish cutoff levels for which sources with emissions lower than the 
thresholds would typically be exempt from the minor NSR rules (see 
Table 1 and final 40 CFR 49.153).
    Various commenters supported the development of thresholds and no 
comments were received against this concept. However, some commenters 
wanted us to finalize less [e.g., volatile organic compounds (VOC) and 
carbon monoxide (CO)] or more stringent thresholds (for minor 
modifications) while other commenters expressed concern that the source 
distribution analysis that we used to support the proposed thresholds 
did not accurately reflect the number of sources currently in existence 
in Indian country.

                    Table 1--Minor NSR Thresholds \a\
------------------------------------------------------------------------
                                             Minor NSR       Minor NSR
                                          thresholds for  thresholds for
         Regulated NSR pollutant           nonattainment    attainment
                                            areas (tpy)     areas (tpy)
------------------------------------------------------------------------
Carbon monoxide (CO)....................               5              10
Nitrogen oxides (NOX)...................           5 \b\              10
Sulfur dioxide (SO2)....................               5              10
Volatile Organic Compounds (VOC)........           2 \b\               5
PM......................................               5              10
PM10....................................               1               5
PM2.5...................................             0.6               3
Lead....................................             0.1             0.1
Fluorides...............................              NA               1
Sulfuric acid mist......................              NA               2
Hydrogen sulfide (H2S)..................              NA               2
Total reduced sulfur (including H2S)....              NA               2
Reduced sulfur compounds (including H2S)              NA               2
Municipal waste combustor emissions.....              NA               2
Municipal solid waste landfill emissions              NA              10
 (measured as nonmethane organic
 compounds).............................
------------------------------------------------------------------------
\a\ If part of a Tribe's area of Indian country is designated as
  attainment and another part as nonattainment, the applicable threshold
  for a proposed source or modification is determined based on the
  designation where the source would be located. If the source straddles
  the two areas, the more stringent thresholds apply.
\b\ In extreme ozone nonattainment areas, section 182(e)(2) of the Act
  requires any change at a major source that results in any increase in
  emissions to be subject to major NSR permitting. In other words, any
  changes to existing major sources in extreme ozone nonattainment areas
  are subject to a ``0'' tpy threshold, but that threshold does not
  apply to minor sources.

    After consideration of comments received and further evaluation of 
the proposed thresholds, we are finalizing the minor NSR thresholds as 
proposed, except for the NOX and VOC thresholds in extreme 
ozone nonattainment areas. We are amending the proposed ``0'' tpy 
NOX and VOC thresholds for the minor NSR program in extreme 
ozone nonattainment areas because we believe that these thresholds, 
while required under section 182(e)(2) of the Act and appropriate as 
significance levels for major sources located in extreme ozone 
nonattainment areas, are not appropriate for minor sources. Therefore, 
we are finalizing minor NSR thresholds for NOX and VOC in 
extreme nonattainment areas as 5 and 2 tpy respectively. We also want 
to clarify, as one commenter suggested, that the PM2.5 
threshold applies to direct PM2.5 emissions and does not 
represent the contribution of its precursors (e.g., SO2 or 
NOX).
    Furthermore, we continue to believe that the sources with emissions 
below the thresholds will be inconsequential to attainment or 
maintenance of the NAAQS because the national source distribution 
analysis in the proposal (71 FR 48702) applied to the national source 
distribution at the time (sources inside and outside of Indian country) 
and not only to estimates of the possible number of existing sources in 
Indian country. For each pollutant, we found that only around 1 percent 
(or less) of total emissions would be exempt from review under the 
minor NSR program. At the same time, the thresholds would promote an 
effective balance between environmental protection and source burden 
because anywhere from 42 percent to 76 percent of sources (depending on 
the pollutant) would be too small to be subject to preconstruction 
review.
    In addition, we believe that such thresholds are included in many 
of the minor NSR programs in surrounding states, which will allow us to 
begin leveling the playing field with the surrounding state programs 
and will result in a more cost-effective program by reducing the burden 
on sources and reviewing authorities.
    These thresholds, however, are neither the most stringent nor the 
least stringent of the levels found in existing state minor NSR rules 
since they represent a reasonable balance between environmental 
protection and economic

[[Page 38759]]

growth. We did not want the thresholds to be so high that they were not 
environmentally protective or so low that they ensured environmental 
protection at the cost of discouraging economic growth. Nevertheless, 
to address any concerns about the stringency of the thresholds, we will 
evaluate the information we collect as part of the registration 
provisions for minor sources we are finalizing under this rule (see 
section IV.F of this preamble for more information) and will consider 
changing the minor NSR thresholds as appropriate.\19\
---------------------------------------------------------------------------

    \19\ We might also consider proposing thresholds for greenhouse 
gases and in accordance with any future rulemakings to address small 
greenhouse gas sources as outlined in the rule titled: ``Prevention 
of Significant Deterioration and Title V Greenhouse Gas Tailoring 
Rule'' (75 FR 31514).
---------------------------------------------------------------------------

4. What emissions units and activities at minor sources are exempt from 
this rule?
    Certain emissions units and activities at minor sources either do 
not emit regulated NSR pollutants to the ambient air or emit these 
pollutants in negligible amounts. Therefore, under 40 CFR 49.153(c), we 
are finalizing a list of units and activities at minor sources that are 
exempt from this rule:
    1. Mobile sources;
    2. Ventilating units for comfort that do not exhaust air pollutants 
into the ambient air from any manufacturing of other industrial 
processes;
    3. Noncommercial food preparation;
    4. Consumer use of office equipment and products;
    5. Janitorial services and consumer use of janitorial products;
    6. Internal combustion engines used for landscaping purposes; and
    7. Bench scale laboratory activities, except for laboratory fume 
hoods and vents.
    This list we have finalized is an amended list from the exempted 
units and activities we proposed since we are not exempting air-
conditioning units for comfort and heating units for comfort until we 
can study the implications of the new rules for greenhouse gases (see 
Prevention of Significant Deterioration and Title V Greenhouse Gas 
Tailoring Rule, 75 FR 31514) on these units. In addition and also in 
light of a comment received, we are deleting the last exemption in the 
proposed list of exemptions (any emissions unit or activity that does 
not have the potential to emit a regulated NSR pollutant or HAP, so 
long as that emissions unit or activity is not part of a process unit 
that emits or has the potential to emit a regulated NSR pollutant or 
HAP) because we agree with the commenter that argued that this 
exemption can be confusing and redundant.
    Furthermore, we would like to clarify that the list of exemptions 
included in the proposal's regulatory text included mobile sources, 
although mobile sources were inadvertently left out of the exempted 
units and activities discussion in the proposal's preamble. Therefore, 
we have added mobile sources to the list in this preamble and have 
decided to keep mobile sources in the list of exempted units and 
activities in this final rule because we continue to believe that it is 
not appropriate to include mobile sources in a stationary source 
permitting program and we did not receive any comments suggesting that 
mobile sources should be removed from the list of exemptions.
    Nevertheless, many commenters noted that state and local agencies 
often exempt many more types of emissions units and activities and 
suggested that we should expand the exemptions included in the final 
minor NSR rule. Some of these commenters also argued that failure to 
expand the list of exemptions will significantly burden operators of 
minor sources wishing to locate in Indian country, especially the oil 
and gas industry and will thereby disadvantage Tribes.
    In light of the comments received, we agree that the list of 
exempted units and activities might need to be expanded. Therefore, we 
intend to propose and finalize a separate rule to seek public comment 
on the issue of whether additional units or activities should be 
exempted from the minor NSR program.

B. Site-Specific Permits

1. What are the requirements for permit applications?
    As the owner or operator of a proposed new minor source or a 
proposed modification that is subject to the rule (see 40 CFR 49.154), 
you must submit a complete application to the reviewing authority 
requesting a minor NSR permit specific to your source (unless you are 
seeking a ``general permit''). In addition to basic information 
identifying and describing your source, your application must include a 
list of all affected emissions units. ``Affected emissions units'' are 
defined as all the emissions units at your proposed new minor source or 
all the new, modified and replacement emissions units that comprise 
your proposed modification (excluding the exempt emissions units and 
activities listed in proposed 40 CFR 49.153(c)).
    Your application must also document the increase in emissions of 
regulated NSR pollutants that will result from your new source or 
modification so that the reviewing authority can verify that you are 
subject to this minor NSR program, rather than to major NSR. For each 
new emissions unit that you list, you must provide the PTE in tpy for 
each regulated NSR pollutant, along with supporting documentation. For 
any modified or replacement unit that you list, you must provide the 
allowable emissions of each regulated NSR pollutant in tpy before and 
after the modification or replacement, along with supporting 
documentation. For emissions units that do not have an established 
allowable emissions level prior to the modification, you must provide 
the pre-change PTE. For the post-change allowable emissions for these 
units, you may provide the unrestricted post-change PTE or may propose 
a lower level of allowable emissions. The allowable emissions for any 
emissions unit are calculated considering any emissions limitations 
that are enforceable as a practical matter on the unit's PTE. In 
calculating these emissions levels for applicability purposes you 
should include fugitive emissions, to the extent they are quantifiable, 
only for source categories listed pursuant to section 302(j) of the Act 
(and as described in sections IV.A.1 and IV.A.2 of this preamble).
    Furthermore, you may include in your application proposed emission 
limitations for the listed emissions units. If you do, you must account 
for these limitations in your calculations for post-construction PTE 
and/or allowable emissions.
    The application also must identify and describe any existing air 
pollution control equipment and compliance monitoring devices or 
activities relevant to the affected emissions units, as well as any 
existing emissions limitations or work practice requirements to which 
any affected emissions units are subject.
    No commenters expressed concern with the proposed permit 
application requirements described above except for the concept of 
PAL.\20\ One commenter believed such provisions will not ensure 
compliance with the statutory mandates applicable to minor NSR programs 
under section 110(a)(2)(C) of the Act to ensure that NAAQS are attained 
and maintained. Further, the commenter maintained that such limits 
would likely be unenforceable as a practical

[[Page 38760]]

matter at most sources and offered extensive arguments for his 
position. On the other hand, a couple of commenters expressed support 
for minor source PALs, with one of these commenters believing that it 
is very important that aspects of permitting programs at the Federal 
and state levels outside of Indian country that provide operator 
flexibility, including the creation of PALs, should also be afforded to 
operators currently in or wishing to locate in Indian country.
---------------------------------------------------------------------------

    \20\ A minor source PAL determination is a sourcewide limitation 
on allowable emissions of a regulated NSR pollutant, expressed in 
tpy, that is enforceable as a practical matter and we had proposed 
that you may request that the reviewing authority establish an 
annual minor source PAL for one or more of the regulated NSR 
pollutants emitted by your new or existing minor source.
---------------------------------------------------------------------------

    Based on the comments received, we are finalizing the permit 
application requirements mainly as proposed, with only two exceptions. 
See final 40 CFR 49.154. First, we are not finalizing the minor source 
PAL provisions at this time because we agree with the opposing 
commenter that stated, for example, that finalizing the PAL provisions 
without more specific criteria, including provisions for extensive 
monitoring, would not be enforceable. Second and as we explained in 
sections IV.A.1 and IV.A.2, we are finalizing provisions that will 
require you, the source owner, to include fugitive emissions in the 
minor NSR applicability determinations, to the extent they are 
quantifiable, only for those source categories listed pursuant to 
section 302(j) of the Act.
    In addition, we would like to clarify that if your source is in a 
source category covered by a general permit issued under proposed 40 
CFR 49.156, you may apply for the general permit for that source 
category instead of a site-specific permit. The permit application 
requirements for a particular general permit will be specified in that 
general permit. General permits, including the comments we received 
about them, are discussed further in section IV.C of this preamble.
2. What technical reviews must the reviewing authority conduct?
    After determining that your application is complete (see section 
IV.B.4 for more information about this process), the reviewing 
authority must do 2 types of technical reviews--a control technology 
review and a review of the probable impact on air quality of the 
proposed new source or modification. These reviews are discussed 
further in the following subsections.
a. Control Technology Review
    As required under section 110(a)(2)(C) of the Act, this minor NSR 
permitting program for Indian country is primarily designed to assure 
that the NAAQS are achieved and to prohibit any minor source from 
emitting any air pollutant in amounts that would contribute to 
nonattainment or interfere with maintenance of the NAAQS. Therefore, 
with this single program applicable to all areas of Indian country 
where there is no EPA-approved implementation plan, we are trying to 
ensure the NAAQS protection required by the CAA, while still allowing 
sufficient flexibility in control technology requirements for minor 
sources located in Indian country. By control technology, we mean 
pollution prevention techniques; add-on pollution control equipment; 
design and equipment specifications; work practices and operational 
restrictions.
    For this review, the reviewing authority will consider local air 
quality needs, typical control technology used by similar sources in 
surrounding areas, anticipated economic growth in the area and cost-
effective control alternatives. At a minimum, the reviewing authority 
must require control technology that assures that the NAAQS are 
achieved and that each affected emissions unit will comply with all 
requirements of 40 CFR parts 60, 61 and 63 that apply. The required 
control technology resulting from such a review may range from no 
control technology, to control technology that is less stringent than 
the reasonably available control technology (RACT) level of control 
(which is typically required for existing major sources in 
nonattainment areas), to technology that is the BACT level of control 
(which is the level required for new major sources and major 
modifications in attainment areas). The control technology chosen would 
depend on the air quality needs of the area, other applicable 
regulatory programs of the Act and technical and economic feasibility.
    Furthermore and based on the results of the control technology 
review, the emission limitations required by the reviewing authority 
may consist of numerical limits on the quantity, rate or concentration 
of emissions; pollution prevention techniques; design standards; 
equipment standards; work practice standards; operational standards or 
any combination thereof. If it is technically and economically 
feasible, the reviewing authority must require a numerical limit on the 
quantity, rate or concentration of emissions for each affected 
emissions unit at your source.
    For a new minor source that is subject to this rule, the case-by-
case control technology review would be conducted for all emissions 
units (except the exempt emissions units and activities discussed in 
section IV.A.4 and listed in the final 40 CFR 49.153(c)) that emit or 
have the potential to emit the pollutant(s) for which the source is 
subject to this rule. For a modification, such control technology 
review would apply only to the affected emissions unit(s) at your 
source.
    At proposal, we sought comment on the proposed case-by-case control 
technology review for all new and modified sources subject to this 
minor NSR program. Therefore, we sought comment on whether a control 
technology requirement is necessary to achieve the purposes of the Act 
or whether other approaches can achieve these purposes just as well 
with less cost and administrative burden.
    Several commenters supported the case-by-case control technology 
review. These commenters believed that a case-by-case control 
technology review would allow and promote economic growth and 
development that is tailored to the needs in Indian country, while one 
of these commenters added that having no capacity to impose controls on 
minor sources would seem to defeat the purpose of a permitting process 
for such facilities because a paper permit that could not impose any 
controls adds nothing to existing regulation or protection of public 
health and the environment. Furthermore, several commenters supported a 
clearly defined, standardized method for determining the required level 
of control, while one commenter stated that a system that requires a 
single set of controls for all minor sources across Indian country does 
not provide the needed flexibility to adapt regulation to the needs of 
individual areas of Indian country or to take into account the benefit 
of a level playing field with the surrounding areas.
    On the other hand, other commenters opposed any control technology 
requirement. These commenters believed that a Federal program is likely 
to be applied inconsistently, resulting in a competitive disadvantage 
for sources located in certain areas; EPA has no authority to impose a 
control technology requirement under section 110(A)(2)(C) of the Act 
and a separate control technology review process under minor NSR is 
unnecessary when the threat of PSD review will otherwise accomplish the 
ultimate objective--protection of air resources (i.e., the PSD review 
is generally so complex, time-consuming and expensive, that most 
sources will design their projects to remain below the applicable PSD 
thresholds, even if that means installing more efficient controls, 
switching to cleaner fuel or restricting production or operating 
hours).

[[Page 38761]]

    We disagree with commenters that oppose any control technology 
requirement or who suggested that we have no authority to require such 
controls. Section 110(a)(2)(c) requires us to assure that the NAAQS are 
achieved and we believe that requiring control technologies when 
necessary will ensure the NAAQS are protected as established in this 
section. Furthermore, section 110(a)(2)(c) does not preclude us from 
requiring additional provisions that will further the goal of NAAQS 
protection and the fact that the statutory language requires a control 
technology review under some statutory provisions does not mean that 
the statute prohibits EPA from requiring it under other provisions.
    We also disagree with those commenters that would like us to 
implement consistent control technologies across the nation. As we 
stated in the proposal, it would be impossible to create a single 
program that creates precisely equivalent regulations among all areas 
of Indian country. We wish to ensure that Indian country is not seen as 
a potential ``pollution haven'' where minor sources can go to escape 
air pollution control requirements and we also do not want to put 
Tribes or owners and operators locating in Indian country at a 
competitive disadvantage by requiring substantially more stringent 
controls in a particular area of Indian country than are required in 
the surrounding areas. Therefore, a case-by-case control technology 
review provides the reviewing authority with the flexibility to create 
requirements that protect public health and environment, but also takes 
into consideration the needs of the area in question based on its 
current air quality situation, the potential air quality impacts from 
the growth associated with the source and the technological and 
economic feasibility of the control technology as well as the control 
technologies in use in the surrounding states.
    Therefore, we are finalizing the case-by-case control technology 
review requirements as proposed. The final rules require your reviewing 
authority to perform a control technology review on a case-by-case 
basis when issuing a site-specific minor NSR permit. See the final 40 
CFR 49.154(c). For general permits, the control technology review will 
be performed at the time when the general permit is developed. More 
details on general permits are provided in section IV.C of this 
preamble.
b. Air Quality Impacts Analysis (AQIA)
    If your reviewing authority has reason to be concerned that the 
construction of your minor source or modification could cause or 
contribute to a NAAQS or PSD increment violation, your reviewing 
authority may require you to conduct an AQIA using dispersion modeling 
in accordance with 40 CFR part 51, Appendix W, to determine the impacts 
that will result from your new source or modification. If the AQIA 
demonstrates that the construction of your source or modification would 
cause or contribute to a NAAQS or PSD increment violation, you would be 
required to further reduce its impact before you could obtain a permit.
    Various commenters supported requiring an AQIA and added that they 
would like us to develop guidance on when and how an AQIA analysis 
should be performed. On the other hand, several commenters believed 
that AQIAs would be excessive, very costly and time consuming for small 
businesses.
    Based on the comments received, we are finalizing the AQIA 
provisions as proposed at 40 CFR 49.154(d). We continue to believe that 
allowing reviewing authority discretion for when an AQIA might be 
required ensures that construction of new minor sources or 
modifications at existing minor sources do not cause or contribute to a 
NAAQS or PSD increment violation when needed, but limits overburdening 
all minor sources in Indian country with these types of air quality 
analysis. Nevertheless, to aid the reviewing authorities in the 
determination of when an AQIA might be needed for minor NSR sources in 
Indian country and to address the commenters' suggestions, we intend to 
develop guidance on the scope of the AQIA that will consider the 
suggestions presented by these commenters. We are also eliminating the 
language in the proposal preamble that stated (71 FR 48704) that AQIAs 
will be required ``[i]n rare instances.'' Since the reviewing authority 
has the discretion to require an AQIA, it is difficult to predict that 
such AQIAs will be required only in rare instances.
3. What are the permit content requirements?
    The requirements for permits issued pursuant to site-specific 
preconstruction review include the following (see 40 CFR 49.155):
     The effective date of the permit and the date by which you 
must commence construction on your approved project in order for your 
permit to remain valid (i.e., 18 months after the permit effective 
date).
     The emissions units subject to the permit and their 
associated emissions limitations.
     Monitoring, recordkeeping, reporting and testing 
requirements to assure compliance with the emission limitations.
    In addition, the permit should include a number of standard permit 
terms. These include emission limitations, monitoring recordkeeping and 
reporting requirements as well as terms such as a severability clause 
(to ensure the continued validity of the other portions of the permit 
in the event of a challenge to a portion of the permit), a requirement 
to comply with all conditions of the permit, a requirement that the 
permitted source does not cause or contribute to a NAAQS violation and 
inspection and entry provisions requiring that you allow 
representatives of the reviewing authority to enter and inspect your 
source.
a. Emissions Limitations
    Your permit must include 2 types of emission limitations:
     The emissions limitations for each affected emissions unit 
determined by the reviewing authority based on the case-by-case 
technology review discussed previously in section IV.B.2 of this 
preamble.
     Limits on annual allowable emissions in tpy.
    Emission limitation, as defined in 40 CFR 49.152, means a 
requirement established by the reviewing authority that limits the 
quantity, rate or concentration of emissions of air pollutants on a 
continuous basis, including any requirement relating to the operation 
or maintenance of a source to assure continuous emissions reduction and 
any design standard, equipment standard, work practice, operational 
standard or pollution prevention technique. Allowable emissions (also 
as defined under 40 CFR 49.152) means ``allowable emissions'' as 
defined in 40 CFR 52.21(b)(16), except that the allowable emissions for 
any emissions unit are calculated considering any emissions limitations 
that are enforceable as a practical matter on the emissions units' 
potential to emit. Once established in the permit, annual allowable 
emissions become the basis for determining whether a later change at 
your source will result in an increase in allowable emissions subject 
to permitting under this program.
    We did not specifically receive comments on these two types of 
emissions limitations that must be included in your permit. Therefore 
we are finalizing these emissions limitations at 40 CFR 49.155(a)(2) as 
proposed.
    Additionally, we would like to clarify, as some commenters 
requested, a couple

[[Page 38762]]

of terms or conditions. One commenter interpreted the proposal to only 
require annual emissions limits in the minor source permits, while one 
commenter asked us to clarify if the term ``on a continuous basis'' in 
the definition of emissions limitation implies that every emission 
limitation must be complied with on an instantaneous time period and 
accompanied by a continuous emission monitoring system (CEMS).
    Therefore, we want to clarify that the reviewing authority may not 
only require annual emissions limits in the minor NSR permits, but also 
short-term limits as necessary. Short-term emission limits may also be 
required as part of any enforceable emission limitation and, if 
applicable, depending on the relevant ambient air quality standard 
associated with the regulated pollutant.
    Furthermore, the term ``on a continuous basis'' in the definition 
of emission limitation does not imply that every emission limitation 
must be complied with on an instantaneous time period and accompanied 
by a CEMS. The term ``on a continuous basis,'' as the commenter 
suggests, means that the limitation applies ``at all times,'' but not 
that the emission limitation has to be accompanied by a CEMS. There are 
various ways to monitor compliance with limitations that apply on a 
continuous basis as we mention in the next section.
b. Monitoring, Recordkeeping and Reporting
    The monitoring, recordkeeping and reporting requirements have been 
finalized under 40 CFR 49.155. Specifically, the final monitoring 
requirements are under 40 CFR 49.155(a)(3), the final recordkeeping 
requirements under 49.155(a)(4) and the final reporting requirements 
under 40 CFR 49.155(a)(5).
    (1) Monitoring requirements. The permit must include monitoring 
requirements sufficient to assure compliance with any emissions 
limitations contained in the permit. Monitoring approaches may include 
CEMS, predictive emissions monitoring systems (PEMS), continuous 
parameter monitoring systems (CPMS), periodic manual logging of monitor 
readings, equipment inspections, mass balances, periodic performance 
tests and/or emission factors, as appropriate for your minor source 
based on the types of emissions units, magnitude of emissions and air 
quality considerations. Such monitoring shall assure use of terms, test 
methods, units and averaging periods consistent with the control 
technology and emission limitations required for your source.
    (2) Recordkeeping requirements. The permit must include 
recordkeeping requirements sufficient to assure compliance with the 
enforceable emission limitations in your permit. Records of required 
monitoring information must include all calculations using emissions 
factors, all stack tests or sampling information including date and 
time of test or sampling, the name of the company or entity that 
performed the analyses, the analytical techniques or methods used, the 
results of such analyses and the operating conditions existing at the 
time of sampling or measurement. All such records including support 
information must be retained for 5 years from the date of the record. 
Support information may include all calibration and maintenance records 
and all original strip-chart recordings or electronic records for 
continuous monitoring instrumentation.
    (3) Reporting requirements. You must provide annual monitoring 
reports showing whether you have complied with your permit emission 
limitations. You also must provide prompt reports of deviations from 
permit requirements, including those attributable to upset conditions 
as defined in the permit, the probable cause of such deviations and any 
corrective actions or preventive measures taken. Within a permit, the 
reviewing authority must define ``prompt'' in relation to the degree 
and type of deviation likely to occur.
    We did not receive any specific comments regarding the monitoring 
and recordkeeping requirements, but several commenters commented on the 
reporting requirements. Some of these commenters specifically asserted 
that requiring annual monitoring reports for minor sources is overly 
burdensome, while another commenter would like us to require monitoring 
reports to be submitted at least annually, to give the reviewing 
authority flexibility to require semiannual monitoring reports and in 
accordance with the title V reporting schedule. Other commenters 
recommended that for reporting deviations the word ``prompt'' should be 
defined within the regulation.
    We disagree with those commenters that state that the monitoring, 
recordkeeping and reporting requirements are too burdensome because, as 
stated in the proposal, sections 110(a)(2)(A) and 110(a)(2)(C) of the 
Act require that a preconstruction permitting program provide for the 
enforcement of measures that include ``enforceable emission limitations 
and other control measures, means or techniques * * * as well as 
schedules and time-tables for compliance.'' In addition, section 
110(a)(2)(F) requires that a permitting program may require ``the 
installation, maintenance and replacement of equipment and the 
implementation of other necessary steps by owners and operators of 
stationary sources to monitor emissions from such sources,'' as well as 
periodic reports on the nature and amounts of emissions and emissions-
related data from such sources. Therefore, we believe that, for 
example, annual reporting requirements will ensure that sources are 
complying with their annual emissions limits as well as any other 
limits determined by the reviewing authority.
    However, we do not believe that requiring monitoring reports more 
frequently than annually, as one commenter suggested, would be 
appropriate for minor sources. Minor sources are typically much smaller 
than the title V sources the commenter is referring to and therefore 
requiring monitoring reports more frequently than annually might be 
overly burdensome for these sources. However, we encourage reviewing 
authorities to develop annual monitoring schedules in accordance with 
title V permit monitoring schedules if that facilitates the reporting 
of emissions to the reviewing authority.
    We also disagree with the commenters that would like us to define 
the word ``prompt'' for the reporting of deviations. We continue to 
believe that deferring the definition of this term to the reviewing 
authority is more appropriate to ensure that the respective permits are 
protective of the NAAQS while also ensuring that the particular needs 
of the area where the source is being permitted are considered. For 
example, if a source is locating in a particular area of Indian 
country, the reviewing authority might define this term by considering 
the provisions of the state and/or the air quality control districts 
surrounding the area of Indian country where the source is locating as 
well as technical and economical feasibility. Therefore, we are 
finalizing the monitoring, recordkeeping and reporting requirements as 
proposed and these requirements will be included in each permit as 
necessary to assure compliance with the source's emission limitations.
c. Other Permit Content Requirements
    Under 40 CFR 49.155(a)(7), we have finalized other permit 
requirements. Specifically, these requirements include inspection and 
entry provisions under 40 CFR 49.155(a)(7)(vii) that state that upon 
presentation of proper credentials, you, as the permittee, must allow a

[[Page 38763]]

representative of the reviewing authority to:
     Enter upon your premises where a source is located or 
emissions-related activity is conducted or where records are required 
to be kept under the conditions of the permit;
     Have access to and copy, at reasonable times, any records 
that are required to be kept under the conditions of the permit;
     Inspect, during normal business hours or while the source 
is in operation, any facilities, equipment (including monitoring and 
air pollution control equipment), practices or operations regulated or 
required under the permit;
     Sample or monitor, at reasonable times, substances or 
parameters for the purpose of assuring compliance with the permit or 
other applicable requirements; and
     Record any inspection by use of written, electronic, 
magnetic and photographic media.
    Commenters on these requirements wanted us to clarify that as the 
reviewing authority representative enters the source premises for any 
inspection, the reviewing authority ``must comply with the safety 
requirements of the permittee.'' Upon further evaluation of these 
provisions, we do believe that the representative of the reviewing 
authority should follow standard safety requirements identical to the 
ones that apply to the permittee's employees.
4. What are the permit issuance procedures, permit term and public 
participation requirements?
a. Permit Issuance Process
    Under 40 CFR 49.154(b), we have finalized definite timelines for 
the overall minor source permit issuance process that vary depending on 
the type of source being regulated under the minor NSR program. The 
timelines are described as follows:
     For minor sources seeking a site-specific permit, the 
permit issuance process timeline includes a period of 45 days for the 
application completeness review as well as a 30-day public comment 
period. Any site-specific permit will be granted or denied no later 
than 135 days after the date the application is deemed complete and all 
additional information necessary to make an informed decision has been 
provided.
     For minor modifications at major sources seeking coverage 
under a site-specific permit, the permit issuance process timeline 
includes a period of 60 days for the application completeness review as 
well as a 30-day public comment period. Any site-specific permit will 
be granted or denied no later than 1 year after the date the 
application is deemed complete and all additional information necessary 
to make an informed decision has been provided.
     For minor sources seeking coverage under a general permit 
(discussed in section IV.C of this preamble and under 40 CFR 49.156), 
the permit issuance process timeline includes a completeness review 
period of 45 days. Any request for coverage by individual sources under 
a general permit will be granted or denied within 90 days of the 
receipt of such request for coverage by the reviewing authority. We 
believe that since the general permit requirements have been subject to 
public notice when the general permit was developed, a shorter permit 
issuance process is warranted for determining whether a source is 
eligible for coverage under the general permit.
     For synthetic minor sources (discussed in section IV.D of 
this preamble and under 40 CFR 49.158), the permit issuance process 
timeline includes, as proposed, a period of 60 days for the application 
completeness review as well as a 30-day public comment period. Any 
synthetic minor permit will be granted or denied no later than 1 year 
after the date the application is deemed complete and all additional 
information necessary to make an informed decision has been provided.
    The application for a permit under this program will be reviewed by 
the reviewing authority within 45 days of its receipt for site-specific 
permits (60 days from its receipt for synthetic minor permits and minor 
modification at major sources) to determine whether the application 
contains all the information necessary for processing the application. 
If the reviewing authority determines that the application is not 
complete, it will request additional information as necessary to 
process the application. If the reviewing authority determines that the 
application is complete, it will notify you in writing. The reviewing 
authority's completeness determination or request for additional 
information should be postmarked within 45 days of receipt of the 
permit application by the reviewing authority for site-specific permits 
(60 days of receipt of the permit application by the reviewing 
authority for synthetic minor permits and minor modifications at major 
sources). If you do not receive a request for additional information or 
a notice of complete application postmarked within 45 days of receipt 
of the permit application by the reviewing authority for site-specific 
permits (60 days for synthetic minor permits and minor modification at 
major sources), your application will be deemed complete. Once the 
application is complete, your reviewing authority will develop a draft 
permit and provide public notice seeking comments on the draft permit 
for a 30-day period. After considering all timely, relevant comments, 
if your reviewing authority determines that your new source or 
modification meets all applicable requirements, it will issue you a 
final permit. Otherwise, the reviewing authority will send you a letter 
denying your permit application with reasons for the denial.
    We decided to finalize a definite timeline for the overall minor 
source permit issuance process that varies depending on the type of 
source being regulated under the minor NSR program because we agree 
with those commenters who believed that this timeline will provide 
regulatory certainty for the regulated community and the public, as 
well as time for the regulated community and the reviewing authority to 
plan for the permit issuance process. Specifically, commenters believed 
that the proposed permit issuance process was too lengthy and/or too 
uncertain for minor sources. They argued that state minor NSR programs 
are bound by shorter and more definite time lines. In addition, a few 
commenters believed that the proposed language could allow a permit 
application to be held without a final decision for an unreasonable 
period, resulting in serious financial burden, lost business 
opportunities, a delay in the project and even cancellation of the 
project.
    Furthermore, we have amended our proposed completeness review 
procedures, as suggested by some commenters and we will no longer 
require that if the source has not received a notice of completeness or 
a request for additional information in 50 days, that the application 
would be deemed complete. We agree with those commenters that expressed 
concerns that this provision can be confusing. Therefore and as we 
stated previously, if you do not receive a request for additional 
information or a notice of complete application postmarked within 45 
days of receipt of the permit application by the reviewing authority 
for site-specific permits (60 days for synthetic minor permits and 
minor modification at major sources), your application will be deemed 
complete. The permit issuance procedures for general permits are 
discussed in section IV.C.5 of this preamble.

[[Page 38764]]

b. Permit Term
    Under 40 CFR 49.155(b), we have finalized provisions that state 
that your permit remains valid as long as you commence construction on 
your project within 18 months after the effective date of the permit, 
you do not discontinue construction for a period of 18 months or more 
and you complete construction in a reasonable time. The reviewing 
authority may extend the 18-month period where justified and that 18-
month limit does not apply to the time period between construction of 
approved phases of a phased construction program. In those cases, you 
must commence construction of each such phase within 18 months of the 
approved commencement date for that phase.
    We received only one comment about the permit term provisions. This 
commenter had concerns about the proposal preamble language that stated 
that: ``a preconstruction permit does not expire.'' Specifically, this 
commenter stated that it may be appropriate to specify that the permit 
does expire after a specified period, subject to renewal for a 
specified period upon showing of diligence by the source. If a 
preconstruction permit does not expire, the commenter argues that the 
permit term provisions may be administratively impractical to 
implement.
    Upon further review of these provisions, we have noticed that the 
language we used in the proposal preamble was not consistent with the 
provisions we proposed under 40 CFR 49.155(b). Under 40 CFR 49.155(b), 
we proposed provisions for when permits become invalid and did not 
state that ``a preconstruction permit does not expire.'' Therefore, we 
have eliminated the proposal preamble language that stated that permits 
do not expire and we are finalizing the proposed provisions as stated 
under 40 CFR 49.155(b).
    In addition, we would like to clarify that permits under this 
program would not be revoked at the source's request when there is a 
rapid decrease in production, as a few commenters recommended. In such 
a case, the limits of these permits might be revised appropriately to 
account for the reduction, but the permit would not be revoked. Permits 
will be revoked only if the source officially shuts down its operation 
and notifies the reviewing authority about the business closure.
c. Public Participation Requirements
    We have finalized our public participation requirements under 40 
CFR 49.157 for site-specific permits, minor modification at major 
sources, synthetic minor sources and the initial development of a 
general permit for a source category. Pursuant to these requirements, 
the reviewing authority is required to prepare a draft permit and 
provide adequate public notice to ensure that the affected community 
and the general public have reasonable access to the application and 
draft permit information. The reviewing authority must make such 
information available for public inspection at the appropriate EPA 
Regional Office and in at least one location in the area affected by 
the source, such as the Tribal environmental office or a local library. 
The public notice must provide an opportunity for public comment and a 
public hearing on the draft permit. The appropriate types of notice may 
vary depending on the proposed project and the area of Indian country 
that would be affected.
    In all cases, the reviewing authority must mail a copy of the 
notice to you (the permit applicant); the appropriate Indian governing 
body and the Tribal, state and local air pollution authorities having 
jurisdiction adjacent to the area of Indian country potentially 
impacted by the air pollution source. In addition, the reviewing 
authority may elect to provide public notice for a given situation as 
appropriate and depending on such factors as the nature and size of 
your source, local air quality considerations and the characteristics 
of the population in the affected area. The optional methods of 
notifying the public include the following:
     Mailing or e-mailing a copy of the notice to persons on a 
mailing list developed by the reviewing authority consisting of those 
persons who have requested to be placed on such a mailing list.
     Posting the notice on its Web site.
     Publishing the notice in a newspaper of general 
circulation in the area affected by the source. Where possible, the 
notice may also be published in a Tribal newspaper or newsletter.
     Providing copies of the public notice for posting at 
locations in the area affected by your source. We expect that such 
locations might include post offices, libraries, Tribal environmental 
offices, community centers and other gathering places in the community.
     Other appropriate means of notification.
    Furthermore, the reviewing authority must provide for a 30-day 
public comment period on the draft permit. After considering all 
relevant public comments, the reviewing authority will make a final 
decision to issue or deny your permit. The public (including you, the 
permit applicant) will have an opportunity to appeal the final decision 
under 40 CFR 49.159. Final permit issuance and the opportunity for 
appeal are discussed further in the next section of this preamble.
    Several commenters supported the proposed public participation 
requirements stating that they like the proposed mix of mandatory and 
optional approaches to notices, while others suggested that the overall 
permitting process should be shortened. On the other hand, other 
commenters argued that the proposed public participation requirements 
were too burdensome, time consuming and will be open to abuse by 
persons who oppose any sort of development including development from 
very small projects. Therefore, some of these opposing commenters 
suggested adding a de minimis threshold below which sources would be 
exempt from the public notice and participation requirements in order 
to match the level of public participation to the environmental 
significance of the project. In addition, one commenter believed that 
we should strengthen the proposed public participation requirements by 
requiring notices to be sent by mail or e-mail to all persons 
requesting such notice, by requiring notices to be published in a 
Tribal newspaper or newsletter and by requiring other means of 
publication customary to the Tribe, where possible. They also wanted us 
to hold a public hearing whenever one is requested.
    After careful consideration of these comments, we are finalizing 
our public participation requirements for site-specific permits, minor 
modifications at major sources, synthetic minor permits and the initial 
development of a general permit for a source category as proposed, with 
the clarification that the appropriate types of notice will take into 
consideration any seasonal activities that may conflict with the public 
participation of the local community (e.g., subsistence hunting and 
fishing or other seasonal cultural practices). We believe these 
requirements are consistent with the current public availability of 
information requirements under our existing regulations at 40 CFR 
51.161 and they add optional public noticing and participation 
provisions that will enhance the permitting process. All the 
requirements will ensure that the public is informed about the 
permitting actions occurring in Indian country and will also ensure 
that the particular public noticing needs in Indian country are 
considered.

[[Page 38765]]

    We are not matching the public participation requirements to the 
environmental significance of the project, as some commenters 
suggested, because we believe that the public has the right to know 
about any permitting actions occurring in their area notwithstanding 
the environmental significance of the project and that a 30-day public 
comment period on a permitting action, as in our existing regulations, 
is an appropriate timeline for this purpose.
    In addition, we do not believe that our public participation 
requirements need to be strengthened at this time, as some commenters 
suggested, because we used the existing regulations under 40 CFR 51.161 
as the basis for our public noticing requirements and added additional 
optional provisions to ensure that factors such as the nature and size 
of the source, the local air quality and the characteristics of the 
population in the area are considered. Therefore, we believe that these 
requirements are more detailed than the requirements in our existing 
regulations under 40 CFR 51.161 and do not need to be strengthened even 
further at this time.
    We also continue to believe that, as proposed, the reviewing 
authority should be able to hold a public hearing at its own 
discretion. We believe that the reviewing authority is in the best 
position to determine whether there is significant interest in a 
hearing on a case-by-case basis and to decide whether it is more 
administrative and economically prudent to ask a small number of 
commenters to submit their comments in writing.
    To address any concerns about the length of the entire permit 
issuance process, we are finalizing definite timelines for the overall 
permitting process depending on the source type. See section IV.B.4.a 
of this preamble for more details about the permit issuance process 
timeline.
5. What are the provisions for final action on a permit, permit 
reopenings, administrative permit revisions and administrative and 
judicial review procedures?
    In general, these provisions are based closely on selected 
provisions of part 124, subpart A. The specific provisions are as 
follows:
a. Final Action on a Permit
    Under 40 CFR 49.159(a), we have finalized provisions regarding how 
final action on a permit will occur. Specifically we state that after a 
decision to issue or deny your permit, the reviewing authority must 
notify you, the permit applicant, of the decision in writing and, if 
the permit is denied, provide the reasons for the denial and the 
procedures for appeal. If the reviewing authority issues a final permit 
to you, the reviewing authority must provide adequate public notice of 
the final permit decision to ensure that the affected community, 
general public and any individuals who commented on the draft permit 
have reasonable access to the decision and supporting materials.
    Furthermore, under 40 CFR 49.159(b) we have finalized provisions 
regarding how long the reviewing authority will retain permit-related 
records and under 40 CFR 49.159(c) the requirements on what must be in 
that record. For example, the records must be kept by the reviewing 
authority for not less than 5 years. The administrative record must 
include the application and any supporting data furnished by the 
applicant and all comments received during the public comment period, 
including any extension or reopening.
    A few commenters supported the proposed provisions for providing 
notice of final permit actions, which included making a copy of the 
final permit available at all of the locations where the draft permit 
was made available. These commenters believed that such notice should 
be provided in the same manner that it was provided during the public 
comment on the draft permit and not depend, as we proposed, ``upon the 
circumstances of your permit''.
    On the other hand, a few commenters indicated that the proposed 
notification requirements are excessive. They believed that the 
proposed requirements are more stringent than the requirements for 
major sources under the PSD program and/or the part 71 program, which 
they believed is unwarranted because the impact for minor sources on 
public health and/or the environment would be much lower than major 
sources. Furthermore, some of these commenters argued that EPA may find 
the proposed requirements burdensome and expensive unless the method of 
notice is limited to something such as publication on EPA's Web site.
    Based on the comments received, we agree that, for site-specific 
permits, making a copy of the permit available at all of the locations 
where the draft permit was made available might be too burdensome for 
the reviewing authorities. Accordingly, we are amending 40 CFR 
49.159(a) to require copy of the final permit decision to be made 
available at all of the locations where the draft permit was made 
available for synthetic minor sources and minor modifications at major 
sources, but we are requiring the reviewing authority to only elect one 
or more of the methods for public noticing under 40 CFR 
49.157(b)(1)(ii) for site-specific permits. As proposed, sources are 
required to post, prominently, a copy of the letter granting the 
request for coverage under the general permit at the site where the 
source is locating. More details about the general permit provisions 
are provided in section IV.C of this preamble.
    Regarding the administrative record for a permit decision, several 
commenters commented on how long the reviewing authority should retain 
permit-related records. These commenters agreed with the provision of 
keeping records for not less than 5 years, while one commenter 
specifically asked us to require the reviewing authority to retain 
permit records for the life of the source. We believe that keeping 
permit records for the life of the source will be too burdensome, 
especially when we do not require permit records for major sources 
under some provisions of the major NSR program to be kept for more than 
5 years either. Therefore, we have finalized, as proposed and under 40 
CFR 49.159(b), that the reviewing authority must retain permit-related 
records for not less than 5 years.
    No comments were received on what must be kept on the 
administrative record and thus, we have also finalized these 
provisions, under 40 CFR 49.159(c), as proposed.
b. Permit Reopenings
    Under 40 CFR 49.159(e) we have finalized provisions regarding when 
your permit can be reopened. These provisions state that the reviewing 
authority may reopen a final, currently-in-effect permit for cause on 
its own initiative, such as if the permit contains a material mistake 
or fails to assure compliance with applicable requirements. However, 
except for those permit reopenings that do not increase the emissions 
limitations in the permit, such as permit reopenings that correct 
typographical errors, all other permit reopenings shall be carried out 
after the opportunity for public notice and comment and in accordance 
with one or more of the public participation requirements under 40 CFR 
49.157(b)(1)(ii).
    These final provisions amend the proposed provisions, which stated, 
among other requirements, that any person (including the permittee) may 
petition the reviewing authority to reopen a permit for cause, based on 
the comments we received. Commenters were concerned about allowing 
anyone--regardless of motive or lack of

[[Page 38766]]

factual support--to petition to reopen permits issued to sources of 
insignificant emissions. Furthermore, they argued that the proposed 
provisions were more stringent than the reopening provisions in the 
major source permitting programs, which they contend is unwarranted for 
minor sources and that these provisions are inconsistent with state 
minor NSR programs.
    We agree, as some commenters suggested, that the provisions we 
proposed might open potential avenues for any person, even if 
uninformed or maliciously intentioned, to harass and disrupt permitting 
operations. In addition, we did not intend to excessively restrict the 
reasons for why a permit should be reopened by us, as the reviewing 
authority, by stating in the proposal that the reviewing authority may 
not reopen a permit for a cause unless it contains a material mistake 
or fails to assure compliance with the applicable requirements. We do 
agree that the reasons for reopening the permit by the reviewing 
authority should not be limited to the permit containing a material 
mistake or failing to assure compliance with applicable requirements. 
Therefore and as stated previously, we have amended the proposed 
provisions by adopting the language finalized at 40 CFR 49.159(e).
c. Administrative Permit Revisions
    Under 40 CFR 49.159(f), we have finalized provisions to allow for 
minor changes in the permit without these changes being subject to the 
permit application, issuance, public participation or administrative 
and judicial review requirements of the program. For example, an 
administrative permit revision is a permit revision that could make a 
change such as: (1) Correcting a typographical error, (2) requiring 
more frequent monitoring or reporting by the permittee or (3) 
identifying a change in the name, address or phone number of any person 
identified in the permit. However, proposed physical or operational 
changes that could not be implemented within the requirements of an 
existing permit would necessitate a permit revision, even if they are 
not otherwise subject to major or minor NSR. (See final 40 CFR 
49.159(f) for more information on the provisions that govern 
administrative permit revisions). A few commenters supported our 
proposed administrative permit revision provisions \21\ because they 
believed that these provisions will allow a source to make minor 
changes without being subject to the overall permit process, while one 
commenter specifically opposed the provision to allow increases in 
allowable emission limits through an administrative permit revision 
since the commenter believed. According to the commenter, increases in 
allowable emission rates must be subject to NSR permitting, review of 
impacts on air quality and public notice and review.
---------------------------------------------------------------------------

    \21\ See 71 FR 48743 for more information on the proposed list 
of administrative permit revisions.
---------------------------------------------------------------------------

    We agree with those commenters that support the administrative 
permit revision provisions for the situations outlined in the proposal 
and hence we are finalizing these provisions as proposed at 40 CFR 
49.159(f). We believe that permit changes involving typographical 
errors, more frequent monitoring and reporting requirements and/or 
changes in ownership should not go through the overall permitting 
process.
    We understand, however and as the opposing commenter suggested, 
that there might be particular concerns with the provision at 40 CFR 
49.159(f)(v) where an administrative permit revision is allowed for an 
increase in an emissions unit's annual allowable emissions limit for a 
regulated NSR pollutant, when the action that necessitates such 
increase is not otherwise subject to review under major NSR or under 
this program. For example, this case could be one where a source 
introduces a new coating to a process line that will increase the 
emissions of that unit but the emissions increases from the source will 
not trigger the minor NSR requirements.
    Although this type of change does not trigger the major or the 
minor NSR thresholds, we continue to believe that we need to account 
for these changes in emissions in the permit to know the source's 
current allowable emissions and to ensure that the source is complying 
with the applicable requirements. Therefore, an administrative permit 
revision can be used when the increase in an unit's allowable emissions 
limit for a regulated NSR pollutant is not subject to major or minor 
NSR.
d. Administrative and Judicial Review Procedures
    At 40 CFR 49.159(d), we have finalized the provisions under which 
permit decisions may be appealed. Permit decisions may be appealed to 
the Environmental Appeals Board (EAB) within 30 days after a final 
permit decision has been issued and a final permit typically will not 
become effective until 30 days after the service of notice of the final 
permit decision. Upon filing a petition for review, the permit would be 
stayed (i.e., not go into effect) until the EAB decides whether to 
review any condition of the permit and the reviewing authority takes 
any action required by the EAB. When the EAB has issued its final order 
on an appeal, a motion to reconsider the final order may be filed with 
the EAB within 10 days. Only after all the administrative remedies 
under proposed 40 CFR 49.159 have been exhausted could the person(s) 
filing the petition seek review in the Federal Court of Appeals with 
jurisdiction over the area of Indian country in which the source is 
located. We proposed and took comment on two options for reviewing 
final permit decisions by reviewing authorities under 40 CFR 49.159(d). 
The option described above or Option 1 (where review of minor NSR 
permits will be similar to review of major PSD permits issued under 40 
CFR 52.21 and which occurs in accordance with EPA's permitting 
regulations at 40 CFR part 124) and an alternative Option 2, where the 
reviewing authority's initial permit could be appealed directly to the 
appropriate Federal Court of Appeals without a requirement to appeal to 
the EAB first.
    Several commenters supported Option 1 because they believed that 
the EAB has greater environmental expertise and is likely to resolve 
issues more quickly. These commenters also argued that citizen appeals 
to the EAB represent an easier threshold to meet for the layperson that 
is aggrieved by a final agency action. They believed it is easier for 
most citizens to write a letter to the EAB requesting an appeal than it 
is to hire an attorney to sue a governmental agency.
    Supporting commenters also argued that it makes more sense to delay 
the effective date of the permit while the issues are being resolved 
(rather than allowing the source to begin construction), while some of 
these supporting commenters would like us to allow the permit to become 
effective immediately upon issuance unless a later date is specified. 
These latter commenters believed this option will allow for development 
in Indian country while encouraging participation from environmental 
experts should an appeal occur.
    Other commenters opposed Option 1. These commenters stated that 
delaying final permit effectiveness for 30 days after issuance will 
compound an already lengthy permitting process. They also argued that 
these provisions are not consistent with the process that most states 
follow with their minor NSR programs and that these provisions are

[[Page 38767]]

ripe for abuse and would encourage challenges from anti-development 
stakeholders.
    On the other hand, several commenters specifically endorsed Option 
2 because it allows the source to determine whether to commence 
construction at its own risk. Some of these commenters also noted that 
this option is more consistent with most state minor NSR programs and 
it eliminates an intermediate step, the EAB review. These commenters 
also argued that Option 2 is more appropriate due to the size and 
amount of emissions from minor NSR sources and it expedites the 
permitting process. Another commenter added that for Tribes that have 
or will be seeking, delegation of the NSR program, the rule should 
allow for Tribal administrative and Tribal court review prior to going 
to Federal court.
    Based on the comments received, we agree with those commenters that 
support the option of filing a petition for permit review through the 
Environmental Appeals Board. We believe, as some commenters stated, 
that the EAB has greater environmental expertise, is likely to solve 
issues more quickly and it will be easier for the public to file a 
petition through the EAB than to hire an attorney to go through the 
appeals process.
    However, we are not allowing permits to become effective 
immediately upon the service of notice of the final permit decision 
under the EAB option, as some commenters suggested, because the 
proposed provisions are based upon the EAB regulations under 40 CFR 
124.15 and we did not propose to allow a different approach under this 
rule. The EAB regulations clearly state, under 40 CFR section 
124.15(b), that a final permit decision shall become effective 30 days 
after the service of notice of the decision unless: (1) A later 
effective date is specified in the decision; (2) a review is requested 
on the permit under 40 CFR 124.19 or (3) no comments requested a change 
in the draft permit, in which case the permit shall become effective 
immediately upon issuance. In other words, EPA regulations specify that 
the only permits that become effective upon issuance are those for 
which no comments were submitted. Furthermore, we do not believe we can 
allow sources to construct while the EAB process is pending, because 
while a permit is being reviewed by the EAB, it is not effective and 
thus it does not authorize construction.
    Regarding the commenter that stated that delegated programs should 
allow for Tribal administrative and Tribal court review prior to going 
to Federal court, we disagree. This is because under a delegated 
Federal program, the delegated Indian Tribe would be assisting EPA with 
the administration of Federal requirements on EPA's behalf and under 
these Federal regulations. Any Federal requirement administered by a 
delegated Tribe and any permit issued by such a delegated Tribe would 
remain Federal actions subject to EPA enforcement and EPA appeal 
procedures under Federal law. On the other hand, if a Tribe develops 
and EPA approves a TIP that includes a NSR program, Tribally-issued NSR 
permits would be subject to administrative and judicial review under 
the applicable Tribal program as approved by EPA. Therefore, we are 
finalizing the administrative and judicial review procedures for Option 
1 as proposed at 40 CFR 49.159(d).

C. General Permits

1. What is a ``General Permit?''
    A ``general permit'' is a preconstruction permit that may be 
applied to a number of similar emissions units or minor sources. The 
purpose of a general permit is to simplify the permit issuance process 
for similar facilities so that a reviewing authority's limited 
resources need not be expended for site-specific permit development for 
such facilities. A general permit may be written to address a single 
emissions unit, a group of the same type of emissions units or an 
entire minor source. We believe that general permits offer a cost-
effective means of issuing permits and provide a quicker and simpler 
alternative mechanism for permitting minor sources than the site-
specific permitting process discussed previously.
    We received strong support for the development of general permits. 
These commenters believed that the development of general permits for 
sources of similar operation and emissions will simplify the permit 
issuance process. On the other hand, one commenter urged EPA to issue 
guidance for particular source categories, rather than use general 
permits to streamline permitting. The commenter believed that 
developing guidance documents is a better method.
    We agree with those commenters who supported the development of 
general permits because we believe, as some commenters suggested, that 
general permits will simplify the permit issuance process, avoid the 
need for case-by-case control technology review for those source 
categories/units for which the general permit was established and 
reduce the administrative burden of the reviewing authorities. However, 
we disagree with the commenter that preferred guidance rather than 
general permits for the minor NSR program in Indian country. We 
understand that general permits are not appropriate in all 
circumstances, but we believe it is appropriate to develop general 
permits for certain source categories/units, especially for those 
source categories/units for which the control technology or 
technologies available are fairly standard. Therefore, we are 
finalizing the option of developing general permits as proposed under 
40 CFR 49.156.
    In addition, upon consideration of other alternatives to streamline 
minor source permitting, we plan to propose permits-by-rule for 
suitable source categories not covered by general permits. The permits-
by-rule content and requirements will be addressed in a separate 
rulemaking action.
2. What is the process for issuing general permits?
    Under 40 CFR 49.156(b), we have finalized the provisions for the 
general permits issuance process. The reviewing authority may issue a 
general permit for a category of emissions units or sources that are 
similar in nature, have substantially similar emissions and would be 
subject to the same or substantially similar requirements governing 
operations, emissions, monitoring, reporting and recordkeeping. 
``Similar in nature'' refers to size, processes and operating 
conditions.
    A general permit must be issued according to the requirements for 
public participation in 40 CFR 49.157 and the requirements for final 
permit issuance and administrative and judicial review in 40 CFR 
49.159. Issuance of a general permit is considered final action with 
respect to all aspects of the general permit except its applicability 
to an individual source. The sole issue that may be appealed after an 
individual source is approved to construct under a general permit is 
the applicability of the general permit to a particular source. We did 
not receive comments regarding the proposed general permit issuance 
procedures under 49.156(b). Consequently, we are finalizing the 
provisions under 49.156(b) as proposed.
3. For what categories will general permits be issued?
    Under 40 CFR 49.156(c), we have finalized provisions allowing the 
reviewing authority to determine which categories of individual 
emissions units, groups of similar emissions units or

[[Page 38768]]

sources are appropriate for general permits in its area.
    General permits may be issued to cover any category of numerous 
similar sources, provided that such sources meet the appropriate 
criteria. For example, permits can be issued to cover small businesses 
such as gas stations or dry cleaners. General permits may also, in some 
circumstances, be issued to cover discrete emissions units, such as 
individual solvent cleaning machines at industrial complexes.
    In addition, in setting criteria for sources to be covered by 
general permits, your reviewing authority will consider the following 
factors. First, categories of sources or emissions units covered by a 
general permit should be generally homogeneous in terms of operations, 
processes and emissions. All sources or emissions units in the category 
should have essentially similar operations or processes and emit 
pollutants with similar characteristics. Second, the sources or 
emissions units should be expected to warrant the same or substantially 
similar permit requirements governing operation, emissions, monitoring, 
recordkeeping and reporting.
    A few commenters specifically requested establishing general 
permits for the oil and gas sector. Other commenters were more general 
in their general permits recommendations and stated that general 
permits should be adopted for categories of similar sources and 
emissions units and developed before the minor NSR program is adopted 
in Indian country. These commenters also added that EPA needs to define 
further the criteria for developing general permits and the categories 
of emissions sources to which the program may apply. For example, some 
of these commenters would like us to develop general permits that are 
consistent across all of Indian country.
    Based on the comments received, we are in the process of developing 
general permits for various source categories under the factors 
mentioned. The permits will be consistent across all of Indian country, 
as some commenters suggested, unless there is a need to develop 
specific provisions or a specific general permit, for a particular area 
of Indian country. We also plan to develop these general permits, after 
the opportunity for public notice and comment, using the public 
noticing procedures under 40 CFR 49.157. Furthermore, we plan to update 
general permits, also after the opportunity of notice and comment under 
40 CFR 49.157, as appropriate to account for advances in control 
technology or for other pertinent reasons. However, when we update a 
general permit, sources operating under the existing general permit 
will be able to continue to operate under that existing permit until 
such time when the source is modified.
4. What are the permit content requirements for general permits?
    General permits must contain the same permit elements required for 
permits issued under the site-specific preconstruction review rules. 
These permit elements are described in section IV.B of this preamble 
and listed in final 40 CFR 49.155(a).
    In addition, the general permit must identify the specific category 
of emissions units or sources to which the general permit applies, 
including any criteria that your emissions unit must meet to be 
eligible for coverage under the general permit. The general permit must 
also include information required to apply for coverage under the 
general permit, such as the name and address of your reviewing 
authority, how to obtain application forms and the information you must 
provide to demonstrate that you are eligible for coverage. Finally, the 
reviewing authority may include other general permit terms and 
conditions as it deems necessary.
    We did not receive any comments on the permit content requirements 
for general permits. Therefore, we are finalizing the general permit 
content requirements as proposed under 49.156(d).
5. What is the process that you may use for obtaining coverage under a 
general permit?
    Under 40 CFR 49.156(e), we have finalized provisions that state 
that once a general permit has been issued for a source category or 
category of emissions units, you may submit a request for coverage 
under that general permit if your proposed new minor source or 
modification qualifies for that permit. Alternatively, you may apply 
for a site-specific permit under the provisions of 40 CFR 49.154.
    If your source qualifies for a general permit, you may request 
coverage under that general permit to the reviewing authority 4 months 
after the effective date of the general permit, that is, 6 months after 
publication of the general permit in the Federal Register. The 
reviewing authority must act on your request for coverage under the 
general permit as expeditiously as possible, but it must notify you of 
the final decision within 90 days of its receipt of your coverage 
request.
    Your reviewing authority must comply with a 45-day completeness 
review period to determine if your request for coverage under a general 
permit is complete. Therefore, within 30 days after the receipt of your 
coverage request, your reviewing authority must make an initial request 
for any additional information necessary to process this request and 
you must submit such information within 15 days. If you do not submit 
the requested information within 15 days from the date of the request 
for additional information and this results in a delay that is beyond 
the 45-day completeness review period, the 90-day permit issuance 
period for your general permit will be extended by the additional days 
you take to submit the requested information beyond the 45-day period. 
If the reviewing authority fails to notify you within a 30-day period 
of any additional information necessary to process your coverage 
request, you will still have 15 days to submit such information and the 
reviewing authority must still grant or deny your request for coverage 
under a general permit within the 90-day general permit issuance period 
and without any time extension.
    If the reviewing authority determines that your request for 
coverage under a general permit has all the relevant information and is 
complete, we will notify you in writing as soon as that determination 
is made. If you do not receive from the reviewing authority a request 
for additional information or a notice that your request for coverage 
under a general permit is complete within the 45-day completeness 
review period described previously, your request for coverage under a 
general permit will be deemed complete.
    As proposed, your reviewing authority shall grant or deny your 
request for coverage under a general permit without another 30-day 
public comment period. However, you must submit a copy of such request 
to the Tribe in the area where your source is locating. We will also 
post notice of the coverage request under the general permit on our Web 
site. During our review of your request for coverage under the general 
permit, commenters can only notify us of any concerns about the 
eligibility of your source to obtain coverage under that general permit 
and not on any other issue. Your reviewing authority shall grant or 
deny your request for coverage under a general permit as expeditiously 
as possible by sending you a letter notifying you of the approval or 
denial of your request. This letter is a final action for purposes of 
judicial review (see 40 CFR 49.159) only for the issue of whether your 
source qualifies for coverage under the general permit. If your request 
for coverage under a general permit is approved, you

[[Page 38769]]

must post, prominently, a copy of the letter granting such request at 
the site where your source is locating and you must comply with all the 
condition and terms of the general permit.
    You will be subject to enforcement action for failure to obtain a 
preconstruction permit if you construct the emission unit(s) or source 
under the general permit and your source is later determined not to 
qualify for the conditions and terms of the general permit. Any source 
eligible to request coverage under the general permit may alternatively 
apply for a site-specific permit under 40 CFR 49.154.
    We received a few comments regarding the timeline in which the 
reviewing authority must notify you of the final decision on a request 
for coverage under a general permit. These commenters argued that the 
90-day period we proposed for the reviewing authority to determine 
coverage under the general permit should be eliminated or at least 
reduced to 30 days. However, we continue to believe that a 90-day 
permit issuance timeframe is appropriate since reviewing authorities 
need adequate time to determine if your request for coverage has all 
the relevant information and is complete. If not, the reviewing 
authority will need to request additional information.
    Moreover, we believe it is appropriate to add a completeness review 
time period for sources requesting coverage under a general permit, as 
one commenter suggested, to ensure that both sources and reviewing 
authorities act on the request for coverage under a general permit as 
expeditiously as possible.
    In regards to a 30-day public comment period for when a source 
requests to be covered under a general permit, some commenters 
expressed concerns about this provision arguing that this will 
significantly delay or disrupt the permitting process. Other commenters 
were more concerned about being informed about the sources planning to 
construct in their area. To address these comments, we have decided not 
to require a 30-day comment period for sources seeking coverage under a 
general permit. However, as stated previously, you and the reviewing 
authority must implement the other notification procedures.
    Regarding the requirement to post prominent notice of the letter 
approving your request for coverage under a general permit, we received 
two comments. One of these commenters believed that we should allow the 
general permit and letter to be maintained at the operator's office 
closest to the emission source since, specifically, many oil and gas 
sites are unmanned. Another commenter believed that requiring an 
applicant to post information at the source about the fact that now a 
general permit will be applied to this source is duplicative of the 
public review and comment period and thus unnecessary.
    We continue to believe that posting, prominently, a copy of the 
letter granting your request for coverage under a general permit at the 
site where the source is locating is appropriate since this will 
facilitate any inspection by the reviewing authority. Moreover, this 
will allow the public to be informed about the sources locating in 
their area. The original copy of this letter of approval can be kept in 
a safe place, for example, a corporate office, especially for source 
locations that are unmanned.
    Accordingly, we are finalizing the general permit issuance 
procedures under 40 CFR 49.156(e) mainly as proposed. In addition, in 
the final rule we are including provisions for addressing when a 
general permit becomes invalid that mirror the corresponding site-
specific permit provisions (see section IV.B.4.b of this preamble for 
more information on these provisions).
    Finally we want to add that if a general permit has been issued for 
your source category, you have the option to request coverage under 
that general permit 4 months after the effective date of the permit 
(i.e., 6 months after the general permit is published) or you can apply 
for a site-specific permit according to the provisions under 40 CFR 
49.154. However we want to clarify that since we are delaying the 
implementation date of this minor NSR program to true minor sources for 
36 months after the effective date of this rule (see section VII.C of 
this preamble for an explanation of these implementation provisions), 
if you elect not to seek coverage under the general permit available 
for your source category, you will have to apply for a site-specific 
permit prior to construction if that occurs prior to the 36 month 
implementation date. In other words, there will be no permitting grace 
period if a general permit exists for your source category prior to the 
36-month period and you elect not to seek coverage under that general 
permit.

D. Synthetic minor source permits

    Some sources have the potential to emit one or more pollutants in 
major source amounts, but have actual emissions that are below the 
major source thresholds. These sources are called ``synthetic minor 
sources'' and the term means a source that otherwise has the potential 
to emit regulated NSR pollutants in amounts that are at or above those 
for major sources in 40 CFR 49.167, 40 CFR 52.21 or 40 CFR 71.2, as 
applicable, but has taken a restriction so that its potential to emit 
is less than such amounts for major sources. Such restrictions must be 
enforceable as a practical matter (as defined in 40 CFR 49.152).
    The designation of synthetic minor source is allowed for both 
regulated NSR pollutants and HAPs and although you may choose to obtain 
such emission limitations at your own discretion, once you have 
accepted an enforceable emission limitation, you must comply with that 
limitation. This is necessary to ensure that you are legally prohibited 
from operating as a major source. In addition, if you apply for a 
synthetic minor source or synthetic minor HAP source, you must comply 
with the same public participation requirements and the same procedures 
for final permit issuance and administrative and judicial review found 
at 40 CFR 49.157 and 40 CFR 49.159 respectively.
    In our proposal we explained that our 1999 policy memo on synthetic 
minor sources in Indian country currently provides guidance on how 
sources that would otherwise be major sources under section 302 or part 
D of title I of the Act can become synthetic minor sources if their 
actual emissions remain below 50 percent of the relevant major source 
PTE threshold and they comply with all other requirements of the policy 
memo.\22\ However, as the memo specifies, this PTE transition policy 
terminates when we adopt and implement a mechanism that you can use to 
limit your potential to emit or we explicitly approve a program 
providing such a mechanism. This minor NSR program adopts and 
implements a mechanism that you can use to limit your potential to emit 
and as such it terminates the PTE transition policy.
---------------------------------------------------------------------------

    \22\ John S. Seitz and Eric V. Schaeffer. Policy memo. 
``Potential to Emit Transition Policy for Part 71 Implementation in 
Indian Country.'' March 7, 1999.
---------------------------------------------------------------------------

    Several commenters supported the proposal to allow synthetic minor 
source permits because this option has been previously available for 
sources located outside of Indian country. On the other hand, two 
commenters opposed the proposal to allow for synthetic minor source 
permits since they believe that synthetic minor source permits are not 
available outside of Indian country and therefore HAP sources would 
rush to Indian country to avoid MACT standards.

[[Page 38770]]

    Another commenter opined that the proposed synthetic minor rule 
will hinder some Tribes' ability to develop or maintain their own 
sustainable title V major source permitting programs. This commenter 
argued that allowing for synthetic minor source permits in Indian 
country will decrease the number of major sources under this program 
thereby reducing the permitting fees collected and used by Tribes to 
run their title V permitting programs. One commenter also added that 
general permits should be allowed for synthetic minor sources.
    We agree with those commenters that would like us to allow 
synthetic minor source permits for both criteria pollutants and HAPs. 
We believe that allowing synthetic minor source permits could be 
beneficial to the environment by reducing the amount of pollution that 
could have been emitted to the air otherwise. In addition, this option 
has been available for sources outside of Indian country for both 
regulated NSR pollutants and HAP sources for many years. Thus, we 
disagree with the commenters who believed that we will be creating 
pollution havens in Indian country for HAP sources because HAP sources 
who obtain synthetic minor permits need to comply with emissions limits 
that are enforceable as a practical matter (as defined in 40 CFR 
49.152) and with the applicable regulations under 40 CFR Part 63.
    We do not believe that synthetic minor source permits will 
significantly reduce the number of title V major sources in Indian 
country and hence the associated permit fees, since we do not 
anticipate many sources to change their current status to synthetic 
minor status once this rule is final. The PTE transition policy had 
already allowed sources in Indian country, until this FIP becomes 
final, to limit their potential to emit to avoid major source status 
for purposes of the title V program. However, if a Tribe is concerned 
that existing title V programs may be unsustainable after a certain 
number of sources change their existing title V permits to synthetic 
minor source permits, the Tribe will have to consider raising their 
title V fees as necessary to ensure that, as stated in section 
502(b)(3) of the Act, the fees collected under the title V program are 
``sufficient to cover all reasonable (direct and indirect) costs 
required to develop and administer the permit program requirements.''
    We also disagree with the commenter that would like us to allow the 
use of general permits for synthetic minor sources since these sources 
are major sources until they are approved to construct under a 
synthetic minor source permit. We believe that the size and amount of 
emissions from these sources warrants a case-by-case review of the 
source and their proposed emission limitations. Therefore, in the final 
rule, we are not allowing general permits for synthetic minor sources.
    In this final rule apart from specifying the circumstances under 
which a new source may obtain a synthetic minor source permit, we are 
also clarifying the possible mechanisms under which synthetic minor 
source permits have been issued to date and the requirements these 
sources may have to comply with after the effective date of this rule.
    Consequently, we are finalizing provisions under 40 CFR 49.158 that 
state that you may obtain a synthetic minor source permit under this 
program to establish a synthetic minor source for PSD, nonattainment 
major NSR and title V purposes and/or a synthetic minor HAP source for 
MACT standards and title V purposes. Any source that becomes a 
synthetic minor for NSR and title V purposes but has other applicable 
requirements or becomes a synthetic minor for NSR but is major for 
title V purposes, must also apply for a part 71 title V permit. In 
addition, you, as the permit applicant, will have to submit a permit 
application pursuant to the provisions of 40 CFR 49.158(a) and 40 CFR 
49.154 and you will also be subject to the permit requirements at 40 
CFR 49.155 and 49.158 which include, among other things, case-by-case 
control technology review as well as monitoring, recordkeeping and 
reporting requirements.\23\
---------------------------------------------------------------------------

    \23\ Please note that if you propose to construct or modify a 
synthetic minor source, you are subject to the synthetic minor 
source provisions under 40 CFR 49.158 and the preconstruction 
permitting requirements in 40 CFR 49.154 and 49.155, except for the 
completeness review and permit issuance timeline provisions. The 
permit completeness review and permit issuance timeline provisions 
that apply for sources seeking a synthetic minor permit are 
specified in 40 CFR 49.158(b).
---------------------------------------------------------------------------

    Hence, we are finalizing the synthetic minor source permit 
application procedures mainly as proposed, with the exception that we 
are requiring the reviewing authority to notify you of the permit 
application completeness determination in writing and thus eliminating 
the requirement that you, as the permit applicant, should contact the 
reviewing authority to find out the date of receipt of the application. 
The final synthetic minor source permit application requirements state 
that you must submit a permit application to the reviewing authority 
and within 60 days after receipt of an application, the reviewing 
authority will determine if it contains the information specified in 40 
CFR 49.158(a). If the reviewing authority determines that the 
application is not complete, it will request additional information 
from you as necessary to process the application. If the reviewing 
authority determines that the application is complete, it will notify 
you in writing. The reviewing authority's completeness determination or 
request for additional information should be postmarked within 60 days 
of receipt of the permit application by the reviewing authority.
    We are also adding a provision, to be consistent with the site-
specific and general permit provisions, to state that if you do not 
receive a request for additional information or a notice of complete 
application postmarked within 60 days of receipt of the permit 
application by the reviewing authority, your application would be 
deemed complete. The reviewing authority must provide an opportunity 
for public participation and public comment on the draft synthetic 
minor source permit as set out in 40 CFR 49.157. The final synthetic 
minor source permit will be issued and will be subject to 
administrative and judicial review as set out in 40 CFR 49.159.
    The provisions of the final rule address the various possible 
scenarios for synthetic minor source permits as follows:
     If you own or operate an existing major source and you 
wish to obtain a synthetic minor source permit pursuant 40 CFR 49.158 
to establish a synthetic minor source and/or a synthetic minor HAP 
source,\24\ you may submit a synthetic minor source permit application 
on or after the effective date of the final rule, that is, on or after 
August 30, 2011. However, if your

[[Page 38771]]

permit application for a synthetic minor source and/or synthetic minor 
HAP source pursuant to the FIPs for reservations in Idaho, Oregon and 
Washington has been determined complete prior to August 30, 2011, you 
do not need to apply for a synthetic minor source permit under this 
program.
---------------------------------------------------------------------------

    \24\ EPA's historic policy is ``that facilities may switch to 
area source status [in this case through a synthetic minor permit] 
at any time until `the first compliance' of the standard. The 
``first compliance date'' is defined as the first date a source must 
comply with an emission limitation or other substantive regulatory 
requirement (i.e., leak detection and repair programs, work practice 
measures, housekeeping measures, etc * * *, but not a notice 
requirement) in the applicable MACT standard. Facilities that are 
major sources for HAPs on the ``first compliance date'' are required 
to comply permanently with the MACT standard to ensure that maximum 
achievable reductions in toxic emissions are achieved and 
maintained.'' Memorandum from John S. Seitz, Director, Office of Air 
Quality Planning and Standards, U.S. EPA, ``Potential to Emit for 
MACT Standards--Guidance on Timing Issues'' (May 16, 1995). EPA 
continues to believe that this policy best reflects the way Congress 
intended the MACT program to function. As a result, if you own or 
operate a major source subject to a MACT standard for which the 
initial compliance date has already passed, you cannot become a 
synthetic minor source for purposes of or otherwise avoid continuing 
to comply with, that particular MACT standard.
---------------------------------------------------------------------------

     If you wish to commence construction of a new synthetic 
minor source and/or a new synthetic minor HAP source,\25\ or a 
modification at an existing synthetic minor source and/or synthetic 
minor HAP source, on or after the effective date of the final rule 
(that is, on or after August 30, 2011), you must obtain a permit 
pursuant to 40 CFR 49.158 prior to commencing construction.
---------------------------------------------------------------------------

    \25\ See previous footnote regarding the timing for obtaining 
potential to emit restrictions on sources seeking a synthetic minor 
HAP permit.
---------------------------------------------------------------------------

     If your existing synthetic minor source and/or synthetic 
minor HAP source was established pursuant to the FIPs applicable to the 
Indian reservations in Idaho, Oregon and Washington or was established 
under an EPA-approved rule or permit program limiting potential to 
emit, you do not need to take any action under this program unless you 
propose a modification for your existing synthetic minor source and/or 
synthetic minor HAP source on or after the effective date of this rule, 
that is, on or after August 30, 2011. For these modifications, you must 
obtain a permit pursuant to 40 CFR 49.158 prior to commencing 
construction.
     If your existing synthetic minor source and/or synthetic 
minor HAP source was established under a permit with enforceable 
emissions limitations issued pursuant to the part 71 program, the 
reviewing authority has the discretion to require you to submit a 
permit application pursuant to 40 CFR 49.158 for a synthetic minor 
source permit under this program within 1 year after the effective date 
of the final rule (that is, by September 4, 2012) or to require you to 
submit a permit application for a synthetic minor source permit under 
this program (pursuant to 40 CFR 49.158) at the same time that you 
apply to renew your part 71 permit or to allow you to continue to 
maintain synthetic minor status through your part 71 permit. If the 
reviewing authority requires you to obtain a synthetic minor source 
permit and/or a synthetic minor HAP source permit under this program 
(pursuant to 40 CFR 49.158), it also has the discretion to require any 
additional requirements, including control technology requirements, 
based on the specific circumstances of the source.
     If your existing synthetic minor source and/or synthetic 
minor HAP source \26\ was established through a mechanism other than 
those described in preceding paragraphs, you must submit an application 
for a synthetic minor source permit pursuant to 40 CFR 49.158 within 1 
year of the effective date of the final rule, that is, by September 4, 
2012. The reviewing authority has the discretion to require any 
additional requirements, including control technology requirements, 
based on the specific circumstances of the source.
---------------------------------------------------------------------------

    \26\ You can only be an existing synthetic minor HAP source if 
your current PTE limits are federally enforceable. 40 CFR 63.2. As a 
result, a source located in Indian country can only be an existing 
synthetic minor HAP source if the limits on its PTE were established 
through a mechanism administered by or on behalf of EPA.
---------------------------------------------------------------------------

    If you submit your application and any requested additional 
information in the timelines indicated above, your source will continue 
to be considered a synthetic minor source or synthetic minor HAP source 
(as applicable) until your synthetic minor source permit under this 
program has been issued. Should you fail to submit your application and 
any requested additional information in the timelines indicated above, 
your source will no longer be considered a synthetic minor source or 
synthetic minor HAP source (as applicable) and will become subject to 
all requirements for major sources.

E. Case-by-Case MACT Determinations Under Section 112(g) of the Act

    Section 112(g)(2)(B) of the Act provides that you may not construct 
or reconstruct a major source of HAPs unless the appropriate permitting 
authority determines that MACT for new sources will be met. If the 
Administrator has not established a MACT standard for the source 
category, the Act requires that MACT be determined on a case-by-case 
basis.
    The regulations implementing section 112(g)(2)(B) are at 40 CFR 
63.40 through 63.44. The regulations at 40 CFR 63.43(c) set forth 
several options for procedures that can be used to accomplish case-by-
case MACT determinations. These options include using title V 
administrative procedures if a pre-construction or reconstruction 
(63.43(c)(1)) title V permit is required or can be obtained, applying 
for and obtaining a Notice of MACT Approval (63.43(c)(2)(i)) and ``any 
other administrative procedures for preconstruction review and approval 
established by the permitting authority for a state or local 
jurisdiction which provide for public participation * * *'' 
(63.43(c)(2)(ii)).\27\
---------------------------------------------------------------------------

    \27\ See also 63.42(b) for an additional option where the 
permitting authority has not adopted a 112(g) program but has 
authority to make case-by-case MACT determinations.
---------------------------------------------------------------------------

    Currently, no Tribes have an EPA-approved title V permitting 
program or have adopted any other program to implement section 112(g), 
although one Tribe has been delegated authority to assist us with 
implementation of the Federal part 71 operating permit program (i.e., 
the Federal program for issuing title V permits). Therefore, EPA 
expects that it will conduct case-by-case MACT determinations for 
sources in Indian country.
    Furthermore, while we can accomplish a section 112(g) case-by-case 
MACT determination through a part 71 permit issued pre-construction or 
reconstruction or a Notice of MACT Approval, we believe that if your 
source is a major source only for HAPs and a minor source for regulated 
NSR pollutants, the minor NSR program is an appropriate ``other 
administrative procedures'' under 63.43(c)(2)(ii) for obtaining a case-
by-case MACT determination. In addition, if your source is or could be 
minor for regulated NSR pollutants and is or could be major for HAPs, 
it would also be administratively convenient for you and for us, as the 
reviewing authority, to combine the construction permit process for 
both regulated NSR pollutants and case-by-case MACT determinations 
under the final minor NSR program, rather than to address regulated NSR 
pollutants under the minor NSR program and also go through the part 71 
permit for preconstruction or reconstruction or Notice of MACT Approval 
process to address case-by-case MACT requirements. Note that even with 
this approach to preconstruction review, the source is still a major 
source for HAP under the MACT program (unless the source becomes a 
synthetic minor source) and thus you ultimately will have to obtain a 
part 71 operating permit for your major source of HAPs.
    Several commenters supported the proposal to provide for case-by-
case MACT determinations in the minor NSR program because they stated 
this will be consistent with the practice of most state programs, it 
would be administratively convenient and regulation of HAPs is 
important to health. On the other hand, one commenter argued that if a 
source is major for HAPs, the source should not apply for a minor 
source permit because

[[Page 38772]]

applying for a case-by-case MACT determination under the minor NSR 
program would exempt the source from the MACT program.
    We agree with those commenters that supported the use of the minor 
NSR program as one of the mechanisms for obtaining a case-by-case MACT 
determination. As we stated previously, it is administratively 
convenient for us, as the reviewing authority and for you as the source 
owner to combine the preconstruction permit review process for both 
regulated NSR pollutants and case-by-case MACT determinations under 
this minor NSR program. If not, the minor NSR source that is also major 
for HAPs would have to apply for a minor NSR permit and a separate 
preconstruction or reconstruction part 71 permit or Notice of MACT 
Approval for its case-by-case MACT determination of its HAP emissions. 
We want to clarify, however and as the opposing commenter suggested, 
that using the minor NSR program as the mechanism for a section 112(g) 
case-by-case MACT determination does not mean that a major source will 
escape the major source requirements under the MACT program. The source 
still needs to comply with the requirements of 40 CFR 63.40 through 
63.44 that apply to case-by-case MACT determinations using ``other 
administrative procedures.'' In addition, any source that is required 
to obtain a case-by-case MACT determination is a major source of HAPs 
and will have to obtain a part 71 permit.
    In addition, we would like to clarify that for case-by-case MACT 
determinations under this minor NSR program, we will apply the public 
noticing requirements under 40 CFR 49.157 and the administrative and 
judicial review procedures under 40 CFR 49.159. See final 40 CFR 
49.153(a)(4) for the provisions related to section 112(g) case-by-case 
MACT determinations.

F. Treatment of Existing Minor Sources Under the Minor NSR Program

    In the proposal preamble, we raised the question of whether it may 
be appropriate to also regulate existing minor sources in Indian 
country under this minor NSR program to help attain and maintain the 
NAAQS. At proposal, we discussed four options for the treatment of 
existing minor sources, as follows:
     Option 1--No requirements for existing minor sources 
(until a source wishes to make a modification).
     Option 2--Require existing synthetic minor sources to 
become subject to the minor NSR program requirements (including control 
technology review and other requirements as provided in section IV.A.5 
through 9 of the proposal preamble) and to submit a permit application 
within 1 year after the effective date of the program.
     Option 3--Require all existing minor sources to register 
within 1 year after the effective date of this program, but not be 
subject to the permitting requirements.
     Option 4--Require all existing minor sources to be subject 
to the minor NSR program requirements (as provided in section IV.A.5 
through 9 of the proposal preamble).
    Numerous commenters supported Option 1. These commenters believed 
that this option is consistent with state minor NSR programs, is the 
least burdensome on existing sources and the EPA and Tribes do not have 
the resources available to implement any of the other options. In 
addition, these commenters opined that regulation of existing sources 
is not needed to maintain the NAAQS. On the other hand, a few 
commenters opposed this option, mainly because they believed it would 
not address any air quality impacts resulting from existing sources.
    Regarding Option 2, a few commenters supported this option if it 
were to be used in combination with other options such as Option 1 or 
3. However, two commenters specifically opposed Option 2 because they 
believe this option represents extremely onerous provisions for sources 
and reviewing authorities.
    Several commenters supported Option 3 because they believed it 
would only place a small administrative burden on existing sources to 
report their existing emissions while providing Tribes with important 
information about the existing emissions within their jurisdictions. 
Nevertheless, one commenter opposed this option because the commenter 
believed Option 3 will be unduly burdensome and overbroad and could 
significantly disadvantage minor sources already operating in Indian 
country.
    A few commenters supported Option 4 by noting that states have 
generally regulated minor sources and thus that experience could aid 
the implementation of this option. Another commenter added that EPA 
could meet the requirements under Option 4 if we used a ``sunset 
clause.'' A ``sunset clause'' would allow sources some time to come 
into compliance and thereby avoid undue economic burden all at once. On 
the other hand, other commenters opposed this option because they 
generally believe it is extremely onerous for both sources and 
reviewing authorities.
    After considering the comments, we have decided to finalize Option 
3 for true minor sources. For synthetic minor sources, we are 
finalizing provisions as stated in section IV.D of this final rule 
preamble, which include provisions that require certain sources to 
obtain permits under this program 1 year after the effective date of 
this rule.
    We are not finalizing our preferred option for ``true'' minor 
sources, Option 1, because even though we agree that this option is 
consistent with state minor NSR programs and it is the least burdensome 
option for existing minor sources, we believe that collecting source 
inventory data for minor sources in Indian country is necessary to 
successfully implement the minor NSR program. In addition, these source 
inventory data are needed to assess the feasibility of an actual 
emissions based applicability test and to determine if we need to 
modify the minor NSR thresholds at a later time. We are also not 
finalizing Option 4 at this time because we believe that Option 4 would 
overwhelm limited EPA resources even if we were to use a ``sunset 
clause.''
    Thus, under the program we are finalizing, we are creating a 
registration program for minor sources in Indian country. Under the 
minor source registration program, if you own or operate an existing 
true minor source in Indian country (as defined in 40 CFR 49.152(d)) 
you must register your source with your reviewing authority in your 
area within 18 months after the effective date of this program, that 
is, by March 1, 2013. This date has been modified from the 12 months we 
proposed to provide existing sources additional time to comply with 
these requirements. These provisions are discussed further in section 
VII.C of this preamble. If your true minor source commences 
construction in the time period between the effective date of this rule 
and September 2, 2014, you must register your source with the reviewing 
authority in your area within 90 days after the source begins 
operation.
    If construction or modification of your source commenced any time 
on or after September 2, 2014 and your source is subject to this rule, 
you must report your source's actual emissions (if available) as part 
of your permit application and your permit application information will 
be used to fulfill all the other registration requirements described in 
40 CFR 49.160(c)(2).
    This registration will be a one-time registration (not an annual 
registration) of your source's estimated actual and allowable emissions 
as provided in 40

[[Page 38773]]

CFR 49.160. For the Indian reservations subject to the registration 
requirements under 40 CFR 49.138 (``Rule for the registration of air 
pollution sources and the reporting of emissions''), the data being 
collected under that rule will be used to fulfill the requirements of 
this national registration program.

V. Final Major NSR Program for Nonattainment Areas in Indian Country

    In this final action, we are establishing a major NSR program for 
new major sources and major modifications at existing major sources in 
nonattainment areas of Indian country at 40 CFR 49.166 through 49.175. 
This program is designed to meet the requirements of part D of title I 
of the Act and, as proposed, sources subject to this program would be 
required to comply with the requirements of 40 CFR part 51, Appendix S 
(Appendix S).
    Appendix S is titled ``Emission Offset Interpretative Ruling'' and 
sets forth preconstruction review requirements for major sources and 
modifications locating in nonattainment areas where the state does not 
have an EPA-approved nonattainment major NSR program. In general, 
Appendix S is a transitional nonattainment major NSR program that 
covers the period after an area has been newly designated as 
nonattainment, up until the time that the state has amended its SIP's 
nonattainment major NSR program, as needed, to address the new 
nonattainment area. The requirements under Appendix S are essentially 
the same as our requirements for state nonattainment major NSR programs 
at 40 CFR 51.165.
    We are finalizing our proposal to apply Appendix S to nonattainment 
areas in Indian country for a number of reasons. Primarily, we believe 
it is appropriate to apply Appendix S provisions in Indian country for 
administrative convenience. Additionally, since Appendix S generally 
applies in nonattainment areas where there is no approved nonattainment 
major NSR program and since no Tribe currently has such a program, we 
believe that Appendix S should also apply in Indian country. Another 
reason for requiring sources subject to this program to comply with 
Appendix S requirements is that the EPA Regional Offices (which will be 
implementing the program until an EPA-approved implementation plan is 
in place) and owners/operators of several major sources in Indian 
country are familiar with the implementation and provisions of Appendix 
S.
    We considered and rejected the option of amending Appendix S to 
extend its application to Indian country, since we believe that sources 
in Indian country are more likely to look for regulations applicable to 
them under part 49, which is solely dedicated to regulations that apply 
in Indian country. We also considered drafting a parallel major NSR 
regulation to apply to sources in Indian country, but rejected this 
option since it would essentially re-propose Appendix S provisions, 
which have been in effect outside of Indian country for many years. We 
wanted to avoid any potential confusion or possible perception that 
these parallel regulation requirements would be different than the 
Appendix S requirements.

A. What are the requirements for major source permitting?

    Pursuant to paragraph IV of Appendix S, we have finalized that a 
reviewing authority may issue a permit for a new major source or a 
major modification locating in a nonattainment area, if it complies 
with the following conditions:
    1. The new major source or a major modification meets the LAER for 
that source using add-on controls or pollution prevention measures.
    2. The applicant certifies that all existing major sources owned or 
operated by the applicant (or any entity controlling, controlled by or 
under common control with the applicant) in the same state as the 
proposed source are in compliance with (or under a Federally-
enforceable compliance schedule for) all applicable emission 
limitations and standards under the Act.
    3. Emission reductions (offsets) from existing sources in the area 
of the proposed source (whether or not under the same ownership) are 
obtained such that there will be reasonable progress towards attainment 
of the applicable NAAQS.\28\
---------------------------------------------------------------------------

    \28\ In general, only intrapollutant offsets are permitted 
(e.g., NOX for NOX). As part of the rulemaking 
to implement the NSR program for PM2.5, Appendix S and 40 
CFR 51.165 were revised to allow interpollutant trading of emissions 
of PM2.5 and its precursors under certain conditions (73 
FR 28321, May 16, 2008). However, this aspect of the regulations is 
currently under reconsideration by EPA. See letter from Lisa P. 
Jackson, EPA Administrator, to Paul R. Cort, Earthjustice, April 24, 
2009. http://www.epa.gov/nsr/documents/Earthjustice.pdf.
---------------------------------------------------------------------------

    4. The emission offsets provide a net air quality benefit in the 
affected area.
    5. The permit applicant conducts an analysis of alternative sites, 
sizes, production processes and environmental control techniques for 
such proposed source that demonstrates that the benefits of the 
proposed source significantly outweigh the environmental and social 
costs imposed as a result of its location, construction or 
modification.
    We received only a few comments regarding the use of Appendix S for 
Indian country. A couple of commenters did not explicitly support or 
oppose the use of Appendix S in Indian country, while one commenter 
suggested that Appendix S failed to address provisions under the CAA. 
The commenter pointed out that section 173(a)(5) of the Act provides 
for permits in a nonattainment area to be issued if ``an analysis of 
alternative sites, sizes, production processes and environmental 
control techniques for such proposed source demonstrates that benefits 
of the proposed source significantly outweigh the environmental and 
social costs imposed as a result of its location, construction or 
modification.'' However, the provisions under 40 CFR Part 51, Appendix 
S did not include such requirement even when this requirement is 
included in every approved SIP in the country. Therefore, by requiring 
only the provisions of Appendix S, the commenter believed that the 
proposed nonattainment major NSR program failed to satisfy the 
requirements of the Act. The commenter suggested that a requirement for 
an adequate alternate site assessment should be added to the proposed 
regulations as a complementary requirement to Appendix S.
    Upon further review of Appendix S, we agree that the section 173 
alternate site provision was inadvertently missing from Appendix S 
regulations. Therefore, we have amended Appendix S to include the 
section 173 alternatives site provision to ensure that the provisions 
of the 1990 amendments, including the CAA section 173 alternative sites 
analysis provision, is codified in implementing regulations. See 
section V.F. of this preamble for more details on the Appendix S 
amendments.

B. How is EPA addressing the lack of available offsets in Indian 
Country?

    Tribal representatives have repeatedly stated that requirements for 
emission offsets are problematic in Indian country because: (1) Many 
Tribes believe that transport is a major cause of pollution in Indian 
country, (2) Tribes generally do not have many existing sources within 
their area of Indian country from which offsets can be obtained, and 
(3) administrative barriers may hinder Tribal access to otherwise 
available offsets. Therefore, Tribal representatives have advocated for 
additional flexibility to address offsets, such as the provision of NSR 
offset set-

[[Page 38774]]

asides (which we expect would come from state offset pools or 
banks).\29\
---------------------------------------------------------------------------

    \29\ Tribal representatives have raised these and other concerns 
in discussions on implementation of the 8-hour ozone and 
PM2.5 standards and in comments on the 8-hour ozone 
implementation rule. For example, see the letter from Bill Grantham, 
National Tribal Environmental Council, to docket EPA-HQ-OAR-2003-
0076, providing comments on the proposed 8-hour ozone implementation 
rule (66 FR 32802).
---------------------------------------------------------------------------

    We recognize the unique circumstances that Tribes face. Unlike 
states that have a SIP, a huge industrial base with several hundred 
existing sources and a broad range of measures to attain and maintain 
NAAQS, a Tribe generally has neither a TIP nor many existing sources 
from which to generate offsets. Because of these circumstances, we 
proposed two options to address the lack of availability of offsets for 
Tribes: (1) The Economic Development Zone (EDZ) option, and (2) the 
Appendix S, paragraph VI option.
1. Economic Development Zone Option
    For this option we rely on section 173(a)(1)(B) of the Act under 
which the Administrator, in consultation with the Secretary of Housing 
and Urban Development (HUD), may identify zones within nonattainment 
areas as EDZs such that sources subject to major NSR located in EDZs in 
Indian country would be exempt from the offset requirement in section 
173(a)(1)(A) of the Act.
    Section 173(a)(1) of the Act provides for the issuance of permits 
to construct and operate a new or modified major stationary source if 
the reviewing authority determines that (A) ``* * * sufficient 
offsetting emissions reductions have been obtained * * *'' or (B) ``in 
the case of a new or modified major stationary source which is located 
in a zone (within a nonattainment area) identified by the 
Administrator, in consultation with the Secretary of Housing and Urban 
Development, as a zone to which economic development should be 
targeted, that emissions of such pollutant resulting from the proposed 
new or modified major stationary source will not cause or contribute to 
emissions levels which exceed the allowance permitted for such 
pollutant for such area from new or modified major stationary sources 
under section 172(c).''
    Once the Administrator has identified an area that should be 
targeted for economic development in consultation with HUD, major 
sources that construct or modify within that area are relieved of the 
offset requirement if the state/Tribe can demonstrate that the new 
permitted emissions are consistent with the achievement of reasonable 
further progress pursuant to section 172(c)(4) of the Act and will not 
interfere with attainment of the applicable NAAQS by the applicable 
attainment date.
    To be identified as an EDZ, HUD's Initiative for Renewal 
Communities, Urban Empowerment Zones and Urban Enterprise Communities 
generally require that participating communities demonstrate pervasive 
poverty, high unemployment and general distress throughout the 
designated area. The United States Department of Agriculture requires 
similar eligibility criteria for participating communities located in 
rural areas. We believe that some areas of Indian country may meet 
these criteria and hence could qualify for this offset relief 
provision.
    As we proposed, the Administrator will consult with HUD only once 
to develop a general set of approval criteria, such that a consultation 
with HUD is not required every time a Tribe applies for its area of 
Indian country to be designated as an EDZ. Also as proposed, EPA 
intends to provide assistance as needed for a Tribe to complete an EDZ 
designation request. If the Administrator approves such a request from 
a Tribe, a new major source or a major modification locating in that 
EDZ would be exempt from the offset provisions.
2. Appendix S, Paragraph VI Option
    Paragraph VI of Appendix S notes that in some cases the dates for 
attainment of the primary or secondary NAAQS may not have passed. In 
such cases, Appendix S provides that a new source locating in a 
nonattainment area may be exempt from the requirements of paragraph 
IV.A of Appendix S (discussed in section VI.A of this preamble), 
including the offset requirement, if the following conditions are met:
     The new source complies with the applicable implementation 
plan emission limitations;
     The new source will not interfere with the attainment date 
for a regulated NSR pollutant; and
     We have determined that the preceding two conditions are 
satisfied and such determination is published in the Federal Register.
    It is important to note that this option only provides temporary 
offset relief because it will cease to be available once the attainment 
date for a pollutant has passed.
    Several commenters gave general support to waiving the requirement 
for offsets in Indian country, either through support of one or both of 
the proposed options or through advocating a general waiver on other 
grounds. For example, some commenters suggested that:
     EPA should allow sources in Indian country to obtain 
offsets not just from the Indian country area itself, but from adjacent 
or upwind areas. Section 173(c) of the Act specifically provides that 
offsets may be used if they are from an area with an equal or higher 
nonattainment classification and if emissions from that area contribute 
to a violation of the NAAQS in the area needing the offsets.
     EPA should allow Tribes to participate in state offset 
pools. With the approach of opening offset pools to Tribes, those 
Tribes wishing to develop major sources in nonattainment areas would 
still be able to do so, but would be treated like other sources needing 
to obtain an offset to maintain air quality.
     EPA should implement a set-aside program in which Tribes 
receive a certain amount of offset emissions that would need to be made 
up by the other sources in the state. The commenter believed that this 
would be fair because most nonattainment problems in Indian country are 
caused by sources that are not under Tribal control.
     EPA, the states, the Tribe and sources could collaborate 
to identify acceptable offsets outside of Indian country.
     EPA should launch a concerted effort to improve the 
availability of offsets in all areas that need them (not just in Indian 
country) by encouraging the development of protocols to allow the 
creation of offsets from nontraditional sources, especially mobile and 
area/minor sources.
     Tribes should be afforded the opportunity to request a 
permanent offset waiver based on language in the TAR. The TAR: 
``provide[s] an opportunity for Indian Tribes to assume responsibility 
for the development and implementation of CAA programs on lands within 
the exterior boundaries of their reservations or other areas within 
their jurisdiction.'' Thus, the commenter believed that the waiver will 
allow the opportunity for Tribes to be able to develop and implement 
the nonattainment major NSR program.
    However, other commenters believe that offsetting of major NSR 
projects should be a requirement of the nonattainment major NSR program 
and no waivers should be given. These commenters opined that offset 
waivers would: (1) Likely be illegal under the Act, (2) cause air 
quality concerns, and (3) be unfair for sources located or locating 
outside of Indian country. For example, one of the commenters indicated 
that there is a significant shortage of offsets in virtually every

[[Page 38775]]

district in California, while another commenter added that the proposal 
would create an incentive for industrial sources to find Indian country 
a kind of refuge from regulatory requirements--resulting in a tilted 
playing field and exacerbating air quality and public health problems 
on reservations. Other commenters stated that:
     Setting up an offset bank within an area of Indian country 
would be difficult because no source on Tribal land is currently 
subject to NSR and therefore there are currently no offsets from 
sources on Tribal land to be bought or sold. The commenter believed 
that with no available offsets, when NSR is enacted on Tribal lands, 
the price of the first offsets will be unaffordable for most if not all 
sources on Tribal lands.
     There would be problems in allowing sources on Tribal 
lands access to the State offset banks. The commenter believed that 
states will be apprehensive to allow sources on Tribal lands access to 
state-established offset banks because states will not receive the tax 
revenue from offsets purchased by sources on Tribal lands as they do 
with sources within the state.
     EPA, state and Tribal collaboration should not make it 
necessary for Tribes to go to the states to obtain offsets for economic 
development on the reservation since it denigrates the government-to-
government relations.
     Offsets should not be traded between Indian country and 
the states due to Tribal sovereignty issues and potential for confusion 
involving monitoring and tracking costs, as well as who receives tax 
revenue from the offsets.
    In regards to the EDZ option, supporting commenters believed that 
this option provides the flexibility for EPA not to require emissions 
offsets for a project where economic development and environmental 
protection are equally important concerns, while opposing commenters 
believed that the EDZ option cannot lawfully be applied in the present 
circumstances. According to one commenter, under section 173(a)(1)(B) 
of the Act, the affected source must not cause or contribute to 
emissions levels ``which exceed the allowance permitted for such 
pollutant for such area from new or modified stationary sources under 
section 172(c).'' The latter section, at section 172(c)(4) of the Act, 
provides that the implementation plan shall identify and quantify the 
emissions, if any, that will be allowed to be used under section 
173(a)(1)(B) (the EDZ section) and shall ``demonstrate to the 
satisfaction of the Administrator that the emissions quantified for 
this purpose will be consistent with the achievement of reasonable 
further progress and will not interfere with attainment of the 
applicable national ambient air quality standard by the applicable 
attainment date.'' Thus, the commenter believed that, in the absence of 
a TIP that quantifies the allowance and makes the required 
demonstration, this precondition for offset relief in EDZs would not 
generally be met within Indian country.
    Furthermore, another commenter believed that, by definition, the 
proposed rule does not apply where there is a TIP and thus EPA would 
need to look at the relevant SIP of the surrounding or adjacent state 
for the applicable ``allowance of emissions'' for EDZ sources. The 
commenter noted that in many cases there may be no such allowance and 
that even if the relevant State SIP includes an allowance, that 
allowance would almost certainly not have been calculated under the 
assumption that areas in Indian country could access the allowance. 
Under these circumstances, the commenter asserted, the affected state 
would be entitled under the Act to determine in the first instance 
what, if any, access to the allowance it wished to make available to 
sources in Indian country. The commenter concluded that as a matter of 
law the EDZ option is unavailable unless and until the relevant state 
creates and makes available an appropriate allowance.
    Another commenter also noted that as proposed, EPA would consult 
with the Secretary of Housing and Urban Development only once to 
develop a general set of approval criteria for EDZs. The commenter 
stated that this approach appears to conflict with the language of the 
Act, which requires consultation on each individual zone.
    In regards to the Appendix S, paragraph VI option, several 
commenters supported it because, as one of these commenters stated, 
this option provides equivalent environmental protection. The reviewing 
agency has to demonstrate that the proposed source will not interfere 
with the attainment date for the regulated NSR pollutant(s) in the 
area.
    However, a number of commenters had misgivings about the paragraph 
VI option, generally based on legal or environmental grounds. Two 
commenters stated that the paragraph VI option is inapplicable and 
unlawful because: (1) There is no applicable implementation plan in 
Indian country, so no source can ``comply with applicable 
implementation plan emissions limitations'' (in addition, one of these 
commenters conceded that if we interpret this to require the source to 
meet the SIP limits in the surrounding or adjacent state, this 
requirement could be met), (2) if there is no applicable implementation 
plan, it will be impossible to demonstrate that a source will not 
interfere with the attainment date for a nonattainment pollutant, (3) 
the Act requires that for every major source, the source must provide 
sufficient offsetting emissions reductions such that there is a 
reduction in emissions amounting to reasonable further progress, when 
considered together with emissions from other new and existing sources 
(see section 173(a)(1)(A) of the Act) and (4) the 1990 Amendments to 
the Act set out specific offset ratios which major sources must meet, 
such as 1.5 to 1 for Extreme Areas, 1.3 to 1 for Severe Areas, etc. 
(section 182 of the Act). These ratios may be met on an aggregate basis 
(i.e., individual sources may be exempt from offsets if the state makes 
an equivalency demonstration showing that the universe of new sources 
as a whole meets the applicable ratios). However, nothing in paragraph 
VI requires that equivalency demonstration to be made. Therefore, the 
commenter noted that paragraph VI on its face violates the 1990 
Amendments to the Act.
    Other commenters stated that the paragraph VI option is not 
acceptable because it would be difficult for some Tribes to meet the 
criteria. They stated that such a waiver does not balance legitimate 
development needs with environmental protection or that a major source 
could not interfere with attainment. One of these commenters also noted 
that these waivers would expire at attainment dates and added that 
these ``expiration dates'' established by states should not be imposed 
on Tribes.
    As we stated previously, we recognize the unique circumstances that 
Tribes face as well as the difficulty in obtaining offsets in certain 
parts of the country; however, we do not have the legal authority to 
waive the offset requirement under section 173 of the Act or under the 
TAR.
    Thus and to address the lack of offsets availability, both inside 
and outside of Indian country, we encourage states and Tribes to work 
together in the creation and use of offset banks for their lands since 
we agree that, where appropriate, Tribes can obtain offsets from 
surrounding areas. For example, Tribes may enter into a Memorandum of 
Understanding (MOU) with their neighboring states to allow Tribal 
access to offsets in the state offset bank and vice-versa if and when 
Tribes develop

[[Page 38776]]

their own offset banks. This MOU would contain provisions establishing 
the criteria for emissions reductions to be used as offsets such as 
real, quantifiable, surplus, permanent and enforceable.
    Furthermore, we are addressing the lack of availability of offsets 
in general. For example, in the final rule titled, ``Implementation of 
the New Source Review (NSR) Program for Particulate Matter Less Than 
2.5 Micrometers (PM2.5)'' (73 FR 28340), we finalized 
provisions that allow for inter-pollutant and inter-precursor trading 
of offsets between direct PM2.5 emissions and its precursor emissions. 
We believe this is a first step in the process of addressing the 
shortage of offsets in the nation and we will continue to explore and 
implement, as one commenter suggested, the use of non-traditional 
sources of offsets such as offsets from mobile sources and area or 
minor sources.
    Regarding the offset waivers we proposed, we want to clarify that 
these waivers are currently available under the CAA and implementing 
regulations for both states and Tribes. The EDZ option is currently 
available under section 173(a)(1)(B) of the Act and the Appendix S 
paragraph VI option is currently available under 40 CFR part 51 
Appendix S. Therefore, we disagree with those commenters that believed 
that if the proposed offset waivers would only be available for Indian 
country, then states would be at an economic disadvantage and/or that 
we would be creating pollution havens in Indian country.
    Nevertheless, based on the opposing comments we received, including 
comments from the Tribes, regarding the implementation issues under the 
Appendix S Paragraph VI option, we are only allowing the EDZ option 
that is currently available under the statute for both Tribes and 
States as a potential option for offset waiver and we are not 
finalizing the Appendix S Paragraph VI option in this final rule.
    After reviewing all the comments received, we believe that the EDZ 
option as established by statute is available for offset relief as long 
as the area meets the statutory criteria in order to qualify. In other 
words, Tribes who develop TIPs might request EPA to establish their 
area as an EDZ so they can avail themselves of the offset provision 
under section 173 of the Act.
    However, we disagree with the commenter who believed that, by 
definition, the proposed rule does not apply where there is a TIP and 
thus EPA would need to look at the relevant SIP of the surrounding or 
adjacent state for the applicable ``allowance of emissions'' for EDZ 
sources. We do not see why the commenter believed that a TIP is not an 
appropriate mechanism for the EDZ provision under section 173 since the 
TAR provides that Tribes will be treated in the same manner as states 
for virtually all CAA programs and states generally lack jurisdiction 
under the Act over facilities in Indian country.
    The ability of an area to qualify would be determined on a case-by-
case basis, but criteria for including Tribes in the EDZs and for 
consultation with the Tribes will need to be developed in advance and 
in coordination with the Secretary of Housing and Urban Development. 
These criteria will ensure that Tribal and state input are included and 
that considerations are put in place to avoid industries coming into an 
area strictly for the offset relief. Therefore, we disagree with the 
commenter that believed that a general set of approval criteria will be 
in conflict with the language of the Act.
    We are not finalizing the Appendix S provision as an option for 
offset waiver, since the provision is only available temporarily and it 
will be challenging for EPA or the Tribe to demonstrate that the 
proposed source will not interfere with the attainment date.

C. How do I meet the statewide compliance certification requirement of 
the Act and Appendix S?

    Pursuant to the statewide compliance certification requirements of 
section 173(a)(3) of the Act, as reflected in Appendix S at Condition 2 
of paragraph IV.A, an owner or operator of a proposed new or modified 
major stationary source must demonstrate that all other major sources 
under his/her control in the same state are in compliance or on a 
schedule for compliance with all emission limitations and standards 
under the Act. In the context of Indian country, we sought comment on 
whether this requirement should be expressed as an Indian country-wide 
compliance certification or remain a statewide certification. In other 
words, we requested comment on whether you should be required to 
certify that all your sources in the state where your proposed source 
is locating are in compliance or that all your sources in all of Indian 
country are in compliance.
    We received a variety of comments on this issue. Several commenters 
believed that the certification should be on a state-wide basis 
because: (1) It will not provide sources in Indian country with a 
competitive advantage over sources in non-Indian country, and (2) 
obtaining certification for all of Indian country would be very 
difficult since it is a vast area and sources under common control may 
be operated by different business units of the same parent company. On 
the other hand, one commenter believed that state-wide compliance 
certification would give EPA overreaching authority to facilities that 
are operating under SIP-approved programs within the state since other 
sources within the same state may not be within Indian country and thus 
regulated by the state rather than EPA.
    Regarding the Indian country-wide certification, one commenter 
supported it. The commenter believed this type of certification will 
benefit Tribes by allowing for the development of compliance databases, 
assisting Tribes with monitoring patterns of noncompliance, minimizing 
risk of noncompliance and building and enhancing consumer and market 
confidence.
    Other commenters provided comments supporting a national 
certification (not proposed) since they believed that expanding the 
requirement will ensure that the sources attempting to locate in Indian 
country will operate within regulatory parameters and several 
reservations exist in more than one state. Other commenters supported a 
certification for each applicable area of Indian country since these 
commenters believe that: (1) It would be too burdensome to require such 
certification across all of Indian country and (2) this is more 
consistent with treatment of individual Tribes as states under 
applicable EPA regulations.
    After consideration of comments, we are finalizing a state-wide 
compliance certification requirement consistent with section 173(a)(3) 
of the Act. We believe that a state-wide compliance certification: (1) 
Provides a broad enough look at the compliance history of the company, 
without overburdening the review process and (2) reflects a geographic 
approach to the certification rather than an approach based on the 
entity that is sovereign. An Indian country-wide certification would 
not have the proximity and geographic contiguity that a state-wide 
approach would have.

D. What are the public participation requirements for this program?

    We believe that the public participation requirements of 40 CFR 
51.161 apply to permitting under Appendix S. Additionally, for the 
nonattainment major NSR program in Indian country, we are finalizing 
detailed public participation requirements at 40 CFR 49.171. As 
proposed, the final public participation

[[Page 38777]]

requirements for the nonattainment major NSR program are very similar 
to those finalized for the minor NSR program at 40 CFR 49.157. See 
section IV.B of this preamble for more information on these 
requirements and the comments we received.

E. What are the provisions for final action on a permit, permit 
reopenings and administrative and judicial review procedures?

    In general, these provisions are based closely on selected 
provisions of part 124, subpart A. The specific provisions are as 
follows:
1. Final Action on a Permit
    This final rule requires that after making a decision to issue or 
deny your permit, the reviewing authority must notify you of the 
decision in writing and, if the permit is denied, provide the reasons 
for the denial. If the reviewing authority issues a final permit to 
you, it must make a copy of the permit available at any location where 
the draft permit was made available. In addition, the reviewing 
authority must provide adequate public notice of the final permit 
decision to ensure that the affected community, general public and any 
individuals who commented on the draft permit have reasonable access to 
the decision and supporting materials. See final 40 CFR 49.172(a).
    The reviewing authority's final decision on your permit must be 
based on an administrative record and the final rule includes 
requirements on what must be in that record. For example, the 
administrative record must include the application and any supporting 
data furnished by the applicant and all comments received during the 
public comment period, including any extension or reopening. See final 
40 CFR 49.172(b) and (c) for a listing of all the requirements.
    A few commenters largely supported the proposed provisions for 
providing notice of final permit actions. However, the commenters 
recommended that such notice be provided in the same manner that it was 
provided during the public comment on the draft permit. The commenters 
believed that numerous inconsistencies will occur if the agency uses 
subjective discretion based, as we proposed, ``upon the circumstances 
of your permit.''
    Based on the comments received, we are finalizing slightly 
different final permit public notice requirements for the nonattainment 
major NSR program and the minor NSR program. We believe that for major 
sources in nonattainment areas making a copy of the permit available at 
all of the locations where the draft permit was made available will not 
be too burdensome for the reviewing authorities and will ensure that 
the affected community and the general public have reasonable access to 
the applicable information. These provisions are included in 40 CFR 
49.171 of this final rule. However, for minor sources, we continue to 
believe that depending on the circumstances of your permit, the 
reviewing authority may elect to provide notice directly to the 
individuals who commented on the draft permit and/or use any of the 
other methods of public notice discussed in section IV.B.4 of this 
preamble because providing the same public noticing procedures as those 
that were used during the comment period for the draft permit might be 
too burdensome for minor sources. These provisions are included in 40 
CFR 49.157 of this final rule.
    Regarding the administrative record for a permit decision, we are 
finalizing these provisions as proposed and under 40 CFR 49.172(b) and 
(c). The records, including any required applications for each draft 
and final permit or application for permit revision, must be kept by 
the reviewing authority for no less than 5 years. These provisions are 
the same as the ones for the minor NSR program and details of the 
comments received and the rationale behind finalizing these provisions 
are included in section IV.B.3 of this preamble. We did not receive any 
comments about these provisions specifically for the nonattainment 
major NSR program.
2. Permit Reopenings
    Regarding the permit reopening provisions, the final rule requires 
that a permit may be reopened for cause by the reviewing authority on 
its own initiative, such as if it contains a material mistake or fails 
to assure compliance with permit requirements. See final 40 CFR 
49.172(e). Details of the comments received and the rationale behind 
finalizing these provisions are included in section IV.B.5 of this 
preamble. We did not receive any comments about these provisions 
specifically for the nonattainment major NSR program.
3. Administrative and Judicial Review Procedures
    At 40 CFR 49.172(d), we have finalized the provisions under which 
permit decisions for major nonattainment NSR permits may be appealed. 
Details of the comments received and the rationale behind finalizing 
these provisions are included in section IV.B.5 of this preamble. We 
did not receive any comments about these provisions specifically for 
the nonattainment major NSR program.

F. How is EPA revising Appendix S?

    As we explain in more detail in section V.A. of this preamble, we 
are amending Appendix S to include the alternative sites analysis 
provisions of CAA section 173. Therefore, we are finalizing a change to 
Appendix S that will add a Condition 5 to the provisions under 40 CFR 
Appendix S Paragraph IV.A. This condition will state that the permit 
applicant shall conduct an analysis of alternative sites, sizes, 
production processes and environmental control techniques for such 
proposed source that demonstrates that the benefits of the proposed 
source significantly outweigh the environmental and social costs 
imposed as a result of its location, construction or modification.
    In addition and as proposed, we are finalizing a minor change to 
Appendix S that is related to the ``emission limitations and standards 
of the Act.'' Existing paragraph II.B of Appendix S requires the 
reviewing authority to review each proposed new major source and major 
modification to determine whether it will meet ``any applicable NSPS in 
40 CFR part 60 or any national emission standard for HAPs in 40 CFR 
part 61.'' While we have incorporated this requirement into final 40 
CFR 49.169(a), we believe that it should be expanded to include the 
newer national emission standards for HAPs codified at 40 CFR part 63 
(commonly referred to as MACT standards). Accordingly, we are revising 
paragraph II.B of Appendix S to add these standards under the Act and 
to match the revised language of this paragraph with the final 40 CFR 
49.169(a). We did not receive any comments for this proposed provision.

VI. Legal Basis, Statutory Authority and Jurisdictional Issues

A. What is the basis for EPA's authority to implement these NSR 
programs in Indian country?

    As we have described in section III of this preamble, in the 
absence of an EPA-approved program, we are authorized to develop a FIP 
to protect air quality by directly implementing provisions of the Act 
throughout Indian country. See, e.g., 59 FR 43958-61 (August 25, 1994), 
63 FR 7262-64 (February 12, 1998) and 62 FR 13750 (March 21, 1997). For 
the PSD program, no Tribe is currently administering an EPA-approved 
PSD program.\30\ Therefore, EPA has been

[[Page 38778]]

implementing a FIP and issuing PSD permits for major sources in 
attainment areas in Indian country. See 40 CFR 52.21.
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    \30\ Under the Act and the TAR (see 40 CFR part 49, subpart A), 
eligible tribes may seek approval of their own PSD programs for 
their reservations and/or for other areas under their jurisdiction.
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    For the nonattainment major NSR program and the minor NSR program 
in Indian country, no Tribes have been administering an EPA-approved 
nonattainment major NSR program and only a few Tribes have been 
administering EPA-approved minor NSR programs.\31\ In addition, there 
has been no FIP in place to implement these programs until now. Hence, 
there was a regulatory gap in Indian country. This final rule will 
allow us to address that gap and more fully implement the NSR program 
in Indian country. We are finalizing the minor NSR program at 40 CFR 
49.151 through 49.165 and the nonattainment major NSR program at 40 CFR 
49.166 through 49.175.
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    \31\ For example, the St. Regis Mohawk Tribe has in place an 
EPA-approved TIP that includes provisions for minor NSR and 
synthetic minor permitting (See http://www.srmtenv.org/pdf_files/airtip.pdf). In addition, the Gila River Indian Community has 
developed a TIP that includes a minor NSR program (See http://www.epa.gov/region9/air/actions/gila-river.html).
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    It is important to recognize, however, that even though we are 
adopting this Federal program that applies in Indian country, the 
Tribes may still develop TIPs, similar to SIPs, to implement these 
programs. If a Tribe develops a TIP to implement NSR, the TIP, once it 
is approved by EPA, will replace the Federal program as the requirement 
for that area of Indian country and the Tribe will become the reviewing 
authority under its TIP.
    A few commenters remarked upon EPA's analysis of its jurisdiction 
in Indian country (citing various court cases as well as legislative 
history). These commenters believed that in general Congress placed the 
primary responsibility of preventing air pollution on states and thus 
states have the responsibility to adopt or enforce any emission 
standards in Indian country. Some of these commenters also added that 
this FIP violates the CAA because the Administrator has failed to make 
a finding that any specific state or Tribe has failed to submit an 
implementation plan or that any specific implementation plan either 
fails to satisfy the minimum criteria under the Act or has been 
disapproved in whole or in part. In addition, the commenter believed 
that the Act only authorizes the adoption of a FIP on a jurisdiction-
by-jurisdiction basis, not nationally. Two of these commenters also 
stated that even if the EPA adopts the proposed nationwide FIP, the FIP 
cannot supersede and EPA must acknowledge, the State of Oklahoma's 
right to administer its state air quality programs in areas of Indian 
country within Oklahoma under the Federal Safe, Accountable, Flexible 
and Efficient Transportation Equity Act: A Legacy for Users (2005). We 
disagree with these commenters to the extent they believe EPA does not 
have authority under the Act to implement these programs in Indian 
country.
    EPA's Authority To Implement the CAA in Indian Country. In the 
final rule titled, ``Indian Tribes: Air Quality Planning and 
Management,'' generally referred to as the ``Tribal Authority Rule'' or 
``TAR,'' EPA explains that it intends to use its authority under the 
CAA ``to protect air quality throughout Indian country'' \32\ by 
directly implementing the CAA's requirements where Tribes have chosen 
not to develop or are not implementing an EPA-approved CAA program. 63 
FR 7254, February 12, 1998. The final TAR at 40 CFR 49.11 states that 
EPA would ``promulgate without unreasonable delay such FIP provisions 
as are necessary or appropriate to protect air quality'' for these 
areas. The EPA is exercising its authority under sections 301(a) and 
301(d)(4) of the CAA and 40 CFR 49.11(a) to promulgate FIPs in order to 
remedy an existing regulatory gap under the CAA with respect to Indian 
country.
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    \32\ ``Indian country'' is defined under 18 U.S.C. 1151 as: (1) 
All land within the limits of any Indian reservation under the 
jurisdiction of the United States Government, notwithstanding the 
issuance of any patent and including rights-of-way running through 
the reservation, (2) all dependent Indian communities within the 
borders of the United States, whether within the original or 
subsequently acquired territory thereof and whether within or 
without the limits of a state, and (3) all Indian allotments, the 
Indian titles to which have not been extinguished, including rights-
of-way running through the same. Under this definition, EPA treats 
as reservations trust lands validly set aside for the use of a tribe 
even if the trust lands have not been formally designated as a 
reservation.
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    Although many facilities in these areas may have historically 
followed state and local government air quality programs, with rare 
exception, EPA has never approved those governments to exercise 
regulatory authority under the CAA in any area of Indian country. In 
addition, EPA has never approved a state or local government to 
implement a minor NSR or nonattainment major NSR program in Indian 
country.\33\ Since the CAA was amended in 1990, EPA has been clear in 
its approvals of state programs that the approved state program does 
not extend into Indian country. It is EPA's position that, absent an 
explicit demonstration of authority by a state to administer a CAA 
program in Indian country and absent an explicit finding by EPA of such 
jurisdiction and explicit approval of the state in Indian country, 
state and local governments lack authority under the CAA over air 
pollution sources and the owners or operators of air pollution sources 
throughout Indian country.
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    \33\ For purposes of approving the Washington Department of 
Ecology (WDOE) operating permits program under 40 CFR part 70, EPA 
explicitly found that WDOE demonstrated that the Washington Indian 
(Puyallup) Land Claims Settlement Act, 25 U.S.C. 1773, gives 
explicit authority to state and local governments to administer 
their environmental laws on all nontrust lands within the 1873 
Survey Area of the Puyallup Reservation in Tacoma, Washington.
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    Because only a few Tribes have yet sought eligibility to administer 
a minor NSR program and no Tribe has yet sought eligibility for the 
nonattainment major NSR program, a gap for implementation of these 
programs currently exists in Indian country. Given the longstanding air 
quality concerns in some areas and the need to establish requirements 
in all areas to maintain CAA standards, EPA believes that these FIP 
provisions are appropriate to protect air quality in Indian country 
where no EPA-approved minor NSR or nonattainment major NSR program is 
in place.
    The rules published here are based on the same CAA authority as EPA 
has used elsewhere in rulemaking that have been affirmed by the courts. 
The EPA's interpretation of its authority has been affirmed by the U.S. 
Court of Appeals for the District of Columbia Circuit in Arizona Public 
Service Co. v. EPA, 211 F.3d 1280 (DC Cir. 2000), cert. denied 121 S. 
Ct. 1600 (2001). In addition, EPA's authority to issue operating 
permits to major sources located in Indian country under title V of the 
Act, pursuant to nationwide regulations at 40 CFR part 71, was affirmed 
in State of Michigan v. EPA, 268 F.3d 1075 (DC Cir. 2001). The EPA has 
used this same authority to issue a number of FIPs to address air 
pollution concerns on a regional basis and at specific facilities 
located in Indian country. See Federal Implementation Plans Under the 
Clean Air Act for Indian Reservation in Idaho, Oregon, Washington, 40 
CFR part 49, subpart M (70 FR 18074, April 8, 2005) (upheld in Safe Air 
for Everyone v. EPA, 2006 WL 3697684 (9th Cir. 2006)); FIP for Tri-
Cities landfill, 40 CFR 49.22 (64 FR 65664, November 23, 1999); Salt 
River Pima-Maricopa Indian Community, 40 CFR 49.22 (64 FR 65663, 
November 23, 1999); FIP for the Astaris-Idaho LLC Facility (formerly 
owned by FMC Corporation) in the Fort

[[Page 38779]]

Hall PM-10 Nonattainment Area, 40 CFR 49.10711 (65 FR 51412, August 23, 
2000) and FIP for Four Corners Power Plant, Navajo Nation, 40 CFR 49.23 
(72 FR 25698, May 7, 2007) (upheld in Arizona Public Service Co. v. 
EPA, 562 F.3d 1116 (10th Cir. 2009)).
    Effects of State Law. The rules established by EPA here are in 
effect under the CAA. The EPA recognizes that in a few cases, other 
state or local governmental entities may have established air quality 
requirements that the commenters believe apply to activities in Indian 
country. However, unless those rules or requirements have been 
explicitly approved by EPA under the CAA to apply in Indian country, 
compliance with those other requirements does not relieve a source from 
complying with the applicable provision of this FIP. As EPA has stated 
elsewhere, states generally lack the authority to regulate air quality 
in Indian country. See Alaska v. Native Village of Venetie Tribal 
Government, 522 U.S. 520, 527 fn.1 (1998) (``Generally speaking, 
primary jurisdiction over land that is Indian country rests with the 
Federal Government and the Indian Tribe inhabiting it and not with the 
States.''), California v. Cabazon Band of Mission Indians, 480 U.S. 
202, 216 and n.18 (1987); see also HRI v. EPA, 198 F.3d 1224, 1242 
(10th Cir. 2000); see also discussion in EPA's final rule for the 
Federal operating permits program, 64 FR 8251-8255, February 19, 1999.
    Furthermore, with regard to Indian reservations, EPA interprets the 
CAA as establishing unitary management of air resources and as a 
delegation of Federal authority to eligible Tribes to implement the CAA 
over all sources within reservations, including non-Indian sources on 
fee lands. Accordingly, even if a state could demonstrate authority 
over non-Indian sources on fee lands within an Indian reservation, EPA 
believes that the CAA generally provides the Agency the discretion to 
Federally implement the CAA over all Indian reservation sources in 
order to ensure an efficient and effective transition to Tribal CAA 
programs and to avoid the administratively undesirable checker-boarding 
of reservation air quality management based on land ownership. The EPA 
believes that Congress intended that EPA take a territorial view of 
implementing air programs within reservations. The EPA also believes 
that air quality planning for a checker-boarded reservation area would 
be more difficult and that it would be inefficient if a state were to 
exercise regulation over piecemeal tracts of land within such areas, 
possibly with similar Indian country sources being subject to different 
substantive requirements. The EPA's approach provides for coherent and 
consistent environmental regulation within Indian country.
    Although EPA does not recognize state or local air regulations as 
being effective within Indian country for purposes of the CAA, absent 
an express approval by EPA of those regulations for an area of Indian 
country, this rulemaking does not address the validity of state and 
local law and regulations with respect to sources in Indian country or 
the authority of state and local agencies to regulate such sources, for 
purposes other than the Federal CAA. We are specifically not making a 
determination that these Federal CAA rules override or preempt any 
other laws that have been established outside the scope of the Federal 
CAA. The EPA does not, therefore, believe that any further preemption 
analysis suggested by the commenters is needed in these circumstances. 
As described above, EPA believes that its authority under the CAA to 
implement these programs in Indian country is clear and well-
established and has been upheld by reviewing courts in similar 
circumstances.
    With regard to the comments relating to Indian country and the 
State of Oklahoma, EPA recognizes that the Safe, Accountable, Flexible, 
Efficient Transportation Equity Act of 2005 (SAFETEA) contains a 
provision (section 10211) relating to implementation of environmental 
regulatory programs under Federal environmental laws, including the 
CAA, in Indian country in Oklahoma. However, to date, neither the State 
of Oklahoma, nor any Indian Tribe in Oklahoma, has applied for EPA 
approval to administer either of the CAA programs included in this 
rulemaking for any area of Indian country. In the absence of an EPA-
approved program, these FIPs will apply throughout Indian country, 
including Indian country in Oklahoma. In promulgating these FIPs, EPA 
is not acting on any potential request by the State of Oklahoma to 
administer any CAA or other regulatory program in Indian country, nor 
is EPA acting on any potential treatment-in-the-same-manner-as-a-state 
application for an environmental regulatory program by any Indian Tribe 
in Oklahoma. The EPA would address any such applications when necessary 
and on a case-by-case basis and in full consideration of the 
requirements of Section 10211 of SAFETEA. Section 10211 of the SAFETEA 
is thus not implicated in this rulemaking and is not a relevant 
consideration in EPA's promulgation of the minor and nonattainment 
major NSR programs for Indian country, including Indian country in 
Oklahoma.

B. How does a Tribe receive delegation to assist EPA with 
administration of the Federal minor and major NSR rules?

    With this action, we are finalizing the provisions on 
administrative delegation to Tribes as proposed. Our authority for such 
delegations is discussed in the following paragraphs.
    Under the procedures set forth in the TAR, Tribes may seek to 
demonstrate eligibility for approval of Tribal programs under the Act, 
including a Tribal NSR program, under Tribal law.\34\ The TAR allows 
Tribes to seek approval for such programs covering their reservations 
or other areas within their jurisdiction. However, we recognize that 
some Tribes may choose not to develop Tribal NSR programs for 
submission to EPA for approval under the TAR, but that these Tribes may 
still wish to assist us in implementing all or some portion of the 
Federal NSR program for their area of Indian country. In addition, 
although sections 110(o) and 301(d) of the Act and the TAR authorize us 
to review and approve TIPs, neither the Act nor the regulations provide 
that approval of Tribal programs under Tribal law is the sole mechanism 
available for Tribal agencies to take on permitting responsibilities. 
Accordingly, we are exercising our discretion to delegate 
administration of the Federal NSR program to interested and qualified 
Tribal agencies satisfying the requirements of final provisions at 40 
CFR 49.161 and 49.173. By assisting us with administration of the 
Federal program through delegation, Tribes may remain appropriately 
involved in implementation of an important air quality program and may 
develop their own capacity to manage such programs in the future should 
they choose to do so. Therefore final 40 CFR 49.161 and 49.173 of the 
minor and major NSR rules, respectively, provide Tribal governments the 
option of seeking delegation from us of the administration of the 
Federal NSR program or aspects of the program, for their area of Indian 
country.
---------------------------------------------------------------------------

    \34\ As noted elsewhere, the TAR contains a process, pursuant to 
section 301(d) of the Act, for tribes to seek treatment in a similar 
manner as a state (TAS), for various provisions and programs of the 
Act.
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    We have well-established processes for delegating our Federal 
authority to states and/or Tribes for administering Federal rules under 
the Act, including

[[Page 38780]]

conducting NSR under 40 CFR 52.21(u),\35\ issuing Federal operating 
permits under 40 CFR 71.4(j) and 71.10 and delegation to Tribes of 
elements of the Federal air rules for Indian country in the Pacific 
Northwest under 40 CFR 49.122. The process we will follow to delegate 
the administration of the Federal NSR program to a Tribal agency is 
similar to the process we follow to delegate the administration of 
Federal programs under those provisions.
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    \35\ The current provisions under 40 CFR 52.21(u) do not allow a 
tribe to request delegation of the PSD program. However, we are 
aware of this deficiency and we are currently working on a 
rulemaking that will amend this provision.
---------------------------------------------------------------------------

    This administrative delegation is to be distinguished from the TAS 
process under the TAR whereby Tribes seek approval to run programs 
under Tribal law. Tribes would not need to seek TAS under the TAR in 
order to request delegation of administration of aspects of these 
Federal NSR programs. Tribes would, however, need to provide the 
relevant application information described in sections 40 CFR 49.161 
and 49.173.\36\ In addition, program functions delegated under final 40 
CFR 49.161 or 49.173 remain part of the relevant FIP administered under 
Federal law. The delegate Tribal agency would simply assist EPA with 
administration of the program to the extent of the functions delegated.
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    \36\ This information includes identifying the specific rules 
and provisions and the area of Indian country for which the 
delegation is requested. In addition, tribal agencies seeking 
delegation must provide a statement by the tribe's legal counsel or 
equivalent official including a statement that the tribe is 
recognized by the Secretary of the Interior, a descriptive statement 
demonstrating that the tribe is currently carrying out substantial 
governmental duties and powers over a defined area (this statement 
should be consistent with the type of information described in 40 
CFR 49.7(a)(2), which relates to the separate process by which 
tribes apply to be treated in a similar manner as states for various 
purposes under the Act), a description of the laws of the tribe that 
provide adequate authority to administer the federal rules and 
provisions for which the delegation is requested and a descriptive 
statement demonstrating that the tribal agency has, or will have, 
the technical capability and adequate resources to administer the 
federal rules and provisions for which the delegation is requested.
---------------------------------------------------------------------------

    As described in the preamble to the TAR,\37\ it is our position 
that the TAS provision of the Act constitutes a statutory delegation of 
authority to eligible Tribes over their reservations. As described 
earlier, the TAR established procedures for our approval of Tribal 
eligibility applications to operate the programs of the Act under 
Tribal law. Where we approve a Tribal eligibility application and 
approve a Tribal NSR program, the approved Tribe will manage the 
program under Tribal law and the Tribal program becomes Federally 
enforceable. Among the required elements of a Tribal eligibility 
application under the TAR is a demonstration of the Tribe's authority, 
including appropriate enforcement authority, to regulate air quality 
for the areas to be covered by the program. For air resources within 
the exterior boundaries of a Tribe's reservation, the Tribe may rely on 
the Congressional delegation of Federal authority to operate approved 
Tribal programs. Tribes may also attempt to demonstrate authority to 
operate the programs of the Act over other areas outside of their 
reservations, generally including non-reservation areas of Indian 
country. Arizona Public Service Co. v. EPA, 211 F. 3d 1280 (DC Cir. 
2000), cert. den., 532 U.S. 970 (2001).
---------------------------------------------------------------------------

    \37\ See 63 FR 7254-59.
---------------------------------------------------------------------------

    In contrast, the administrative delegation approach finalized in 
these rules provides for us to delegate administration of the Federal 
program operating under Federal law to interested Tribes that provide 
the information described in final 40 CFR 49.161(b)(1) and 
49.173(b)(1). Since this program operates throughout Indian country 
under Federal authority, Tribes will not need to demonstrate either 
Congressionally-delegated authority over air resources within the 
exterior boundaries of their reservations or authority of non-
reservation areas of Indian country. Instead, Tribal agencies will 
assist us in implementing the Federal program by taking delegation of 
the administration of particular activities conducted under our 
authority in Indian country. Under final 40 CFR 49.161(b)(1)(iii)(C) 
and 49.173(b)(1)(iii)(C), Tribes will only need to show that their laws 
provide adequate capacity and authority to carry out the delegated 
activities. For example, where a Tribe seeks administrative delegation 
for permit issuing activities of the Federal program, the Tribe may, 
among other things, need to show it has in place an appropriate agency 
with legal authority to review applications and issue permits on behalf 
of the delegate Tribal government. For these administratively delegated 
programs, Federal program requirements will continue to be subject to 
enforcement by EPA, not the delegate Tribal agency, under Federal law. 
Administrative appeals of permitting decisions will also continue to be 
made directly to the EAB under our administrative procedures with any 
subsequent judicial review to be conducted in Federal court. In the 
final rules we make it clear that we will not delegate enforcement or 
appeal components of the program to Tribal agencies.
    When delegation is approved, a Partial Delegation of Administrative 
Authority Agreement between the Administrator and the Tribal agency 
will set forth the terms and conditions of the delegation and will also 
specify the rules and provisions that the Tribal agency is authorized 
to implement. Once the delegation becomes effective, the Tribal agency 
will have the authority under the Act, to the extent specified in the 
Agreement, to administer the rules in effect for the particular area of 
Indian country and to act on behalf of the Administrator. The Federal 
requirements administered by the delegate Tribal agency will be subject 
to enforcement by EPA under Federal law.
    When we have delegated administration of the portion of the Federal 
minor or major NSR program that includes receipt of permit application 
materials and preparation of draft permits, the delegate Tribal agency 
must provide us a copy of each permit application (including any 
application for permit revision) and each draft permit.\38\ In any such 
delegation, we retain the authority to object to the issuance of any 
permit that we determine not to be in compliance with the requirements 
under the program or other requirements pursuant to regulations under 
the Act. For any such objections, we will outline the reasons for the 
objection in writing and we will provide a copy of the written 
statement to the permit applicant. The delegate Tribal agency may not 
issue a permit if we object to its issuance in writing. The delegate 
Tribal agency may submit a revised draft permit to us in response to 
the objection. However, if it does not do so within 90 days, we will 
issue or deny the permit in accordance with the requirements of the 
Federal minor or major NSR program, as applicable.
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    \38\ The proposed minor and major NSR programs provide that the 
delegate tribal agency may require the applicant to provide a copy 
of the permit application directly to us. In addition, with our 
consent, the delegate tribal agency may submit to us a permit 
application summary form and any relevant portion of the permit 
application.
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    We did not receive any comments expressly supporting our delegation 
provisions. However, a number of commenters opined that when a Tribe 
has administrative delegation of the program, enforcement authority 
should be delegated to the Tribes as well. These comments are addressed 
in section VII.B of this preamble.
    Other commenters oppose delegation of the program to the Tribes. 
One of these commenters believed that

[[Page 38781]]

delegation demonstrations will be approved by EPA based on their 
administrative completeness, rather than on their technical merit and 
thus recommends that any delegation be contingent upon an approved TIP. 
Another commenter maintained that only the TAS process should be used 
to delegate authority of environmental programs to Tribes to avoid 
jurisdictional conflicts between EPA, Tribes and the state (especially 
in Oklahoma because there have been, according to the commenter, 
significant problems there with Tribes providing adequate jurisdiction 
of lands they claim) and to avoid confusion for the regulated 
community. The commenter suggested that if the administrative 
delegation process is included in the final NSR program, it should 
include a Federal Register public notice and comment provision. Another 
commenter believed that because EPA has not made any jurisdictional 
determinations in connection with the proposed FIP, delegation of 
authority to Tribes to assist in administering the FIP violates the 
plain requirements of the Act.
    As described previously, EPA continues to believe that the CAA 
authorizes us to use the administrative delegation approach to assist 
EPA in carrying out implementation of our Federal program. See CAA 
section 301(a).\39\ The EPA believes that the administrative delegation 
provisions provide additional flexibility for implementation of the 
Federal rules and establish an appropriate means for Tribal involvement 
in EPA's Federal implementation of CAA requirements.
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    \39\ Section 301(a)(1) of the Act provides that the 
Administrator is authorized to prescribe such regulations as are 
necessary to carry out his or her functions under the Act. This 
authority supports EPA's finalization of 40 CFR 49.161 and 49.173 of 
the minor and major NSR rules, respectively, which provide for 
partial administrative delegations to tribal agencies. However, 
nothing in the final rules requires us to delegate administration of 
any aspect of the federal program to a tribal agency.
---------------------------------------------------------------------------

    As described above, delegation of the authority to assist EPA with 
administration of elements of the Federal NSR programs is a process 
that is distinct from approval of Tribal eligibility and Tribal 
programs under CAA section 301(d) and the TAR. To the extent the 
commenters are concerned that administrative delegation acts as an 
approval of Tribal authority, EPA reiterates that irrespective of any 
such delegation, the minor NSR and nonattainment major NSR programs 
established here will continue to operate under Federal authority 
subject to EPA appeal procedures before EPA's Environmental Appeals 
Board and to enforcement solely by EPA. The administrative delegation 
provision simply allows EPA to delegate certain functions to qualified 
Tribes that may then assist EPA with administration of the programs.
    EPA also notes that because the minor and nonattainment major NSR 
programs will continue to operate under Federal authority (irrespective 
of administrative delegation of any functions to qualified Tribes), 
none of the jurisdictional issues raised in the comments should arise. 
Indeed, as described elsewhere, EPA's well-established Federal 
authority to implement CAA programs in Indian country in the absence of 
an EPA-approved program should provide jurisdictional certainty to all 
sources covered by these programs. Similarly, issues of Tribal 
jurisdiction over covered sources should not arise since no showing or 
finding of such jurisdiction is needed for administration of the 
Federal programs.
    As noted in EPA's proposal of the minor NSR and nonattainment major 
NSR rules, EPA also intends to consult with other Federal, state, 
Tribal or local governmental entities or other governmental agencies in 
the area, prior to finalizing a delegation agreement with a Tribal 
agency. Although the CAA does not require such consultations or any 
specific process, to approve administrative delegations, EPA believes 
that this approach provides an appropriate opportunity for such 
governmental entities to express views regarding the potential 
delegation agreement and will assist EPA in identifying any 
unanticipated issues.
    The EPA also notes that our establishment of criteria for the 
delegation provisions of the minor and nonattainment major NSR rules 
for Tribes seeking to assist EPA with administration of the Federal 
programs does not change the criteria EPA would evaluate in reviewing 
and acting upon Tribal applications for TAS under CAA section 301(d) 
and the TAR. CAA section 301(d) and the TAR at 40 CFR 49.6 and 49.7 
establish the criteria Tribes must demonstrate and the types of 
information to be included in Tribal applications, to obtain TAS 
eligibility to administer Tribal programs under Tribal law.
    Although the TAS and delegation criteria overlap in certain 
respects, they also contain significant differences, most notably in 
the required demonstration of authority. Tribes seeking TAS eligibility 
to administer approved Tribal regulatory programs under Tribal law must 
demonstrate their relevant authority, including appropriate enforcement 
authority, to regulate air quality in the areas to be covered by the 
program. See 40 CFR 49.6(c) and 49.7(a)(3). By contrast, because the 
minor and nonattainment major NSR programs will, in all circumstances, 
operate under Federal authority, Tribes requesting to assist EPA 
through administrative delegation need not demonstrate Congressionally-
delegated authority over air resources within the exterior boundaries 
of their reservations or authority over non-reservations areas of 
Indian country. Instead, such Tribes would only need to show that their 
laws provide adequate capacity and authority to carry out the delegated 
activities. These distinctions between the TAS and administrative 
delegation requirements are important and EPA reiterates that nothing 
in either process is intended to affect the criteria and requirements 
for the other.

C. What happens to permits previously issued by states to sources in 
Indian country?

    In the past, sources in some areas of Indian country may have 
received permits from states. However, states generally lack 
jurisdiction under the Act over these facilities and generally were not 
authorized under the Act to issue such permits in Indian country. See 
sections III.B and VI.A. of this preamble for more information. 
Therefore, this final rulemaking provides a mechanism to change state 
permits issued to major sources of regulated NSR pollutants in 
nonattainment areas of Indian country to Federal major NSR permits. If 
you own or operate a major source with a state-issued nonattainment 
major NSR permit, you must apply to convert the permit to a Federal 
permit under this program within 1 year of the effective date of this 
program. See final 40 CFR 49.168(b). We believe that transforming the 
state permits into Federal major NSR permits for major sources in 
Indian country is appropriate to protect air quality in Indian country.
    A couple of commenters believed that the permit reapplication 
process set out in the proposed 40 CFR 49.158(c)(1) and 49.168(b) seems 
unnecessarily complex and thus these commenters argued that these 
permits should be transferred ``en masse'' from one agency to the other 
with a simple notification to the operator of the transfer or 
jurisdiction. One of these commenters added that if EPA feels that the 
``en masse'' transfer methods are impracticable, then the source should 
be able to transfer the permit by submitting a transfer request (not a 
complete application) with a copy of the permit to both agencies, while 
the other commenter stressed that sources with state minor NSR permits 
should be

[[Page 38782]]

grandfathered into the Indian country program and not required to 
conduct minor NSR permitting.
    On the other hand, one commenter maintained that while previous 
state permit conditions may be appropriate to be included in the new 
Federal permit, this should not be automatic. The commenter also stated 
that government-to-government consultation between EPA and the affected 
Tribe must take place during this process. Furthermore, two commenters 
pointed out that the proposal did not discuss what enforcement 
mechanism would be used if a source failed to convert a state permit to 
a Federal permit in the given time frame and thus one of these 
commenters recommended that EPA should consider using Tribal courts for 
this purpose since the infraction would occur on Tribal lands and 
within Tribal jurisdiction.
    After considering these comments, we believe that transforming 
state nonattainment major NSR permits into Federal nonattainment major 
NSR permits in Indian country is appropriate to protect air quality in 
Indian country. However, we do not believe that these permits should be 
transferred ``en masse'' from one agency to another or be automatically 
transferred because we need to determine if the permit complies with 
the applicable requirements under the NSR program. If it does not, a 
new permit with appropriate requirements would have to be public 
noticed and issued. If a source fails to obtain a required Federal 
permit by the established timeline and/or does not meet the applicable 
requirements under this rule, it may be subject to potential 
enforcement action. We also believe that since any failure of a source 
to convert a state permit into a Federal permit would be a violation of 
this rule, the violation is of the Federal requirement and thus 
administratively enforceable by EPA and in Federal court, not Tribal 
court. Because these programs are operated under Federal authority, 
there is no finding (and no need for a finding) of Tribal jurisdiction.

VII. Implementation Issues

A. Are Tribes allowed to collect fees for NSR permitting?

    Many Tribal commenters suggested that the NSR program should 
include a mechanism that allows Tribes or the EPA to collect fees to 
offset the costs of the program, especially when a Tribe has been given 
delegation of the program. Two of these commenters pointed out that 
Tribes that do accept delegation of the program will need resources, 
such as funds to train and support personnel who will be reviewing and 
commenting on the permitting applications and funds for providing 
technical assistance to businesses regarding compliance issues. Some of 
these commenters also indicated that EPA should provide funding for 
Tribal implementation of the NSR program, for example, through 
cooperative agreements and grants.
    The Agency is aware of and concerned about the resource needs of 
the rule, but the CAA does not give the Agency explicit authority to 
charge permit fees for pre-construction permitting. However, under a 
delegation agreement, EPA and the delegated Tribe could, as 
appropriate, establish mechanisms to fund the work by Tribal staff, 
that may include Federal funding assistance through cooperative 
agreements and grants and/or user fees and charges established by the 
Tribe [under Tribal law] for the purpose of funding its administrative 
activities on behalf of EPA (See Federal Implementation Plans Under the 
Clean Air Act for Indian Reservations in Idaho, Oregon and Washington 
(70 FR 18080)). In addition, Tribes that develop TIPs can charge for 
permits under their authority. Furthermore, the final rule includes a 
number of mechanisms to address concerns regarding the resource burden, 
including: Encouraging delegation of the program through trainings 
(face-to-face training sessions and through ITEP training) and 
developing and using general permits.

B. Who retains enforcement authority in Indian country?

    Numerous Tribal commenters recommended that administrative 
delegation of the program to Tribes should include enforcement 
authority. Where they were specific, most of these commenters specified 
delegation of civil enforcement authority (including the ability to 
collect civil penalties to help support the program), but a number of 
commenters also favored delegation of criminal enforcement authority. 
In addition, commenters stated that by declining to administratively 
delegate enforcement (whether civil or criminal) of Federal permits to 
Tribes, EPA is acting inconsistently with other delegations which, in 
the commenters' view, withhold only criminal enforcement, but include 
civil enforcement. Other commenters also added that Tribes should be 
allowed to negotiate the level of enforcement authority on a case-by-
case basis. We disagree with these commenters.
    The EPA believes that these commenters mistake the distinction 
between approvals of Tribal programs under Tribal law provided for in 
the TAR and the administrative delegations at issue here. Where EPA 
approves an eligible Tribe for TAS under CAA section 301(d) and the 
TAR, EPA will continue to review the applicant Tribe's authority, 
including its authority to enforce, in an appropriate Tribal forum, any 
approved Tribal program operated under Tribal law. In such 
circumstances, EPA has recognized that certain limitations on Tribal 
criminal authority should not constitute a bar to Tribal program 
approval and has determined to fill any gap in Tribal criminal 
authority by retaining primary criminal enforcement at the Federal 
level for all circumstances in which a Tribe is precluded from 
exercising such authority. See 40 CFR 49.7(a)(6), 49.8. In such 
situations EPA would, however, generally expect the applicant Tribe to 
demonstrate authority to pursue appropriate civil enforcement under 
Tribal law of any approved Tribal program.
    By contrast, any permits issued under the Federal NSR programs 
(even where issued by a Tribe acting on EPA's behalf pursuant to a 
delegation agreement) remain Federal in character and continue to be 
enforceable (whether civilly or criminally) in Federal court. EPA does 
not believe that it would be appropriate to delegate enforcement of a 
Federal permit in Federal court to an Indian Tribe assisting EPA with 
administration of the NSR program. Indeed, in similar circumstances EPA 
has consistently withheld enforcement in Federal court from any 
administratively delegated entity, whether a state or a Tribe. For 
instance, under certain other CAA programs (e.g., EPA's major source 
operating permit program under 40 CFR part 70 and EPA's PSD program 
under 40 CFR 52.21) EPA may, in appropriate circumstances, delegate 
administration of elements of the program to non-Federal entities. 
However, while such entities may pursue enforcement in their own courts 
of parallel non-Federal air quality requirements, enforcement of the 
Federal permit in Federal court will always be retained and conducted 
by EPA.\40\ See also 40 CFR 49.122; 70 FR 18074, 18080-81, April 8, 
2005 (discussing EPA's similar approach to administrative delegation in 
the context

[[Page 38783]]

of FIPs for Indian reservations in the Pacific Northwest).
---------------------------------------------------------------------------

    \40\ Most states have sought and obtained EPA approval to 
administer their own minor and nonattainment major NSR programs 
administered under state law. To the extent the commenters believe 
that states are pursuing enforcement of NSR programs, EPA notes that 
such enforcement is likely being taken pursuant to State law under 
such approved state programs.
---------------------------------------------------------------------------

    The EPA's approach to administrative delegation of the Federal NSR 
programs is thus consistent with other administrative delegation 
regulations and with EPA's approach to approval of Tribal programs 
under the TAR. The EPA notes that Tribes interested in enforcing NSR 
permits issued in their areas may continue to seek TAS eligibility and 
program approval pursuant to established procedures under the TAR. 
Indeed, EPA expects that the approach to administrative delegation of 
elements of the Federal NSR program may benefit such Tribes by 
providing opportunities for Tribes that are building air quality 
programs to gain experience by assisting EPA with administration of the 
Federal rules without needing to first develop Tribal air programs 
under Tribal law. To the extent such Tribes do subsequently obtain TAS 
eligibility and NSR program approval, their approved Tribal programs 
under Tribal law would replace the relevant Federal rule. In addition, 
EPA recognizes that some Tribes may choose not to develop air programs 
under Tribal law, but may still want to participate in air quality 
management in their areas of Indian country. Administrative delegation 
of elements of the Federal rules may provide an appropriate opportunity 
for such Tribal involvement.
    Consequently, EPA believes the distinction between delegation of 
administration of aspects of the Federal NSR rules and approval of 
eligible Tribal programs under CAA section 301(d) and the TAR is 
significant and warrants EPA's retention of Federal enforcement of 
Federal NSR permits in Federal court. The EPA also believes that this 
approach does not create any inconsistency with its treatment of Tribal 
programs under the TAR or with EPA's approach to administrative 
delegations of other CAA programs to Tribes and states.

C. What is the implementation schedule for the final rules?

    At proposal we stated that all the provisions of these final rules 
will be effective 60 days from publication of the final rule based on 
the information we had at the time about the number of sources that 
might need to seek permits under the minor NSR program. In the 
proposal, we noted that the data on minor sources in Indian country 
were very limited, but we projected that 288 new minor sources and 112 
modifications will be required to obtain permits during the first six 
years of implementation of the minor NSR program (71 FR at 48724). 
Since then, however, the Agency has obtained additional information 
about sources in Indian country and the Agency now estimates that 
several thousand new and modified minor sources will be created in 
Indian country during the first six years following issuance of this 
rule (see section VIII of this preamble for more information about the 
projected number of new and modified sources that might be subject to 
this program).
    Furthermore, a few commenters believed that neither EPA nor Tribal 
agencies had adequate resources to implement the NSR program without 
significant permitting delays. One commenter in particular was very 
concerned about the workload EPA Regions will have, especially those 
Regions that oversee large areas of Indian country, given EPA's 
presupposition that few, if any, Tribes will be prepared to pursue 
delegation of the responsibility to implement these requirements.
    Therefore, upon review of our updated estimate of the projected 
number of covered sources and the comments we received pertaining to 
this issue, we agree that it would be very challenging for us, as the 
reviewing authority until a Tribe requests delegation or obtains 
approval of a TIP, to implement all elements of the final rules 
simultaneously beginning on the rules' effective date. We currently 
experience resource constraints and these rules will create new 
workload for the Agency, especially for those EPA Regions where EPA, as 
the reviewing authority, would oversee a large number of Tribes. 
Consequently, to ensure timely permit issuance, we have decided to 
delay the implementation date of the minor NSR permitting requirement 
for true minor sources for a period of 36 months after this rule's 
effective date, that is, September 2, 2014. The implementation dates of 
other parts of the program depending on the type of source being 
permitted are as follows:
    Existing major sources.
     If you wish to commence construction of a minor 
modification at an existing major source on or after the effective date 
of the final rule (that is, on or after August 30, 2011), you must 
obtain a permit pursuant to 40 CFR 49.154 and 49.155 (or a general 
permit pursuant to 40 CFR 49.156, if applicable) prior to commencing 
construction.
     If you wish to obtain a synthetic minor source permit 
pursuant to 40 CFR 49.158 to establish a synthetic minor source and/or 
a synthetic minor HAP source at your existing major source, you may 
submit a synthetic minor source permit application on or after August 
30, 2011. However, if your permit application for a synthetic minor 
source and/or synthetic minor HAP source pursuant to the FIPs for 
reservations in Idaho, Oregon and Washington has been determined 
complete prior to August 30, 2011 you do not need to apply for a 
synthetic minor source permit under this program.
    Synthetic minor sources.
     If you wish to commence construction of a new synthetic 
minor source and/or a new synthetic minor HAP source \41\ or a 
modification at an existing synthetic minor source and/or synthetic 
minor HAP source on or after the effective date of the final rule (that 
is, on or after August 30, 2011), you must obtain a permit pursuant to 
40 CFR 49.158 prior to commencing construction.
---------------------------------------------------------------------------

    \41\ EPA's historic policy is ``that facilities may switch to 
area source status [in this case through a synthetic minor permit] 
at any time until ``the first compliance'' of the standard. The 
``first compliance date'' is defined as the first date a source must 
comply with an emission limitation or other substantive regulatory 
requirement (i.e., leak detection and repair programs, work practice 
measures, housekeeping measures, etc * * *, but not a notice 
requirement) in the applicable MACT standard. Facilities that are 
major sources for HAPs on the ``first compliance date'' are required 
to comply permanently with the MACT standard to ensure that maximum 
achievable reductions in toxic emissions are achieved and 
maintained.'' Memorandum from John S. Seitz, Director, Office of Air 
Quality Planning and Standards, U.S. EPA, ``Potential to Emit for 
MACT Standards--Guidance on Timing Issues'' (May 16, 1995). EPA 
continues to believe that this policy best reflects the way Congress 
intended the MACT program to function. As a result, if you own or 
operate a major source subject to a MACT standard for which the 
initial compliance date has already passed, you cannot become a 
synthetic minor source for purposes of or otherwise avoid continuing 
to comply with that particular MACT standard.
---------------------------------------------------------------------------

     If your existing synthetic minor source and/or synthetic 
minor HAP source was established pursuant to the FIPs applicable to the 
Indian reservations in Idaho, Oregon and Washington or was established 
under an EPA-approved rule or permit program limiting potential to 
emit, you do not need to take any action under this program unless you 
propose a modification for this existing synthetic minor source and/or 
synthetic minor HAP source, on or after the effective date of this 
rule, that is, on or after August 30, 2011. For these modifications, 
you need to obtain a permit pursuant to 40 CFR 49.158 prior to 
commencing construction.
     If your existing synthetic minor source and/or synthetic 
minor HAP source was established under a permit with enforceable 
emissions limitations

[[Page 38784]]

issued pursuant to the part 71 program, the reviewing authority has the 
discretion to require you to submit a permit application for a 
synthetic minor source permit under this program within 1 year after 
the effective date of the final rule (that is, by September 4, 2012, 
and pursuant to 40 CFR 49.158), to require you to submit a permit 
application for a synthetic minor source permit under this program 
(pursuant to 40 CFR 49.158) at the same time that you apply to renew 
your part 71 permit or to allow you to continue to maintain synthetic 
minor status through your part 71 permit. If the reviewing authority 
requires you to obtain a synthetic minor source permit and/or a 
synthetic minor HAP source permit under this program (pursuant to 40 
CFR 49.158), it also has the discretion to require any additional 
requirements, including control technology requirements, based on the 
specific circumstances of the source.
     If your existing synthetic minor source and/or synthetic 
minor HAP source was established through a mechanism other than those 
described in the preceding paragraphs, you must submit an application 
pursuant to 40 CFR 49.158 for a synthetic minor source permit within 1 
year after the effective date of the final rule, that is, by September 
4, 2012. The reviewing authority has the discretion to require any 
additional requirements, including control technology requirements, 
based on the specific circumstances of the source.
    True minor sources.
     If you own or operate an existing true minor source in 
Indian country (as defined in 40 CFR 49.152(d)), you must register your 
source with your reviewing authority in your area within 18 months 
after the effective date of this program, that is, by March 1, 2013. If 
your true minor source commences construction in the time period after 
the effective date of this rule and September 2, 2014, you must also 
register your source with the reviewing authority in your area within 
90 days after the source begins operation. You are exempt from this 
registration requirement if your source is subject to 40 CFR 49.138--
``Rule for the registration of air pollution sources and the reporting 
of emissions.''
     If you wish to commence construction of a new true minor 
source or a modification at an existing true minor source that is 
subject to this program, you must obtain a permit pursuant to 40 CFR 
49.154 and 49.155 (or a general permit pursuant to 40 CFR 49.156, if 
applicable) by the earlier of 6 months after the general permit for a 
source category is published in the Federal Register or on or after 36 
months from the effective date of this rule, that is, September 2, 
2014. The proposed new source or modification will be subject to the 
registration requirements of 40 CFR 49.160, except for sources that are 
subject to the registration requirements of 40 CFR 49.138--``Rule for 
the registration of air pollution sources and the reporting of 
emissions.''

VIII. Statutory and Executive Order Reviews

A. Executive Order 12866: Regulatory Planning and Review

    Under Executive Order 12866 (58 FR 51735, October 4, 1993), this 
action is a ``significant regulatory action'' because it raises novel 
legal or policy issues arising out of legal mandates, the President's 
priorities or the principles set forth in the Executive Order. 
Accordingly, EPA submitted this action to the Office of Management and 
Budget (OMB) for review under Executive Orders 12866 and 13563 (76 FR 
3821, January 21, 2011) and any changes made in response to OMB 
recommendations have been documented in the docket for this action.
    In addition, EPA prepared an analysis of the potential costs and 
impacts associated with this action. This rule is not considered 
economically significant because EPA estimates the total annualized 
costs of the rule to be substantially lower than $100 million.
    Given that during the first three years following the rule's 
effective date, all new and modified sources are either required to 
register or request coverage under the general permit available for 
their source category (unless the source decides to apply for a site-
specific permit at the time the source had to request coverage under 
that general permit), the EPA estimates lower bound \42\ total 
annualized costs of the rule to be $4.6 million, including $2.3 million 
for industry and $2.3 million for the Agency ($2008) while upper bound 
\42\ total annualized costs of this rule are estimated to be 
approximately $4.7 million per year, including $2.4 million for 
industry and $2.3 million for the Agency ($2008). After the first 36 
months, total annualized costs for true minor sources would increase, 
since all new and modified true minor sources will have to apply for a 
site-specific permit or request coverage under a general permit. 
However, EPA believes that costs for sources choosing to request 
coverage under a general permit would remain low, as would cost for the 
Agency. This analysis is contained in the EIA for this final rule. A 
copy of the analysis is available in the docket for this action.
---------------------------------------------------------------------------

    \42\ ``Lower Bound'' costs in the Economic Impact Analysis (EIA) 
of this rule only include monitoring, recordkeeping and reporting 
costs computed under the conservative assumption that all facilities 
choose site-specific permitting (cost burden for development and 
implementation of general permits is unknown at this time). Under 
the ``Upper Bound'' cost estimates some facilities area assumed to 
be subject to BACT.
---------------------------------------------------------------------------

B. Paperwork Reduction Act

    The information collection requirements in this rule have been 
submitted for approval to the Office of Management and Budget (OMB) 
under the Paperwork Reduction Act, 44 U.S.C. 3501 et seq. The 
information collection requirements are not enforceable until OMB 
approves them.
    The information collection requirements resulting from this final 
rule are associated with certain records and reports that are necessary 
for the Tribal agency (or the EPA Administrator in non-delegated 
areas), for example, to: (1) Confirm the compliance status of 
stationary sources, (2) identify any stationary sources not subject to 
the standards and identify stationary sources subject to the rules, and 
(3) ensure that the stationary source control requirements are being 
achieved. The information would be used by the EPA or Tribal 
enforcement personnel to (1) identify stationary sources subject to the 
rules, (2) ensure that appropriate control technology is being properly 
applied, and (3) ensure that the emission control devices are being 
properly operated and maintained on a continuous basis. Based on the 
reported information, the delegate Tribes (or the EPA Administrator in 
non-delegated areas) can decide which plants, records or processes 
should be inspected.
    The nonattainment major NSR rule would have little impact on 
existing major sources in Indian country because it would only affect 
such owners and operators if they propose a major modification and only 
one is expected during the first 6 years after promulgation (See the 
Economic Impact Analysis in the docket for this action for more 
information). In addition, the final rule would only result in an 
administrative change for new major sources in Indian country because, 
although the regulatory mechanism to issue permits is not yet available 
in the form of either a Federal nonattainment major NSR rule or a TIP, 
we are already required to implement the program in Indian country and 
have developed source-specific FIPs to do so. As a result, there would 
be no new or additional burden on industry.
    With regard to the minor source permitting rule (including new 
minor

[[Page 38785]]

sources, minor modifications at minor sources, minor modifications at 
major sources and new synthetic minor sources), it is estimated that 
4,326 new or modified facilities will be affected for the first 3 years 
after promulgation of the rule.
    Minor sources will incur approximately 47,220 hours in monitoring, 
recordkeeping and reporting burden, incurring an estimated $549,402 
($2008) in burden during this 36 month period to complete registration 
or request coverage under a general permit. In addition, 32,970 
existing true and synthetic minor sources will incur a one-time burden 
of 169,590 hours or an estimated $2.1 million, to complete registration 
for true minor sources and to secure new permits for existing synthetic 
minor sources. The Agency is estimated to incur 76,550 hours or $6.91 
million ($2008) in burden to administer the minor source program during 
the first 3 years after rule promulgation. This Agency burden does not 
include costs associated with development and implementation of new 
general permits, as these costs are not known at this time. Burden is 
defined at 5 CFR 1320.3(b).
    An agency may not conduct or sponsor and a person is not required 
to respond to, a collection of information unless it displays a 
currently valid OMB control number. The OMB control numbers for EPA's 
regulations in 40 CFR are listed in 40 CFR part 9. When this ICR is 
approved by OMB, the Agency will publish a technical amendment to 40 
CFR part 9 in the Federal Register to display the OMB control number 
for the approved information collection requirements contained in this 
final rule.

C. Regulatory Flexibility Act (RFA)

    The RFA generally requires an agency to prepare a regulatory 
flexibility analysis of any rule subject to notice and comment 
rulemaking requirements under the Administrative Procedure Act or any 
other statute unless the agency certifies that the rule will not have a 
significant economic impact on a substantial number of small entities. 
Small entities include small businesses, small organizations and small 
governmental jurisdictions.
    For purposes of assessing the impacts of this final rule on small 
entities, ``small entity'' is defined as: (1) A small business as 
defined by the Small Business Administration's regulations at 13 CFR 
121.201; (2) a small governmental jurisdiction that is a government or 
a city, county, town, school district or special district with a 
population of less than 50,000; and (3) a small organization that is 
any not-for-profit enterprise which is independently owned and operated 
and is not dominant in its field.
    After considering the economic impacts of this final rule on small 
entities, I certify that this action will not have a significant 
economic impact on a substantial number of small entities. The small 
entities potentially regulated by this final rule in Indian country 
are:
     New and modified minor sources of regulated NSR 
pollutants;
     Sources of regulated NSR pollutants choosing to accept 
enforceable emission limitations to avoid major source regulations 
(synthetic minors);
     Sources of HAP choosing to accept enforceable emission 
limitations to avoid major source regulations (synthetic minors);
     Minor modifications to major sources of regulated NSR 
pollutants;
     New major sources of regulated NSR pollutants in 
nonattainment areas; and
     Major modifications to major sources of regulated NSR 
pollutants in nonattainment areas.
    We have determined that the new major sources and major 
modifications at existing major sources in nonattainment areas will 
incur no incremental costs or will experience cost savings due to the 
final rule because the rule only changes the regulatory mechanism in 
which these sources can request a permit (it does not change the 
compliance requirements). The costs of the source-specific FIP (the 
alternative mechanism in the absence of this rule) would have been 
comparable to the estimated costs of complying with this rule. In 
addition, since the permitting process may be less uncertain under the 
final rule, new and modifying major sources could potentially 
experience cost savings compared to baseline conditions.
    Therefore, the screening assessment focused on costs for new and 
modified minor sources, minor modifications at major sources and 
synthetic minor sources. To analyze potential impacts to small 
companies owning such sources, we first estimated the number of new 
sources that would be sited in Indian country over the period of 2011 
through 2016. However, since data on minor sources in Indian country 
are generally very limited, we conducted an exhaustive search for 
information currently available from EPA databases, the Small Business 
Administration and EPA Regional Offices. We then collected data from 
the Economic Census (2002) on the number of establishments of each type 
in each state and allocated the establishments to Indian country based 
on Tribes' share of state income. Then, we projected the number of new 
minor sources of each type that would be created in Indian country by 
applying the estimated growth rate for American Indian/Alaska Native 
(AI/AN) population in each state to the estimated baseline number of 
sources in Indian country in the state. Over the 6-year period after 
the effective date of the rule (2011 through 2016), we estimate that 
7,606 new minor sources will be created in Indian country.
    Based on our analysis,\43\, EPA also estimates that fewer than 20 
percent of new minor sources in Indian country (20 percent of 7,606) 
will be owned by small businesses. Thus, we estimate that 1,521 new 
minor source facilities will be created in Indian country by small 
businesses during the first 6 years after promulgation. Additionally, 
we project that 197 of the total estimated 984 minor modifications to 
existing minor sources during the period 2011 through 2016 will occur 
at facilities owned by small businesses. Furthermore, we estimate that 
10 synthetic minor sources owned by small businesses will be created 
during the period 2011 through 2016.
---------------------------------------------------------------------------

    \43\ We used data from financial databases to compute the share 
of companies in each sector that are owned by small businesses 
(based on the Small Business Administration small business size 
definitions at 13 CFR 121.201). We also examined the share of 
existing major and synthetic minor sources in Indian country that 
are owned by small businesses.
---------------------------------------------------------------------------

    Finally, we estimate that 2 of the 12 major sources in Indian 
country that make a minor modification to their operations between 2011 
and 2016 will be owned by small businesses. Table 2 summarizes the 
estimated number of affected facilities and small businesses and table 
3 disaggregates this information by source category (NAICS code).

         Table 2--Projected Number of Affected Small Businesses
                         [2011 through 2016] \a\
------------------------------------------------------------------------
                                                        Projected number
                                                           of new and
                      Source type                       modified sources
                                                         owned by small
                                                           businesses
------------------------------------------------------------------------
New Minor Sources.....................................             1,521
Modified Minor Sources................................               197
Synthetic Minor Sources...............................                10
Minor Modifications to Major Sources..................                 2
                                                       -----------------

[[Page 38786]]

 
    Total.............................................             1,730
------------------------------------------------------------------------
\a\ Based on Year 2008 dollars.


                                      Table 3--Source Categories for Projected Number of Affected Small Businesses
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                            Minor        Total projected
                NAICS                     Sector description        New minor      Modified minor    Synthetic minor  modifications to  small businesses
                                                                     sources           sources           sources        major sources       by sector
--------------------------------------------------------------------------------------------------------------------------------------------------------
324121...............................  Asphalt hot mix........                 1  ................  ................  ................                 1
811121...............................  Auto body refinishing..                 4                 6  ................  ................                10
3116.................................  Beef Cattle Complex,                    1  ................  ................  ................                 1
                                        Slaughter House and
                                        Meat Packing Plant.
3251.................................  Chemical preparation...                 1  ................  ................  ................                 1
32711................................  Clay and ceramics                       4                 1  ................  ................                 5
                                        operations (kilns).
327320...............................  Concrete batching plant                 1  ................  ................  ................                 1
211111...............................  Crude Petroleum and                 1,402               150                 3                 2             1,557
                                        Natural Gas Extraction.
22111................................  Electric power                          1  ................  ................  ................                 1
                                        generation.
3329.................................  Fabricated metal         ................                 1  ................  ................                 1
                                        products.
3323.................................  Fabricated structural    ................                 1  ................  ................                 1
                                        metal.
4471.................................  Gasoline station                       19                 7  ................  ................                26
                                        (storage tanks,
                                        refueling).
424510...............................  Grain Elevator.........                 2                 1  ................  ................                 3
33311................................  Machinery manufacturing  ................                 3  ................  ................                 3
221210...............................  Natural Gas                             1                 1  ................  ................                 2
                                        Distribution.
21111................................  Oil and gas production/                 1  ................  ................  ................                 1
                                        operations.
72112................................  Other (natural gas-                    11                10                 7  ................                28
                                        fired boilers) \a\.
323110...............................  Printing operations                     3                 1  ................  ................                 4
                                        (lithographic).
54171................................  Professional,                           3                 1  ................  ................                 4
                                        Scientific and
                                        Technical Services.
212321...............................  Sand and Gravel Mining.                 1                 1  ................  ................                 2
238990...............................  Sand and shot blasting                  3                 1  ................  ................                 4
                                        operations.
321113...............................  Sawmills...............                 1                 1  ................  ................                 2
221320...............................  Sewage treatment                        1  ................  ................  ................                 1
                                        facilities.
562212...............................  Solid Waste Landfill...                 1  ................  ................  ................                 1
332812...............................  Surface coating                         5                 3  ................  ................                 8
                                        operations.
                                       Other (costs not                       54                 8  ................  ................                62
                                        estimated) \b\.
                                                               -----------------------------------------------------------------------------------------
    Total............................  .......................             1,521               197                10                 2             1,730
--------------------------------------------------------------------------------------------------------------------------------------------------------
\a\ For small business analysis, used NAICS code designated for casino hotels. However, the projected new and modified sources listed under ``other
  (natural gas-fired boilers)'' include not only boilers at casino hotels, but also new sources listed as ``boilers'' and new Tribal government
  facilities assumed to have natural gas-fired boilers.
\b\ Includes source categories such as crematories, restaurants, car dealers and social assistance.

    To conduct our screening analysis of impacts \44\ on small 
businesses, we compared the estimated costs of

[[Page 38787]]

compliance for each type of source in each sector with typical small 
business sales in each sector.
---------------------------------------------------------------------------

    \44\ This small entity impact assessment does not reflect the 
final revisions to the rule's provisions. At the time this analysis 
was conducted, we planned to delay the implementation date of the 
rule for true minor sources that might be subject to the minor NSR 
program for a period of 18 months from the rule's effective date (60 
days after the final rule is published). However, to address 
commenters' concerns about EPA's ability to implement this NSR 
permitting program in a timely manner and to provide additional time 
for EPA Regions to prepare for their duties as the Federal 
permitting authority, including the development of additional 
permitting tools, we have extended the implementation date of the 
rule for true minor sources to 36 months from the effective date of 
this final rule. In addition, sources eligible to seek coverage 
under a general permit will be subject to that general permit 4 
months after the general permit is effective (6 months after the 
general permit is published in the Federal Register) unless the 
source decides to apply for a site-specific permit at the time the 
source had to request coverage under that general permit. Therefore, 
since we are reducing the permitting requirements during the initial 
36-month period after the effective date of the rule, we expect the 
actual impacts to be lower than those reported here.
---------------------------------------------------------------------------

    Our analysis estimates that small businesses investing in new minor 
source facilities, minor modifications to existing minor sources, minor 
modifications to existing major sources and new synthetic minor sources 
over the period 2011 through 2016 will incur costs that are less than 1 
percent of average small company sales revenues for most sectors, but 
small companies choosing to invest in new auto body refinishing plants, 
concrete batching plants, sawmills, solid waste landfills, sand and 
gravel mines and sand and shot blasting operations have the potential 
to incur costs between 1 percent and 3 percent of sales under upper 
bound cost estimates. The EPA estimates that at most 20 new and 
modified sources would be owned by small businesses in these sectors 
(new auto body refinishing plants, concrete batching plants, sawmills, 
solid waste landfills, sand and gravel mines and sand and shot blasting 
operations) during the first 6 years following the effective date of 
the rule. Because this is a small number of facilities and because EPA 
believes that very few new sources will incur upper bound costs, this 
is considered an over-estimate of the potential small business impacts. 
Thus, EPA does not believe that the rule will impose significant 
economic impacts on a substantial number of small businesses owning new 
or modified minor sources.
    Although this final rule will not have a significant economic 
impact on a substantial number of small entities, EPA has tried to 
reduce the impact of this rule on small entities. We are not requiring 
existing minor sources to obtain a permit once the rule is effective, 
but we are requiring them to register within 18 months after the rule's 
effective date or 90 days after the source begins operation. In 
addition, we are delaying the implementation of the rule for new and 
modified minor sources to the earlier of 4 months after the effective 
date of a general permit (6 months after the final permit is published) 
or 36 months after the rule's effective date, that is, September 2, 
2014, to provide adequate time for the regulated entities and us, the 
reviewing authority, to prepare for the implementation of this rule.

D. Unfunded Mandates Reform Act

    This rule does not contain a Federal mandate that may result in 
expenditures of $100 million or more for state, local and Tribal 
governments, in the aggregate or the private sector in any 1 year.
    The EPA cost estimates lower bound total annualized costs of the 
rule to be $4.6 million, including $2.3 million for industry and $2.3 
million for the Agency ($2008) while upper bound total annualized costs 
of this rule were estimated to be approximately $4.7 million per year, 
including $2.4 million for industry and $2.3 million for the Agency 
($2008). After the first three years following the rule's effective 
date, total annualized costs for true minor sources would increase 
since all new and modified true minor sources will have to apply for a 
site-specific permit or request coverage under a general permit. 
However, EPA believes that costs for sources choosing to request 
coverage under a general permit would remain low, as would cost for the 
Agency. Agency costs do not include the costs of developing general 
permits, as these costs are unknown at this time. Thus, this rule is 
not subject to the requirements of sections 202 or 205 of the Unfunded 
Mandates Reform Act (UMRA).
    This rule is also not subject to the requirements of section 203 of 
UMRA because it contains no regulatory requirements that might 
significantly or uniquely affect small governments. This rule has no 
requirements applicable to small governments and as such does not 
impose obligations upon them.

E. Executive Order 13132: Federalism

    This action does not have federalism implications. It will not have 
substantial direct effects on the states, on the relationship between 
the national government and the states or on the distribution of power 
and responsibilities among the various levels of government, as 
specified in Executive Order 13132. This rule has no requirements 
applicable to states. Thus, Executive Order 13132 does not apply to 
this rule.
    In the spirit of Executive Order 13132 and consistent with EPA 
policy to promote communications between EPA and state and local 
governments, EPA specifically solicited comment on the proposed rule 
from state and local officials. To that end, we had two meetings with 
the STAPPA/ALAPCO \45\ to present the draft preamble and rule. We also 
met with the National Federation of Independent Business and provided 
outreach material through EPA's Small Business Ombudsman's office to 
get input from the small businesses that might be affected by this 
rule.
---------------------------------------------------------------------------

    \45\ This organization has since changed its name to the 
National Association of Clean Air Agencies (NACAA).
---------------------------------------------------------------------------

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

    Subject to the Executive Order 13175 (65 FR 67249, November 9, 
2000) EPA may not issue a regulation that has Tribal implications, that 
imposes substantial direct compliance costs and that is not required by 
statute, unless the Federal government provides the funds necessary to 
pay the direct compliance costs incurred by Tribal governments or EPA 
consults with Tribal officials early in the process of developing the 
proposed regulation and develops a Tribal summary impact statement.
    The EPA has concluded that this action will have Tribal 
implications. However, it will neither impose substantial direct 
compliance costs on Tribal governments, nor preempt Tribal law. This 
action provides two preconstruction air permitting rules for stationary 
sources in Indian Country, but these rules will neither impose 
substantial direct compliance costs on Tribal governments nor preempt 
Tribal law because these rules will be implemented by EPA or a delegate 
Tribal agency that has requested to assist EPA with administration of 
the rules, until replaced by an EPA-approved Tribal implementation 
plan. Nonetheless, EPA conducted substantial outreach and consultation 
with Tribal officials and other Tribal representatives and has 
incorporated Tribal views, throughout the course of developing these 
rules. See section III.D of this final rule preamble for more details 
on our Tribal outreach and consultation efforts.

G. Executive Order 13045: Protection of Children From Environmental 
Health & Safety Risks

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

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

    This action is not a ``significant energy action'' as defined in 
Executive Order 13211 (66 FR 28355, May 22, 2001), because it is not 
likely to have a

[[Page 38788]]

significant adverse effect on the supply, distribution or use of 
energy. The number of projected new sources in the energy sector due to 
this rule is a small share (about 1 percent) of the total number of 
energy sector facilities nationwide. Therefore, EPA does not believe 
that this action will have a significant effect on energy production. 
In addition, EPA's cost analysis, presented in the Economic Impact 
Analysis (EIA), estimates the total annualized cost of the rule will be 
substantially less than the $100 million cost and/or benefits trigger 
identified in EO 12866 and thus this action is not considered an 
``economically significant regulatory action.'' With the final rule not 
being a economically significant regulatory action, it is not 
considered a significant energy action.

I. National Technology Transfer and Advancement Act

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

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

    Executive Order 12898 (59 FR 7629, February 16, 1994) establishes 
Federal executive policy on environmental justice. Its main provision 
directs Federal agencies, to the greatest extent practicable and 
permitted by law, to make environmental justice part of their mission 
by identifying and addressing, as appropriate, disproportionately high 
and adverse human health or environmental effects of their programs, 
policies and activities on minority populations and low-income 
populations in the United States.
    The EPA has determined that this final rule will not have 
disproportionately high and adverse human health or environmental 
effects on minority or low-income populations because it increases the 
level of environmental protection for all affected populations (which 
are persons living in Indian country) without having any 
disproportionately high and adverse human health or environmental 
effects on any population, including any minority or low-income 
population. Indeed, EPA believes that the two preconstruction air 
quality regulations in this FIP would provide regulatory certainty and 
fill a regulatory gap in Indian country and result in emissions 
reductions from sources complying with these regulations. Consequently, 
the regulations are expected to result in health benefits to persons 
living in Indian country, many of whom live in low-income and minority 
communities.

K. Congressional Review Act

    The Congressional Review Act, 5 U.S.C. 801 et seq., as added by the 
Small Business Regulatory Enforcement Fairness Act of 1996, generally 
provides that before a rule may take effect, the agency promulgating 
the rule must submit a rule report, which includes a copy of the rule, 
to each House of the Congress and to the Comptroller General of the 
United States. The EPA will submit a report containing this rule and 
other required information to the U.S. Senate, the U.S. House of 
Representatives and the Comptroller General of the United States prior 
to publication of the rule in the Federal Register. A major rule cannot 
take effect until 60 days after it is published in the Federal 
Register. This action is not a ``major rule'' as defined by 5 U.S.C. 
804(2). This rule will be effective 60 days from the date of 
publication, i.e., on August 30, 2011.
    Under section 307(b)(1) of the Act, petitions for judicial review 
of this action must be filed in the United States Court of Appeals for 
the District of Columbia Circuit by August 30, 2011 Any such judicial 
review is limited to only those objections that are raised with 
reasonable specificity in timely comments. Filing a petition for 
reconsideration by the Administrator of this final rule does not affect 
the finality of this rule for the purposes of judicial review nor does 
it extend the time within which a petition for judicial review may be 
filed and shall not postpone the effectiveness of such rule or action. 
Under section 307(b)(2) of the Act, the requirements of this final 
action may not be challenged later in civil or criminal proceedings 
brought by us to enforce these requirements.

IX. Statutory Authority

    The statutory authority for this action is provided by sections 
101, 110, 112, 114, 116 and 301 of the Act as amended (42. U.S.C. 7401, 
7410, 7412, 7414, 7416 and 7601).

List of Subjects

40 CFR Part 49

    Administrative practices and procedures, Air pollution control, 
Environmental protection, Indians, Intergovernmental relations, 
Reporting and recordkeeping requirements.

40 CFR Part 51

    Administrative practices and procedures, Air pollution control, 
Environmental protection, Intergovernmental relations.

    Dated: June 10, 2011.
Lisa P. Jackson,
Administrator.

    For the reasons cited in the preamble, title 40, chapter I of the 
Code of Federal Regulations is amended as follows:

PART 49--[AMENDED]

0
1. The authority citation for part 49 continues to read as follows:

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

Subpart C--[AMENDED]

0
2. Add an undesignated center heading and Sec. Sec.  49.151 through 
49.161 to subpart C to read as follows:

Federal Minor New Source Review Program in Indian Country

* * * * *
Sec.
49.151 Program overview.
49.152 Definitions.
49.153 Applicability.
49.154 Permit application requirements.
49.155 Permit requirements.
49.156 General permits.
49.157 Public participation requirements.
49.158 Synthetic minor source permits.
49.159 Final permit issuance and administrative and judicial review.
49.160 Registration program for minor sources in Indian country.
49.161 Administration and delegation of the minor NSR program in 
Indian country.
* * * * *


Sec.  49.151  Program overview.

    (a) What constitutes the Federal minor new source review (NSR) 
program in Indian country? As set forth in this Federal Implementation 
Plan (FIP), the Federal minor NSR program in Indian country (or 
``program'') consists of Sec. Sec.  49.151 through 49.165.

[[Page 38789]]

    (b) What is the purpose of this program? This program has the 
following purposes:
    (1) It establishes a preconstruction permitting program for new and 
modified minor sources (minor sources) and minor modifications at major 
sources located in Indian country to meet the requirements of section 
110(a)(2)(C) of the Act.
    (2) It establishes a registration system that will allow the 
reviewing authority to develop and maintain a record of minor source 
emissions in Indian country.
    (3) It provides a mechanism for an otherwise major source to 
voluntarily accept restrictions on its potential to emit to become a 
synthetic minor source. This mechanism may also be used by an otherwise 
major source of HAPs to voluntarily accept restrictions on its 
potential to emit to become a synthetic minor HAP source. Such 
restrictions must be enforceable as a practical matter.
    (4) It provides an additional mechanism for case-by-case maximum 
achievable control technology (MACT) determinations for those major 
sources of HAPs subject to such determinations under section 112(g)(2) 
of the Act.
    (5) It sets forth the criteria and procedures that the reviewing 
authority (as defined in Sec.  49.152(d)) will use to administer the 
program.
    (c) When and where does this program apply?
    (1) The provisions of this program apply in Indian country where 
there is no EPA-approved minor NSR program, according to the following 
implementation schedule:
    (i) Existing major sources.
    (A) If you wish to commence construction of a minor modification at 
an existing major source on or after August 30, 2011, you must obtain a 
permit pursuant to Sec. Sec.  49.154 and 49.155 (or a general permit 
pursuant to Sec.  49.156, if applicable) prior to commencing 
construction.
    (B) If you wish to obtain a synthetic minor source permit pursuant 
Sec.  49.158 to establish a synthetic minor source and/or a synthetic 
minor HAP source at your existing major source, you may submit a 
synthetic minor source permit application on or after August 30, 2011. 
However, if your permit application for a synthetic minor source and/or 
synthetic minor HAP source pursuant to the FIPs for reservations in 
Idaho, Oregon and Washington has been determined complete prior to 
August 30, 2011, you do not need to apply for a synthetic minor source 
permit under this program.
    (ii) Synthetic minor sources.
    (A) If you wish to commence construction of a new synthetic minor 
source and/or a new synthetic minor HAP source or a modification at an 
existing synthetic minor source and/or synthetic minor HAP source on or 
after August 30, 2011, you must obtain a permit pursuant to Sec.  
49.158 prior to commencing construction.
    (B) If your existing synthetic minor source and/or synthetic minor 
HAP source was established pursuant to the FIPs applicable to the 
Indian reservations in Idaho, Oregon and Washington or was established 
under an EPA-approved rule or permit program limiting potential to 
emit, you do not need to take any action under this program unless you 
propose a modification for this existing synthetic minor source and/or 
synthetic minor HAP source, on or after the effective date of this 
rule, that is, on or after August 30, 2011. For these modifications, 
you need to obtain a permit pursuant to Sec.  49.158 prior to 
commencing construction.
    (C) If your existing synthetic minor source and/or synthetic minor 
HAP source was established under a permit with enforceable emissions 
limitations issued pursuant to part 71 of this chapter, the reviewing 
authority has the discretion to require you to submit a permit 
application for a synthetic minor source permit under this program by 
September 4, 2012 and pursuant to Sec.  49.158, to require you to 
submit a permit application for a synthetic minor source permit under 
this program (pursuant to Sec.  49.158) at the same time that you apply 
to renew your part 71 permit or to allow you to continue to maintain 
synthetic minor status through your part 71 permit. If the reviewing 
authority requires you to obtain a synthetic minor source permit and/or 
synthetic minor HAP source permit under this program (pursuant to Sec.  
49.158) it also has the discretion to require any additional 
requirements, including control technology requirements, based on the 
specific circumstances of the source.
    (D) If your existing synthetic minor source and/or synthetic minor 
HAP source was established through a mechanism other than those 
described in paragraphs (c)(1)(ii)(B) and (C) of this section, you must 
submit an application pursuant to Sec.  49.158 for a synthetic minor 
source permit under this program by September 4, 2012. The reviewing 
authority has the discretion to require any additional requirements, 
including control technology requirements, based on the specific 
circumstances of the source.
    (iii) True minor sources.
    (A) If you own or operate an existing true minor source in Indian 
country (as defined in 40 CFR 49.152(d)), you must register your source 
with your reviewing authority in your area within 18 months after the 
effective date of this program, that is, by March 1, 2013. If your true 
minor source commences construction in the time period after the 
effective date of this rule and September 2, 2014, you must also 
register your source with the reviewing authority in your area within 
90 days after the source begins operation. You are exempt from this 
registration requirement if your source is subject to Sec.  49.138--
``Rule for the registration of air pollution sources and the reporting 
of emissions.''
    (B) If you wish to commence construction of a new true minor source 
or a modification at an existing true minor source that is subject to 
this program, you must obtain a permit pursuant to Sec. Sec.  49.154 
and 49.155 (or a general permit pursuant to Sec.  49.156, if 
applicable) by the earlier of 6 months after the general permit for a 
source category is published in the Federal Register or on or after 36 
months from the effective date of this rule, that is, September 2, 
2014. The proposed new source or modification will also be subject to 
the registration requirements of Sec.  49.160, except for sources that 
are subject to Sec.  49.138.
    (2) The provisions of this program or portions of this program 
cease to apply in an area covered by an EPA-approved Tribal 
implementation plan on the date that our approval of that 
implementation plan becomes effective, provided that the implementation 
plan includes provisions that comply with the requirements of section 
110(a)(2)(C) of the Act for the construction and modification of minor 
sources and minor modifications at major sources. Permits previously 
issued under this program will remain in effect and be enforceable as a 
practical matter until and unless the Tribe issues new permits to these 
sources based on the provisions of the EPA-approved Tribal 
implementation plan.
    (d) What general provisions apply under this program? The following 
general provisions apply to you as an owner/operator of a minor source:
    (1) If you commence construction of a new source or modification 
that is subject to this program after the applicable date specified in 
paragraph (c) of this section without applying for and receiving a 
permit pursuant to this program, you will be subject to appropriate 
enforcement action.
    (2) If you do not construct or operate your source or modification 
in accordance with the terms of your

[[Page 38790]]

minor NSR permit, you will be subject to appropriate enforcement 
action.
    (3) If you are subject to the registration requirements of this 
program, you must comply with those requirements.
    (4) Issuance of a permit does not relieve you of the responsibility 
to comply fully with applicable provisions of any EPA-approved 
implementation plan or FIP and any other requirements under applicable 
law.
    (5) Nothing in this program prevents a Tribe from administering a 
minor NSR permit program with different requirements in an approved 
Tribal Implementation Plan (TIP) as long as the TIP does not interfere 
with any applicable requirement of the Act.
    (e) What is the process for issuing permits under this program? For 
the reviewing authority to issue a final permit decision under this 
program (other than a general permit under Sec.  49.156 or a synthetic 
minor source permit under Sec.  49.158), all the actions listed in 
paragraphs (e)(1) through (8) of this section need to be completed. The 
processes for issuing general permits and synthetic minor source 
permits are set out in Sec.  49.156 and Sec.  49.158, respectively.
    (1) You must submit a permit application that meets the 
requirements of Sec.  49.154(a).
    (2) The reviewing authority determines completeness of the permit 
application as provided in Sec.  49.154(b) within 45 days of receiving 
the application (60 days for minor modifications at major sources).
    (3) The reviewing authority determines the appropriate emission 
limitations and permit conditions for your affected emissions units 
under Sec.  49.154(c).
    (4) The reviewing authority may require you to submit an Air 
Quality Impact Analysis (AQIA) if it has reason to be concerned that 
the construction of your minor source or modification would cause or 
contribute to a NAAQS or PSD increment violation.
    (5) If an AQIA is submitted, the reviewing authority determines 
that the new or modified source will not cause or contribute to a NAAQS 
or PSD increment violation.
    (6) The reviewing authority develops a draft permit that meets the 
permit content requirements of Sec.  49.155(a).
    (7) The reviewing authority provides for public participation, 
including a 30-day period for public comment, according to the 
requirements of Sec.  49.157.
    (8) The reviewing authority either issues a final permit that meets 
the requirements of Sec.  49.155(a) or denies the permit and provides 
reasons for the denial, within 135 days (or within 1 year for minor 
modifications at major sources) after the date the application is 
deemed complete and all additional information necessary to make an 
informed decision has been provided.


Sec.  49.152  Definitions.

    (a) For sources of regulated NSR pollutants in nonattainment areas, 
the definitions in Sec.  49.167 apply to the extent that they are used 
in this program (except for terms defined in paragraph (d) of this 
section).
    (b) For sources of regulated NSR pollutants in attainment or 
unclassifiable areas, the definitions in Sec.  52.21 of this chapter 
apply to the extent that they are used in this program (except for 
terms defined in paragraph (d) of this section).
    (c) For sources of HAP, the definitions in Sec.  63.2 of this 
chapter apply to the extent that they are used in this program (except 
for terms defined in paragraph (d) of this section).
    (d) The following definitions also apply to this program:
    Affected emissions units means the following emissions units, as 
applicable:
    (1) For a proposed new minor source, all the emissions units.
    (2) For a proposed modification, the new, modified and replacement 
emissions units involved in the modification.
    Allowable emissions means ``allowable emissions'' as defined in 
Sec.  52.21(b)(16) of this chapter, except that the allowable emissions 
for any emissions unit are calculated considering any emission 
limitations that are enforceable as a practical matter on the emissions 
unit's potential to emit.
    Emission limitation means a requirement established by the 
reviewing authority that limits the quantity, rate or concentration of 
emissions of air pollutants on a continuous basis, including any 
requirement relating to the operation or maintenance of a source to 
assure continuous emissions reduction and any design standard, 
equipment standard, work practice, operational standard or pollution 
prevention technique.
    Enforceable as a practical matter means that an emission limitation 
or other standard is both legally and practicably enforceable as 
follows:
    (1) An emission limitation or other standard is legally enforceable 
if the reviewing authority has the right to enforce it.
    (2) Practical enforceability for an emission limitation or for 
other standards (design standards, equipment standards, work practices, 
operational standards, pollution prevention techniques) in a permit for 
a source is achieved if the permit's provisions specify:
    (i) A limitation or standard and the emissions units or activities 
at the source subject to the limitation or standard;
    (ii) The time period for the limitation or standard (e.g., hourly, 
daily, monthly and/or annual limits such as rolling annual limits); and
    (iii) The method to determine compliance, including appropriate 
monitoring, recordkeeping, reporting and testing.
    (3) For rules and general permits that apply to categories of 
sources, practical enforceability additionally requires that the 
provisions:
    (i) Identify the types or categories of sources that are covered by 
the rule or general permit;
    (ii) Where coverage is optional, provide for notice to the 
reviewing authority of the source's election to be covered by the rule 
or general permit; and
    (iii) Specify the enforcement consequences relevant to the rule or 
general permit.
    Environmental Appeals Board means the Board within the EPA 
described in Sec.  1.25(e) of this chapter.
    Indian country, as defined in 18 U.S.C. 1151, means the following:
    (1) All land within the limits of any Indian reservation under the 
jurisdiction of the United States government, notwithstanding the 
issuance of any patent and including rights-of-way running through the 
reservation; \1\
---------------------------------------------------------------------------

    \1\ Under this definition, EPA treats as reservations trust 
lands validly set aside for the use of a tribe even if the trust 
lands have not been formally designated as a reservation.
---------------------------------------------------------------------------

    (2) All dependent Indian communities within the borders of the 
United States whether within the original or subsequently acquired 
territory thereof and whether within or without the limits of a state; 
and
    (3) All Indian allotments, the Indian titles to which have not been 
extinguished, including rights-of-way running through the same.
    Indian governing body means the governing body of any Tribe, band 
or group of Indians subject to the jurisdiction of the United States 
and recognized by the United States as possessing power of self-
government.
    Minor modification at a major source means a modification at a 
major source that does not qualify as a major modification under Sec.  
49.167 or Sec.  52.21 of this chapter, as applicable.

[[Page 38791]]

    Minor NSR threshold means any of the applicability cutoffs for this 
program listed in Table 1 of Sec.  49.153.
    Minor source means, for purposes of this rule, a source, not 
including the exempt emissions units and activities listed in Sec.  
49.153(c), that has the potential to emit regulated NSR pollutants in 
amounts that are less than the major source thresholds in Sec.  49.167 
or Sec.  52.21 of this chapter, as applicable, but equal to or greater 
than the minor NSR thresholds in Sec.  49.153. The potential to emit 
includes fugitive emissions, to the extent that they are quantifiable, 
only if the source belongs to one of the source categories listed in 
part 51, Appendix S, paragraph II.A.4(iii) or Sec.  52.21(b)(1)(iii) of 
this chapter, as applicable.
    Modification means any physical or operational change at a source 
that would cause an increase in the allowable emissions of a minor 
source or an increase in the actual emissions (based on the applicable 
test under the major NSR program) of a major source for any regulated 
NSR pollutant or that would cause the emission of any regulated NSR 
pollutant not previously emitted. Allowable emissions of a minor source 
include fugitive emissions, to the extent that they are quantifiable, 
only if the source belongs to one of the source categories listed in 
part 51, Appendix S, paragraph II.A.4(iii) or Sec.  52.21(b)(1)(iii) of 
this chapter, as applicable. The following exemptions apply:
    (1) A physical or operational change does not include routine 
maintenance, repair or replacement.
    (2) An increase in the hours of operation or in the production rate 
is not considered an operational change unless such change is 
prohibited under any permit condition that is enforceable as a 
practical matter.
    (3) A change in ownership at a stationary source.
    (4) The emissions units and activities listed in Sec.  49.153(c).
    Potential to emit means the maximum capacity of a source to emit a 
pollutant under its physical and operational design. Any physical or 
operational limitation on the capacity of the source to emit a 
pollutant, including air pollution control equipment and restrictions 
on hours of operation or on the type or amount of material combusted, 
stored or processed, shall be treated as part of its design if the 
limitation or the effect it would have on emissions is enforceable as a 
practical matter. Secondary emissions, as defined at Sec.  52.21(b)(18) 
of this chapter, do not count in determining the potential to emit of a 
source.
    Reviewing authority means the Administrator or may mean an Indian 
Tribe in cases where a Tribal agency is assisting EPA with 
administration of the program through a delegation.
    Synthetic minor HAP source means a source that otherwise has the 
potential to emit HAPs in amounts that are at or above those for major 
sources of HAP in Sec.  63.2 of this chapter, but that has taken a 
restriction so that its potential to emit is less than such amounts for 
major sources. Such restrictions must be enforceable as a practical 
matter.
    Synthetic minor source means a source that otherwise has the 
potential to emit regulated NSR pollutants in amounts that are at or 
above those for major sources in Sec.  49.167, Sec.  52.21 or Sec.  
71.2 of this chapter, as applicable, but that has taken a restriction 
so that its potential to emit is less than such amounts for major 
sources. Such restrictions must be enforceable as a practical matter.
    True minor source means a source, not including the exempt 
emissions units and activities listed in Sec.  49.153(c), that emits or 
has the potential to emit regulated NSR pollutants in amounts that are 
less than the major source thresholds in Sec.  49.167 or Sec.  52.21 of 
this chapter, as applicable, but equal to or greater than the minor NSR 
thresholds in Sec.  49.153, without the need to take an enforceable 
restriction to reduce its potential to emit to such levels. That is, a 
true minor source is a minor source that is not a synthetic minor 
source. The potential to emit includes fugitive emissions, to the 
extent that they are quantifiable, only if the source belongs to one of 
the source categories listed in part 51, Appendix S, paragraph 
II.A.4(iii) or Sec.  52.21(b)(1)(iii) of this chapter, as applicable.


Sec.  49.153  Applicability.

    (a) Does this program apply to me? The requirements of this program 
apply to you as set out in paragraphs (a)(1) through (4) of this 
section.
    (1) New and modified sources. The applicability of the 
preconstruction review requirements of this program is determined 
individually for each regulated NSR pollutant that would be emitted by 
your new or modified source. For each such pollutant, determine 
applicability as set out in the relevant paragraph (a)(1)(i) or (ii) of 
this section.
    (i) New source. Use the following steps to determine applicability 
for each regulated NSR pollutant.
    (A) Step 1. Determine whether your proposed source's potential to 
emit the pollutant that you are evaluating is subject to review under 
the applicable major NSR program (that is, under Sec.  52.21 of this 
chapter, under the Federal major NSR program for nonattainment areas in 
Indian country at Sec. Sec.  49.166 through 49.175 or under a program 
approved by the Administrator pursuant to Sec.  51.165 or Sec.  51.166 
of this chapter). If not, go to Step 2 (paragraph (a)(1)(i)(B) of this 
section).
    (B) Step 2. Determine whether your proposed source's potential to 
emit the pollutant that you are evaluating, (including fugitive 
emissions, to the extent they are quantifiable, only if the source 
belongs to one of the source categories listed pursuant to section 
302(j) of the Act), is equal to or greater than the corresponding minor 
NSR threshold in Table 1 of this section. If it is, you are subject to 
the preconstruction requirements of this program for that pollutant.
    (ii) Modification at an existing source. Use the following steps to 
determine applicability for each regulated NSR pollutant.
    (A) Step 1. For the pollutant being evaluated, determine whether 
your proposed modification is subject to review under the applicable 
major NSR program. If the modification at your existing major source 
does not qualify as a major modification under that program based on 
the actual-to-projected-actual test, it is considered a minor 
modification and is subject to the minor NSR program requirements, if 
the net emissions increase from the actual-to-projected-actual test is 
equal to or exceeds the minor NSR threshold listed in Table 1 of this 
section. For a modification at your existing minor source go to Step 2 
(paragraph (a)(1)(ii)(B) of this section).
    (B) Step 2. Determine whether the increase in allowable emissions 
from the proposed modification (calculated using the procedures of 
paragraph (b) of this section) would be equal to or greater than the 
minor NSR threshold in Table 1 of this section for the pollutant that 
you are evaluating. If it is, you are subject to the preconstruction 
requirements of this program for that pollutant. If not, go to Step 3 
(paragraph (a)(1)(ii)(C) of this section).
    (C) Step 3. If any of the emissions units affected by your proposed 
modification result in an increase in an annual allowable emissions 
limit for the pollutant that you are evaluating, the proposed 
modification is subject to paragraph (a)(2) of this section. If not, 
your proposed modification is not subject to this program.
    (2) Increase in an emissions unit's annual allowable emissions 
limit. If you propose a physical or operational change at your minor or 
major source

[[Page 38792]]

that would increase an emissions unit's allowable emissions of a 
regulated NSR pollutant above its existing annual allowable emissions 
limit, you must obtain a permit revision to reflect the increase in the 
limit prior to making the change. For a physical or operational change 
that is not otherwise subject to review under major NSR or under this 
program, such increase in the annual allowable emissions limit may be 
accomplished through an administrative permit revision as provided in 
Sec.  49.159(f).
    (3) Synthetic minor source permits.
    (i) If you own or operate an existing major source and you wish to 
obtain a synthetic minor source permit pursuant to Sec.  49.158 to 
establish a synthetic minor source and/or a synthetic minor HAP source, 
you may submit a synthetic minor source permit application on or after 
August 30, 2011. However, if your permit application for a synthetic 
minor source and/or synthetic minor HAP source pursuant to the FIPs for 
reservations in Idaho, Oregon and Washington has been determined 
complete prior to August 30, 2011, you do not need to apply for a 
synthetic minor source permit under this program.
    (ii) If you wish to commence construction of a new synthetic minor 
source and/or a new synthetic minor HAP source or a modification at an 
existing synthetic minor source and/or synthetic minor HAP source, on 
or after August 30, 2011, you must obtain a permit pursuant to Sec.  
49.158 prior to commencing construction.
    (iii) If you own or operate a synthetic minor source or synthetic 
minor HAP source that was established prior to the effective date of 
this rule (that is, prior to August 30, 2011) pursuant to the FIPs 
applicable to the Indian reservations in Idaho, Oregon and Washington 
or under an EPA-approved rule or permit program limiting potential to 
emit, you do not need to take any action under this program unless you 
propose a modification for this existing synthetic minor source and/or 
synthetic minor HAP source, on or after the effective date of this 
rule, that is, on or after August 30, 2011. For these modifications, 
you need to obtain a permit pursuant to Sec.  49.158 prior to 
commencing construction.
    (iv) If you own or operate a synthetic minor source or synthetic 
minor HAP source that was established prior to the effective date of 
this rule (that is, prior to August 30, 2011) through a permit with 
enforceable emissions limitations issued pursuant to the operating 
permit program in part 71 of this chapter, the reviewing authority has 
the discretion to require you to apply for a synthetic minor source 
permit under Sec.  49.158 of this program by September 4, 2012 or at 
the time of part 71 permit renewal or allow you to maintain synthetic 
minor status through your part 71 permit.
    (v) For all other synthetic minor sources or synthetic minor HAP 
sources that obtained synthetic minor status or synthetic minor source 
permits through a mechanism other than those described in paragraphs 
(a)(3)(iii) and (iv) of this section, you must submit an application 
for a synthetic minor source permit under this program by September 4, 
2012 under Sec.  49.158.
    (4) Case-by-case maximum achievable control technology (MACT) 
determinations. If you propose to construct or reconstruct a major 
source of HAPs such that you are subject to a case-by-case MACT 
determination under section 112(g)(2) of the Act, you may elect to have 
this determination approved under the provisions of this program (other 
options for such determinations include a title V permit action or a 
Notice of MACT Approval under Sec.  63.43 of this chapter). If you 
elect this option, you still must comply with the requirements of Sec.  
63.43 of this chapter that apply to all case-by-case MACT 
determinations.
    (b) How do I determine the increase in allowable emissions from a 
physical or operational change at my source? Determine the resulting 
increase in allowable emissions in tons per year (tpy) of each 
regulated NSR pollutant after considering all increases from the 
change. A physical or operational change may involve one or more 
emissions units. The total increase in allowable emissions resulting 
from your proposed change, including fugitive emissions, to the extent 
they are quantifiable, only if your source belongs to one of the source 
categories listed pursuant to section 302(j) of the Act, would be the 
sum of the following:
    (1) For each new emissions unit that is to be added, the emissions 
increase would be the potential to emit of the emissions unit.
    (2) For each emissions unit with an allowable emissions limit that 
is to be changed or replaced, the emissions increase would be the 
allowable emissions of the emissions unit after the change or 
replacement minus the allowable emissions prior to the change or 
replacement. However, this may not be a negative value. If the 
allowable emissions of an emissions unit would be reduced as a result 
of the change or replacement, use zero in the calculation.
    (3) For each unpermitted emissions unit (a unit without any 
enforceable permit conditions) that is to be changed or replaced, the 
emissions increase is the allowable emissions of the emissions unit 
after the change or replacement minus the potential to emit prior to 
the change or replacement. However, this may not be a negative value. 
If an emissions unit's post-change allowable emissions would be less 
than its pre-change potential to emit, use zero in the calculation.
    (c) What emissions units and activities are exempt from this 
program?
    This program does not apply to the following emissions units and 
activities at a source that are listed in paragraphs (c)(1) through (7) 
of this section.
    (1) Mobile sources.
    (2) Ventilating units for comfort that do not exhaust air 
pollutants into the ambient air from any manufacturing or other 
industrial processes
    (3) Noncommercial food preparation.
    (4) Consumer use of office equipment and products.
    (5) Janitorial services and consumer use of janitorial products.
    (6) Internal combustion engines used for landscaping purposes.
    (7) Bench scale laboratory activities, except for laboratory fume 
hoods or vents.

            Table 1 to Sec.   49.153--Minor NSR Thresholds a
------------------------------------------------------------------------
                                       Minor NSR           Minor NSR
                                    thresholds for      thresholds for
     Regulated NSR pollutant         nonattainment     attainment areas
                                     areas  (tpy)            (tpy)
------------------------------------------------------------------------
Carbon monoxide (CO)............                   5                  10
Nitrogen oxides (NOX)...........               5 \b\                  10
Sulfur dioxide (SO2)............                   5                  10
Volatile Organic Compounds (VOC)               2 \b\                   5

[[Page 38793]]

 
PM..............................                   5                  10
PM10............................                   1                   5
PM2.5...........................                 0.6                   3
Lead............................                 0.1                 0.1
Fluorides.......................                  NA                   1
Sulfuric acid mist..............                  NA                   2
Hydrogen sulfide (H2S)..........                  NA                   2
Total reduced sulfur (including                   NA                   2
 H2S)...........................
Reduced sulfur compounds                          NA                   2
 (including H2S)................
Municipal waste combustor                         NA                   2
 emissions......................
Municipal solid waste landfill                    NA                  10
 emissions (measured as
 nonmethane organic compounds)..
------------------------------------------------------------------------
\a\ If part of a Tribe's area of Indian country is designated as
  attainment and another part as nonattainment, the applicable threshold
  for a proposed source or modification is determined based on the
  designation where the source would be located. If the source straddles
  the two areas, the more stringent thresholds apply.
\b\ In extreme ozone nonattainment areas, section 182(e)(2) of the Act
  requires any change at a major source that results in any increase in
  emissions to be subject to major NSR permitting. In other words, any
  changes to existing major sources in extreme ozone nonattainment areas
  are subject to a ``0'' tpy threshold, but that threshold does not
  apply to minor sources.

Sec.  49.154  Permit application requirements.

    This section applies to you if you are subject to this program 
under Sec.  49.153(a) for the construction of a new minor source, 
synthetic minor source or a modification at an existing source.
    (a) What information must my permit application contain? Paragraphs 
(a)(1) through (3) of this section govern the content of your 
application.
    (1) General provisions for permit applications. The following 
provisions apply to permit applications under this program:
    (i) The reviewing authority may develop permit application forms 
for your use.
    (ii) The permit application need not contain information on the 
exempt emissions units and activities listed in Sec.  49.153(c).
    (iii) The permit application for a modification need only include 
information on the affected emissions units as defined in Sec.  
49.152(d).
    (2) Required permit application content. Except as specified in 
paragraphs (a)(1)(ii) and (iii) of this section, you must include the 
information listed in paragraphs (a)(2)(i) through (ix) of this section 
in your application for a permit under this program. The reviewing 
authority may require additional information as needed to process the 
permit application.
    (i) Identifying information, including your name and address (and 
plant name and address if different) and the name and telephone number 
of the plant manager/contact.
    (ii) A description of your source's processes and products.
    (iii) A list of all affected emissions units (with the exception of 
the exempt emissions units and activities listed in Sec.  49.153(c)).
    (iv) For each new emissions unit that is listed, the potential to 
emit of each regulated NSR pollutant in tpy (including fugitive 
emissions, to the extent that they are quantifiable, if the emissions 
unit or source is in one of the source categories listed in part 51, 
Appendix S, paragraph II.A.4(iii) or Sec.  52.21(b)(1)(iii) of this 
chapter, as applicable), with supporting documentation. In your 
calculation of the potential to emit for an emissions unit, you must 
account for any proposed emission limitations.
    (v) For each modified emissions unit and replacement unit that is 
listed, the allowable emissions of each regulated NSR pollutant in tpy 
both before and after the modification (including fugitive emissions, 
to the extent that they are quantifiable, if the emissions unit or 
source belongs to one of the source categories listed in part 51, 
Appendix S, paragraph II.A.4(iii) or Sec.  52.21(b)(1)(iii) of this 
chapter, as applicable), with supporting documentation. For emissions 
units that do not have an allowable emissions limit prior to the 
modification, report the potential to emit. In your calculation of 
annual allowable emissions for an emissions unit after the 
modification, you must account for any proposed emission limitations.
    (vi) The following information to the extent it is needed to 
determine or regulate emissions: Fuels, fuel use, raw materials, 
production rates and operating schedules.
    (vii) Identification and description of any existing air pollution 
control equipment and compliance monitoring devices or activities.
    (viii) Any existing limitations on source operation affecting 
emissions or any work practice standards, where applicable, for all NSR 
regulated pollutants at the source.
    (ix) For each emission point associated with an affected emissions 
unit, provide stack or vent dimensions and flow information.
    (3) Optional permit application content. At your option, you may 
propose emission limitations for each affected emissions unit, which 
may include pollution prevention techniques, air pollution control 
devices, design standards, equipment standards, work practices, 
operational standards or a combination thereof. You may include an 
explanation of why you believe the proposed emission limitations to be 
appropriate.
    (b) How is my permit application determined to be complete? 
Paragraphs (b)(1) through (3) of this section govern the completeness 
review of your permit application.
    (1) An application for a permit under this program will be reviewed 
by the reviewing authority within 45 days of its receipt (60 days for 
minor modifications at major sources) to determine whether the 
application contains all the information necessary for processing the 
application.
    (2) If the reviewing authority determines that the application is 
not complete, it will request additional information from you as 
necessary to process the application. If the reviewing authority 
determines that the application is complete, it will notify you in 
writing. The reviewing

[[Page 38794]]

authority's completeness determination or request for additional 
information should be postmarked within 45 days of receipt of the 
permit application by the reviewing authority (60 days for minor 
modifications at major sources). If you do not receive a request for 
additional information or a notice of complete application postmarked 
within 45 days of receipt of the permit application by the reviewing 
authority (60 days for minor modifications at major sources), your 
application will be deemed complete.
    (3) If, while processing an application that has been determined to 
be complete, the reviewing authority determines that additional 
information is necessary to evaluate or take final action on the 
application, it may request additional information from you and require 
your responses within a reasonable time period.
    (4) Any permit application will be granted or denied no later than 
135 days (1 year for minor modifications at major sources) after the 
date the application is deemed complete and all additional information 
necessary to make an informed decision has been provided.
    (c) How will the reviewing authority determine the emission 
limitations that will be required in my permit? After determining that 
your application is complete, the reviewing authority will conduct a 
case-by-case control technology review to determine the appropriate 
level of control, if any, necessary to assure that NAAQS are achieved, 
as well as the corresponding emission limitations for the affected 
emissions units at your source.
    (1) In carrying out this case-by-case control technology review, 
the reviewing authority will consider the following factors:
    (i) Local air quality conditions.
    (ii) Typical control technology or other emissions reduction 
measures used by similar sources in surrounding areas.
    (iii) Anticipated economic growth in the area.
    (iv) Cost-effective emission reduction alternatives.
    (2) The reviewing authority must require a numerical limit on the 
quantity, rate or concentration of emissions for each regulated NSR 
pollutant emitted by each affected emissions unit at your source for 
which such a limit is technically and economically feasible.
    (3) The emission limitations required by the reviewing authority 
may consist of numerical limits on the quantity, rate or concentration 
of emissions; pollution prevention techniques; design standards; 
equipment standards; work practices; operational standards; 
requirements relating to the operation or maintenance of the source or 
any combination thereof.
    (4) The emission limitations required by the reviewing authority 
must assure that each affected emissions unit will comply with all 
requirements of parts 60, 61 and 63 of this chapter as well as any FIPs 
or TIPs that apply to the unit.
    (5) The emission limitations required by the reviewing authority 
must not be affected in a manner by so much of a stack's height as 
exceeds good engineering practice or by any other dispersion technique, 
except as provided in Sec.  51.118(b) of this chapter. If the reviewing 
authority proposes to issue a permit to a source based on a good 
engineering practice stack height that exceeds the height allowed by 
Sec.  51.100(ii)(1) or (2) of this chapter, it must notify the public 
of the availability of the demonstration study and must provide 
opportunity for a public hearing according to the requirements of Sec.  
49.157 for the draft permit.
    (d) When may the reviewing authority require an air quality impacts 
analysis (AQIA)? Paragraphs (d)(1) through (3) of this section govern 
AQIA requirements under this program.
    (1) If the reviewing authority has reason to be concerned that the 
construction of your minor source or modification would cause or 
contribute to a NAAQS or PSD increment violation, it may require you to 
conduct and submit an AQIA.
    (2) If required, you must conduct the AQIA using the dispersion 
models and procedures of part 51, Appendix W of this chapter.
    (3) If the AQIA reveals that construction of your source or 
modification would cause or contribute to a NAAQS or PSD increment 
violation, the reviewing authority must require you to reduce or 
mitigate such impacts before it can issue you a permit.


Sec.  49.155  Permit requirements.

    This section applies to your permit if you are subject to this 
program under Sec.  49.153(a) for construction of a new minor source, 
synthetic minor source or a modification at an existing source.
    (a) What information must my permit include? Your permit must 
include the requirements in paragraphs (a)(1) through (7) of this 
section.
    (1) General requirements. The permit must include the following 
elements:
    (i) The effective date of the permit and the date by which you must 
commence construction in order for your permit to remain valid (i.e., 
18 months after the permit effective date).
    (ii) The emissions units subject to the permit and their associated 
emission limitations.
    (iii) Monitoring, recordkeeping, reporting and testing requirements 
to assure compliance with the emission limitations.
    (2) Emission limitations. The permit must include the emission 
limitations determined by the reviewing authority under Sec.  49.154(c) 
for each affected emissions unit. In addition, the permit must include 
an annual allowable emissions limit for each affected emissions unit 
and for each regulated NSR pollutant emitted by the unit if the unit is 
issued an enforceable emission limitation lower than the potential to 
emit of that unit.
    (3) Monitoring requirements. The permit must include monitoring 
requirements sufficient to assure compliance with the emission 
limitations and annual allowable emissions limits that apply to the 
affected emissions units at your source. The reviewing authority may 
require, as appropriate, any of the requirements in paragraphs 
(a)(3)(i) and (ii) of this section.
    (i) Any emissions monitoring, including analysis procedures, test 
methods, periodic testing, instrumental monitoring and non-instrumental 
monitoring. Such monitoring requirements shall assure use of test 
methods, units, averaging periods and other statistical conventions 
consistent with the required emission limitations.
    (ii) As necessary, requirements concerning the use, maintenance and 
installation of monitoring equipment or methods.
    (4) Recordkeeping requirements. The permit must include 
recordkeeping requirements sufficient to assure compliance with the 
emission limitations and monitoring requirements and it must require 
the elements in paragraphs (a)(4)(i) and (ii) of this section.
    (i) Records of required monitoring information that include the 
information in paragraphs (a)(4)(i)(A) through (F) of this section, as 
appropriate.
    (A) The location, date and time of sampling or measurements.
    (B) The date(s) analyses were performed.
    (C) The company or entity that performed the analyses.
    (D) The analytical techniques or methods used.
    (E) The results of such analyses.
    (F) The operating conditions existing at the time of sampling or 
measurement.
    (ii) Retention for 5 years of records of all required monitoring 
data and

[[Page 38795]]

support information for the monitoring sample, measurement, report or 
application. Support information may include all calibration and 
maintenance records, all original strip-chart recordings or digital 
records for continuous monitoring instrumentation and copies of all 
reports required by the permit.
    (5) Reporting requirements. The permit must include the reporting 
requirements in paragraphs (a)(5)(i) and (ii) of this section.
    (i) Annual submittal of reports of monitoring required under 
paragraph (a)(3) of this section, including the type and frequency of 
monitoring and a summary of results obtained by monitoring.
    (ii) Prompt reporting of deviations from permit requirements, 
including those attributable to upset conditions as defined in the 
permit, the probable cause of such deviations and any corrective 
actions or preventive measures taken. Within the permit, the reviewing 
authority must define ``prompt'' in relation to the degree and type of 
deviation likely to occur and the applicable emission limitations.
    (6) Severability clause. The permit must include a severability 
clause to ensure the continued validity of the other portions of the 
permit in the event of a challenge to a portion of the permit.
    (7) Additional provisions. The permit must also contain provisions 
stating the requirements in paragraphs (a)(7)(i) through (vii) of this 
section.
    (i) You, as the permittee, must comply with all conditions of your 
permit, including emission limitations that apply to the affected 
emissions units at your source. Noncompliance with any permit term or 
condition is a violation of the permit and may constitute a violation 
of the Act and is grounds for enforcement action and for a permit 
termination or revocation.
    (ii) Your permitted source must not cause or contribute to a NAAQS 
violation or in an attainment area, must not cause or contribute to a 
PSD increment violation.
    (iii) It is not a defense for you, as the permittee, in an 
enforcement action that it would have been necessary to halt or reduce 
the permitted activity in order to maintain compliance with the 
conditions of this permit.
    (iv) The permit may be revised, reopened, revoked and reissued or 
terminated for cause. The filing of a request by you, as the permittee, 
for a permit revision, revocation and re-issuance or termination or of 
a notification of planned changes or anticipated noncompliance does not 
stay any permit condition.
    (v) The permit does not convey any property rights of any sort or 
any exclusive privilege.
    (vi) You, as the permittee, shall furnish to the reviewing 
authority, within a reasonable time, any information that the reviewing 
authority may request in writing to determine whether cause exists for 
revising, revoking and reissuing or terminating the permit or to 
determine compliance with the permit. For any such information claimed 
to be confidential, you must also submit a claim of confidentiality in 
accordance with part 2, subpart B of this chapter.
    (vii) Upon presentation of proper credentials, you, as the 
permittee, must allow a representative of the reviewing authority to:
    (A) Enter upon your premises where a source is located or 
emissions-related activity is conducted or where records are required 
to be kept under the conditions of the permit;
    (B) Have access to and copy, at reasonable times, any records that 
are required to be kept under the conditions of the permit;
    (C) Inspect, during normal business hours or while the source is in 
operation, any facilities, equipment (including monitoring and air 
pollution control equipment), practices or operations regulated or 
required under the permit;
    (D) Sample or monitor, at reasonable times, substances or 
parameters for the purpose of assuring compliance with the permit or 
other applicable requirements and
    (E) Record any inspection by use of written, electronic, magnetic 
and photographic media.
    (b) Can my permit become invalid? Your permit becomes invalid if 
you do not commence construction within 18 months after the effective 
date of your permit, if you discontinue construction for a period of 18 
months or more or if you do not complete construction within a 
reasonable time. The reviewing authority may extend the 18-month period 
upon a satisfactory showing that an extension is justified. This 
provision does not apply to the time period between construction of the 
approved phases of a phased construction project; you must commence 
construction of each such phase within 18 months of the projected and 
approved commencement date.


Sec.  49.156  General permits.

    This section applies to general permits for the purposes of 
complying with the preconstruction permitting requirements for sources 
of regulated NSR pollutants under this program.
    (a) What is a general permit? A general permit is a preconstruction 
permit issued by a reviewing authority that may be applied to a number 
of similar emissions units or sources. The purpose of a general permit 
is to simplify the permit issuance process for similar facilities so 
that a reviewing authority's limited resources need not be expended for 
case-by-case permit development for such facilities. A general permit 
may be written to address a single emissions unit, a group of the same 
type of emissions units or an entire minor source.
    (b) How will the reviewing authority issue general permits? The 
reviewing authority will issue general permits as follows:
    (1) A general permit may be issued for a category of emissions 
units or sources that are similar in nature, have substantially similar 
emissions and would be subject to the same or substantially similar 
requirements governing operations, emissions, monitoring, reporting and 
recordkeeping. ``Similar in nature'' refers to size, processes and 
operating conditions.
    (2) A general permit must be issued according to the applicable 
requirements in Sec.  49.154(c), Sec.  49.154(d) and Sec.  49.155, the 
public participation requirements in Sec.  49.157 and the requirements 
for final permit issuance and administrative and judicial review in 
Sec.  49.159.
    (3) Issuance of a general permit is considered final agency action 
with respect to all aspects of the general permit except its 
applicability to an individual source. The sole issue that may be 
appealed after an individual source is approved to construct under a 
general permit (see paragraph (e) of this section) is the applicability 
of the general permit to that particular source.
    (c) For what categories will general permits be issued?
    (1) The reviewing authority will determine which categories of 
individual emissions units, groups of similar emissions units or 
sources are appropriate for general permits in its area.
    (2) General permits will be issued at the discretion of the 
reviewing authority.
    (d) What should the general permit contain? The general permit must 
contain the permit elements listed in Sec.  49.155(a). In addition, the 
general permit must contain the information listed in paragraphs (d)(1) 
and (2) of this section. The reviewing authority may specify additional 
general permit terms and conditions.

[[Page 38796]]

    (1) Identification of the specific category of emissions units or 
sources to which the general permit applies, including any criteria 
that your emissions units or source must meet to be eligible for 
coverage under the general permit.
    (2) Information required to request coverage under a general permit 
including, but not limited to, the following:
    (i) The name and mailing address of the reviewing authority to whom 
you must submit your application.
    (ii) The procedure to obtain any standard application forms that 
the reviewing authority may have developed.
    (iii) The information that you must provide to the reviewing 
authority in your application to demonstrate that you are eligible for 
coverage under the general permit.
    (iv) Other application requirements deemed necessary by the 
reviewing authority.
    (e) What are the procedures for obtaining coverage for a source 
under a general permit?
    (1) If your source qualifies for a general permit, you may request 
coverage under that general permit to the reviewing authority 4 months 
after the effective date of the general permit, that is, 6 months after 
publication of the general permit in the Federal Register.
    (2) At the time you submit your request for coverage under a 
general permit, you must submit a copy of such request to the Tribe in 
the area where the source is locating.
    (3) The reviewing authority must act on your request for coverage 
under the general permit as expeditiously as possible, but it must 
notify you of the final decision within 90 days of its receipt of your 
coverage request.
    (4) Your reviewing authority must comply with a 45-day completeness 
review period to determine if your request for coverage under a general 
permit is complete. Therefore, within 30 days after the receipt of your 
coverage request, your reviewing authority must make an initial request 
for any additional information necessary to process your coverage 
request and you must submit such information within 15 days. If you do 
not submit the requested information within 15 days from the request 
for additional information and this results in a delay that is beyond 
the 45-day completeness review period, the 90-day permit issuance 
period for your general permit will be extended by the additional days 
you take to submit the requested information beyond the 45-day period. 
If the reviewing authority fails to notify you within a 30-day period 
of any additional information necessary to process your coverage 
request, you will still have 15 days to submit such information and the 
reviewing authority must still grant or deny your request for coverage 
under a general permit within the 90-day general permit issuance period 
and without any time extension.
    (5) If the reviewing authority determines that your request for 
coverage under a general permit has all the relevant information and is 
complete, it will notify you in writing as soon as that determination 
is made. If you do not receive from the reviewing authority a request 
for additional information or a notice that your request for coverage 
under a general permit is complete within the 45-day completeness 
review period described in paragraph (4) of this section, your request 
will be deemed complete.
    (6) The reviewing authority will send you a letter notifying you of 
the approval or denial of your request for coverage under a general 
permit. This letter is a final action for purposes of judicial review 
(see 40 CFR 49.159) only for the issue of whether your source qualifies 
for coverage under the general permit. If your request for coverage 
under a general permit is approved, you must post, prominently, a copy 
of the letter granting such request at the site where your source is 
locating.
    (7) If the reviewing authority has sent a letter to you approving 
your request for coverage under a general permit, you must comply with 
all conditions and terms of the general permit. You will be subject to 
enforcement action for failure to obtain a preconstruction permit if 
you construct the emissions unit(s) or source with general permit 
approval and your source is later determined not to qualify for the 
conditions and terms of the general permit.
    (8) Your permit becomes invalid if you do not commence construction 
within 18 months after the effective date of your request for coverage 
under a general permit, if you discontinue construction for a period of 
18 months or more or if you do not complete construction within a 
reasonable time. The reviewing authority may extend the 18-month period 
upon a satisfactory showing that an extension is justified. This 
provision does not apply to the time period between construction of the 
approved phases of a phased construction project; you must commence 
construction of each such phase within 18 months of the projected and 
approved commencement date.
    (9) Any source eligible to request coverage under a general permit 
may request to be excluded from the general permit by applying for a 
permit under Sec.  49.154.


Sec.  49.157  Public participation requirements.

    This section applies to the issuance of minor source permits and 
synthetic minor source permits, the initial issuance of general permits 
and coverage of a particular source under a general permit.
    (a) What permit information will be publicly available? With the 
exception of any confidential information as defined in part 2, subpart 
B of this chapter, the reviewing authority must make available for 
public inspection the documents listed in paragraphs (a)(1) through (6) 
of this section. The reviewing authority must make such information 
available for public inspection at the appropriate EPA Regional Office 
and in at least one location in the area affected by the source, such 
as the Tribal environmental office or a local library.
    (1) All information submitted as part of your application for a 
permit.
    (2) Any additional information requested by the reviewing 
authority.
    (3) The reviewing authority's analysis of the application and any 
additional information you submitted, including (for preconstruction 
permits and the initial issuance of general permits) the control 
technology review.
    (4) For minor source permits and the initial issuance of general 
permits, the reviewing authority's analysis of the effect of the 
construction of the minor source or modification on ambient air 
quality.
    (5) For coverage of a particular source under a general permit, the 
reviewing authority's analysis of whether your particular emissions 
unit or source is within the category of emissions units or sources to 
which the general permit applies, including whether your emissions unit 
or source meets any criteria to be eligible for coverage under the 
general permit.
    (6) A copy of the draft permit or the decision to deny the permit 
with the justification for denial.
    (b) How will the public be notified and participate?
    (1) Before issuing a permit under this program, the reviewing 
authority must prepare a draft permit and must provide adequate public 
notice to ensure that the affected community and the general public 
have reasonable access to the application and draft permit information, 
as set out in paragraphs (b)(1)(i) and (ii) of this section. The public 
notice must provide an opportunity for public comment and notice of a 
public hearing, if any, on the draft permit.

[[Page 38797]]

    (i) The reviewing authority must mail a copy of the notice to you, 
the appropriate Indian governing body and the Tribal, state and local 
air pollution authorities having jurisdiction adjacent to the area of 
Indian country potentially impacted by the air pollution source.
    (ii) Depending on such factors as the nature and size of your 
source, local air quality considerations and the characteristics of the 
population in the affected area (e.g., subsistence hunting and fishing 
or other seasonal cultural practices), the reviewing authority must use 
appropriate means of notification, such as those listed in paragraphs 
(b)(1)(ii)(A) through (E) of this section.
    (A) The reviewing authority may mail or e-mail a copy of the notice 
to persons on a mailing list developed by the reviewing authority 
consisting of those persons who have requested to be placed on such a 
mailing list.
    (B) The reviewing authority may post the notice on its Web site.
    (C) The reviewing authority may publish the notice in a newspaper 
of general circulation in the area affected by the source. Where 
possible, the notice may also be published in a Tribal newspaper or 
newsletter.
    (D) The reviewing authority may provide copies of the notice for 
posting at one or more locations in the area affected by the source, 
such as post offices, trading posts, libraries, Tribal environmental 
offices, community centers or other gathering places in the community.
    (E) The reviewing authority may employ other means of notification 
as appropriate.
    (2) The notice required pursuant to paragraph (b)(1) of this 
section must include the following information at a minimum:
    (i) Identifying information, including your name and address (and 
plant name and address if different) and the name and telephone number 
of the plant manager/contact.
    (ii) The name and address of the reviewing authority processing the 
permit action;
    (iii) For minor source permits, the initial issuance of general 
permits and coverage of a particular source under a general permit, the 
regulated NSR pollutants to be emitted, the affected emissions units 
and the emission limitations for each affected emissions unit;
    (iv) For minor source permits, the initial issuance of general 
permits and coverage of a particular source under a general permit, the 
emissions change involved in the permit action;
    (v) For synthetic minor source permits, a description of the 
proposed limitation and its effect on the potential to emit of the 
source;
    (vi) Instructions for requesting a public hearing;
    (vii) The name, address and telephone number of a contact person in 
the reviewing authority's office from whom additional information may 
be obtained;
    (viii) Locations and times of availability of the information 
(listed in paragraph (a) of this section) for public inspection and
    (ix) A statement that any person may submit written comments, a 
written request for a public hearing or both, on the draft permit 
action. The reviewing authority must provide a period of at least 30 
days from the date of the public notice for comments and for requests 
for a public hearing.
    (c) How will the public comment and will there be a public hearing?
    (1) Any person may submit written comments on the draft permit and 
may request a public hearing. These comments must raise any reasonably 
ascertainable issue with supporting arguments by the close of the 
public comment period (including any public hearing). The reviewing 
authority must consider all comments in making the final decision. The 
reviewing authority must keep a record of the commenters and of the 
issues raised during the public participation process and such records 
must be available to the public.
    (2) The reviewing authority must extend the public comment period 
under paragraph (b) of this section to the close of any public hearing 
under this section. The hearing officer may also extend the comment 
period by so stating at the hearing.
    (3) A request for a public hearing must be in writing and must 
state the nature of the issues proposed to be raised at the hearing.
    (4) The reviewing authority must hold a hearing whenever there is, 
on the basis of requests, a significant degree of public interest in a 
draft permit. The reviewing authority may also hold a public hearing at 
its discretion, whenever, for instance, such a hearing might clarify 
one or more issues involved in the permit decision. The reviewing 
authority must provide notice of any public hearing at least 30 days 
prior to the date of the hearing. Public notice of the hearing may be 
concurrent with that of the draft permit and the two notices may be 
combined. Reasonable limits may be set upon the time allowed for oral 
statements at the hearing.
    (5) The reviewing authority must make a tape recording or written 
transcript of any hearing available to the public.


Sec.  49.158  Synthetic minor source permits.

    You may obtain a synthetic minor source permit under this program 
to establish a synthetic minor source for purposes of the applicable 
PSD, nonattainment major NSR or Clean Air Act title V program and/or a 
synthetic minor HAP source for purposes of part 63 of the Act or the 
applicable Clean Air Act title V program. Any source that becomes a 
synthetic minor source for NSR and title V purposes but has other 
applicable requirements or becomes a synthetic minor for NSR but is 
major for title V purposes, remains subject to the applicable title V 
program. Note that if you propose to construct or modify a synthetic 
minor source, you are also subject to the preconstruction permitting 
requirements in Sec. Sec.  49.154 and 49.155, except for the permit 
application content and permit application completeness provisions 
included in Sec.  49.154(a)(2) and Sec.  49.154(b).
    (a) What information must my synthetic minor source permit 
application contain?
    (1) Your application must include the following information:
    (i) Identifying information, including your name and address (and 
plant name and address if different) and the name and telephone number 
of the plant manager/contact.
    (ii) For each regulated NSR pollutant and/or HAP and for all 
emissions units to be covered by an emissions limitation, the following 
information:
    (A) The proposed emission limitation and a description of its 
effect on actual emissions or the potential to emit. Proposed emission 
limitations must have a reasonably short averaging period, taking into 
consideration the operation of the source and the methods to be used 
for demonstrating compliance.
    (B) Proposed testing, monitoring, recordkeeping and reporting 
requirements to be used to demonstrate and assure compliance with the 
proposed limitation.
    (C) A description of the production processes.
    (D) Identification of the emissions units.
    (E) Type and quantity of fuels and/or raw materials used.
    (F) Description and estimated efficiency of air pollution control 
equipment under present or anticipated operating conditions.
    (G) Estimates of the current actual emissions and current potential 
to emit, including all calculations for the estimates.
    (H) Estimates of the allowable emissions and/or potential to emit 
that

[[Page 38798]]

would result from compliance with the proposed limitation, including 
all calculations for the estimates.
    (iii) Any other information specifically requested by the reviewing 
authority.
    (2) Estimates of actual emissions must be based upon actual test 
data or in the absence of such data, upon procedures acceptable to the 
reviewing authority. Any emission estimates submitted to the reviewing 
authority must be verifiable using currently accepted engineering 
criteria. The following procedures are generally acceptable for 
estimating emissions from air pollution sources:
    (i) Source-specific emission tests;
    (ii) Mass balance calculations;
    (iii) Published, verifiable emission factors that are applicable to 
the source;
    (iv) Other engineering calculations or
    (v) Other procedures to estimate emissions specifically approved by 
the reviewing authority.
    (b) What are the procedures for obtaining a synthetic minor source 
permit?
    (1) If you wish to obtain a synthetic minor source permit under 
this program, you must submit a permit application to the reviewing 
authority. The application must contain the information specified in 
paragraph (a) of this section.
    (2) Within 60 days after receipt of an application, the reviewing 
authority will determine if it contains the information specified in 
paragraph (a) of this section.
    (3) If the reviewing authority determines that the application is 
not complete, it will request additional information from you as 
necessary to process the application. If the reviewing authority 
determines that the application is complete, it will notify you in 
writing. The reviewing authority's completeness determination or 
request for additional information should be postmarked within 60 days 
of receipt of the permit application by the reviewing authority. If you 
do not receive a request for additional information or a notice of 
complete application postmarked within 60 days of receipt of the permit 
application by the reviewing authority, your application will be deemed 
complete
    (4) The reviewing authority will prepare a draft synthetic minor 
source permit that describes the proposed limitation and its effect on 
the potential to emit of the source.
    (5) The reviewing authority must provide an opportunity for public 
participation and public comment on the draft synthetic minor source 
permit as set out in Sec.  49.157.
    (6) After the close of the public comment period, the reviewing 
authority will review all comments received and prepare a final 
synthetic minor source permit.
    (7) The final synthetic minor source permit will be granted or 
denied no later than 1 year after the date the application is deemed 
complete and all additional information necessary to make an informed 
decision has been provided.
    (8) The final synthetic minor source permit will be issued and will 
be subject to administrative and judicial review as set out in Sec.  
49.159.
    (c) What are my responsibilities under this program for my source 
that already has synthetic minor source or synthetic minor HAP source 
status prior to the effective date of this rule (that is, prior to 
August 30, 2011)?
    (1) If your existing synthetic minor source and/or synthetic minor 
HAP source was established pursuant to the FIPs applicable to the 
Indian reservations in Idaho, Oregon and Washington or was established 
under an EPA-approved rule or permit program limiting potential to 
emit, you do not need to take any action under this program unless you 
propose a modification for this existing synthetic minor source and/or 
synthetic minor HAP source, on or after the effective date of this 
rule, that is, on or after August 30, 2011. For these modifications, 
you need to obtain a permit pursuant to Sec.  49.158 prior to 
commencing construction.
    (2) If your existing synthetic minor source and/or synthetic minor 
HAP source was established under a permit with enforceable emissions 
limitations issued pursuant to part 71 of this chapter, the reviewing 
authority has the discretion to do any of the following:
    (i) Allow you to maintain the synthetic minor status for your 
source through your permit under part 71 of this chapter, including 
subsequent renewals of that permit.
    (ii) Require you to submit an application for a synthetic minor 
source permit under this program by September 4, 2012, subject to the 
provisions in paragraphs (a) and (c)(4)(i) through (iii) of this 
section. The reviewing authority also has the discretion to require any 
additional requirements, including control technology requirements, 
based on the specific circumstances of the source.
    (iii) Require you to submit an application for a synthetic minor 
source permit under this program at the same time that you apply to 
renew your permit under part 71 of this chapter, subject to the 
provisions in paragraphs (a) and (c)(4)(i) through (iii) of this 
section. The reviewing authority also has the discretion to require any 
additional requirements, including control technology requirements, 
based on the specific circumstances of the source.
    (3) If your existing synthetic minor source and/or synthetic minor 
HAP source was established through a mechanism other than those 
described in paragraphs (c)(1) and (c)(2) of this section, you must 
submit an application for a synthetic minor source permit under this 
program by September 4, 2012, subject to the provisions in paragraphs 
(a) and (c)(4)(i) through (iii) of this section
    (4) If you are required to obtain a synthetic minor source permit 
under this program for your existing synthetic minor source and/or 
synthetic minor HAP source, the following provisions apply:
    (i) After submitting your synthetic minor source permit 
application, you must respond in a timely manner to any requests from 
the reviewing authority for additional information.
    (ii) Provided that you submit your application as required in 
paragraph (c)(2)(ii), (c)(2)(iii) or (c)(3) (as applicable) and any 
requested additional information as required in paragraph (c)(4)(i) of 
this section, your source will continue to be considered a synthetic 
minor source or synthetic minor HAP source (as applicable) until your 
synthetic minor source permit under this program has been issued. 
Issuance of your synthetic minor source permit under this program will 
be in accordance with the applicable requirements in Sec. Sec.  49.154 
and 49.155 and all other provisions under this section.
    (iii) Should you fail to submit your application as required in 
paragraph (c)(2)(ii), (c)(2)(iii) or (c)(3) (as applicable) or any 
requested additional information as required in paragraph (c)(4)(i) of 
this section, your source will no longer be considered a synthetic 
minor source or synthetic minor HAP source (as applicable) and will 
become subject to all requirements for major sources. In the case of 
sources subject to section (c)(2)(iii) of this section, the renewed 
part 71 permit will not contain enforceable emissions limitations and 
instead will include applicable major source requirements.


Sec.  49.159  Final permit issuance and administrative and judicial 
review.

    (a) How will final action occur and when will my permit become 
effective? After decision on a permit, the reviewing authority must 
notify you of the decision, in writing and if the

[[Page 38799]]

permit is denied, of the reasons for such denial and the procedures for 
appeal. The reviewing authority must provide adequate public notice of 
the final permit decision to ensure that the affected community, 
general public and any individuals who commented on the draft permit 
have reasonable access to the decision and supporting materials 
according to 49.157(b)(1), for synthetic minor sources and minor 
modifications at major sources and according to one or more of the 
provisions in Sec.  49.157(b)(1)(ii)(A)-(E) for site-specific permits. 
A final permit becomes effective 30 days after service of notice of the 
final permit decision, unless:
    (1) A later effective date is specified in the permit or
    (2) Review of the final permit is requested under paragraph (d) of 
this section (in which case the specific terms and conditions of the 
permit that are the subject of the request for review must be stayed) 
or
    (3) The reviewing authority may make the permit effective 
immediately upon issuance if no comments requested a change in the 
draft permit or a denial of the permit.
    (b) For how long will the reviewing authority retain my permit-
related records? The records, including any required applications for 
each draft and final permit or application for permit revision, must be 
kept by the reviewing authority for not less than 5 years.
    (c) What is the administrative record for each final permit?
    (1) The reviewing authority must base final permit decisions on an 
administrative record consisting of:
    (i) The application and any supporting data furnished by you, the 
permit applicant;
    (ii) The draft permit or notice of intent to deny the application;
    (iii) Other documents in the supporting files for the draft permit 
that were relied upon in the decision-making;
    (iv) All comments received during the public comment period, 
including any extension or reopening;
    (v) The tape or transcript of any hearing(s) held;
    (vi) Any written material submitted at such a hearing;
    (vii) Any new materials placed in the record as a result of the 
reviewing authority's evaluation of public comments;
    (viii) The final permit and
    (ix) Other documents in the supporting files for the final permit 
that were relied upon in the decision-making.
    (2) The additional documents required under paragraph (c)(1) of 
this section should be added to the record as soon as possible after 
their receipt or preparation by the reviewing authority. The record 
must be complete on the date the final permit is issued.
    (3) Material readily available or published materials that are 
generally available and that are included in the administrative record 
under the standards of paragraph (c)(1) of this section need not be 
physically included in the same file as the rest of the record as long 
as it is specifically referred to in that file.
    (d) Can permit decisions be appealed? Permit decisions may be 
appealed according to the following provisions:
    (1) The Administrator delegates authority to the Environmental 
Appeals Board (the Board) to issue final decisions in permit appeals 
filed under this program. An appeal directed to the Administrator, 
rather than to the Board, will not be considered. This delegation does 
not preclude the Board from referring an appeal or a motion under this 
program to the Administrator when the Board, in its discretion, deems 
it appropriate to do so. When an appeal or motion is referred to the 
Administrator by the Board, all parties shall be so notified and the 
provisions of this program referring to the Board shall be interpreted 
as referring to the Administrator.
    (2) Within 30 days after a final permit decision has been issued, 
any person who filed comments on the draft permit or participated in 
the public hearing may petition the Board to review any condition of 
the permit decision. Any person who failed to file comments or failed 
to participate in the public hearing on the draft permit may petition 
for administrative review only to the extent that the changes from the 
draft to the final permit or other new grounds were not reasonably 
ascertainable during the public comment period on the draft permit. The 
30-day period within which a person may request review under this 
section begins with the service of notice of the final permit decision, 
unless a later date is specified in that notice.
    (3) The petition must include a statement of the reasons supporting 
the review, including a demonstration that any issues being raised were 
raised during the public comment period (including any public hearing) 
to the extent required by these regulations, unless the petitioner 
demonstrates that such objections were not reasonably ascertainable 
within such period and, when appropriate, a showing that the condition 
in question is based on:
    (i) A finding of fact or conclusion of law that is clearly 
erroneous or
    (ii) An exercise of discretion or an important policy consideration 
that the Board should, in its discretion, review.
    (4) The Board may also decide on its own initiative to review any 
condition of any permit issued under this program.
    (5) Within a reasonable time following the filing of the petition 
for review, the Board will issue an order either granting or denying 
the petition for review. To the extent review is denied, the conditions 
of the final permit decision become final agency action. If the Board 
grants review in response to requests under paragraph (d)(2)-(3) or (4) 
of this section, public notice must be given as provided in Sec.  
49.157(b). Public notice must set forth a briefing schedule for the 
appeal and must state that any interested person may file an amicus 
brief. If the Board denies review, you, the permit applicant and the 
person(s) requesting review must be notified through means that are 
adequate to assure reasonable access to the decision, which may include 
mailing a notice to each party.
    (6) The reviewing authority, at any time prior to the rendering of 
a decision under paragraph (d)(5) of this section to grant or deny 
review of a permit decision, may, upon notification to the Board and 
any interested parties, withdraw the permit and prepare a new draft 
permit addressing the portions so withdrawn. The new draft permit shall 
proceed through the same process of public comment and opportunity for 
a public hearing as would apply to any other draft permit subject to 
this subpart and in accordance with Sec.  49.157.
    (7) A petition to the Board under paragraph (d)(2) of this section 
is, under section 307(b) of the Act, a prerequisite to seeking judicial 
review of the final agency action.
    (8) For purposes of judicial review, final agency action occurs 
when a final permit is issued or denied by the reviewing authority and 
agency review procedures are exhausted. A final permit decision will be 
issued by the reviewing authority:
    (i) When the Board issues notice to the parties that review has 
been denied;
    (ii) When the Board issues a decision on the merits of the appeal 
and the decision does not include a remand of the proceedings or
    (iii) Upon the completion of remand proceedings if the proceedings 
are remanded, unless the Board's remand order specifically provides 
that appeal of the remand decision will be required to exhaust 
administrative remedies.
    (9) Motions to reconsider a final order must be filed within 10 
days after service of the final order. Every such

[[Page 38800]]

motion must set forth the matters claimed to have been erroneously 
decided and the nature of the alleged errors. Motions for 
reconsideration under this provision must be directed to and decided 
by, the Board. Motions for reconsideration directed to the 
Administrator, rather than to the Board, will not be considered, except 
in cases the Board has referred to the Administrator pursuant to Sec.  
49.159(d)(1) and in which the Administrator has issued the final order. 
A motion for reconsideration will not stay the effective date of the 
final order unless specifically so ordered by the Board.
    (10) For purposes of this section, time periods are computed as 
follows:
    (i) Any time period scheduled to begin on the occurrence of an act 
or event must begin on the day after the act or event.
    (ii) Any time period scheduled to begin before the occurrence of an 
act or event must be computed so that the period ends on the day before 
the act or event, except as otherwise provided.
    (iii) If the final day of any time period falls on a weekend or 
legal holiday, the time period must be extended to the next working 
day.
    (iv) Whenever a party or interested person has the right or is 
required to act within a prescribed period after the service of notice 
or other paper upon him or her by mail, 3 days must be added to the 
prescribed time.
    (e) Can my permit be reopened? The reviewing authority may reopen 
an existing, currently-in-effect permit for cause on its own 
initiative, such as if it contains a material mistake or fails to 
assure compliance with applicable requirements. However, except for 
those permit reopenings that do not increase the emissions limitations 
in the permit, such as permit reopenings that correct typographical, 
calculation and other errors, all other permit reopenings shall be 
carried out after the opportunity of public notice and comment and in 
accordance with one or more of the public participation requirements 
under Sec.  49.157(b)(1)(ii).
    (f) What is an administrative permit revision? The following 
provisions govern administrative permit revisions.
    (1) An administrative permit revision is a permit revision that 
makes any of the following changes:
    (i) Corrects typographical errors.
    (ii) Identifies a change in the name, address or phone number of 
any person identified in the permit or provides a similar minor 
administrative change at the source.
    (iii) Requires more frequent monitoring or reporting by the 
permittee.
    (iv) Allows for a change in ownership or operational control of a 
source where the reviewing authority determines that no other change in 
the permit is necessary, provided that a written agreement containing a 
specific date for transfer of permit responsibility, coverage and 
liability between the current and new permittee has been submitted to 
the reviewing authority.
    (v) Establishes an increase in an emissions unit's annual allowable 
emissions limit for a regulated NSR pollutant, when the action that 
necessitates such increase is not otherwise subject to review under 
major NSR or under this program.
    (vi) Incorporates any other type of change that the reviewing 
authority has determined to be similar to those in paragraphs (f)(1)(i) 
through (v) of this section.
    (2) An administrative permit revision is not subject to the permit 
application, issuance, public participation or administrative and 
judicial review requirements of this program.


Sec.  49.160  Registration program for minor sources in Indian country.

    (a) Does this section apply to my source? This section applies to 
you if you are the owner/operator of a true minor source.
    (b) What is exempted from this section? The exemptions in 
paragraphs (b)(1) and (b)(2) of this section apply to the registration 
program of this section.
    (1) You are exempt from this registration program if any of the 
following paragraphs applies to your source:
    (i) Your source is subject to the registration requirements under 
Sec.  49.138--``Rule for the registration of air pollution sources and 
the reporting of emissions.''
    (ii) Your source has a part 71 permit.
    (iii) Your source is a synthetic minor source or a synthetic minor 
HAP source or a minor modification at a major source as defined in 
Sec.  49.152(d).
    (2) For purposes of determining the potential to emit, allowable or 
actual emissions of your source, you are not required to include 
emissions from the exempted emissions units and activities listed in 
Sec.  49.153(c).
    (c) What are the requirements for registering your minor source? 
The requirements for registrations are as follows:
    (1) Due date. The due date of your source registration varies 
according to the following paragraphs:
    (i) If you own or operate an existing true minor source (as defined 
in 40 CFR 49.152(d)), you must register your source with your reviewing 
authority 18 months after the effective date of this program, that is, 
March 1, 2013.
    (ii) If your true minor source commences construction in the time 
period between the effective date of the rule and September 2, 2014, 
you must register your source with your reviewing authority within 90 
days after the source begins operation.
    (iii) If construction or modification of your source commenced any 
time on or after September 2, 2014 and your source is subject to this 
rule, you must report your source's actual emissions (if available) as 
part of your permit application and your permit application information 
will be used to fulfill the registration requirements described in 
Sec.  49.160(c)(2).
    (2) Content. You must submit all registration information on forms 
provided by the reviewing authority. Each registration must include the 
following information, as applicable:
    (i) Identifying information, including your name and address (and 
plant name and address if different) and the name and telephone number 
of the plant manager/contact.
    (ii) A description of your source's processes and products.
    (iii) A list of all emissions units (with the exception of the 
exempt emissions units and activities listed in Sec.  49.153(c)).
    (iv) For each emissions unit that is listed, both the allowable and 
estimated actual annual emissions of each regulated NSR pollutant in 
tpy (including fugitive emissions, to the extent that they are 
quantifiable, if the emissions unit or source is in one of the source 
categories listed in Sec.  51, Appendix S, paragraph II.A.4(iii) or 
Sec.  52.21(b)(1)(iii) of this chapter), with supporting documentation.
    (v) The following information: Fuels, fuel use, raw materials, 
production rates and operating schedules.
    (vi) Identification and description of any existing air pollution 
control equipment and compliance monitoring devices or activities.
    (vii) Any existing limitations on source operation affecting 
emissions or any work practice standards, where applicable, for all NSR 
regulated pollutants at the source.
    (viii) Any other information specifically requested by the 
reviewing authority.
    (3) Procedure for estimating emissions. Your registration should 
include potential to emit or estimates of the allowable and actual 
emissions, in tpy, of each regulated NSR pollutant for each emissions 
unit at the source.
    (i) Estimates of allowable emissions must be consistent with the 
definition of that term in Sec.  49.152(d). Allowable

[[Page 38801]]

emissions must be calculated based on 8,760 operating hours per year 
(i.e., operating 24 hours per day, 365 days per year) unless the 
reviewing authority approves a different number of annual operating 
hours as the basis for the calculation.
    (ii) Estimates of actual emissions must take into account 
equipment, operating conditions and air pollution control measures. For 
a source that operated during the entire calendar year preceding the 
initial registration submittal, the reported actual emissions typically 
should be the annual emissions for the preceding calendar year, 
calculated using the actual operating hours, production rates, in-place 
control equipment and types of materials processed, stored or combusted 
during the preceding calendar year. However, if you believe that the 
actual emissions in the preceding calendar year are not representative 
of the emissions that your source will actually emit in coming years, 
you may submit an estimate of projected actual emissions along with the 
actual emissions from the preceding calendar year and the rationale for 
the projected actual emissions. For a source that has not operated for 
an entire year, the actual emissions are the estimated annual emissions 
for the current calendar year.
    (iii) The allowable and actual emission estimates must be based 
upon actual test data or, in the absence of such data, upon procedures 
acceptable to the reviewing authority. Any emission estimates submitted 
to the reviewing authority must be verifiable using currently accepted 
engineering criteria. The following procedures are generally acceptable 
for estimating emissions from air pollution sources:
    (i) Source-specific emission tests;
    (ii) Mass balance calculations;
    (iii) Published, verifiable emission factors that are applicable to 
the source;
    (iv) Other engineering calculations or
    (v) Other procedures to estimate emissions specifically approved by 
the Regional Administrator.
    (4) Duty to obtain a permit. Submitting a registration does not 
relieve you of the requirement to obtain any required permit, including 
a preconstruction permit, if your source or any physical or operational 
change at your source would be subject to any minor or major NSR rule.
    (d) What are the requirements for additional reports? After you 
have registered your source, you must submit the following additional 
reports, when applicable:
    (1) Report of relocation. After your source has been registered, 
you must report any relocation of your source to the reviewing 
authority in writing no later than 30 days prior to the relocation of 
the source. However, you need not submit a report if you obtained a 
major or minor NSR permit for the relocation. Submitting a report of 
relocation does not relieve you of the requirement to obtain a 
preconstruction permit if the change is subject to any major NSR or 
minor NSR rule.
    (2) Report of change of ownership. After your source has been 
registered, the new owner/operator must report any change of ownership 
of a source to the reviewing authority in writing within 90 days after 
the change in ownership is effective.
    (3) Report of closure. Except for regular seasonal closures, after 
your source has been registered, you must submit a report of closure to 
the reviewing authority in writing within 90 days after the cessation 
of all operations at your source.


Sec.  49.161  Administration and delegation of the minor NSR program in 
Indian country.

    (a) Who administers a minor NSR program in Indian country?
    (1) If the Administrator has approved a TIP that includes a minor 
NSR program for sources in Indian country that meets the requirements 
of section 110(a)(2)(C) of the Act and Sec. Sec.  51.160 through 51.164 
of this chapter, the Tribe is the reviewing authority and it will 
administer the approved minor NSR program under Tribal law.
    (2) If the Administrator has not approved an implementation plan, 
the Administrator may delegate the authority to assist EPA with 
administration of portions of this Federal minor NSR program 
implemented under Federal authority to a Tribal agency upon request, in 
accordance with the provisions of paragraph (b) of this section. If the 
Tribal agency has been granted such delegation, it will have the 
authority to assist EPA according to paragraph (b) of this section and 
it will be the reviewing authority for purposes of the provisions for 
which it has been granted delegation.
    (3) If the Administrator has not approved an implementation plan or 
granted delegation to a Tribal agency, the Administrator is the 
reviewing authority and will directly administer all aspects of this 
Federal minor NSR program in Indian country under Federal authority.
    (b) Delegation of administration of the Federal minor NSR program 
to Tribes. This paragraph (b) establishes the process by which the 
Administrator may delegate authority to a Tribal agency, with or 
without signature authority, to assist EPA with administration of 
portions of this Federal minor NSR program, in accordance with the 
provisions in paragraphs (b)(1) through (8) of this section. Any 
Federal requirements under this program that are administered by the 
delegate Tribal agency will be subject to enforcement by EPA under 
Federal law. This section provides for administrative delegation of the 
Federal minor NSR program and does not affect the eligibility criteria 
under Sec.  49.6 for treatment in the same manner as a state.
    (1) Information to be included in the Administrative Delegation 
Request. In order to be delegated authority to assist EPA with 
administration of this FIP permit program for sources, the Tribal 
agency must submit a request to the Administrator that:
    (i) Identifies the specific provisions for which delegation is 
requested;
    (ii) Identifies the Indian Reservation or other areas of Indian 
country for which delegation is requested;
    (iii) Includes a statement by the applicant's legal counsel (or 
equivalent official) that includes the following information:
    (A) A statement that the applicant is a Tribe recognized by the 
Secretary of the Interior;
    (B) A descriptive statement that is consistent with the type of 
information described in Sec.  49.7(a)(2) demonstrating that the 
applicant is currently carrying out substantial governmental duties and 
powers over a defined area and
    (C) A description of the laws of the Tribe that provide adequate 
authority to administer the Federal rules and provisions for which 
delegation is requested and
    (iv) A demonstration that the Tribal agency has the technical 
capability and adequate resources to administer the FIP provisions for 
which the delegation is requested.
    (2) Delegation of Partial Administrative Authority Agreement. A 
Delegation of Partial Administrative Authority Agreement (Agreement) 
will set forth the terms and conditions of the delegation, will specify 
the provisions that the delegate Tribal agency will be authorized to 
implement on behalf of EPA and will be entered into by the 
Administrator and the delegate Tribal agency. The Agreement will become 
effective upon the date that both the Administrator and the delegate 
Tribal agency have signed the Agreement or as otherwise stated in the 
Agreement. Once the delegation becomes effective, the delegate Tribal 
agency will be responsible, to the extent specified in

[[Page 38802]]

the Agreement, for assisting EPA with administration of the provisions 
of the Federal minor NSR program that are subject to the Agreement.
    (3) Publication of notice of the Agreement. The Administrator will 
publish a notice in the Federal Register informing the public of any 
Agreement for a particular area of Indian country. The Administrator 
also will publish the notice in a newspaper of general circulation in 
the area affected by the delegation. In addition, the Administrator 
will mail a copy of the notice to persons on a mailing list developed 
by the Administrator consisting of those persons who have requested to 
be placed on such a mailing list.
    (4) Revision or revocation of an Agreement. An Agreement may be 
modified, amended or revoked, in part or in whole, by the Administrator 
after consultation with the delegate Tribal agency.
    (5) Transmission of information to the Administrator. When 
administration of a portion of the Federal minor NSR program in Indian 
country that includes receipt of permit application materials and 
preparation of draft permits has been delegated in accordance with the 
provisions of this section, the delegate Tribal agency must provide to 
the Administrator a copy of each permit application (including any 
application for permit revision) and each draft permit. You, the permit 
applicant, may be required by the delegate Tribal agency to provide a 
copy of the permit application directly to the Administrator. With the 
Administrator's consent, the delegate Tribal agency may submit to the 
Administrator a permit application summary form and any relevant 
portion of the permit application, in place of the complete permit 
application. To the extent practicable, the preceding information 
should be provided in electronic format by the delegate Tribal agency 
or by you, the permit applicant, as applicable and as requested by the 
Administrator. The delegate Tribal agency must also submit to the 
Administrator such information as the Administrator may reasonably 
require to ascertain whether the delegate Tribal agency is implementing 
and administering the delegated program in compliance with the 
requirements of the Act and of this program.
    (6) Waiver of information transmission requirements. The 
Administrator may waive the requirements of paragraph (b)(5) of this 
section for any category of sources (including any class, type or size 
within such category) by transmitting the waiver in writing to the 
delegate Tribal agency.
    (7) Retention of records. Where a delegate Tribal agency prepares 
draft or final permits or receives applications for permit revisions on 
behalf of EPA, the records for each draft and final permit or 
application for permit revision must be kept by the delegate Tribal 
agency for a period not less than 3 years.
    (8) Delegation of signature authority. To receive delegation of 
signature authority, the legal statement submitted by the Tribal agency 
pursuant to paragraph (b)(1) of this section must certify that no 
applicable provision of Tribal law requires that a minor NSR permit be 
issued after a certain time if the delegate Tribal agency has failed to 
take action on the application (or includes any other similar provision 
providing for default issuance of a permit).
    (c) Are there any non-delegable elements of the Federal minor NSR 
program in Indian country? The following authorities cannot be 
delegated outside of EPA:
    (1) The Administrator's authority to object to the issuance of a 
minor NSR permit.
    (2) The Administrator's authority to enforce permits issued 
pursuant to this program.
    (d) How will EPA transition its authority to an approved minor NSR 
program?
    (1) The Administrator will suspend the issuance of minor NSR 
permits under this program promptly upon publication of notice of 
approval of a Tribal implementation plan with a minor NSR permit 
program for that area.
    (2) The Administrator may retain jurisdiction over the permits for 
which the administrative or judicial review process is not complete and 
will address this issue in the notice of program approval.
    (3) After approval of a program for issuing minor NSR permits and 
the suspension of issuance of minor NSR permits by the Administrator, 
the Administrator will continue to administer minor NSR permits until 
permits are issued under the approved Tribal implementation plan 
program.
    (4) Permits previously issued under this program will remain in 
effect and be enforceable as a practical matter until and unless the 
Tribe issues new permits to these sources based on the provisions of 
the EPA-approved Tribal implementation plan.

0
3. Add an undesignated center heading and Sec. Sec.  49.166 through 
49.173 to subpart C to read as follows:

Federal Major New Source Review Program for Nonattainment Areas in 
Indian Country

* * * * *
Sec.
49.166 Program overview.
49.167 Definitions.
49.168 Does this program apply to me?
49.169 Permit approval criteria.
49.170 Emission offset requirement exemption.
49.171 Public participation requirements.
49.172 Final permit issuance and administrative and judicial review.
49.173 Administration and delegation of the nonattainment major NSR 
program in Indian country.
* * * * *


Sec.  49.166  Program overview.

    (a) What constitutes the Federal major new source review (NSR) 
program for nonattainment areas in Indian country? As set forth in this 
Federal Implementation Plan (FIP), the Federal major NSR program for 
nonattainment areas in Indian country (or ``program'') consists of 
Sec. Sec.  49.166 through 49.175.
    (b) What is the purpose of this program? This program has the 
following purposes:
    (1) It establishes a preconstruction permitting program for new 
major sources and major modifications at existing major sources located 
in nonattainment areas in Indian country to meet the requirements of 
part D of title I of the Act.
    (2) It requires that major sources subject to this program comply 
with the provisions and requirements of part 51, Appendix S of this 
chapter (Appendix S). Additionally, it sets forth the criteria and 
procedures in Appendix S that the reviewing authority (as defined in 
Sec.  49.167) will use to approve permits under this program. Note that 
for the purposes of this program, the term SIP as used in Appendix S 
means any EPA-approved implementation plan, including a Tribal 
Implementation Plan (TIP). While some of the important provisions of 
Appendix S are paraphrased in various paragraphs of this program to 
highlight them, the provisions of Appendix S govern.
    (3) It also sets forth procedures for appealing a permit issued 
under this program as provided in Sec.  49.172.
    (c) When and where does this program apply?
    (1) The provisions of this program apply to new major sources and 
major modifications at existing major sources located in nonattainment 
areas in Indian country where there is no EPA-approved nonattainment 
major NSR program beginning on August 30, 2011. The provisions of this 
program apply only to new sources and modifications

[[Page 38803]]

that are major for the regulated NSR pollutant(s) for which the area is 
designated nonattainment.
    (2) The provisions of this program cease to apply in an area 
covered by an EPA-approved implementation plan on the date that our 
approval of that implementation plan becomes effective, provided that 
the plan includes provisions that comply with the requirements of part 
D of title I of the Act and Sec.  51.165 of this chapter for the 
construction of new major sources and major modifications at existing 
major sources in nonattainment areas. Permits previously issued under 
this program will remain in effect and be enforceable as a practical 
matter until and unless the Tribe issues new permits to these sources 
based on the provisions of the EPA-approved Tribal implementation plan.
    (d) What general provisions apply under this program? The following 
general provisions apply to you as an owner/operator of a source:
    (1) If you propose to construct a new major source or a major 
modification at an existing major source in a nonattainment area in 
Indian country, you must obtain a major NSR permit under this program 
before beginning actual construction. If you commence construction 
after the effective date of this program without applying for and 
receiving a permit pursuant to this program, you will be subject to 
appropriate enforcement action.
    (2) If you do not construct or operate your source or modification 
in accordance with the terms of your major NSR permit issued under this 
program, you will be subject to appropriate enforcement action.
    (3) Issuance of a permit under this program does not relieve you of 
the responsibility to comply fully with applicable provisions of any 
EPA-approved implementation plan or FIP and any other requirements 
under applicable law.
    (4) Nothing in this program prevents a Tribe from administering a 
nonattainment major NSR permit program with different requirements in 
an approved TIP as long as the TIP meets the requirements of part D of 
title I of the Act.


Sec.  49.167  Definitions.

    For the purposes of this program, the definitions in part 51, 
Appendix S, paragraph II.A of this chapter apply, unless otherwise 
stated. The following definitions also apply to this program:
    Allowable emissions means ``allowable emissions'' as defined in 
part 51, Appendix S, paragraph II.A.11 of this chapter, except that the 
allowable emissions for any emissions unit are calculated considering 
any emission limitations that are enforceable as a practical matter on 
the emissions unit's potential to emit.
    Enforceable as a practical matter means that an emission limitation 
or other standard is both legally and practicably enforceable as 
follows:
    (1) An emission limitation or other standard is legally enforceable 
if the reviewing authority has the right to enforce it.
    (2) Practical enforceability for an emission limitation or for 
other standards (design standards, equipment standards, work practices, 
operational standards, pollution prevention techniques) in a permit for 
a source is achieved if the permit's provisions specify:
    (i) A limitation or standard and the emissions units or activities 
at the source subject to the limitation or standard;
    (ii) The time period for the limitation or standard (e.g., hourly, 
daily, monthly and/or annual limits such as rolling annual limits) and
    (iii) The method to determine compliance, including appropriate 
monitoring, recordkeeping, reporting and testing.
    (3) For rules and general permits that apply to categories of 
sources, practical enforceability additionally requires that the 
provisions:
    (i) Identify the types or categories of sources that are covered by 
the rule or general permit;
    (ii) Where coverage is optional, provide for notice to the 
reviewing authority of the source's election to be covered by the rule 
or general permit and
    (iii) Specify the enforcement consequences relevant to the rule or 
general permit.
    Environmental Appeals Board means the Board within the EPA 
described in Sec.  1.25(e) of this chapter.
    Indian country, as defined in 18 U.S.C. 1151, means the following:
    (1) All land within the limits of any Indian reservation under the 
jurisdiction of the United States government, notwithstanding the 
issuance of any patent and including rights-of-way running through the 
reservation; \1\
---------------------------------------------------------------------------

    \1\ Under this definition, EPA treats as reservations trust 
lands validly set aside for the use of a tribe even if the trust 
lands have not been formally designated as a reservation.
---------------------------------------------------------------------------

    (2) All dependent Indian communities within the borders of the 
United States whether within the original or subsequently acquired 
territory thereof and whether within or without the limits of a state 
and
    (3) All Indian allotments, the Indian titles to which have not been 
extinguished, including rights-of-way running through the same.
    Indian governing body means the governing body of any Tribe, band 
or group of Indians subject to the jurisdiction of the United States 
and recognized by the United States as possessing power of self-
government.
    Reviewing authority means the Administrator or an Indian Tribe in 
cases where a Tribal agency is assisting EPA with administration of the 
program through a delegation under Sec.  49.173.
    Synthetic minor HAP source means a source that otherwise has the 
potential to emit HAPs in amounts that are at or above those for major 
sources of HAP in Sec.  63.2 of this chapter, but that has taken a 
restriction such that its potential to emit is less than such amounts 
for major sources. Such restrictions must be enforceable as a practical 
matter.
    Synthetic minor source means a source that otherwise has the 
potential to emit regulated NSR pollutants in amounts that are at or 
above those for major sources in Appendix S, but that has taken a 
restriction such that its potential to emit is less than such amounts 
for major sources. Such restrictions must be enforceable as a practical 
matter.


Sec.  49.168  Does this program apply to me?

    (a) In a nonattainment area for a pollutant in Indian country, the 
requirements of this program apply to you under either of the following 
circumstances:
    (1) If you propose to construct a new major source (as defined in 
part 51, Appendix S, paragraph II.A.4 of this chapter) of the 
nonattainment pollutant.
    (2) If you propose to construct a major modification at your 
existing major source (as defined in part 51, Appendix S, paragraph 
II.A.5 of this chapter), where your source is a major source of the 
nonattainment pollutant and the proposed modification is a major 
modification for the nonattainment pollutant.
    (b) If you own or operate a major source with a state-issued 
nonattainment major NSR permit, you must apply to convert such permit 
to a Federal permit under this program by September 4, 2012.
    (c) If you propose to establish a synthetic minor source or 
synthetic minor HAP source or to construct a minor modification at your 
major source, you will have to comply with the requirements of the 
Federal minor NSR program in Indian country at

[[Page 38804]]

Sec. Sec.  49.151 through 49.165 or other EPA-approved minor NSR 
program, as applicable.


49.169  Permit approval criteria.

    (a) What are the general criteria for permit approval? The general 
review criteria for permits are provided in part 51, Appendix S, 
paragraph II.B of this chapter. In summary, that paragraph basically 
requires the reviewing authority to ensure that the proposed new major 
source or major modification would meet all applicable emission 
requirements in the EPA-approved implementation plan or FIP, any 
applicable new source performance standard in part 60 of this chapter 
and any applicable national emission standards for hazardous air 
pollutants in part 61 or part 63 of this chapter, before a permit can 
be issued.
    (b) What are the program-specific criteria for permit approval? The 
approval criteria or conditions for obtaining a major NSR permit for 
major sources and major modifications locating in nonattainment areas 
are given in part 51, Appendix S, paragraph IV.A of this chapter. In 
summary, these are the following:
    (1) The lowest achievable emission rate (LAER) requirement for any 
NSR pollutant subject to this program.
    (2) Certification that all existing major sources owned or operated 
by you in the same state as the state including the Tribal land where 
the proposed source or modification is locating are in compliance or 
under a compliance schedule.
    (3) Emissions reductions (offsets) requirement for any source or 
modification subject to this program.
    (4) A demonstration that the emission offsets will provide a net 
air quality benefit in the affected area.
    (5) An analysis of alternative sites, sizes, production processes 
and environmental control techniques for such proposed source that 
demonstrates that the benefits of the proposed source significantly 
outweigh the environmental and social costs imposed as a result of its 
location, construction or modification.


Sec.  49.170  Emission offset requirement exemption.

    An Indian governing body may seek an exemption from the emission 
offset requirement (see Sec.  49.169(b)(3)) for major sources and major 
modifications subject to this program that are located within the 
Tribe's Indian country pursuant to section 173(a)(1)(B) of the Act, 
under which major sources and major modifications subject to this 
program may be exempted from the offset requirement if they are located 
in a zone targeted for economic development by the Administrator, in 
consultation with the Department of Housing and Urban Development 
(HUD). Under this Economic Development Zone (EDZ) approach, the 
Administrator would waive the offset requirement for such sources and 
modifications, provided that:
    (a) The new major source or major modification is located in a 
geographical area which meets the criteria for an EDZ and the 
Administrator has approved a request from a Tribe and declared the area 
an EDZ and
    (b) The state/Tribe demonstrates that the new permitted emissions 
are consistent with the achievement of reasonable further progress 
pursuant to section 172(c)(4) of the Act and will not interfere with 
attainment of the applicable NAAQS by the applicable attainment date.


Sec.  49.171  Public participation requirements.

    (a) What permit information will be publicly available? With the 
exception of any confidential information as defined in part 2, subpart 
B of this chapter, the reviewing authority must make available for 
public inspection the documents listed in paragraphs (a)(1) through (4) 
of this section. The reviewing authority must make such information 
available for public inspection at the appropriate EPA Regional Office 
and in at least one location in the area affected by the source, such 
as the Tribal environmental office or a local library.
    (1) All information submitted as part of your application for a 
permit.
    (2) Any additional information requested by the reviewing 
authority.
    (3) The reviewing authority's analysis of the application and any 
additional information submitted by you, including the LAER analysis 
and, where applicable, the analysis of your emissions reductions 
(offsets), your demonstration of a net air quality benefit in the 
affected area and your analysis of alternative sites, sizes, production 
processes and environmental control techniques.
    (4) A copy of the draft permit or the decision to deny the permit 
with the justification for denial.
    (b) How will the public be notified and participate?
    (1) Before issuing a permit under this program, the reviewing 
authority must prepare a draft permit and must provide adequate public 
notice to ensure that the affected community and the general public 
have reasonable access to the application and draft permit information, 
as set out in paragraphs (b)(1)(i) and (ii) of this section. The public 
notice must provide an opportunity for public comment and notice of a 
public hearing, if any, on the draft permit.
    (i) The reviewing authority must mail a copy of the notice to you, 
the appropriate Indian governing body and the Tribal, state and local 
air pollution authorities having jurisdiction adjacent to the area of 
Indian country potentially impacted by the air pollution source.
    (ii) Depending on such factors as the nature and size of your 
source, local air quality considerations and the characteristics of the 
population in the affected area (e.g., subsistence hunting and fishing 
or other seasonal cultural practices), the reviewing authority must use 
appropriate means of notification, such as those listed in paragraphs 
(b)(1)(ii)(A) through (E) of this section.
    (A) The reviewing authority may mail or e-mail a copy of the notice 
to persons on a mailing list developed by the reviewing authority 
consisting of those persons who have requested to be placed on such a 
mailing list.
    (B) The reviewing authority may post the notice on its Web site.
    (C) The reviewing authority may publish the notice in a newspaper 
of general circulation in the area affected by the source. Where 
possible, the notice may also be published in a Tribal newspaper or 
newsletter.
    (D) The reviewing authority may provide copies of the notice for 
posting at one or more locations in the area affected by the source, 
such as Post Offices, trading posts, libraries, Tribal environmental 
offices, community centers or other gathering places in the community.
    (E) The reviewing authority may employ other means of notification 
as appropriate.
    (2) The notice required pursuant to paragraph (b)(1) of this 
section must include the following information at a minimum:
    (i) Identifying information, including your name and address (and 
plant name and address if different) and the name and telephone number 
of the plant manager/contact.
    (ii) The name and address of the reviewing authority processing the 
permit action;
    (iii) The regulated NSR pollutants to be emitted, the affected 
emissions units and the emission limitations for each affected 
emissions unit;
    (iv) The emissions change involved in the permit action;
    (v) Instructions for requesting a public hearing;
    (vi) The name, address and telephone number of a contact person in 
the

[[Page 38805]]

reviewing authority's office from whom additional information may be 
obtained;
    (vii) Locations and times of availability of the information 
(listed in paragraph (a) of this section) for public inspection and
    (viii) A statement that any person may submit written comments, a 
written request for a public hearing or both, on the draft permit 
action. The reviewing authority must provide a period of at least 30 
days from the date of the public notice for comments and for requests 
for a public hearing.
    (c) How will the public comment and will there be a public hearing?
    (1) Any person may submit written comments on the draft permit and 
may request a public hearing. These comments must raise any reasonably 
ascertainable issue with supporting arguments by the close of the 
public comment period (including any public hearing). The reviewing 
authority must consider all comments in making the final decision. The 
reviewing authority must keep a record of the commenters and of the 
issues raised during the public participation process and such records 
must be available to the public.
    (2) The reviewing authority must extend the public comment period 
under paragraph (b) of this section to the close of any public hearing 
under this section. The hearing officer may also extend the comment 
period by so stating at the hearing.
    (3) A request for a public hearing must be in writing and must 
state the nature of the issues proposed to be raised at the hearing.
    (4) The reviewing authority must hold a hearing whenever there is, 
on the basis of requests, a significant degree of public interest in a 
draft permit. The reviewing authority may also hold a public hearing at 
its discretion, whenever, for instance, such a hearing might clarify 
one or more issues involved in the permit decision. The reviewing 
authority must provide notice of any public hearing at least 30 days 
prior to the date of the hearing. Public notice of the hearing may be 
concurrent with that of the draft permit and the two notices may be 
combined. Reasonable limits may be set upon the time allowed for oral 
statements at the hearing.
    (5) The reviewing authority must make a tape recording or written 
transcript of any hearing available to the public.


Sec.  49.172  Final permit issuance and administrative and judicial 
review.

    (a) How will final action occur and when will my permit become 
effective? After making a decision on a permit, the reviewing authority 
must notify you of the decision, in writing and if the permit is 
denied, provide the reasons for such denial and the procedures for 
appeal. If the reviewing authority issues a final permit to you, it 
must make a copy of the permit available at any location where the 
draft permit was made available. In addition, the reviewing authority 
must provide adequate public notice of the final permit decision to 
ensure that the affected community, general public and any individuals 
who commented on the draft permit have reasonable access to the 
decision and supporting materials. A final permit becomes effective 30 
days after service of notice of the final permit decision, unless:
    (1) A later effective date is specified in the permit or
    (2) Review of the final permit is requested under paragraph (d) of 
this section (in which case the specific terms and conditions of the 
permit that are the subject of the request for review must be stayed) 
or
    (3) The draft permit was subjected to a public comment period and 
no comments requested a change in the draft permit or a denial of the 
permit, in which case the reviewing authority may make the permit 
effective immediately upon issuance.
    (b) For how long will the reviewing authority retain my permit-
related records? The records, including any required applications for 
each draft and final permit or application for permit revision, must be 
kept by the reviewing authority for not less than 5 years.
    (c) What is the administrative record for each final permit?
    (1) The reviewing authority must base final permit decisions on an 
administrative record consisting of:
    (i) All comments received during any public comment period, 
including any extension or reopening;
    (ii) The tape or transcript of any hearing(s) held;
    (iii) Any written material submitted at such a hearing;
    (iv) Any new materials placed in the record as a result of the 
reviewing authority's evaluation of public comments;
    (v) Other documents in the supporting files for the permit that 
were relied upon in the decision-making;
    (vi) The final permit;
    (vii) The application and any supporting data furnished by you, the 
permit applicant;
    (viii) The draft permit or notice of intent to deny the application 
or to terminate the permit and
    (ix) Other documents in the supporting files for the draft permit 
that were relied upon in the decision-making.
    (2) The additional documents required under paragraph (c)(1) of 
this section should be added to the record as soon as possible after 
their receipt or publication by the reviewing authority. The record 
must be complete on the date the final permit is issued.
    (3) Material readily available or published materials that are 
generally available and that are included in the administrative record 
under the standards of paragraph (c)(1) of this section need not be 
physically included in the same file as the rest of the record as long 
as it is specifically referred to in that file.
    (d) Can permit decisions be appealed? Permit decisions may be 
appealed according to the following provisions:
    (1) The Administrator delegates authority to the Environmental 
Appeals Board (the Board) to issue final decisions in permit appeals 
filed under this program. An appeal directed to the Administrator, 
rather than to the Board, will not be considered. This delegation does 
not preclude the Board from referring an appeal or a motion under this 
program to the Administrator when the Board, in its discretion, deems 
it appropriate to do so. When an appeal or motion is referred to the 
Administrator by the Board, all parties shall be so notified and the 
provisions of this program referring to the Board shall be interpreted 
as referring to the Administrator.
    (2) Within 30 days after a final permit decision has been issued, 
any person who filed comments on the draft permit or participated in 
the public hearing may petition the Board to review any condition of 
the permit decision. Any person who failed to file comments or failed 
to participate in the public hearing on the draft permit may petition 
for administrative review only to the extent that the changes from the 
draft to the final permit or other new grounds were not reasonably 
ascertainable during the public comment period on the draft permit. The 
30-day period within which a person may request review under this 
section begins with the service of notice of the final permit decision, 
unless a later date is specified in that notice.
    (3) The petition must include a statement of the reasons supporting 
the review, including a demonstration that any issues being raised were 
raised during the public comment period (including any public hearing) 
to the extent required by these regulations, unless the petitioner 
demonstrates that it was impracticable to raise such objections were 
not reasonably

[[Page 38806]]

ascertainable within such period or unless the grounds for such 
objection arose after such period and, when appropriate, a showing that 
the condition in question is based on:
    (i) A finding of fact or conclusion of law that is clearly 
erroneous or
    (ii) An exercise of discretion or an important policy consideration 
that the Board should, in its discretion, review.
    (4) The Board may also decide on its own initiative to review any 
condition of any permit issued under this program.
    (5) Within a reasonable time following the filing of the petition 
for review, the Board will issue an order either granting or denying 
the petition for review. To the extent review is denied, the conditions 
of the final permit decision become final agency action. If the Board 
grants review in response to requests under paragraph (d)(2)-(3) or (4) 
of this section, public notice must be given as provided in Sec.  
49.171(b). Public notice must set forth a briefing schedule for the 
appeal and must state that any interested person may file an amicus 
brief. If the Board denies review, you, the permit applicant and the 
person(s) requesting review must be notified through means that are 
adequate to assure reasonable access to the decision, which may include 
mailing a notice to each party.
    (6) The reviewing authority, at any time prior to the rendering of 
the decision under paragraph (d)(5) of this section to grant or deny 
review of a permit decision, may, upon notification to the Board and 
any interested parties, withdraw the permit and prepare a new draft 
permit addressing the portions so withdrawn. The new draft permit shall 
proceed through the same process of public comment and opportunity for 
a public hearing as would apply to any other draft permit subject to 
this part.
    (7) A petition to the Board under paragraph (d)(2) of this section 
is, under section 307(b) of the Act, a prerequisite to seeking judicial 
review of the final agency action.
    (8) For purposes of judicial review, final agency action occurs 
when a final permit is issued or denied by the reviewing authority and 
agency review procedures are exhausted. A final permit decision will be 
issued by the reviewing authority:
    (i) When the Board issues notice to the parties that review has 
been denied;
    (ii) When the Board issues a decision on the merits of the appeal 
and the decision does not include a remand of the proceedings or
    (iii) Upon the completion of remand proceedings if the proceedings 
are remanded, unless the Board's remand order specifically provides 
that appeal of the remand decision will be required to exhaust 
administrative remedies.
    (9) The reviewing authority shall promptly publish in the Federal 
Register notice of any final agency action on a permit.
    (10) Motions to reconsider a final order must be filed within 10 
days after service of the final order. Every such motion must set forth 
the matters claimed to have been erroneously decided and the nature of 
the alleged errors. Motions for reconsideration under this provision 
must be directed to and decided by, the Board. Motions for 
reconsideration directed to the Administrator, rather than to the 
Board, will not be considered, except in cases the Board has referred 
to the Administrator pursuant to Sec.  49.172(d)(1) and in which the 
Administrator has issued the final order. A motion for reconsideration 
will not stay the effective date of the final order unless specifically 
so ordered by the Board.
    (11) For purposes of this section, time periods are computed as 
follows:
    (i) Any time period scheduled to begin on the occurrence of an act 
or event must begin on the day after the act or event.
    (ii) Any time period scheduled to begin before the occurrence of an 
act or event must be computed so that the period ends on the day before 
the act or event, except as otherwise provided.
    (iii) If the final day of any time period falls on a weekend or 
legal holiday, the time period must be extended to the next working 
day.
    (iv) Whenever a party or interested person has the right or is 
required to act within a prescribed period after the service of notice 
or other paper upon him or her by mail, 3 days must be added to the 
prescribed time.
    (e) Can my permit be reopened? The reviewing authority may reopen 
an existing, currently-in-effect permit for cause on its own 
initiative, such as if it contains a material mistake or fails to 
assure compliance with applicable requirements. However, except for 
those permit reopenings that do not increase the emissions limitations 
in the permit, such as permit reopenings that correct typographical, 
calculation and other errors, all other permit reopenings shall be 
carried out after the opportunity of public notice and comment and in 
accordance with one or more of the public participation requirements 
under Sec.  49.171(b)(1)(ii).


Sec.  49.173  Administration and delegation of the nonattainment major 
NSR program in Indian country.

    (a) Who administers a nonattainment major NSR program in Indian 
country?
    (1) If the Administrator has approved a TIP that includes a major 
NSR program for sources in nonattainment areas of Indian country that 
meets the requirements of part D of title I of the Act and Sec.  51.165 
of this chapter, the Tribe is the reviewing authority and will 
administer the approved major NSR program under Tribal law.
    (2) If the Administrator has not approved an implementation plan, 
the Administrator may delegate the authority to assist EPA with 
administration of portions of this Federal nonattainment major NSR 
program implemented under Federal authority to a Tribal agency upon 
request, in accordance with the provisions of paragraph (b) of this 
section. If the Tribal agency has been granted such delegation, it will 
have the authority to assist EPA according to paragraph (b) of this 
section and it will be the reviewing authority for purposes of the 
provisions for which it has been granted delegation.
    (3) If the Administrator has not approved an implementation plan or 
granted delegation to a Tribal agency, the Administrator is the 
reviewing authority and will directly administer all aspects of this 
Federal nonattainment major NSR program in Indian country under Federal 
authority.
    (b) Delegation of administration of the Federal nonattainment major 
NSR program to Tribes. This paragraph (b) establishes the process by 
which the Administrator may delegate authority to a Tribal agency, with 
or without signature authority, to assist EPA with administration of 
portions of this Federal nonattainment major NSR program, in accordance 
with the provisions in paragraphs (b)(1) through (8) of this section. 
Any Federal requirements under this program that are administered by 
the delegate Tribal agency will be subject to enforcement by EPA under 
Federal law. This section provides for administrative delegation of the 
Federal nonattainment major NSR program and does not affect the 
eligibility criteria under Sec.  49.6 for treatment in the same manner 
as a state.
    (1) Information to be included in the Administrative Delegation 
Request. In order to be delegated authority to assist EPA with 
administration of this FIP permit program for sources, the Tribal 
agency must submit a request to the Administrator that:
    (i) Identifies the specific provisions for which delegation is 
requested;

[[Page 38807]]

    (ii) Identifies the Indian Reservation or other areas of Indian 
country for which delegation is requested;
    (iii) Includes a statement by the applicant's legal counsel (or 
equivalent official) that includes the following information:
    (A) A statement that the applicant is a Tribe recognized by the 
Secretary of the Interior;
    (B) A descriptive statement that is consistent with the type of 
information described in Sec.  49.7(a)(2) demonstrating that the 
applicant is currently carrying out substantial governmental duties and 
powers over a defined area and
    (C) A description of the laws of the Tribe that provide adequate 
authority to administer the Federal rules and provisions for which 
delegation is requested and
    (iv) A demonstration that the Tribal agency has the technical 
capability and adequate resources to administer the FIP provisions for 
which the delegation is requested.
    (2) Delegation of Partial Administrative Authority Agreement. A 
Delegation of Partial Administrative Authority Agreement (Agreement) 
will set forth the terms and conditions of the delegation, will specify 
the provisions that the delegate Tribal agency will be authorized to 
implement on behalf of EPA and will be entered into by the 
Administrator and the delegate Tribal agency. The Agreement will become 
effective upon the date that both the Administrator and the delegate 
Tribal agency have signed the Agreement or as otherwise stated in the 
Agreement. Once the delegation becomes effective, the delegate Tribal 
agency will be responsible, to the extent specified in the Agreement, 
for assisting EPA with administration of the provisions of the Federal 
nonattainment major NSR program that are subject to the Agreement.
    (3) Publication of notice of the Agreement. The Administrator will 
publish a notice in the Federal Register informing the public of any 
Agreement for a particular area of Indian country. The Administrator 
also will publish the notice in a newspaper of general circulation in 
the area affected by the delegation. In addition, the Administrator 
will mail a copy of the notice to persons on a mailing list developed 
by the Administrator consisting of those persons who have requested to 
be placed on such a mailing list.
    (4) Revision or revocation of an Agreement. An Agreement may be 
modified, amended or revoked, in part or in whole, by the Administrator 
after consultation with the delegate Tribal agency.
    (5) Transmission of information to the Administrator. When 
administration of a portion of the Federal nonattainment major NSR 
program in Indian country that includes receipt of permit application 
materials and preparation of draft permits has been delegated in 
accordance with the provisions of this section, the delegate Tribal 
agency must provide to the Administrator a copy of each permit 
application (including any application for permit revision) and each 
draft permit. You, the permit applicant, may be required by the 
delegate Tribal agency to provide a copy of the permit application 
directly to the Administrator. With the Administrator's consent, the 
delegate Tribal agency may submit to the Administrator a permit 
application summary form and any relevant portion of the permit 
application, in place of the complete permit application. To the extent 
practicable, the preceding information should be provided in electronic 
format by the delegate Tribal agency or by you, the permit applicant, 
as applicable and as requested by the Administrator. The delegate 
Tribal agency must also submit to the Administrator such information as 
the Administrator may reasonably require to ascertain whether the 
delegate Tribal agency is implementing and administering the delegated 
program in compliance with the requirements of the Act and of this 
program.
    (6) Waiver of information transmission requirements. The 
Administrator may waive the requirements of paragraph (b)(5) of this 
section for any category of sources (including any class, type or size 
within such category) by transmitting the waiver in writing to the 
delegate Tribal agency.
    (7) Retention of records. Where a delegate Tribal agency prepares 
draft or final permits or receives applications for permit revisions on 
behalf of EPA, the records for each draft and final permit or 
application for permit revision must be kept by the delegate Tribal 
agency for a period not less than 5 years.
    (8) Delegation of signature authority. To receive delegation of 
signature authority, the legal statement submitted by the Tribal agency 
pursuant to paragraph (b)(1) of this section must certify that no 
applicable provision of Tribal law requires that a major NSR permit be 
issued after a certain time if the delegate Tribal agency has failed to 
take action on the application (or includes any other similar provision 
providing for default issuance of a permit).
    (c) Are there any non-delegable elements of the Federal 
nonattainment major NSR program in Indian country? The following 
authorities cannot be delegated outside of EPA:
    (1) The Administrator's authority to object to the issuance of a 
major NSR permit.
    (2) The Administrator's authority to enforce permits issued 
pursuant to this program.
    (d) How will EPA transition its authority to an approved 
nonattainment major NSR program?
    (1) The Administrator will suspend the issuance of nonattainment 
major NSR permits under this program promptly upon publication of 
notice of approval of a TIP with a major NSR permit program for 
nonattainment areas.
    (2) The Administrator may retain jurisdiction over the permits for 
which the administrative or judicial review process is not complete and 
will address this issue in the notice of program approval.
    (3) After approval of a program for issuing nonattainment major NSR 
permits and the suspension of issuance of nonattainment major NSR 
permits by the Administrator, the Administrator will continue to 
administer nonattainment major NSR permits until permits are issued 
under the approved Tribal implementation plan program.
    (4) Permits previously issued under this program will remain in 
effect and be enforceable as a practical matter until and unless the 
Tribe issues new permits to these sources based on the provisions of 
the EPA-approved Tribal implementation plan.

PART 51--[AMENDED]

0
4. The authority citation for part 51 continues to read as follows:

    Authority:  23 U.S.C. 101; 42 U.S.C. 7401-7671q.


0
5. Appendix S to part 51 is amended by revising paragraph II.B and 
adding condition 5 to paragraph IV.A to read as follows:

Appendix S to Part 51--Emission Offset Interpretative Ruling

* * * * *
    II. * * *
    B. Review of all sources for emission limitation compliance. The 
reviewing authority must examine each proposed major new source and 
proposed major modification \1\ to determine if such a source will 
meet all applicable emission requirements in the SIP, any applicable 
new source performance standard in part 60 or any national emission 
standard for hazardous

[[Page 38808]]

air pollutants in part 61 or part 63 of this chapter. If the 
reviewing authority determines that the proposed major new source 
cannot meet the applicable emission requirements, the permit to 
construct must be denied.
---------------------------------------------------------------------------

    \1\ Hereafter the term source will be used to denote both any 
source and any modification.
---------------------------------------------------------------------------

    IV. * * *
    A. * * *
    Condition 5. The permit applicant shall conduct an analysis of 
alternative sites, sizes, production processes and environmental 
control techniques for such proposed source that demonstrates that 
the benefits of the proposed source significantly outweigh the 
environmental and social costs imposed as a result of its location, 
construction or modification.
* * * * *
[FR Doc. 2011-14981 Filed 6-30-11; 8:45 am]
BILLING CODE 6560-50-P