The FAA has determined that notice of, and opportunity for prior public comment on, these special conditions are impracticable because these procedures would significantly delay issuance of the design approval and thus delivery of the affected aircraft. In addition, the substance of these special conditions has been subject to the public-comment process in several prior instances with no substantive comments received. The FAA therefore finds that good cause exists for making these special conditions effective upon issuance.

We invite interested people to take part in this rulemaking by sending written comments, data, or views. The most helpful comments reference a specific portion of the special conditions, explain the reason for any recommended change, and include supporting data. We ask that you send us two copies of written comments.

We will file in the docket all comments we receive, as well as a report summarizing each substantive public contact with FAA personnel about these special conditions. You can inspect the docket before and after the comment closing date. If you wish to review the docket in person, go to the address in theADDRESSESsection of this preamble between 7:30 a.m. and 4 p.m., Monday through Friday, except Federal holidays.

We will consider all comments we receive by the closing date for comments. We may change these special conditions based on the comments we receive.

If you want us to acknowledge receipt of your comments on these special conditions, include with your comments a self-addressed, stamped postcard on which you have written the docket number. We will stamp the date on the postcard and mail it back to you.

On March 30, 2006, GALP applied for a type certificate for their new Model G250 airplane. The G250 is an 8-10 passenger (19 maximum), twin-engine airplane with a maximum operating altitude of 45,000 feet and a range of approximately 3,400 nautical miles. Airplane dimensions are 61.69-foot wing span, 66.6-foot overall length, and 20.8-foot tail height. Maximum takeoff weight is 39,600 pounds and maximum landing weight 32,700 pounds. Maximum cruise speed is mach 0.85, dive speed is mach 0.92. The avionics suite will be the Rockwell Collins Pro Line Fusion.

Under the provisions of 14 CFR 21.17, GALP must show that the Model G250 airplane meets the applicable provisions of part 25 as amended by Amendments 25-1 through 25-117.

If the Administrator finds that the applicable airworthiness regulations (i.e., 14 CFR part 25) do not contain adequate or appropriate safety standards for the Model G250 airplane because of a novel or unusual design feature, special conditions are prescribed under the provisions of § 21.16.

Special conditions are initially applicable to the model for which they are issued. Should the type certificate for that model be amended later to include any other model that incorporates the same novel or unusual design feature, the special conditions would also apply to the other model.

In addition to the applicable airworthiness regulations and special conditions, the Model G250 airplane must comply with the fuel-vent and exhaust-emission requirements of 14 CFR part 34 and the noise-certification requirements of 14 CFR part 36; and the FAA must issue a finding of regulatory adequacy under § 611 of Public Law 92-574, the “Noise Control Act of 1972.”

The FAA issues special conditions, as defined in 14 CFR 11.19, in accordance with § 11.38, and they become part of the type-certification basis under § 21.17(a)(2).

The Model G250 will incorporate the following novel or unusual design features:

The GALP Model G250 airplane has an FBW flight control system that governs the yaw and roll axes. The current rules are inadequate for considering the effects on structuralperformance of this system and its failures.

Active flight control systems are capable of providing automatic responses to inputs from sources other than the pilots. Active flight control systems have been expanded in function, effectiveness, and reliability to the point that FBW flight controls, without a manual backup system to override FBW system failures, are becoming standard equipment. As a result of these advancements in flight controls technology, the current safety standards contained in Title 14 Code of Federal Regulations (14 CFR) part 25 do not provide an adequate basis to address an acceptable level of safety for airplanes so equipped. Instead, certification of these systems has been achieved by issuance of special conditions under the provisions of § 21.16.

For example, stability augmentation systems (SASs), and to a lesser extent load alleviation systems (LASs), have been used on transport airplanes for many years. Past approvals of these systems were based on individual findings of equivalent level of safety with existing rules and on special conditions. Advisory Circular 25.672-1 was issued on November 11, 1983, to provide an equivalent means of compliance under the provisions of § 21.21(b)(1) for SAS, LAS, and flutter control systems (FCSs), another type of active control system.

Although autopilots are also considered active control systems, their control authority historically has been limited such that the consequences of system failures could be readily counteracted by the pilot. Now, autopilot functions are integrated into the primary flight controls and are given sufficient control authority to maneuver the airplane to its structural design limits. This advanced technology, with its expanded authority, requires a new approach to account for the interaction of control systems and structures.

The usual deterministic approach to defining the loads envelope contained in 14 CFR part 25 does not fully account for system effectiveness and system reliability. These automatic systems may be inoperative or may operate in a degraded mode with less than full-system authority. Therefore, it is necessary to determine the structural factors of safety and operating margins such that the joint probability of structural failures, due to application of loads during system malfunctions, is not greater than that found in airplanes equipped with earlier-technology control systems. To achieve this objective, it is necessary to define the failure conditions with their associated frequency of occurrence to determine the structural factors of safety and operating margins that will ensure an acceptable level of safety.

Earlier automatic control systems usually provided two states: fully functioning, or totally inoperative. These conditions were readily detected by the flight crew. The new active flight control systems have failure modes that allow the system to function in a degraded mode without full authority. These degraded modes are not readily detectable by the flightcrew, therefore monitoring systems are required on these new systems to provide an annunciation of degraded system capability.

In these special conditions, and in the current standards and regulations, the term “any” is used. Use of this term has traditionally been understood to require the applicant to address all items covered by the term, rather than addressing only a portion of the items. The use of the term “any” in these special conditions continues this traditional understanding.

As discussed above, these special conditions are applicable to the GALP Model G250 airplane. Should GALP apply at a later date for a change to the type certificate to include another model incorporating the same novel or unusual design feature, the special conditions would apply to that model as well.

This action affects only certain novel or unusual design features on the GALP Model G250 airplane. It is not a rule of general applicability and it affects only the applicant who applied to the FAA for approval of these features on the airplane.

The FAA has determined that prior public notice and comment are unnecessary and impracticable, and good cause exists for adopting these special conditions upon issuance.

The authority citation for these special conditions is as follows:

Accordingly, pursuant to the authority delegated to me by the Administrator, the following special conditions are issued as part of the type-certification basis for the GALP Model G250 airplane.

For airplanes equipped with systems that affect structural performance, either directly or as a result of a failure or malfunction, the influence of these systems and their failure conditions must be taken into account when showing compliance with the requirements of Subparts C and D of 14 CFR part 25.

The following criteria must be used for showing compliance with these special conditions for airplanes equipped with flight control systems, autopilots, stability augmentation systems, load alleviation systems, flutter control systems, fuel management systems, and other systems that either directly or, as a result of failure or malfunction, affect structural performance. If these special conditions are used for other systems, it may be necessary to adapt the criteria to the specific system.

1. The criteria defined herein only address the direct structural consequences of the system responses and performance. They cannot be considered in isolation but should be included in the overall safety evaluation of the airplane. These criteria may, in some instances, duplicate standards already established for this evaluation. These criteria are only applicable to structure the failure of which could prevent continued safe flight and landing. Specific criteria that define acceptable limits on handling characteristics or stability requirements, when operating in the system degraded or inoperative mode, are not provided in these special conditions.

2. Depending upon the specific characteristics of the airplane, additional criteria may be required that go beyond the criteria provided in these special conditions to demonstrate the capability of the airplane to meet other realistic conditions such as alternative gust or maneuver descriptions for an airplane equipped with a load-alleviation system.

3. The following definitions are applicable to these special conditions.

(a)Structural performance:Capability of the airplane to meet the structural requirements of 14 CFR part 25.

(b)Flight limitations:Limitations that can be applied to the airplane flight conditions following a detectable in-flight occurrence and that are included in the airplane flight manual (AFM; e.g., speed limitations, avoidance of severe weather conditions, etc.).

(c)Operational limitations:Limitations, including flight limitations, that can be applied to the airplane operating conditions before dispatch (e.g., fuel, payload, and Master Minimum Equipment List limitations).

(d)Probabilistic terms:The probabilistic terms (probable, improbable, extremely improbable) used in these special conditions are the same as those used in § 25.1309.

(e)Failure condition:This term is the same as that used in § 25.1309. However, these special conditions apply only to system-failure conditions that affect the structural performance of the airplane (e.g., system-failure conditions that induce loads, change the response of the airplane to inputs such as gusts or pilot actions, or lower flutter margins).

The following criteria will be used in determining the influence of a system and its failure conditions on the airplane structure.

4.System fully operative.With the system fully operative, the following apply:

(a) Limit loads must be derived in all normal operating configurations of the system from all the limit load conditions specified in 14 CFR part 25, subpart C (or used in lieu of those specified in subpart C), taking into account any special behavior of such a system or associated functions, or any effect on the structural performance of the airplane that may occur up to the limit loads. In particular, any significant changes in control-surface limits, rate of displacement of control surface, thresholds, or any other system nonlinearities must be accounted for in a realistic or conservative way when deriving limit loads from limit conditions.

(b) The airplane must meet the strength requirements of part 25 (static strength, residual strength), using the specified factors to derive ultimate loads from the limit loads defined above. The effect of nonlinearities must be investigated beyond limit conditions to ensure the behavior of the system presents no anomaly compared to the behavior below limit conditions. However, conditions beyond limit conditions need not be considered when it can be shown that the airplane has design features that will not allow it to exceed those limit conditions.

(c) The airplane must meet the aeroelastic stability requirements of § 25.629.

5.System in the failure condition.For any system failure condition not shown to be extremely improbable, the following apply:

(a) At the time of occurrence. Starting from 1-g level-flight conditions, a realistic scenario, including pilot corrective actions, must be established to determine the loads occurring at the time of failure and immediately after the failure.

(1) For static-strength substantiation, these loads, multiplied by an appropriate factor of safety that is related to the probability of occurrence of the failure, are ultimate loads to be considered for design. The factor of safety is defined in Figure 1.

(2) For residual strength substantiation, the airplane must be able to withstand two-thirds of the ultimate loads defined in paragraph 5(a)(1) of these special conditions. For pressurized cabins, these loads must be combined with the normal operating differential pressure.

(3) Freedom from aeroelastic instability must be shown up to the speeds defined in § 25.629(b)(2). For failure conditions that result in speeds beyond VC/MC, freedom from aeroelastic instability must be shown to increased speeds so that the margins intended by § 25.629(b)(2) are maintained.

(4) Failures of the system that result in forced structural vibrations (oscillatory failures) must not produce loads that could result in detrimental deformation of primary structure.

(b) For the continuation of the flight. For the airplane in the system-failed state, and considering any appropriate reconfiguration and flight limitations, the following apply:

(1) The loads derived from the following conditions (or used in lieu of the following conditions) at speeds up to VC/MC(or the speed limitation prescribed for the remainder of the flight) must be determined:

(A) The limit symmetrical maneuvering conditions specified in §§ 25.331 and 25.345.

(B) The limit gust and turbulence conditions specified in §§ 25.341 and 25.345.

(C) The limit rolling conditions specified in § 25.349, and the limit unsymmetrical conditions specified in §§ 25.367, and 25.427(b) and (c).

(D) The limit yaw maneuvering conditions specified in § 25.351.

(E) The limit ground loading conditions specified in §§ 25.473 and 25.491.

(2) For static-strength substantiation, each part of the structure must be able to withstand the loads in paragraph 5(b)(1) of these special conditions, multiplied by a factor of safety depending on the probability of being in this failure state. The factor of safety is defined in Figure 2.

(3) For residual-strength substantiation, the airplane must be able to withstand two thirds of the ultimate loads defined in paragraph 5(b)(2) of these special conditions. For pressurized cabins, these loads must be combined with the normal operating differential pressure.

(4) If the loads induced by the failure condition have a significant effect on fatigue or damage tolerance, then their effects must be taken into account.

(5) Freedom from aeroelastic instability must be shown up to a speed determined from Figure 3. Flutter-clearance speeds V′ and V″ may be based on the speed limitation specified for the remainder of the flight using the margins defined by § 25.629(b).

(6) Freedom from aeroelastic instability must also be shown up to V′, in Figure 3 above, for any probable system failure condition combined with any damage required or selected for investigation by § 25.571(b).

(c) Consideration of certain failure conditions may be required by other sections of 14 CFR part 25 regardless of calculated system reliability. Where analysis shows the probability of these failure conditions to be less than 10−9, criteria other than those specified in this paragraph may be used for structural substantiation to show continued safe flight and landing.

6. For system-failure detection and indication, the following apply:

(a) The system must be checked for failure conditions, not extremely improbable, that degrade the structural capability below the level required by 14 CFR part 25, or which significantly reduce the reliability of the remaining system. As far as reasonably practicable, the flightcrew must be made aware of these failures before flight. Certain elements of the control system, such as mechanical and hydraulic components, may use special periodic inspections; and electronic components may use daily checks, in lieu of detection-and-indication systems to achieve the objective of this requirement. These inspections should be Certification Maintenance Requirements (CMR; see Advisory Circular 25.19). These CMRs must be limited to components that are not readily detectable by normal detection-and-indication systems, and where service history shows that inspections will provide an adequate level of safety.

(b) The existence of any failure condition, not extremely improbable, during flight that could significantly affect the structural capability of theairplane and for which the associated reduction in airworthiness can be minimized by suitable flight limitations, must be signaled to the flightcrew. For example, failure conditions that result in a factor of safety between the airplane strength and the loads of 14 CFR part 25, subpart C below 1.25, or flutter margins below V″, must be signaled to the crew during flight with required crew action specified in the AFM.

7.Dispatch with known failure conditions.If the airplane is to be dispatched in a known system-failure condition that affects structural performance, or that affects the reliability of the remaining system to maintain structural performance, then the provisions of these special conditions must be met, including the provisions described in these special conditions in paragraph 4 for the dispatched condition and paragraph 5 for subsequent failures. Expected operational limitations may be taken into account in establishing Pj as the probability of failure occurrence for determining the safety margin in Figure 1. Flight limitations and expected operational limitations may be taken into account in establishing Qj as the combined probability of being in the dispatched failure condition and the subsequent failure condition for the safety margins in Figures 2 and 3. These limitations must be such that the probability of being in this combined failure state, and then subsequently encountering limit load conditions, is extremely improbable. No reduction in these safety margins is allowed if the subsequent system-failure rate is greater than 1E-3 per hour.

The FAA has determined that notice of, and opportunity for prior public comment on, these special conditions are impracticable because these procedures would significantly delay issuance of the design approval and thus delivery of the affected aircraft. In addition, the substance of these special conditions has been subject to the public-comment process in several prior instances with no substantive comments received. The FAA therefore finds that good cause exists for making these special conditions effective upon issuance.

We invite interested people to take part in this rulemaking by sending written comments, data, or views. The most helpful comments reference a specific portion of the special conditions, explain the reason for any recommended change, and include supporting data. We ask that you send us two copies of written comments.

We will file in the docket all comments we receive, as well as a report summarizing each substantive public contact with FAA personnel about these special conditions. You can inspect the docket before and after the comment closing date. If you wish to review the docket in person, go to the address in theADDRESSESsection of this preamble between 7:30 a.m. and 4 p.m., Monday through Friday, except Federal holidays.

We will consider all comments we receive by the closing date for comments. We may change these special conditions based on the comments we receive.

If you want us to acknowledge receipt of your comments on these special conditions, include with your comments a self-addressed, stamped postcard on which you have written the docket number. We will stamp the date on the postcard and mail it back to you.

On March 30, 2006, GALP applied for a type certificate for their new Model G250 airplane. The G250 is an 8-10 passenger (19 maximum), twin-engine airplane with a maximum operating altitude of 45,000 feet and a range of approximately 3,400 nautical miles. Airplane dimensions are 61.69-foot wing span, 66.6-foot overall length, and 20.8-foot tail height. Maximum takeoff weight is 39,600 pounds and maximum landing weight 32,700 pounds. Maximum cruise speed is mach 0.85, dive speed is mach 0.92. The avionics suite will be the Rockwell Collins Pro Line Fusion.

Under the provisions of 14 CFR 21.17, GALP must show that the Model G250 airplane meets the applicable provisions of part 25 as amended by Amendments 25-1 through 25-117.

If the Administrator finds that the applicable airworthiness regulations (i.e.,14 CFR part 25) do not contain adequate or appropriate safety standards for the Model G250 airplane because of a novel or unusual design feature, special conditions are prescribed under the provisions of § 21.16.

Special conditions are initially applicable to the model for which they are issued. Should the type certificate for that model be amended later to include any other model that incorporates the same novel or unusual design feature, the special conditions would also apply to the other model.

In addition to the applicable airworthiness regulations and specialconditions, the Model G250 airplane must comply with the fuel-vent and exhaust-emission requirements of 14 CFR part 34 and the noise-certification requirements of 14 CFR part 36; and the FAA must issue a finding of regulatory adequacy under § 611 of Public Law 92-574, the “Noise Control Act of 1972.”

The FAA issues special conditions, as defined in 14 CFR 11.19, in accordance with § 11.38, and they become part of the type-certification basis under § 21.17(a)(2).

The Model G250 airplane will incorporate the following novel or unusual design features:

The Model G250 airplane is equipped with an electronic flight control system that provides control through the pilot inputs to the flight computer. This novel design feature is not covered in the current roll-maneuver airworthiness regulations of § 25.349(a). The current regulations do not address any nonlinearities or other effects upon roll control that may be caused by electronic flight controls. Therefore, special conditions are necessary to establish appropriate design standards for the GALP Model G250 airplane type design.

The GALP Model G250 airplane is equipped with an electronic spoiler-control system and a mechanical aileron-control system that provide roll control of the aircraft through pilot inputs. An electronic control unit operates the roll spoilers to assist the ailerons in roll control of the aircraft. Current part 25 airworthiness regulations account for control laws for which lateral control-surface deflection is proportional to control-stick deflection. They do not address any nonlinearities or other effects on roll-control-surface actuation that may be caused by electronic flight controls. Since this type of system may affect flight loads, and therefore the structural capability of the airplane, specific regulations are needed to address these effects.

These special conditions differ from current requirements in that they require roll maneuvers to result from defined movements of the cockpit roll control, as opposed to defined aileron deflections. These special conditions require an additional load condition at design maneuvering speed VA, in which the cockpit roll control is returned to neutral following the initial roll input.

These special conditions are limited to the roll axis only. Special conditions are no longer needed for the yaw axis because § 25.351 was revised at Amendment 25-91 to take into account the effects of an electronic flight control system for this control axis.

As discussed above, these special conditions are applicable to the GALP Model G250 airplane. Should GALP apply at a later date for a change to the type certificate to include another model incorporating the same novel or unusual design feature, the special conditions would apply to that model as well.

This action affects only certain novel or unusual design features on the GALP Model G250 airplane. It is not a rule of general applicability and it affects only the applicant who applied to the FAA for approval of these features on the airplane.

The FAA has determined that prior public notice and comment are unnecessary and impracticable, and good cause exists for adopting these special conditions upon issuance.

The authority citation for these special conditions is as follows:

Accordingly, pursuant to the authority delegated to me by the Administrator, the following special conditions are issued as part of the type-certification basis for GALP Model G250 airplane.

The following conditions, speeds, and cockpit roll-control motions (except as the motions may be limited by pilot effort) must be considered in combination with an airplane load factor of zero, and of two-thirds of the positive maneuvering factor used in the design. In determining the resulting control-surface deflections, the torsional flexibility of the wing must be considered in accordance with § 25.301(b):

In lieu of compliance with § 25.349(a):

1. Conditions corresponding to steady rolling velocities must be investigated. In addition, conditions corresponding to maximum angular acceleration must be investigated for airplanes with engines or other weight concentrations outboard of the fuselage. For the angular-acceleration conditions, zero rolling velocity may be assumed in the absence of a rational time-history investigation of the maneuver.

2. At VA, sudden movement of the cockpit roll control up to the limit is assumed. The position of the cockpit roll control must be maintained until a steady roll rate is achieved and then must be returned suddenly to the neutral position.

3. At design cruising speed VC, the cockpit roll control must be moved suddenly and maintained so as to achieve a roll rate not less than that obtained in Special Condition 2, above.

4. At design diving speed VD, the cockpit roll control must be moved suddenly and maintained so as to achieve a roll rate not less than one third of that obtained in Special Condition 2, above.

The Republic of the Sudan (“Sudan”), referred to as “Sudan” in the EAR, was designated by the Secretary of State as a state sponsor of terrorism under U.S. law on August 12, 1993 (58 FR 52523, Oct. 8, 1993). On November 3, 1997, the President issued Executive Order (E.O.) 13067 (Blocking Sudanese Government Property and Prohibiting Transactions with Sudan), imposing comprehensive economic sanctions against Sudan because of the policies and actions of the Government of Sudan, including its continued support for international terrorism.

Consistent with the state sponsor of terrorism designation, the Department of Commerce imposed anti-terrorism controls on Sudan under the authority of Section 6 of the Export Administration Act of 1979, as amended (EAA). Specifically, Section 742.10 of the EAR restricts the export or reexport to Sudan of most items subject to the EAR that are listed on the Commerce Control List (CCL).

On January 9, 2005, the Government of the Republic of the Sudan and the Sudan People's Liberation Movement signed the Comprehensive Peace Agreement (CPA) ending the 22-year civil war, and in October, 2006, pursuant to E.O. 13412 the regional government of Southern Sudan was excluded from the definition of the “Government of Sudan” set forth in E.O. 13067, consistent with Sec. 8(e) of the Darfur Peace and Accountability Act of 2006.

Pursuant to the constitution developed under the CPA, in January 2011, a referendum was held in the region of Southern Sudan to determine whether that region would remain part of Sudan or become a separate, independent nation. On February 7, 2011, the referendum commission announced that the region of Southern Sudan had voted to become a separate nation, effective July 9, 2011.

Recognizing this historic milestone in the implementation of the CPA, on February 7, 2011, President Obama announced the intention of the United States to formally recognize the Republic of South Sudan as a sovereign state. BIS is therefore amending the EAR to reflect this formal recognition as of July 9, 2011, by adding the new nation of the Republic of South Sudan to the Commerce Country Chart and including the new nation as part of Country Group B, which will render the destination eligible for certain export and reexport License Exceptions. The controls that continue to apply to “Sudan” under the EAR will not apply to the Republic of South Sudan. Through this amendment, BIS imposes appropriate export control requirements for U.S.-origin dual-use exports and reexports to the new nation.

This rule adds the Republic of South Sudan to the Commerce Country Chart in Supplement No. 1 to Part 738 of the EAR and adds appropriate “X” symbols denoting license requirements implementing these controls for the new country. It also adds the new country to Country Group B in Supplement No. 1 to Part 740 of the EAR. Country Group B includes a wide range of countries raising relatively few national security concerns. Countries in Country Group B are eligible for several License Exceptions not available for exports or reexports to countries in Country Groups D or E. The EAR will now list two countries with “Sudan” in their names: the Republic of the Sudan, referred to as “Sudan” in the EAR, the capital city of which is Khartoum, and the Republic of South Sudan, the capital of which is expected to be Juba. With the publication of this rule, BIS will require a license for the export or reexport to the Republic of South Sudan of items controlled unilaterally for regional stability and crime control reasons, and items controlled by the multilateral export control regimes (Australia Group, Wassenaar Arrangement, Chemical/Biological Weapons Conventions, Nuclear Suppliers Group, Missile Technology Control Regime). Other reasons for control under the EAR also may apply.

This rule does not change the existing license requirements or licensing policy for exports and reexports of items to any other country under the EAR.

Since August 21, 2001, the Export Administration Act of 1979, as amended, has been in lapse and the President, through Executive Order 13222 of August 17, 2001 (3 CFR, 2001 Comp., p. 783 (2002)), as extended most recently by the Notice of August 16, 2010 (75 FR 50681, August 16, 2010), has continued the EAR in effect under the International Emergency Economic Powers Act. BIS continues to carry out the provisions of the Act, as appropriate and to the extent permitted by law, pursuant to Executive Order 13222.

1. Executive Orders 13563 and 12866 direct agencies to assess all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distributive impacts, and equity). Executive Order 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. This rule has been designated a “significant regulatory action” although not economically significant, under section 3(f) of Executive Order 12866. Accordingly, the rule has been reviewed by the Office of Management and Budget.

2. Notwithstanding any other provisions of law, no person is required to respond to nor be subject to a penalty for failure to comply with a collection of information, subject to the requirements of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501et seq.) (PRA), unless that collection of information displays a currently valid Office of Management and Budget (OMB) Control Number. This rule involves a collection of information subject to the PRA. This collection has been approved by the Office of Management and Budget under control number 0694-0088, “Multi-Purpose Application,” which carries a burden hour estimate of 58 minutes to prepare and submit form BIS-748. Total burden hours associated with the PRA and OMB control number 0694-0088 are not expected to increase as a result of this rule.

3. This rule does not contain policies with Federalism implications as that term is defined under Executive Order 13132.

4. Pursuant to 5 U.S.C. 553(a)(1), the provisions of the Administrative Procedure Act requiring notice ofproposed rulemaking, the opportunity for public participation, and a delay in effective date, are inapplicable because this regulation involves a military or foreign affairs function of the United States. (See5 U.S.C. 553(a)(1)). This final rule implements the United States new policy to recognize the new and independent state of the Republic of South Sudan as announced by the President. No other law requires that a notice of proposed rulemaking and an opportunity for public comment be given for this rule. Because a notice of proposed rulemaking and an opportunity for public comment are not required to be given for this rule by 5 U.S.C. 553, or by any other law, the analytical requirements of the Regulatory Flexibility Act, 5 U.S.C. 601et seq.,are not applicable. Therefore, this regulation is issued in final form. In addition, the Department finds good cause under 5 U.S.C. 553(d)(3) to waive the 30-day delay in effectiveness for the reasons provided above. Accordingly, this regulation is made effective immediately upon publication.

Accordingly, parts 738 and 740 of the EAR (15 CFR parts 730-774) are amended as follows:

On July 21, 2010, President Obama signed the Dodd-Frank Wall Street Reform and Consumer Protection Act.1 Title VII of the Dodd-Frank Act2 amended the CEA3 to establish a comprehensive new regulatory framework for swaps and security-based swaps. The legislation was enacted to reduce risk, increase transparency, and promote market integrity within the financial system by, among other things: (1) Providing for the registration and comprehensive regulation of swap dealers and major swap participants; (2) imposing clearing and trade execution requirements on standardized derivative products; (3) creating robust recordkeeping and real-time reporting regimes; and (4) enhancing the Commission's rulemaking and enforcement authorities with respect to, among others, all registered entities and intermediaries subject to the Commission's oversight.

The Dodd-Frank Act includes provisions applicable to “a swap in an agricultural commodity (as defined by the [CFTC]).” Neither Congress nor the CFTC has previously defined “agricultural commodity” for purposes of the CEA or CFTC regulations. On October 26, 2010, the Commission issued a notice of proposed rulemaking requesting comment on a proposed definition of agricultural commodity (the “NPRM”).4 After reviewing the comments submitted in response to the proposed definition,5 the Commission has determined to issue this final definition in essentially the same form as originally proposed, subject to a minor revision to the commodity-based index provision, for purposes of the CEA and Commission regulations.

The Commission is adopting an amendment to Rule 19b-4 under the Exchange Act as an interim final rule to expand the list of categories that qualify forsummary effectiveness under Section 19(b)(3)(A) of the Exchange Act. The Commission also is making a corresponding technical modification to the General Instructions for Form 19b-4 under the Exchange Act. We will carefully consider the comments that we receive and intend to respond as necessary or appropriate.

Section 19(b)(1) of the Exchange Act1 requires each self-regulatory organization (“SRO”), including any Registered Clearing Agency,2 to file with the Commission copies of any proposed rule or any proposed change in, addition to, or deletion from the rules of such SRO (collectively, “Proposed Rule Change”),3 which must be submitted on Form 19b-44 in accordance with the General Instructions thereto. Once a Proposed Rule Change has been filed, the Commission is required to publish it in theFederal Registerto provide an opportunity for public comment.5 A Proposed Rule Change generally may not take effect unless the Commission approves it,6 or it is otherwise permitted to become effective under Section 19(b).7

Section 19(b)(2) of the Exchange Act sets forth the standards and time periods for Commission action either to approve, disapprove or institute proceedings to determine whether the Proposed Rule Change should be disapproved.8 The Commission must approve a Proposed Rule Change if it finds that the underlying rule change is consistent with the requirements of the Exchange Act and the rules and regulations thereunder applicable to the SRO proposing the rule change.9

The SRO rule filing process for Registered Clearing Agencies serves two important policy goals. First, the notice and comment requirement helps assure that interested persons have an opportunity to provide input on proposed actions by Registered Clearing Agencies that could have a significant impact on the market, market participants (both professionals and individual investors) and others.10 Second, the rule filing process allows the Commission to review Registered Clearing Agencies' Proposed Rule Changes to determine whether they are consistent with the Exchange Act, including the goals of prompt and accurate clearance and settlement of securities transactions and the safeguarding of investors' securities and funds.11

At the same time, Section 19(b)(3)(A) of the Exchange Act provides that a Proposed Rule Change may become effective upon filing with the Commission, without notice and opportunity for hearing, if it is appropriately designated by the SRO as: (i) Constituting a stated policy, practice or interpretation with respect to the meaning, administration, or enforcement of an existing rule of the SRO; (ii) establishing or changing a due, fee, or other charge imposed by the SRO (on any person, whether or not the person is a member of the SRO) or (iii) concerned solely with the administration of the SRO.12 The Commission has the power summarily to temporarily suspend the change in rules of the SRO within sixty days of its filing if it appears to the Commission that such action is necessary or appropriate in the public interest, for the protection of investors, or otherwise in furtherance of the purposes of the Exchange Act.13 If the Commission takes such action, it is then required to institute proceedings to determine whether the Proposed Rule Change should be approved or disapproved.14

In addition to the matters expressly set forth in the statute, Section 19(b)(3)(A) also provides the Commission with the authority, by rule and consistent with the public interest, to designate other types of Proposed Rule Changes that may be effective upon filing with the Commission.15 The Commission has previously utilized this authority to designate, under Rule 19b-4 of the Exchange Act, certain rule changes that qualify for summary effectiveness under Section 19(b)(3)(A).16

Section 763(b) of the Dodd-Frank Act17 provides that (i) A depository institution registered with the Commodity Futures TradingCommission (“CFTC”) that cleared swaps as a multilateral clearing organization prior to the date of enactment of the Dodd-Frank Act and (ii) a derivatives clearing organization (“DCO”) registered with the CFTC that cleared swaps pursuant to an exemption from registration as a clearing agency prior to the date of enactment of the Dodd-Frank Act will be deemed registered with the Commission as a clearing agency solely for the purpose of clearing security-based swaps (“Deemed Registered Provision”).18 The Deemed Registered Provision, along with other general provisions under Title VII of the Dodd-Frank Act, becomes effective on July 16, 2011.19 Once a clearing agency is deemed to be a Registered Clearing Agency, it will be required to comply with all requirements of the Exchange Act, and the rules and regulations thereunder, applicable to Registered Clearing Agencies to the extent it clears security-based swaps after the effective date of the Deemed Registered Provision, including, for example, the obligation to file Proposed Rule Changes under Section 19(b) of the Exchange Act.20 Clearing of futures and options on futures is generally regulated by the CFTC in connection with its oversight and supervision of DCOs. DCOs are generally permitted to implement rule changes by self-certifying that the new rule complies with the Commodity Exchange Act (“CEA”) and the CFTC's regulations.21 The change effected by this interim final rule is intended to eliminate any burdens resulting from delays that could arise due to the differences between the Commission's rule filing process and the CFTC's self-certification process, which generally allows rule changes to become effective immediately upon or shortly after filing.22

The Commission has limited time to act without exposing certain dually registered clearing agencies to potential legal uncertainty and market disruption caused by delays that could result from the requirement that the Commission undertake a full review of Proposed Rule Changes related to a Registered Clearing Agency's futures clearing operations before these Proposed Rule Changes may be made effective. Specifically, and as discussed in greater detail in Section IV, the Commission only recently received urgent requests for the relief to be provided by the interim final rule. Accordingly, and in the interest of adopting the changes to Rule 19b-4 and the General Instructions for Form 19b-4 prior to effective date of the Deemed Registered Provision of the Dodd-Frank Act on July 16, 2011, the Commission finds that it has good cause to adopt the interim final rule immediately and without the notice and public comment procedures that would ordinarily apply to this type of rulemaking.

The Commission is amending Rule 19b-4 to expand the list of categories that qualify for summary effectiveness under Section 19(b)(3)(A) of the Exchange Act to include Proposed Rule Changes made by Registered Clearing Agencies with respect to certain futures clearing operations.23 Specifically, new Rule 19b-4(f)(4)(ii) will allow a Proposed Rule Change concerning futures clearing operations filed by a Registered Clearing Agency to take effect upon filing with the Commission pursuant to Section 19(b)(3)(A) so long as it is properly designated by the Registered Clearing Agency as effecting a change in a service of the Registered Clearing Agency that meets two conditions.24 The first condition, contained in new Rule 19b-4(f)(4)(ii)(A), is that the Proposed Rule Change primarily affects the futures clearing operations of the clearing agency with respect to futures that are not security futures.25 For purposes of this requirement, a Registered Clearing Agency's “futures clearing operations” would generally include any activity that would require the Registered Clearing Agency to register with the CFTC as a DCO in accordance with the CEA.26 In addition, to “primarily affect” such futures clearing operations would mean that the Proposed Rule Change is targeted to affect matters related to the clearing of futures specifically and that any effect on other clearing operations would be incidental in nature and not significant in extent.27 However, because a security futures product is a security for purposes of the Exchange Act,28 a Registered Clearing Agency will not be permitted to file Proposed Rule Changes related to its security futures business pursuant to Section 19(b)(3)(A) of the Exchange Act in reliance on new Rule 19b-4(f)(ii). Instead, such clearing agency will continue to be required to file Proposed Rule Changes with the Commission related to its respective security futures operations in accordance with Section 19(b)(1) of the Exchange Act, which the Commission will review in accordance with Section 19(b)(2), unless there is another basis for the Proposed Rule Change to be filed under Section 19(b)(3)(A).

The second condition, contained in new Rule 19b-4(f)(4)(ii)(B), is that the Proposed Rule Change does not significantly affect any securities clearing operations of the clearingagency or any related rights or obligations of the clearing agency or persons using such service.29 The Commission notes that the phrase “significantly affect” currently is used elsewhere in Rule 19b-4 in the context of defining other categories of Proposed Rule Changes that qualify for summary effectiveness under Section 19(b)(3)(A) of the Exchange Act.30 Accordingly, “significantly affect” has the same meaning and interpretation as that phrase has in Rules 19b-4(f)(4)(i) (as amended by this interim final rule), 19b-4(f)(5) and 19b-4(f)(6). Also for purposes of this requirement, a Registered Clearing Agency's “securities clearing operations * * * or any related rights or obligations of the clearing agency or persons using such service” would generally include any activity that would require the Registered Clearing Agency to register as a clearing agency in accordance with the Exchange Act.

The Commission believes that permitting clearing agencies to submit Proposed Rule Changes that meet the two conditions referenced above (i.e.,(A) Primarily affects the futures clearing operations of the clearing agency with respect to futures that are not security futures and (B) does not significantly affect any securities clearing operations of the clearing agency or any related rights or obligations of the clearing agency or persons using such service) for immediate effectiveness pursuant to Section 19(b)(3)(A) of the Exchange Act is consistent with the public interest and the purposes of the Exchange Act. In particular, this approach should help limit the potential for delays by providing a streamlined process for allowing rule changes to become effective that primarily concern the futures clearing operations of a clearing agency which, unless such operations were linked to securities clearing operations, would not be subject to regulation by the Commission. In addition, the information provided to the Commission by the Registered Clearing Agency in a filing made pursuant to Section 19(b)(1) of the Exchange Act is virtually identical to the information required to be included in a filing made pursuant to Section 19(b)(3)(A). At the same time, the Commission would retain the power summarily to temporarily suspend the change in rules of the Registered Clearing Agency within sixty days of its filing if it appears to the Commission that such action is necessary or appropriate in the public interest, for the protection of investors, or otherwise in furtherance of the purposes of the Exchange Act.31 Finally, and as discussed more fully in Section IV of this release, changes to a clearing agency's futures clearing operations will continue to be subject to the CFTC's normal process for reviewing rule changes.

In order to accommodate the amendment to Rule 19b-4 being adopted today, the Commission also is making a corresponding technical modification to the General Instructions for Form 19b-4 under the Exchange Act. Specifically, the Commission is amending Item 7(b) of the General Instructions for Form 19b-4 (Information to be Included in the Completed Form), which requires the respondent SRO to cite to the statutory basis for filing a Proposed Rule Change pursuant to Section 19(b)(3)(A) in accordance with the existing provisions of Rule 19b-4(f). This amendment would revise Item 7(b)(iv) to include the option to file the form in accordance with new Rule 19b-4(f)(4)(ii), which provides for situations where a Registered Clearing Agency is effecting a change in an existing service that both (i) Primarily affects the futures clearing operations of the clearing agency with respect to futures that are not security futures and (ii) does not significantly affect any securities clearing operations of the clearing agency or any related rights or obligations of the clearing agency or persons using such service.

The amendments to Rule 19b-4 and to the General Instructions for Form 19b-4 will be effective as of July 15, 2011.

We are requesting comments from all members of the public. We will carefully consider the comments that we receive. We seek comment generally on all aspects of the interim final rule. In addition, we seek comment on the following:

1. Do the amendments contemplated by this interim final rule adequately address concerns regarding the application of the Commission's process for reviewing Proposed Rule Changes once the Deemed Registered Provision becomes effective?

2. Given that the objectives and statutory authority of the CFTC differ from the Commission's, does the degree to which the interim final rule uses a process that is similar to the CFTC's process for reviewing rule changes by a Registered Clearing Agency that primarily affect its futures clearing operations and do not significantly affect its securities clearing operations provide for sufficient protection for investors and the securities markets? Why or why not?

3. Are there other amendments the Commission should consider making to Rule 19b-4, such as further expanding the list of categories that qualify for summary effectiveness under Section 19(b)(3)(A) of the Exchange Act? If so, please describe any amendments the Commission should consider and reasons why.

4. Should any additional restrictions be placed on the ability of a Registered Clearing Agency to file Proposed Rule Changes under Exchange Act Section 19(b)(3)(A)?

The Administrative Procedure Act (“APA”)32 generally requires an agency to publish, before adopting a rule, notice of a proposed rulemaking in theFederal Register.33 This requirement does not apply, however, if the agency “for good cause finds * * * that notice and public procedure are impracticable, unnecessary, or contrary to the public interest.”34 Further, the APA also generally requires that an agencypublish a rule in theFederal Register30 days before the rule becomes effective.35 This requirement, however, does not apply if the agency finds good cause for making the rule effective sooner.36

The Commission finds that it has good cause to have these rules take effect on July 15, 2011, on an interim final basis and that notice and solicitation of comment before the effective date of the proposed amendments to Rule 19b-4 and to the General Instructions for Form 19b-4 is impracticable, unnecessary, or contrary to the public interest.

Specifically, Section 763(b) of the Dodd-Frank Act provides that both (i) A depository institution registered with the CFTC that cleared swaps as a multilateral clearing organization prior to the date of enactment of the Dodd-Frank Act and (ii) a DCO registered with the CFTC that cleared swaps pursuant to an exemption from registration as a clearing agency prior to the date of enactment of the Dodd-Frank Act will be deemed registered with the Commission as a clearing agency solely for the purpose of clearing security-based swaps.37 The Deemed Registered Provision, along with other general provisions under Title VII of the Dodd-Frank Act, becomes effective on July 16, 2011.38

The Commission recognizes that the differences between the Commission's rule filing process for Registered Clearing Agencies and the CFTC's process for reviewing rule changes by DCOs could result in additional burdens on certain clearing agencies subject to the Deemed Registered Provision, which are discussed in greater detail below.39 Specifically, DCOs are generally permitted to implement new rules or rule amendments by filing with the CFTC a certification that the new rule or rule amendment complies with the CEA and the CFTC's regulations.40 Alternatively, DCOs may request direct CFTC approval of a rule or amendment thereunder after it has been filed with the CFTC pursuant either to its self-certification process or as a request for direct approval of a rule or amendment.41 Because of the differences between the CFTC's process and the Commission's rules for reviewing Proposed Rule Changes, a rule or rule amendment proposed by a dually-registered clearing agency related exclusively to its futures clearing operations could be delayed by the Commission's rule filing process despite being permitted to become effective by the CFTC immediately upon or shortly after filing.42

This interim final rule takes effect on July 15, 2011. For several reasons, including those discussed above, we have acted on an interim final basis. Specifically, affected clearing agencies requested action with respect to Registered Clearing Agencies' obligations under Section 19(b) of the Exchange Act only shortly before the effective date of the Deemed Registered Provision. Based on discussions with these affected clearing agencies, the Commission understands that market participants believe that the Commission needs to provide relief prior to the effective date of the Deemed Registered Provision of the Dodd-Frank Act on July 16, 2011 in order to avoid operational problems, legal uncertainty and market disruptions.

Specifically, one clearing agency subject to the Deemed Registered Provision contacted staff in late April 2011 to alert the Commission that it had determined that, absent the approach set out in the interim final rule we are adopting today, the clearing agency would encounter a number of negative consequences.43 For example, delays resulting from the requirement that the Commission undertake a full review of Proposed Rule Changes related to a Registered Clearing Agency's futures clearing operations before these Proposed Rule Changes may be made effective could impair a clearing agency's ability to bring beneficial enhancements or other changes into the futures markets, such as those related to improving the operational efficiency of its futures clearing business. These delays could also lead to legal uncertainty regarding the status of Proposed Rule Changes after they have been self-certified with the CFTC but prior to the date on which the Commission makes a final determination in accordance with Section 19(b) of the Exchange Act. As a result, both the clearing agency and market participants could potentially be required to develop contingency plans with alternative approaches related to the clearing of futures which would likely result in substantial operational burdens and increased costs. As a result, the clearing agency requested that the Commission provide relief on the basis that subjecting Proposed Rule Changes that relate primarily to its futures clearing operations to the routine Commission approval process would needlessly delay effectiveness of these Proposed Rule Changes and could affect the clearing agency's operations as well as ability to provide enhancements that promote efficiencies with respect to its futures related activities. In May 2011, another clearing agency contacted the Commission to convey the need for urgent rulemaking by the Commission to address these same issues.

Notwithstanding the limited amount of time before the Deemed Registered Provision becomes effective, and therefore the limited time the Commission has to act, these clearing agencies expressed their strong view that the Commission should provide relief immediately in order to prevent the above-described potential operational problems, legal uncertaintyand market disruptions from manifesting into actual issues for Registered Clearing Agencies once the Deemed Registered Provision becomes effective on July 16, 2011.

In light of the concerns raised by these clearing agencies, the Commission believes that adopting an interim final rule to immediately amend Rule 19b-4 in the manner as set forth above would benefit the public interest by eliminating any undue delays and operational inefficiencies that could result from the requirement that the Commission review changes to rules primarily concerning futures clearing operations before they become effective. This could potentially benefit market participants (including investors) by, among other things, preventing delays to beneficial enhancements within the futures markets. Accordingly, the Commission finds that there is good cause to have the rule effective as an interim final rule on July 15, 2011, and that notice and public procedure in advance of effectiveness of the interim final rule are impracticable, unnecessary and contrary to the public interest.44 The Commission is requesting comments on the interim final rule and will carefully consider any comments received and respond to them as necessary or appropriate.

The Commission does not believe that the amendments to Rule 19b-4 and to the General Instructions for Form 19b-4 adopted pursuant to the interim final rule contain any “collection of information” requirements as defined by the Paperwork Reduction Act of 1995, as amended (“PRA”).45 The interim final rule amends Rule 19b-4 under the Exchange Act to expand the list of categories that qualify for summary effectiveness under Section 19(b)(3)(A) of the Exchange Act to include any matter effecting a change in an existing service of a Registered Clearing Agency that both primarily affects the futures clearing operations of the clearing agency with respect to futures that are not security futures and does not significantly affect any securities clearing operations of the clearing agency or any related rights or obligations of the clearing agency or persons using such service. The interim final rule also makes a corresponding technical modification to the General Instructions for Form 19b-4 under the Exchange Act. The Commission does not believe that these amendments would require any new or additional collection of information, as such term is defined in the PRA.46

As noted above, the Deemed Registered Provision, along with other general provisions under Title VII of the Dodd-Frank Act, becomes effective on July 16, 2011. At such time, the Commission expects that there will be three Registered Clearing Agencies that maintain a futures clearing business regulated by the CFTC.47 Accordingly, these entities will be required to file Proposed Rule Changes with the Commission under Section 19(b) of the Exchange Act, and to comply separately with the CFTC's process for self-certification or direct approval of rules or rule amendments. The Commission is sensitive to the increased burdens these obligations will impose and agrees that it is in the public interest to eliminate any potential inefficiencies and undue delays that could result from the requirement that the Commission review changes to rules primarily concerning futures clearing operations before they may be considered effective.

New Rule 19b-4(f)(4)(ii) will eliminate the requirement for Registered Clearing Agencies to submit a significant number of Proposed Rule Changes that primarily affect their futures clearing operations with the Commission for pre-approval pursuant to Section 19(b)(1) of the Exchange Act. As a result, the rule would eliminate any potential inefficiencies and undue delays that could result from the requirement that the Commission review the Proposed Rule Change before it may be considered effective. At the same time, the Commission would retain the power summarily to temporarily suspend the change in rules of the Registered Clearing Agency within sixty days of its filing if it appears to the Commission that such action is necessary or appropriate in the public interest, for the protection of investors, or otherwise in furtherance of the purposes of the Exchange Act.48

As a result, the Commission would be providing the Registered Clearing Agency with the ability to declare the Proposed Rule Change immediately effective, thereby limiting potential delays to activities related to its futures operations that may be beneficial to both the clearing agency and market participants, in a manner that does not impair the Commission's ability to review the filing and to determine whether it would be necessary or appropriate in the public interest, for the protection of investors, or otherwise in furtherance of the purposes of the Exchange Act, to conduct a more thorough analysis of the issues.

As noted above, the amendments to Rule 19b-4 would expand the list of categories that qualify for summary effectiveness under Section 19(b)(3)(A) of the Exchange Act. These amendments will not materially increase or decrease the costs of complying with Rule 19b-4, nor will they modify an SRO's obligation to submit a Proposed Rule Change to the Commission; rather, the amendments will change the statutory basis under which a rule change is filed. As a result, new Rule 19b-4(f)(4)(ii) would impose minimal, if any, costs on a Registered Clearing Agency, which would consist solely of the time spent determining whether a Proposed Rule Change qualifies for summary effectiveness pursuant to new Rule 19b-4(f)(4)(ii).

The Commission requests that commenters provide views and supporting information regarding the costs and benefits associated with the proposals. The Commission seeks estimates of these costs and benefits, as well as any costs and benefits not already identified.

Section 23(a)49 of the Exchange Act requires the Commission, when making rules and regulations under the Exchange Act, to consider the impact a new rule would have on competition. Section 23(a)(2) of the Exchange Act prohibits the Commission from adopting any rule that would impose a burden on competition not necessary or appropriate in furtherance of the purposes of the Exchange Act. Section 3(f) of the Exchange Act50 requires the Commission, when engaging in rulemaking that requires it to consider whether an action is necessary or appropriate in the public interest, to consider, in addition to the protection of investors, whether the action would promote efficiency, competition, and capital formation.

As discussed above, the amendment to Rule 19b-4 will expand the list of categories that qualify for summary effectiveness under Section 19(b)(3)(A) of the Exchange Act to include any matter that both (i) Primarily affects the futures clearing operations of the clearing agency with respect to futures that are not security futures and (ii) does not significantly affect any securities clearing operations of the clearing agency or any related rights or obligations of the clearing agency or persons using such service. Specifically, new Rule 19b-4(f)(4)(ii) is intended to avoid undue delays that could result from the requirement that the Commission review changes to rules primarily concerning futures clearing operations before they may be considered effective. Without new Rule 19b-4(f)(4)(ii), certain clearing agencies would be required to submit a significant number of Proposed Rule Changes to the Commission for consideration and approval pursuant to Section 19(b)(1) that relate primarily to their futures clearing operations. Accordingly, the Commission believes such changes would not result in any burden to competition and would instead contribute to a better capital formation and more efficient markets by limiting the potential for any undue delays for services or changes that may benefit market participants.

The Regulatory Flexibility Act (“RFA”)51 requires the Commission, in promulgating rules, to consider the impact of those rules on small entities. Section 603(a) of the APA,52 as amended by the RFA, generally requires the Commission to undertake a regulatory flexibility analysis of all proposed rules to determine the impact of such rulemaking on “small entities.”53 Section 605(b) of the RFA states that this requirement shall not apply to any proposed rule which, if adopted, would not have a significant economic impact on a substantial number of small entities.54

For the purposes of Commission rulemaking in connection with the RFA, a small entity includes, when used with reference to a clearing agency, a clearing agency that: (i) Compared, cleared and settled less than $500 million in securities transactions during the preceding fiscal year; (ii) had less than $200 million of funds and securities in its custody or control at all times during the preceding fiscal year (or at any time that it has been in business, if shorter) and (iii) is not affiliated with any person (other than a natural person) that is not a small business or small organization.55 Under the standards adopted by the Small Business Administration, small entities in the finance industry include the following: (i) For entities engaged in investment banking, securities dealing and securities brokerage activities, entities with $6.5 million or less in annual receipts; (ii) for entities engaged in trust, fiduciary and custody activities, entities with $6.5 million or less in annual receipts and (iii) funds, trusts and other financial vehicles with $6.5 million or less in annual receipts.56

The amendments to Rule 19b-4 and to the General Instructions for Form 19b-4 would apply to all Registered Clearing Agencies. As of July 16, 2011, there likely will be seven clearing agencies with active operations registered with the Commission. Of the seven Registered Clearing Agencies with active operations, three currently maintain a futures clearing business. Based on the Commission's existing information about these three Registered Clearing Agencies, as well as on the entities likely to register with the Commission in the future, the Commission preliminarily believes that such entities will not be small entities, but rather part of large business entities that exceed the thresholds defining “small entities” set out above.

For the reasons stated above, the Commission certifies that the proposed amendments to Rule 19b-4 and to the General Instructions for Form 19b-4 would not have a significant economic impact on a substantial number of small entities for the purposes of the RFA. The Commission encourages written comments regarding this certification. The Commission requests that commenters describe the nature of any impact on small entities, including clearing agencies, and provide empirical data to support the extent of the impact.

Pursuant to the Exchange Act, and particularly Section 19(b) thereof, 15 U.S.C. 78s(b), the Commission proposes to amend Rule 19b-4 as set forth below.

In accordance with the foregoing, Title 17, chapter II of the Code of Federal Regulations is amended as follows:

The value of vaccines lies in the prevention of disease and reduced healthcare costs in the long term. Vaccines are highly effective in preventing death and disability, and save billions of dollars in health costs annually. When vaccines are made more readily accessible, a broader section of the population will receive them. In the last 5 years, registered pharmacists have played an increasing role in providing clinical services through the retail pharmacy venue. In 50 states, registered pharmacists are authorized to administer vaccines in a retail pharmacy setting, vastly increasing the accessibility of many vaccines. State Boards of Pharmacy are responsible for the training, oversight, and stipulating the conditions under which a pharmacist may administer a vaccine.

The Department of Defense (DoD) regulation implementing the TRICARE Pharmacy Benefit Program was written prior to this recent development. Therefore, although vaccines are covered under the TRICARE medical benefit, if administered by a pharmacist in a pharmacy the service is not currently covered by TRICARE except as provided for by the interim final rule published December 10, 2009 at 74 FR 65436. Inclusion of vaccines under the pharmacy benefit when provided by a TRICARE retail network pharmacy in accordance with state law, including when administered by a registered pharmacist, is the purpose of this regulation.

TRICARE recognizes that registered pharmacists are increasingly providing vaccine administration services in retail pharmacies. Although vaccines are a covered TRICARE medical benefit, when administered by a pharmacist claims cannot be adjudicated because vaccines are not covered under the pharmacy benefit and pharmacies are not recognized by regulation as authorized providers for the administration of vaccines except as provided for by the interim final rule. Currently, TRICARE beneficiaries who receive a vaccine administered by a pharmacist cannot be reimbursed for any out-of-pocket expenses except as provided for by the interim final rule. TRICARE would like to include vaccines under the pharmacy benefit when provided by a TRICARE retail network pharmacy when functioning within the scope of their state laws, including when administered by a registered pharmacist, to enable claims processing and reimbursement for services.

Adding immunizations to the pharmacy benefits program is an important public health initiative for TRICARE, making immunizations more readily available to beneficiaries. It is especially important as part of the Nation's public health preparations for a potential pandemic, such as was threatened last fall and winter by a novel H1N1 virus strain. Ensuring that TRICARE beneficiaries have ready access to vaccine supplies allocated to private sector pharmacies will facilitate making vaccines appropriately available to high risk groups of TRICAREbeneficiaries. The vaccines to be made available at network pharmacies under this final rule are those authorized as preventive care under the TRICARE basic program benefits at 32 CFR 199.4 and those authorized for Prime enrollees at 32 CFR 199.18,i.e.,immunizations for individuals age six and older, as recommended by the Centers for Disease Control and Prevention (CDC), and immunizations provided when required in the case of dependents of active duty military personnel who are traveling outside the United States as a result of an active duty member's assignment and such travel is being performed under orders issued by a Uniformed Service. Immunizations included will be those recommended by the CDC and published in the Morbidity and Mortality Weekly Report (MMWR). To find information on recommended vaccinations, TRICARE will refer beneficiaries tohttp://www.cdc.gov/vaccinesorhttp://www.tricare.mil/pharmacy. TRICARE will also encourage beneficiaries to speak with their doctor or pharmacist about which vaccinations may be appropriate for them.

An Independent Government Cost Estimate (IGCE) shows an additional cost to the Defense Health Program (DHP) of approximately $4M annually. This cost is primarily driven from beneficiaries who were not receiving the vaccines previously, or from beneficiaries who were paying out-of-pocket to get the vaccines. For the first six months following publication of the interim final rule, 18,361 vaccines were administered under the pharmacy benefits program at a cost of $298,513.19. Had those vaccines been administered under the medical benefit, the cost to TRICARE would have been $1.8M. These savings come both from the lower cost of the vaccines procured under the pharmacy benefits program rather than under the medical benefit which uses the Medicare payment allowance and a shift from the overall higher costs of obtaining a vaccine through a physician office visit. Expanding the number of vaccines available under the pharmacy benefits program from the three listed in the original interim final rule (seasonal influenza, H1N1 vaccine and pneumococcal vaccine) to all of those covered under the DoD's preventive care program, will result in increased savings over the cost of administering those vaccines under the medical benefit. In addition to the lower vaccine costs and costs of administration through the pharmacy benefits program, there is an anticipated cost savings which will result from not having to treat beneficiaries who, due to a higher expected vaccination rate, will not develop the illnesses for which the vaccines were administered. For example an IGCE showed DHP savings of over $600,000 annually in medical costs that would have been incurred in treating beneficiaries for influenza but were not because increased availability of the flu vaccine led to more beneficiaries being vaccinated.

Although the DoD is normally required to follow the same reimbursement methodologies as Medicare, there is an exception allowed when it is not practicable to do so. In calculating the administration fee for injecting these vaccines, the Department has determined that it is not practicable to follow Medicare. Medicare Part B preventive services vaccinations are limited to invasive pneumococcal disease, hepatitis B, and influenza. Medicare's administration fee schedules are adjusted for each Medicare payment locality. Therefore, there is a variation in the Medicare administration payment amount nationwide. The TRICARE pharmacy benefits program will provide many more vaccines than those available under Medicare Part B, and the Medicare rates vary by its various regions and the contractors who administer the programs in those regions. However, TRICARE has only one network retail pharmacy manager and to require the one network administrator to have various rates for the small number of drugs covered by Medicare is neither administratively feasible nor cost effective. To analyze administrative costs of the program, an IGCE compared the Medicare administration fee for the vaccines covered under Medicare Part B to the nationwide administration fees negotiated by the TRICARE pharmacy benefits manager. The results of the IGCE show the rates available to TRICARE will be lower than the rates reimbursed by Medicare.

The interim final rule amended sections 199.6 and 199.21 of the TRICARE regulation to authorize retail network pharmacies when functioning under the scope of their state laws to provide vaccines and immunizations to eligible beneficiaries as covered TRICARE pharmacy benefits. Under the interim final rule, this authorization applied immediately to three immunizations. The three immunizations are H1N1 vaccine, seasonal influenza vaccine, and pneumococcal vaccine. In addition, the interim final rule solicited public comment on also including other TRICARE-covered immunizations in the future for which retail network pharmacies will be authorized providers.

The interim final rule, published in theFederal RegisterDecember 10, 2009, provided for a 60-day comment period. DoD received seven public comments: four comments from DoD beneficiaries; two comments from professional pharmacy associations; and, one comment from a retail pharmacy chain. Comments are discussed below.

Comments:Two beneficiary comments were in favor of making vaccines available in retail pharmacies and asked if there would be a co-pay.

Response:The final rule makes no change to the interim final rule provision that there will be $0.00 co-payment for vaccines/immunizations authorized as preventive care for eligible beneficiaries.

Comments:Two beneficiary comments were in favor of making vaccine available in retail pharmacies and suggested expanding the program to include other vaccines.

Response:The final rule authorizes retail network pharmacies when functioning under the scope of their state laws to provide all TRICARE-covered vaccines and immunizations.

Comments:Both associations highly support and applaud DoD in recognizing that services provided by pharmacists are essential in meeting the healthcare needs of all communities, especially those of TRICARE beneficiaries. Both associations were favorable to expanding the role of pharmacists, including as a community point of service for vaccine administration. Both agree that this rule brings the DoD pharmacy program in line with other insurers that have covered pharmacy/pharmacist administered vaccinations for years.

Response:DoD agrees.

Comment:A retail chain with 211 pharmacies in the state of Texas stated that over 70% of its pharmacists are active immunizers and have been actively providing this service for over 10 years. The chain strongly supports the expansion of the program to includeother vaccines and commends the Department for waiving cost shares.

Response:DoD agrees.

The final rule amends sections 199.6 and 199.21 of the TRICARE regulation to authorize retail network pharmacies when functioning under the scope of their state laws to provide TRICARE authorized vaccines and immunizations to eligible beneficiaries as covered TRICARE pharmacy benefits.

Executive Order 12866 and 13563 requires that a comprehensive regulatory impact analysis be performed on any economically significant regulatory action, defined as one that would result in an annual effect of $100 million or more on the national economy or which would have other substantial impacts. The DoD has examined the economic and policy implications of this final rule and has concluded that it is not a significant regulatory action.

Under the Congressional Review Act, a major rule may not take effect until at least 60 days after submission to Congress of a report regarding the rule. A major rule is one that would have an annual effect on the economy of $100 million or more or have certain other impacts. This rule is not a major rule under the Congressional Review Act.

This rule does not contain a Federal mandate that may result in the expenditure by State, local and tribunal governments, in aggregate, or by the private sector, of $100 million or more in any one year.

The Regulatory Flexibility Act (RFA) requires that each Federal agency prepare and make available for public comment, a regulatory flexibility analysis when the agency issues a regulation which would have a significant impact on a substantial number of small entities. This rule does not have a significant impact on a substantial number of small entities.

This final rule does include information collection requirements that are subject to the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3511). The information collection has been approved with the Office of Management and Budget control number 0720-0032.

This rule does not have federalism implications, as set forth in Executive Order 13132. This rule does not have substantial direct effects on the States; the relationship between the National Government and the States; or the distribution of power and responsibilities among the various levels of Government.

Accordingly, 32 CFR part 199 is amended as follows:

On April 5, 2011, we published a notice of proposed rulemaking (NPRM) entitled Security Zones; Sector Southeastern New England Captain of the Port Zone in theFederal Register(76 FR 18674). We received no comments on the proposed rule.

The legal basis for this rule is 33 U.S.C. 1226, 1231; 46 U.S.C. Chapter 701, 3306, 3703; 50 U.S.C. 191, 195; 33 CFR 1.05-1, 6.04-1, 6.04-6, 160.5; Department of Homeland Security Delegation No. 0170.1, which collectively authorizes the Coast Guard to define Security Zones.

The Coast Guard's maritime security mission includes the requirement to protect cruise ships from destruction, loss, or injury from sabotage, subversive acts, or other malicious acts of a similar nature. Protecting these vessels from potential threats or harm while transiting, or while moored, at any berth, or at anchor in the waters of Southeastern New England COTP Zone is necessary to safeguard cruise ships and the general public. The Coast Guard is establishing a permanent regulation that creates security zones for all navigable waters around certain cruise ships in the Southeastern New England COTP Zone.

On September 22, 2010, the COTP Southeastern New England issued a temporary final rule that established 33 CFR 165.T01-0864 which created security zones nearly identical to the security zones created by this rule. See Security Zone: Passenger Vessels, Southeastern New England Captain of the Port Zone, 75 FR 63714, October 18, 2010. In a rule published March 31, 2011 (FR Doc. 2011-7640), temporary § 165.T01-0864 was extended through October 1, 2011. This final rule removes a temporary security zone regulation in § 165.T01-0864. On April 5, 2011, we published a notice of proposed rulemaking (NPRM) entitled Security Zones; Sector Southeastern New England Captain of the Port Zone in theFederal Register(76 FR 18674). We received no comments on the proposed rule.

No comments were received in response to the NPRM, and no changes from the proposed rule have been made.

We developed this rule after considering numerous statutes and executive orders related to rulemaking. Below we summarize our analyses based on 13 of these statutes or executive orders.

This rule is not a significant regulatory action under section 3(f) of Executive Order 12866, Regulatory Planning and Review, as supplemented by Executive Order 13563, and does not require an assessment of potential costs and benefits under section 6(a)(3) of that Order. The Office of Management and Budget has not reviewed it under that Order. These security zones will be activated and enforced only when a cruise ship is transiting, anchored, or moored within the Southeastern New England COTP zone. Persons and/or vessels may enter a security zone if they obtain permission from the Coast Guard COTP, Southeastern New England.

Under the Regulatory Flexibility Act (5 U.S.C. 601-612), we have considered whether this rule would have a significant economic impact on a substantial number of small entities. The term “small entities” comprises small businesses, not-for-profit organizations that are independentlyowned and operated and are not dominant in their fields, and governmental jurisdictions with populations of less than 50,000.

The Coast Guard certifies under 5 U.S.C. 605(b) that this rule will not have a significant economic impact on a substantial number of small entities. These security zones will be enforced only when a vessel is transiting within the Southeastern New England COTP zone (a routine transit is usually two hours or less), and only when enforced by Coast Guard law enforcement personnel. Persons and/or vessels may enter a security zone if they obtain permission from the Coast Guard COTP, Southeastern New England.

This rule may affect the following entities, some of which might be small entities: The owners or operators of vessels intending to operate or transit within the security zones when a cruise ship is transiting, anchored or moored.

These security zones will not have a significant economic impact on a substantial number of small entities for the following reasons. These security zones are temporary, and will be enforced only either when a vessel is transiting within the Southeastern New England COTP zone (a routine transit is usually two hours or less) or anchored or moored in the Zone. Persons and/or vessels may enter a security zone if they obtain permission from the Coast Guard COTP, Southeastern New England.

Under section 213(a) of the Small Business Regulatory Enforcement Fairness Act of 1996 (Pub. L. 104-121), in the NPRM we offered to assist small entities in understanding the rule so that they could better evaluate its effects on them and participate in the rulemaking process.

This rule calls for no new collection of information under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520).

A rule has implications for federalism under Executive Order 13132, Federalism, if it has a substantial direct effect on State or local governments and would either preempt State law or impose a substantial direct cost of compliance on them. We have analyzed this rule under that Order and have determined that it does not have implications for federalism.

The Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1531-1538) requires Federal agencies to assess the effects of their discretionary regulatory actions. In particular, the Act addresses actions that may result in the expenditure by a State, local, or tribal government, in the aggregate, or by the private sector of $100,000,000 (adjusted for inflation) or more in any one year. Though this rule will not result in such expenditure, we do discuss the effects of this rule elsewhere in this preamble.

This rule will not cause a taking of private property or otherwise have taking implications under Executive Order 12630, Governmental Actions and Interference with Constitutionally Protected Property Rights.

This rule meets applicable standards in sections 3(a) and 3(b)(2) of Executive Order 12988, Civil Justice Reform, to minimize litigation, eliminate ambiguity, and reduce burden.

We have analyzed this rule under Executive Order 13045, Protection of Children from Environmental Health Risks and Safety Risks. This rule is not an economically significant rule and will not create an environmental risk to health or risk to safety that might disproportionately affect children.

This rule does not have tribal implications under Executive Order 13175, Consultation and Coordination with Indian Tribal Governments, because it will not have a substantial direct effect on one or more Indian tribes, on the relationship between the Federal Government and Indian tribes, or on the distribution of power and responsibilities between the Federal Government and Indian tribes.

We have analyzed this rule under Executive Order 13211, Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use. We have determined that it is not a “significant energy action” under that order because it is not a “significant regulatory action” under Executive Order 12866 and is not likely to have a significant adverse effect on the supply, distribution, or use of energy. The Administrator of the Office of Information and Regulatory Affairs has not designated it as a significant energy action. Therefore, it does not require a Statement of Energy Effects under Executive Order 13211.

The National Technology Transfer and Advancement Act (NTTAA) (15 U.S.C. 272 note) directs agencies to use voluntary consensus standards in their regulatory activities unless the agency provides Congress, through the Office of Management and Budget, with an explanation of why using these standards would be inconsistent with applicable law or otherwise impractical. Voluntary consensus standards are technical standards (e.g., specifications of materials, performance, design, or operation; test methods; sampling procedures; and related management systems practices) that are developed or adopted by voluntary consensus standards bodies.

This rule does not use technical standards. Therefore, we did not consider the use of voluntary consensus standards.

We have analyzed this rule in accordance with Department of Homeland Security Management Directive 023-01 and Commandant Instruction M16475.lD, which guide the Coast Guard in complying with the National Environmental Policy Act of 1969 (NEPA) (42 U.S.C. 4321-4370f) and have concluded this action is one of a category of actions that do not individually or cumulatively have a significant effect on the human environment. This rule is categorically excluded, under figure 2-1, paragraphs (34)(g) of the Instruction because it involves establishment of security zones. An environmental analysis checklist and a categorical exclusion determination are available in the docket where indicated underADDRESSES.

For the reasons discussed in the preamble, the Coast Guard amends 33 CFR part 165 as follows:

On November 30, 2004 the Copyright Royalty and Distribution Reform Act of 2004 was signed into law creating the Copyright Royalty Judges, Public Law 108-419, 118 Stat. 2341. The Act replaced the royalty panels with three Copyright Royalty Judges who promulgated separate regulations to govern their proceedings.See37 CFR Ch. III. The Act also provided for the retention of the Copyright Arbitration Royalty Panels (“CARP”) for the purpose of concluding certain open proceedings. For this reason, the Office retained its regulations in order to complete the open proceedings and as a historical reference for those determinations that had been decided under the CARP system and had been appealed. These proceedings, however, have all been concluded and there is no longer a need for these regulations. Hence, the Office is amending its regulations to remove the section that governed the CARP proceedings.

Throughout this document whenever “we,” “us,” or “our” is used, we mean EPA. ThisSUPPLEMENTARY INFORMATIONsection is arranged as follows:

This final rulemaking addresses state submittals from each state (and appropriate state agency) in EPA Region 5: Illinois Environmental Protection Agency (Illinois EPA); Indiana Department of Environmental Management (IDEM); Michigan Department of Environmental Quality (MDEQ); Minnesota Pollution Control Agency (MPCA); Ohio Environmental Protection Agency (Ohio EPA); and Wisconsin Department of Natural Resources Bureau of Air Management (WDNR). At the time of our proposed rulemaking, each state had made submittals on the following dates: Illinois—December 12, 2007; Indiana—December 7, 2007, and supplemented on September 19, 2008, March 23, 2011, and April 7, 2011; Michigan—December 6, 2007, and supplemented on September 19, 2008 and April 6, 2011; Minnesota—November 29, 2007; Ohio—December 5, 2007, and supplemented on April 7, 2011; and, Wisconsin—December 12, 2007, and supplemented on January 24, 2011 and March 28, 2011. The submissions from each state, and the supplements thereto, may be found in the docket for this action.

Under sections 110(a)(1) and (2) of the CAA, and implementing EPA policy, the states were required to submit either revisions to their State Implementation Plans (SIPs) necessary to provide for implementation, maintenance, and enforcement of the 1997 8-hour ozone NAAQS or the 1997 PM2.5NAAQS, or certifications that their existing SIPs for ozone and particulate matter already met those basic requirements. The statute requires that states make these submissions within three years after the promulgation of new or revised NAAQS. However, intervening litigation over the 1997 8-hour ozone NAAQS and the 1997 PM2.5NAAQS created uncertainty about how states were to proceed.1 Accordingly, both EPA and the states were delayed in addressing these basic SIP requirements.

In a consent decree with Earth Justice, EPA agreed to make completeness findings with respect to these SIP submissions. Pursuant to this consent decree, EPA published completeness findings for all states for the 1997 8-hour ozone NAAQS on March 27, 2008, and for all states for the 1997 PM2.5NAAQS on October 22, 2008.

On October 2, 2007, EPA issued a guidance document entitled “Guidance on SIP Elements Required Under Sections 110(a)(1) and (2) for the 1997 8-hour Ozone and PM2.5National Ambient Air Quality Standards,” making recommendations to states concerning these SIP submissions (the 2007 Guidance). Within the 2007 Guidance, EPA gave general guidance relevant to matters such as the timing and content of the submissions.

EPA published its proposed action on the states' submissions on April 28, 2011. During the comment period on this proposal, EPA received three comment letters raising a number of concerns with respect to various issues for one or more states addressed in the proposal. EPA addresses the significant comments in this final action.

EPA received comments concerning the proposed approval of the submission from the State of Wisconsin that require further evaluation. Accordingly, today EPA is not finalizing its proposed approval of that submission for section 110(a)(2)(C) with respect to two narrow issues: (i) The requirement for consideration of oxides of nitrogen (NOX); and (ii) the definition of “major modification” related to fuel changes for certain sources. EPA will address these issues in a later action.

EPA is currently acting upon SIPs that address the infrastructure requirements of CAA section 110(a)(1) and (2) for ozone and PM2.5NAAQS for various states across the country. Commenters on EPA's recent proposals for some States raised concerns about EPA statements that it was not addressing certain substantive issues in the context of acting on the infrastructure SIP submissions.2 The commenters specifically raised concerns involving provisions in existing SIPs and with EPA's statements that it would address two issues separately and not as part of actions on the infrastructure SIP submissions: (i) Existing provisions related to excess emissions during periods of start-up, shutdown, or malfunction at sources, that may be contrary to the CAA and EPA's policies addressing such excess emissions (“SSM”); and (ii) existing provisions related to “director's variance” or “director's discretion” that purport to permit revisions to SIP approved emissions limits with limited public process or without requiring further approval by EPA, that may be contrary to the CAA (“director's discretion”). EPA notes that there are two othersubstantive issues for which EPA likewise stated that it would address the issues separately: (i) Existing provisions for minor source new source review programs that may be inconsistent with the requirements of the CAA and EPA's regulations that pertain to such programs (“minor source NSR”); and (ii) existing provisions for prevention of significant deterioration (PSD) programs that may be inconsistent with current requirements of EPA's “Final NSR Improvement Rule,” 67 FR 80186 (December 31, 2002), as amended by 72 FR 32526 (June 13, 2007) (“NSR Reform”). In light of the comments, EPA now believes that its statements in various proposed actions on infrastructure SIPs with respect to these four individual issues should be explained in greater depth with respect to these issues.

EPA intended the statements in the proposals concerning these four issues merely to be informational, and to provide general notice of the potential existence of provisions within the existing SIPs of some states that might require future corrective action. EPA did not want states, regulated entities, or members of the public to be under the misconception that the Agency's approval of the infrastructure SIP submission of a given state should be interpreted as a reapproval of certain types of provisions that might exist buried in the larger existing SIP for such state. Thus, for example, EPA explicitly noted that the Agency believes that some states may have existing SIP approved SSM provisions that are contrary to the CAA and EPA policy, but that “in this rulemaking, EPA is not proposing to approve or disapprove any existing State provisions with regard to excess emissions during SSM of operations at facilities.” EPA further explained, for informational purposes, that “EPA plans to address such State regulations in the future.” EPA made similar statements, for similar reasons, with respect to the director's discretion, minor source NSR, and NSR Reform issues. EPA's objective was to make clear that approval of an infrastructure SIP for these ozone and PM2.5NAAQS should not be construed as explicit or implicit reapproval of any existing provisions that relate to these four substantive issues.

Unfortunately, the commenters and others evidently interpreted these statements to mean that EPA considered action upon the SSM provisions and the other three substantive issues to be integral parts of acting on an infrastructure SIP submission, and therefore that EPA was merely postponing taking final action on the issue in the context of the infrastructure SIPs. This was not EPA's intention. To the contrary, EPA only meant to convey its awareness of the potential for certain types of deficiencies in existing SIPs, and to prevent any misunderstanding that it was reapproving any such existing provisions. EPA's intention was to convey its position that the statute does not require that infrastructure SIPs address these specific substantive issues in existing SIPs and that these issues may be dealt with separately, outside the context of acting on the infrastructure SIP submission of a state. To be clear, EPA did not mean to imply that it was not taking a full final agency action on the infrastructure SIP submission with respect to any substantive issue that EPA considers to be a required part of acting on such submissions under section 110(k) or under section 110(c). Given the confusion evidently resulting from EPA's statements, however, we want to explain more fully the Agency's reasons for concluding that these four potential substantive issues in existing SIPs may be addressed separately.

The requirement for the SIP submissions at issue arises out of CAA section 110(a)(1). That provision requires that states must make a SIP submission “within 3 years (or such shorter period as the Administrator may prescribe) after the promulgation of a national primary ambient air quality standard (or any revision thereof)” and that these SIPS are to provide for the “implementation, maintenance, and enforcement” of such NAAQS. Section 110(a)(2) includes a list of specific elements that “[e]ach such plan” submission must meet. EPA has historically referred to these particular submissions that states must make after the promulgation of a new or revised NAAQS as “infrastructure SIPs.” This specific term does not appear in the statute, but EPA uses the term to distinguish this particular type of SIP submission designed to address basic structural requirements of a SIP from other types of SIP submissions designed to address other different requirements, such as “nonattainment SIP” submissions required to address the nonattainment planning requirements of part D, “regional haze SIP” submissions required to address the visibility protection requirements of CAA section 169A, new source review permitting program submissions required to address the requirements of part D, and a host of other specific types of SIP submissions that address other specific matters.

Although section 110(a)(1) addresses the timing and general requirements for these infrastructure SIPs, and section 110(a)(2) provides more details concerning the required contents of these infrastructure SIPs, EPA believes that many of the specific statutory provisions are facially ambiguous. In particular, the list of required elements provided in section 110(a)(2) contains a wide variety of disparate provisions, some of which pertain to required legal authority, some of which pertain to required substantive provisions, and some of which pertain to requirements for both authority and substantive provisions.3 Some of the elements of section 110(a)(2) are relatively straightforward, but others clearly require interpretation by EPA through rulemaking, or recommendations through guidance, in order to give specific meaning for a particular NAAQS.4

Notwithstanding that section 110(a)(2) states that “each” SIP submission must meet the list of requirements therein, EPA has long noted that this literal reading of the statute is internally inconsistent, insofar as section 110(a)(2)(I) pertains to nonattainment SIP requirements that could not be met on the schedule provided for these SIP submissions in section 110(a)(1).5 This illustrates that EPA must determine which provisions of section 110(a)(2) may be applicable for a given infrastructure SIP submission. Similarly, EPA has previously decided that it could take action on different parts of the larger, general “infrastructure SIP” for a given NAAQS without concurrent action on all subsections, such as section 110(a)(2)(D)(i), because the Agency bifurcated the action on these latter “interstate transport” provisions withinsection 110(a)(2) and worked with states to address each of the four prongs of section 110(a)(2)(D)(i) with substantive administrative actions proceeding on different tracks with different schedules.6 This illustrates that EPA may conclude that subdividing the applicable requirements of section 110(a)(2) into separate SIP actions may sometimes be appropriate for a given NAAQS where a specific substantive action is necessitated, beyond a mere submission addressing basic structural aspects of the state's SIP. Finally, EPA notes that not every element of section 110(a)(2) would be relevant, or as relevant, or relevant in the same way, for each new or revised NAAQS and the attendant infrastructure SIP submission for that NAAQS. For example, the monitoring requirements that might be necessary for purposes of section 110(a)(2)(B) for one NAAQS could be very different than what might be necessary for a different pollutant. Thus, the content of an infrastructure SIP submission to meet this element from a state might be very different for an entirely new NAAQS, versus a minor revision to an existing NAAQS.7

Similarly, EPA notes that other types of SIP submissions required under the statute also must meet the requirements of section 110(a)(2), and this also demonstrates the need to identify the applicable elements for other SIP submissions. For example, nonattainment SIPs required by part D likewise have to meet the relevant subsections of section 110(a)(2) such as section 110(a)(2)(A) or (E). By contrast, it is clear that nonattainment SIPs would not need to meet the portion of section 110(a)(2)(C) that pertains to part C, i.e., the PSD requirements applicable in attainment areas. Nonattainment SIPs required by part D also would not need to address the requirements of section 110(a)(2)(G) with respect to emergency episodes, as such requirements would not be limited to nonattainment areas. As this example illustrates, each type of SIP submission may implicate some subsections of section 110(a)(2) and not others.

Given the potential for ambiguity of the statutory language of section 110(a)(1) and (2), EPA believes that it is appropriate for EPA to interpret that language in the context of acting on the infrastructure SIPs for a given NAAQS. Because of the inherent ambiguity of the list of requirements in section 110(a)(2), EPA has adopted an approach in which it reviews infrastructure SIPs against this list of elements “as applicable.” In other words, EPA assumes that Congress could not have intended that each and every SIP submission, regardless of the purpose of the submission or the NAAQS in question, would meet each of the requirements, or meet each of them in the same way. EPA elected to use guidance to make recommendations for infrastructure SIPs for these NAAQS.

On October 2, 2007, EPA issued guidance making recommendations for the infrastructure SIP submissions for both the 1997 8-hour ozone NAAQS and the 1997 PM2.5NAAQS.8 Within this guidance document, EPA described the duty of states to make these submissions to meet what the Agency characterized as the “infrastructure” elements for SIPs, which it further described as the “basic SIP requirements, including emissions inventories, monitoring, and modeling to assure attainment and maintenance of the standards.”9 As further identification of these basic structural SIP requirements, “attachment A” to the guidance document included a short description of the various elements of section 110(a)(2) and additional information about the types of issues that EPA considered germane in the context of such infrastructure SIPs. EPA emphasized that the description of the basic requirements listed on attachment A was not intended “to constitute an interpretation of” the requirements, and was merely a “brief description of the required elements.”10 EPA also stated its belief that with one exception, these requirements were “relatively self explanatory, and past experience with SIPs for other NAAQS should enable States to meet these requirements with assistance from EPA Regions.”11 For the one exception to that general assumption, however, i.e., how states should proceed with respect to the requirements of section 110(a)(2)(G) for the 1997 PM2.5NAAQS, EPA gave much more specific recommendations. But for other infrastructure SIP submittals, and for certain elements of the submittals for the 1997 PM2.5NAAQS, EPA assumed that each state would work with its corresponding EPA regional office to refine the scope of a state's submittal based on an assessment of how the requirements of section 110(a)(2) should reasonably apply to the basic structure of the State's SIP for the NAAQS in question.

Significantly, the 2007 Guidance did not explicitly refer to the SSM, director's discretion, minor source NSR, or NSR Reform issues as among specific substantive issues EPA expected states to address in the context of the infrastructure SIPs, nor did EPA give any more specific recommendations with respect to how states might address such issues even if they elected to do so. The SSM and director's discretion issues implicate section 110(a)(2)(A), and the minor source NSR and NSR Reform issues implicate section 110(a)(2)(C). In the 2007 Guidance, however, EPA did not indicate to states that it intended to interpret these provisions as requiring a substantive submission to address these specific issues in the context of the infrastructure SIPs for these NAAQS. Instead, EPA's 2007 Guidance merely indicated its belief that the states should make submissions in which they established that they have the basic SIP structure necessary to implement, maintain, and enforce the NAAQS. EPA believes that states can establish that they have the basic SIP structure, notwithstanding that there may be potential deficiencies within the existing SIP. Thus, EPA's proposals mentioned these issues not because the Agency considers them issues that must be addressed in the context of an infrastructure SIP as required by section 110(a)(1) and (2), but rather because EPA wanted to be clear that it considers these potential existing SIP problems as separate from the pending infrastructure SIP actions.

EPA believes that this approach to the infrastructure SIP requirement is reasonable, because it would not be feasible to read section 110(a)(1) and (2) to require a top to bottom, stem to stern, review of each and every provision of an existing SIP merely for purposes of assuring that the state in question has the basic structural elements for a functioning SIP for a new or revised NAAQS. Because SIPs have grown by accretion over the decades as statutory and regulatory requirements under the CAA have evolved, they may include some outmoded provisions and historical artifacts that, while not fully up to date, nevertheless may not pose a significant problem for the purposes of “implementation, maintenance, and enforcement” of a new or revised NAAQS when EPA considers the overall effectiveness of the SIP. To the contrary, EPA believes that a better approach is for EPA to determine which specific SIP elements from section 110(a)(2) are applicable to an infrastructure SIP for a given NAAQS, and to focus attention on those elements that are most likely to need a specific SIP revision in light of the new or revised NAAQS. Thus, for example, EPA's 2007 Guidance specifically directed states to focus on the requirements of section 110(a)(2)(G) for the 1997 PM2.5NAAQS because of the absence of underlying EPA regulations for emergency episodes for this NAAQS and an anticipated absence of relevant provisions in existing SIPs.

Finally, EPA believes that its approach is a reasonable reading of section 110(a)(1) and (2) because the statute provides other avenues and mechanisms to address specific substantive deficiencies in existing SIPs. These other statutory tools allow the Agency to take appropriate tailored action, depending upon the nature and severity of the alleged SIP deficiency. Section 110(k)(5) authorizes EPA to issue a “SIP call” whenever the Agency determines that a state's SIP is substantially inadequate to attain or maintain the NAAQS, to mitigate interstate transport, or otherwise to comply with the CAA.12 Section 110(k)(6) authorizes EPA to correct errors in past actions, such as past approvals of SIP submissions.13 Significantly, EPA's determination that an action on the infrastructure SIP is not the appropriate time and place to address all potential existing SIP problems does not preclude the Agency's subsequent reliance on provisions in section 110(a)(2) as part of the basis for action at a later time. For example, although it may not be appropriate to require a state to eliminate all existing inappropriate director's discretion provisions in the course of acting on the infrastructure SIP, EPA believes that section 110(a)(2)(A) may be among the statutory bases that the Agency cites in the course of addressing the issue in a subsequent action.14

The public comment period for EPA's proposal to approve some elements and conditionally approve other elements of certifications submitted by the Region 5 states closed on May 31, 2011. EPA received three comment letters; a synopsis of the significant individual comments as well as EPA's response to each comment is discussed below.

Comment 1:One commenter objected to EPA's proposed approvals of the states' SIPs on the ground that the states are not adequately notifying the public of health risks related to the most recent ozone and PM2.5NAAQS. According to the commenter, the SIPs are not consistent with section 110(a)(2)(J), Sub-element 2: Public Notification, and EPA's approval of the submissions violates section 110(l). The commenter argued that it “is wrong for States inform the public that the air is `safe' based on the 1997 ozone and PM2.5NAAQS, particularly when EPA has determined that concentrations of ground-level ozone above 75 parts per billion (ppb) and concentrations of PM2.5above 35 micrograms per cubic meter (μg/m3) are unsafe.” The commenter continued that “there is no reason why States should not be informing the public of air pollution dangers based on the 75 ppb ozone NAAQS and the 35 μg/m3PM2.5NAAQS.” The commenter urged EPA to require states to inform the public of “unsafe air pollution levels based on EPA's official understanding of current public health science.”

Response 1:EPA disagrees with the commenter's view that the existing SIPs of these states are not sufficient for purposes of the 1997 8-hour ozone NAAQS and the 1997 PM2.5NAAQS, and that approval thereof is inconsistent with section 110(l). In the proposed rulemaking, EPA concluded that each of the Region 5 states “* * * has met the requirements of this portion of section 110(a)(2)(J) with respect to the 1997 ozone and PM2.5NAAQS.” As explained above, in these actions EPA is only addressing the 1997 8-hour ozone NAAQS and the 1997 PM2.5NAAQS, and is not taking action with respect to any other NAAQS.

EPA agrees with the commenter that these NAAQS are not as protective as needed for public health and welfare, as shown by EPA's more recent promulgation of new NAAQS for both ground level ozone and particulate matter based on new or revised health assessments.15 Nevertheless, all of the Region 5 states' submittals at issue in this action were intended to satisfy the infrastructure SIP requirements in relation to the 1997 8-hour ozone NAAQS and 1997 PM2.5NAAQS. EPA's action here only addresses the requirements of section 110(a)(1) and (2) in the context of these NAAQS, and not of any subsequent NAAQS. EPA will be taking separate actions on the Region 5 states' submissions for section 110(a)(1)and (2) with respect to the revised ozone and PM2.5NAAQS. In those later actions, EPA will evaluate the states' satisfaction of applicable elements of section 110(a)(2), including section 110(a)(2)(J), based on the applicable NAAQS.

As a further point of information, EPA observes that all Region 5 states participate in the AIRNOW program, which reports air quality according to the current promulgated indices. Thus, members of the public do have access to information concerning the ambient air quality in their states, and this information is given with respect to the most recent ozone and PM2.5NAAQS. EPA believes that the availability of this information serves to address thecommenter's concerns with respect to public information.

Finally, EPA disagrees with the commenter's view of the applicability of section 110(l) to these actions on infrastructure SIPs. EPA agrees that after the Agency promulgates a new or revised NAAQS, subsequent SIP revisions should generally be evaluated for compliance with section 110(l) in light of the existence of any such new or revised NAAQS. However, section 110(l) is more typically a concern with respect to revisions to an existing SIP in which there could be a relaxation of a SIP approved provision in a way that would interfere with attainment or maintenance of the NAAQS or any other applicable requirement of the CAA. In this action, however, EPA is merely approving a new submission that does not purport to subtract from the existing SIP as previously approved by the Agency. These submissions are intended to assure that the state's SIP meets the requirements with respect to the specific NAAQS at issue, i.e., the 1997 8-hour ozone NAAQs and the 1997 PM2.5NAAQS.

Comment 2:One commenter objected to EPA's proposed approval of the submissions from several states on the grounds that the SIPs of each state contain impermissible provisions. The commenter asserted that the states of Wisconsin, Indiana, and Illinois have SSM exemptions in regulations within their existing SIPs that are in conflict with EPA's interpretation of the CAA. The commenters argued that such provisions are contrary to section 110, and that until such provisions are removed, the SIPs do not meet the requirements of section 110.

Response 2:EPA disagrees with the commenter's apparent conclusion that if a state's existing SIP contains any arguably illegal SSM provision, then EPA cannot approve the infrastructure SIP submission of that state. As discussed in more detail in section II of this final rulemaking, “What is the scope of this final rulemaking?,” EPA does not agree that action upon an infrastructure SIP required by section 110(a)(1) and (2) requires that EPA address any existing SSM provisions.

EPA shares the commenter's concerns that certain existing SSM provisions may be contrary to the CAA and existing Agency guidance, and that such provisions can have an adverse impact on air quality control efforts in a given state. As stated in the proposal, EPA plans to address such provisions in the future, and in the meantime encourages any state having a deficient SSM provision to take steps to correct it as soon as possible.

Comment 3:The same commenter also objected to EPA's proposed approvals on the grounds that the existing SIPs of two states contain another form of impermissible provision within their regulations. The commenter asserted that the states of Wisconsin and Illinois have director's discretion provisions in their respective regulations that allow the director of their respective environmental protection agencies to allow violations of SIP approved emissions limits by sources under certain circumstances.

Response 3:EPA also disagrees with the commenter's apparent conclusion that if a state's existing SIP contains any arguably illegal director's discretion or director's variance provision, then EPA cannot approve the infrastructure SIP submission of that state. As discussed in more detail in section II of this final rulemaking, “What is the scope of this final rulemaking?,” EPA does not agree that action upon an infrastructure SIP required by section 110(a)(1) and (2) requires that EPA address any existing director's discretion provisions.

EPA shares the commenter's concerns that certain existing director's discretion provisions may be contrary to the CAA and existing Agency guidance, and that such provisions can have an adverse impact on air quality control efforts in a given state. As stated in the proposal, EPA plans to take action in the future to address such provisions, and in the meantime encourages any state having a deficient director's discretion or director's variance provision to take steps to correct it as soon as possible.

Comment 4:One commenter objected to EPA's proposed approval because it did not explain why the Agency was not acting on the requirements of section 110(a)(2)(D)(i) in the context of the infrastructure SIPs for the 1997 8-hour ozone NAAQS and the 1997 PM2.5NAAQS. The commenter argued that EPA provided no basis for, and professed its own lack of awareness of a basis for, the exclusion of section 110(a)(2)(D)(i) from this action. The commenter implied that because EPA was not addressing section 110(a)(2)(D)(i) in this specific action, it renders the action on the other elements of section 110(a)(2) illegitimate.

Response 4:As previously explained, EPA bifurcated action on section 110(a)(2)(D)(i) from the other applicable infrastructure SIP requirements of section 110(a)(2) for the 1997 8-hour ozone NAAQS and the 1997 PM2.5NAAQS. This approach dates back to 2005 when EPA entered into a consent decree with Environmental Defense Fund which required EPA to make completeness findings with respect to section 110(a)(2)(D)(i) by March 15, 2005, and which required EPA to make completeness findings with respect to other applicable requirements of section 110(a)(2) by December 15, 2007, for the 1997 ozone NAAQS, and by October 5, 2008, for the 1997 PM2.5NAAQS. The findings notice that announced EPA's completeness determinations for the infrastructure SIP submissions for the 1997 8-hour ozone NAAQS and the 1997 PM2.5NAAQS clearly articulated which elements of section 110(a)(2) were relevant to those specific submissions.16 In addition, EPA issued two separate guidance documents making recommendations for SIP submissions to meet section 110(a)(2)(D)(i) and for the other applicable requirements of section 110(a)(2) for these NAAQS. As a result, states made one or more separate submissions to address the substantive requirements of section 110(a)(2)(D)(i) that are separate from, and outside the scope of, the SIP submissions that are at issue in this action.

Comment 5:One commenter argued that the air pollution enforcement program in Indiana is not sufficient, and implies that this is a basis for EPA not to approve the infrastructure SIP submission from the state. According to the commenter, press reports indicate that the State is not aggressively enforcing air pollution regulations. In support of its concerns, the commenter referred to an unspecified letter from EPA to IDEM in which EPA expressed concerns about changes to the enforcement program and funding of the enforcement program in Indiana. In addition, the commenter asserted that IDEM has an enforcement policy that requires a higher threshold for enforcement showing adverse health impacts as a result of a violation and that this threshold is inconsistent with protection of public health because of the difficulty of proving causation with respect to health impacts.

Response 5:EPA acknowledges that concerns have been raised about enforcement of air pollution programs in Indiana, including concerns raised by EPA in a June 24, 2009 letter to David Pippen, Policy Director in the Office of the Indiana Governor. However, EPA disagrees that these concerns rise to the level of demonstrating that the state's SIP is insufficient to meet the basic requirements of section 110(a)(2)(A) and (E) with respect to enforcement.

The commenter's primary objections with respect to enforcement in Indiana go to matters that are properly construed as questions of “enforcement discretion.” In other words, EPA believes that certain decisions about how best to direct enforcement resources, what sources to investigate, what types of violations warrant more attention, etc., are largely matters of discretion that a state may determine.17 EPA agrees that such enforcement discretion, if taken to extremes, could call into question whether a state was effectively meeting its obligations under the CAA. EPA does not see evidence of that in this case. Similarly, questions of the adequacy of resources for effective enforcement are largely matters of state discretion and would not be a basis for disapproval action by EPA unless there were clear evidence that the absence of resources rose to the level that the state was not capable of fulfilling its obligations under the CAA. EPA does not see evidence of that in this case. In short, EPA does not see a basis for disapproval of the infrastructure SIP submissions by Indiana based on the questions raised by the commenter.

EPA continues to monitor IDEM's air enforcement program through monthly conference calls and reviews of enforcement data submitted by IDEM. EPA confirms that IDEM inspectors are meeting EPA's Compliance Monitoring Strategy requirements and furthermore, enforcement under IDEM's reorganized Compliance and Enforcement Branch has shown an increase in the number of enforcement actions timeliness of resolution.

EPA concludes that, in the context of acting on the infrastructure SIPs for the 1997 8-hour ozone and 1997 PM2.5NAAQS, the air pollution enforcement program in Indiana is consistent with the basic requirements of section 110(a)(1) and (2) of the CAA. In the event that concerns with respect to adequate enforcement of the air pollution program in the state arise in the future, EPA could address such concerns using appropriate authorities under the CAA.

Comment 6:One commenter argued that Illinois has state law provisions that undermine enforcement of SIP requirements. The commenter asserts that the enforcement of air pollution regulations in Illinois “is undermined by a convoluted interpretation of State law, including a lengthy appeals process and `automatic stay' provisions that are applicable to Illinois Pollution Control Board hearings.” According to the commenter, permittees who challenge their permits benefit by stays of the challenged permit provisions that can provide de facto variances from SIP requirements. Implicitly, the commenter argued that this issue would preclude EPA's approval of the infrastructure SIP submission by Illinois for the 1997 8-hour ozone NAAQS and the 1997 PM2.5NAAQS.

Response 6:EPA disagrees that the issue raised by the commenter requires EPA to disapprove the submission by Illinois. EPA's review of the infrastructure SIP is intended to evaluate whether the state's SIP contains the basic requirements for implementation, maintenance, and enforcement of the NAAQS in question. The commenter's concerns go to a very specific issue resulting from interpretations of state law. EPA believes that this issue has already been resolved with the state.

On March 3, 2011, EPA completed a review of Illinois EPA's enforcement program in the context of the CAA. EPA is committed to working with the State to address any problems that were documented in the review. With respect to the automatic stay provisions in Illinois, the Illinois State legislature amended the Illinois Environmental Protection Act (415 ILCS 5/) to address this deficiency. The Governor of Illinois signed this legislation on June 20, 2010. This legislation eliminated the `automatic stay' provisions noted by the commenter; therefore, EPA believes that all concerns with respect to this issue have been resolved with respect to approval of Illinois' infrastructure SIP for the 1997 8-hour ozone and 1997 PM2.5NAAQS.

Comment 7:One commenter asserted that Wisconsin is not implementing its SIP sufficiently to comply with 40 CFR 51.160 and section 110(a) of the CAA. The commenter took issue with three aspects of Wisconsin's permitting program, particularly with respect to modeling. First, the commenter alleged that WDNR is effectively exempting sources from demonstrating, through modeling, that emissions from those sources will not cause NAAQS violations or prevent NAAQS maintenance. In support of this claim, the commenter claimed that “* * * DNR's `guidance'18 on modeling notes that sources can avoid modeling in nonattainment areas if they obtain offsets or model below the SIL—despite no SIP provision for Wisconsin allowing such exemptions to Wis. Stat. § 285.63(1). Wisconsin DNR's `guidance' also exempts all operating permits for sources in nonattainment areas from the clea[r] requirement to demonstrate compliance with (and non-prevention of maintenance of) NAAQS as a condition of permit approval for all operating permits for all sources (not merely those in attainment areas) in Wis. Stat. § 285.63(1).”

Second, the commenter asserted that WDNR has not been modeling compliance with PM2.5for registration permits, and has supported the claim by citing Wis. Stat. § 285.63. As evidence for this claim, the commenter pointed to a recent decision by a state Administrative Law Judge concerning a failure to model compliance with the PM2.5NAAQS. The commenter claimed that the State continues to fail to do so.

Third, the commenter claimed that WDNR does not model ozone impacts, i.e., ozone NAAQS compliance, in contravention of the SIP requirement to demonstrate compliance with all NAAQS as a condition of permit issuance. Moreover, the commenter further asserted that to its knowledge “DNR has never analyzed the impacts of facilities on ozone during permitting—as it is required to do pursuant to 42 U.S.C. 7410(a), 40 CFR 51.160, 51.166 and Wis. Stat. § 285.63(1). In fact, DNR's guidance states explicitly that it does not model for ozone impacts.”

Response 7:EPA disagrees with the commenter's conclusions on each point. First, with respect to the claim that the state's guidance improperly “exempts” sources from modeling, EPA disagrees with the commenter's conclusions. EPA's regulations at 40 CFR part 51 section 160(a) and (b) require that states have a procedure to establish whether a source will, inter alia, interfere with attainment or maintenance of the NAAQS. The guidance cited by the commenter is not inconsistent with this requirement, and EPA's regulations do not preclude the appropriate use of offsets or SILs as a means to determine that there will not be such an impact. Therefore, the commenter's objections do not indicate that the State's infrastructure SIP is inconsistent with the applicable requirements of section 110(a)(1) and (2).

Second, the argument that the commenter made with respect to the decision of the Administrative Law Judge is a matter of concern, but does not establish that the State is failing to conduct the necessary analysis in connection with all permits. Moreover,the decision in question relates to the minor source NSR program, and as explained in section II, minor source NSR is an issue that EPA considers outside of the scope of infrastructure SIP evaluations. Therefore, any evaluation of Wisconsin's minor source NSR program will be conducted independently of this rulemaking.

Finally, in response to the commenter's third point, the PSD regulations require an ambient impact analysis for ozone for proposed major stationary sources and major modifications to obtain a PSD permit (40 CFR 51.166 (b)(23)(i), (i)(5)(i)(f), (k), (l) and (m) and 40 CFR 52.21 (b)(23)(i), (i)(5)(i)(f), (k), (l) and (m)), but not necessarily modeling in all cases. The regulations at 40 CFR 51.166(l) state that for air quality models the SIP shall provide for procedures which specify that:

(1) All applications of air quality modeling involved in this subpart shall be based on the applicable models, data bases, and other requirements specified in Appendix W of this part (Guideline on Air Quality Models).

(2) Where an air quality model specified in Appendix W of this part (Guideline on Air Quality Models) is inappropriate, the model may be modified or another model substituted. Such a modification or substitution of a model may be made on a case-by-case basis or, where appropriate, on a generic basis for a specific State program. Written approval of the Administrator must be obtained for any modification or substitution. In addition, use of a modified or substituted model must be subject to notice and opportunity for public comment under procedures set forth in § 51.102.

These parts of 40 CFR Part 51 and 52 are the umbrella SIP components that states have either adopted by reference or the states have been approved and delegated authority to incorporate the PSD requirements of the CAA. As discussed above, these Part 51 and 52 PSD provisions refer to 40 CFR Part 51, Appendix W for the appropriate method to utilize for the ambient impact assessment. 40 CFR Part 51, Appendix W is the Guideline on Air Quality models and Section 1.0.a. states:

The guideline recommends air quality modeling techniques that should be applied to State Implementation Plan (SIP) revisions for existing sources and to new source review (NSR), including prevention of significant deterioration (PSD). {footnotes not included} Applicable only to criteria air pollutants, it is intended for use by EPA Regional Offices in judging the adequacy of modeling analyses performed by EPA, State and local agencies, and by industry. * * * TheGuidelineis not intended to be a compendium of modeling techniques. Rather, it should serve as a common measure of acceptable technical analysis when supported by sound scientific judgment.

Appendix W Section 5.2.1. includes theGuidelinerecommendations for models to be utilized in assessing ambient air quality impacts for ozone. Specifically, Section 5.2.1.c states:

Estimating the Impact of Individual Sources. Choice of methods used to assess the impact of an individual source depends on the nature of the source and its emissions. Thus, model users should consult with the Regional Office to determine the most suitable approach on a case-by-case basis (subsection 3.2.2).

Appendix W Section 5.2.1.c provides that the state and local permitting authorities and permitting applicants should work with the appropriate EPA Regional Office on a case-by-case basis to determine an adequate method for performing an air quality analysis for assessing ozone impacts. Due to the complexity of modeling ozone and the dependency on the regional characteristics of atmospheric conditions, EPA believes this is an appropriate approach rather than specifying a method for assessing single source ozone impacts, which may not be appropriate in all circumstances. Instead, the choice of method “depends on the nature of the source and its emissions. Thus, model users should consult with the Regional Office * * *.” Appendix W Section 5.2.1.c. Therefore, EPA continues to believe it is appropriate for permitting authorities to consult and work with EPA Regional Offices as described in Appendix W, including section 3.0.b and c, 3.2.2, and 3.3, to determine the appropriate approach to assess ozone impacts for each PSD required evaluation.

EPA has previously approved the State's PSD program.19 EPA observes that Wisconsin routinely consults with staff in the Region 5 Office to examine the impacts of ozone from specific sources on a case-by-case basis for permitting purposes. Moreover, EPA observes that the modeling guidance referenced by the commenter is not an approved part of Wisconsin's SIP. Thus, the commenter has not demonstrated that we should not approve this infrastructure SIP submission.

Comment 8:One commenter objected to EPA's proposed conditional approval of the submissions of Indiana, Michigan, and Ohio, with respect to section 110(a)(2)(C) based upon a commitment of each state to update its respective SIP to eliminate the use of PM10as a surrogate for PM2.5in its PSD program. The commenter argued that this use of a conditional approval is inappropriate because it would allow states to continue to use a PM10surrogacy policy that EPA has explicitly determined may not be used by states after May 16, 2011. The commenter further asserted that aside from the inappropriate use of conditional approval, any approval of SIPs that rely on the use of PM10as a surrogate for PM2.5would be contrary to the CAA for a variety of legal and factual reasons.

Response 8:Based on an evaluation of the concerns raised by the commenter, EPA has concluded that a conditional approval is not appropriate in these specific facts and circumstances. Congress has explicitly authorized EPA to use conditional approvals under section 110(k)(4), provided that states make a commitment to adopt specific measures by a date certain within one year. As noted by the commenter, the courts have confirmed that conditional approvals are an available course of action under section 110(k), but only if the statutory conditions for such a conditional approval have been met.

In this instance, EPA believed that the states had made commitments to take sufficiently “specific” actions within the statutorily allotted time, by committing to make a specified SIP submission that would eliminate the use of PM10as a surrogate for PM2.5by a date certain.20 However, the commenter's concerns go not to whether the commitments were specific enough, but rather to whether a conditional approval is appropriate at all, in light of other EPA determinations with respect to when states must cease using the PM10surrogate policy. EPA agrees that its own determination with respect to when states must cease using the PM10 surrogacy policy is relevant to whether a conditional approval is the correct course of action. Section 110(k)(4) provides that EPA “may” approve a SIP conditionally, thereby indicating that EPA has discretion to determine that a given substantive issue is or is not suitable for a conditional approval. After considering the commenter's concerns, EPA has concluded that a conditional approval is not appropriate in these circumstances.

In order to address the commenter's substantive concern about continued use of the PM10surrogate policy after May 16, 2011, EPA asked the states of Indiana, Michigan, and Ohio to clarify the facts with respect to their current usage of the PM10surrogate policy for PSD permitting purposes. All three states responded that they have the legal authority under their respective PSD regulations to regulate PM2.5directly, rather than PM10. Furthermore, the states of Indiana, Michigan, and Ohio confirmed that they have discontinued reliance on the PM10surrogate policy to satisfy the PSD requirements for PM2.5. Indiana, Michigan, and Ohio transmitted letters affirming these points on June 17, 2011, June 22, 2011, and June 23, 2011, respectively.

EPA considers the letters from each state to be a supplemental submission that clarifies and updates the prior infrastructure SIP submissions. Therefore, EPA considers the facts as represented by each state in its letter to be a part of the basis for its evaluation of the infrastructure SIPs. Because each state has confirmed that it already has the requisite legal authority to regulate PM2.5directly in its PSD program, and because each state has confirmed that it is no longer using the PM10surrogate policy, EPA concludes that there is no need to use a conditional approval with respect to section 110(a)(2)(C) for each of these states. Therefore, in today's action EPA is simply approving the submissions with respect to section 110(a)(2)(C). EPA believes that this course of action will alleviate the legitimate concerns of the commenters with respect to any continued use of the PM10surrogacy policy in these states.

For the reasons discussed in the proposed rulemaking, as well as the responses to comments received by EPA during the public comment period, EPA is taking final action to approve elements of submissions from the EPA Region 5 states certifying that the current SIPs are sufficient to meet the applicable infrastructure elements under sections 110(a)(1) and (2) for the 1997 8-hour ozone NAAQS and the 1997 PM2.5NAAQS. Notably, whereas the proposed rulemaking contained conditional approvals for Indiana, Michigan, and Ohio with respect to their satisfaction of section 110(a)(2)(C), Sub-element 3: PM10surrogate policy, EPA's final action for these three states is an approval based on the discussion in the response to Comment 8.

Based upon comments received during the rulemaking, EPA is not finalizing its proposed approval of the submission from the State of Wisconsin with respect to two narrow issues that relate to section 110(a)(2)(C): (i) The requirement for consideration of NOXas a precursor to ozone; and (ii) the definition of “major modification” related to fuel changes for certain sources. EPA will address these issues in a later action.

As detailed in section II of this final action, EPA is affirming that there are four substantive issues outside of the scope of this rulemaking: SSM provisions, director's discretion provisions, NSR Reform, and minor source NSR. It should be noted, however, that our proposed rulemaking included discussion of various past EPA approvals of minor source NSR program submissions from Region 5 states in connection with section 110(a)(2)(C). After realizing the confusion engendered by EPA's statements about certain issues that the Agency considers outside the scope of action on infrastructure SIPs, we want to clarify that EPA does not consider the minor source NSR program to be one that states must address in their infrastructure SIPs, nor one that EPA must evaluate in approving such infrastructure SIPs. Therefore, our final action maintains that EPA is neither approving nor disapproving the minor source NSR programs in the states of Illinois, Indiana, Ohio, Michigan, Minnesota, and Wisconsin in the context of infrastructure SIPs. Any future evaluation of those minor source NSR programs will be conducted independently of today's actions.

Specifically, these are EPA's final actions, by element of section 110(a)(2):

Under the Clean Air Act, the Administrator is required to approve a SIP submission that complies with the provisions of the Clean Air Act and applicable Federal regulations. 42 U.S.C. 7410(k); 40 CFR 52.02(a). Thus, in reviewing SIP submissions, EPA's role is to approve state choices, provided that they meet the criteria of the Clean Air Act. Accordingly, this action merely approves state law as meeting Federal requirements and does not impose additional requirements beyond those imposed by state law. For that reason, this action:

• Is not a “significant regulatory action” subject to review by the Office of Management and Budget under Executive Order 12866 (58 FR 51735, October 4, 1993);

• Does not impose an information collection burden under the provisions of the Paperwork Reduction Act (44 U.S.C. 3501et seq.);

• Is certified as not having a significant economic impact on a substantial number of small entities under the Regulatory Flexibility Act (5 U.S.C. 601et seq.);

• Does not contain any unfunded mandate or significantly or uniquely affect small governments, as described in the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4);

• Does not have Federalism implications as specified in Executive Order 13132 (64 FR 43255, August 10, 1999);

• Is not an economically significant regulatory action based on health or safety risks subject to Executive Order 13045 (62 FR 19885, April 23, 1997);

• Is not a significant regulatory action subject to Executive Order 13211 (66 FR 28355, May 22, 2001);

• Is not subject to requirements of Section 12(d) of the National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 note) because application of those requirements would be inconsistent with the Clean Air Act; and

• Does not provide EPA with the discretionary authority to address, as appropriate, disproportionate human health or environmental effects, using practicable and legally permissible methods, under Executive Order 12898 (59 FR 7629, February 16, 1994).

In addition, this rule does not have tribal implications as specified by Executive Order 13175 (65 FR 67249, November 9, 2000), because the SIP is not approved to apply in Indian country located in the state, and EPA notes that it will not impose substantial direct costs on tribal governments or preempt tribal law.

The Congressional Review Act, 5 U.S.C. 801et seq.,as added by the Small Business Regulatory Enforcement Fairness Act of 1996, generally provides that before a rule may take effect, the agency promulgating the rule must submit a rule report, which includes a copy of the rule, to each House of the Congress and to the Comptroller General of the United States. EPA will submit a report containing this action 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 theFederal Register. A major rule cannot take effect until 60 days after it is published in theFederal Register. This action is not a “major rule” as defined by 5 U.S.C. 804(2).

Under section 307(b)(1) of the Clean Air Act, petitions for judicial review of this action must be filed in the United States Court of Appeals for the appropriate circuit by September 12, 2011. Filing a petition for reconsideration by the Administrator of this final rule does not affect the finality of this action 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. This action may not be challenged later in proceedings to enforce its requirements. (See section 307(b)(2).)

40 CFR part 52, is amended as follows:

Throughout this document whenever “we,” “us,” or “our” is used, we mean EPA. This supplementary information section is arranged as follows:

EPA received three comments. A discussion of each follows:

(A) An anonymous comment was in support of EPA's approval of Ohio's rule.

(B) The Aquatic Company commented that it is concerned that the maximum achievable control technology (MACT) limits in subpart WWWW of 40 CFR part 63, for Reinforced Plastic Composites Production, underestimate emissions generated by tub/shower manufacturers and notes that EPA is currently working to correct these and other issues with subpart WWWW. The Aquatic Company opposes any rule which is tied to the subpart WWWW regulations. This comment is not directly relevant to this rulemaking because it is mainly a complaint against the MACT and provides no suggested revisions to Ohio's rule.

(C) Premix, Inc. commented that it objects to the 25 tons VOC per year applicability cutoff for sheet mold compound (SMC) machines. Premix has successfully, and cost-effectively, controlled VOCs from its SMC machines using its Tight Wet Area Enclosures and a small Regenerative Thermal Oxidizer.This control system has reduced VOC emissions from its two SMC machines at its facility in North Kingsville, Ohio by more than 95 percent for a period of 18 months. Premix submits that this new VOC control system can be cost-effectively implemented on a single, stand-alone SMC machine, and that therefore EPA should not approve the 25 tons VOC per year applicability cutoff in Ohio's rule.

EPA agrees that the Premix control system represents a technically and economically feasible control system that should be considered to represent reasonably available control (RACT), which is the level of control required by VOC sources in ozone nonattainment areas. However, all of Ohio is designated as attainment of the 1997 8-hour ozone standard and therefore RACT is not required. EPA notes that if and when portions of Ohio are designated to nonattainment of a new ozone standard, it is unlikely that Ohio's reinforced plastic composites rule will be considered to satisfy RACT for SMC machines.

EPA is approving into Ohio's SIP new rule Ohio Administrative Code (OAC) 3745-21-25 “Control of VOC Emissions from Reinforced Plastic Composites Production Operations.” This rule was submitted by the Ohio Environmental Protection Agency (Ohio EPA) to EPA on November 10, 2010, and contains enforceable requirements for VOC emissions from reinforced plastic composites production operations. This rule was adopted to establish VOC requirements for such operations to replace the requirements contained in OAC rule 3745-21-07 “Control of emissions of organic materials from stationary sources.” 3745-21-07 is Ohio's general rule for the control of organic materials from stationary sources that are not controlled by a specific VOC RACT rule. 3745-21-07 has been revised by Ohio, and the revised rule (which is the subject of a separateFederal Registeraction) excludes reinforced plastic composites production operations.

In EPA's January 27, 2011 proposal (76 FR 4835), we present a detailed analysis of the State's submission. The reader is referred to that notice for additional background on the submission.

As discussed in the proposal, upon achieving compliance with this rule, the reinforced plastic composites production operations at a facility are not required to meet the requirements of 3745-21-07. This exemption from OAC 3745-21-07 is appropriate because OAC 3745-21-25 contains VOC requirements specific to reinforced plastic composites production operations, whereas OAC 3745-21-07 is a general rule that covers a number of source categories.

For facilities subject to OAC 3745-21-25, the control requirements are more stringent than the requirements for these facilities under OAC 3745-21-07. However, the applicability cutoff of OAC 3745-21-07 is 8 pounds/hour, or 40 pounds/day, as compared to a less stringent 25 tons VOC/year cutoff for the control requirements of OAC 3745-21-25 for SMC manufacturing operations. The main purpose of this rule is the control of such SMC operations because SMC machines were previously covered by OAC 3745-21-07. Because overall, considering both applicability and the control requirements for subject sources, OAC 3745-21-07 is more stringent than OAC 3745-21-25 for SMC machines, EPA must evaluate, according to section 110(l) of the CAA, whether the revision might interfere with attainment, maintenance, or any other CAA requirements.

Ohio EPA submitted an October 25, 2010 demonstration under section 110(l) of the CAA that the less stringent applicability cutoff in OAC 3745-21-25 does not interfere with attainment of the National Ambient Air Quality Standards (NAAQS), nor interfere with any other requirement of the CAA. Ohio documented that the actual emission increase from this change in applicability cutoffs would be 7.1 tons of VOC/year, and that the worst case maximum theoretical increase in uncontrolled emissions is 159 tons of VOC/year.

Most of the SMC production in Ohio is in the Cleveland area. In December 2007 Ohio EPA promulgated rules reducing emissions of nitrogen oxides (NOX) in the Cleveland area. These rules, in OAC Chapter 3745-110, entitled “NOXRACT,” addressed NOXemissions from stationary sources such as boilers, combustion turbines, and stationary internal combustion engines. The rules were made applicable as an attainment strategy in the Cleveland-Akron-Lorain ozone moderate nonattainment area. On September 15, 2009, EPA redesignated the Cleveland-Akron-Lorain metropolitan area as attainment for the 1997 8-hour ozone NAAQS. At the same time, EPA approved a waiver for this area from the NOXRACT requirements of section 182(f) of the CAA, based on the area attaining the standard. Ohio's NOXRACT rules are, therefore, surplus and can be used to offset any increase in emissions from SMC machines in Ohio. Ohio obtained 538 tons NOx/year actual (and surplus) emission reductions from the Arcelor-Mittal facility as a result of the installation of low NOXburners in its three reheat furnaces. The requirement for these low NOXburners is permanent and enforceable because they are needed to comply with OAC 3745-110, Ohio's NOXRACT rule. In the Cleveland-Akron-Lorain area, the ratio of NOXemissions to VOC emissions is approximately 1.36 pounds NOx/pound VOC. Applying this factor, the VOC offset potential for the Arcelor-Mittal facility NOXreductions is 396 tons VOC/year. Consequently, EPA concludes that the net effect of the relaxation of the applicability criterion plus the compensation from requiring NOXemission reductions at Arcelor-Mittal will be an environmental improvement in the Cleveland area and will not interfere with attainment, maintenance, or other CAA requirements.

In addition, two uncontrolled SMC machines are located at Continental Structural Plastics in Van Wert County, which are outside of the former Cleveland-Akron-Lorain ozone moderate nonattainment area. This rule relaxation is not contrary to the requirements of section 110(l) because the most recent three years of data (2008-2010) indicates that the nearest monitor, which is in Lima (in the Lima-Van Wert-Wapakoneta, Ohio Combined Statistical Area), has a 3-year ozone design value which is well under the 2008 8-hour ozone standard (70.0 parts per billion vs. the 75.0 parts per billion standard), such that removal of a requirement for controlling these SMC machines may be judged not to have the potential to cause violations of the standard. Furthermore, if any of its SMC machines exceeds 25 tons VOC per year, the facility is required to reduce their emissions by 95 percent.

In conclusion, OAC 3745-21-25 is approvable because all of Ohio is in attainment of the 1997 8-hour ozone standard and therefore a RACT level of control is not required and Ohio demonstrated that a relaxation of the applicability cutoff for SMC machines, from 8 pounds VOC per hour to 25 tons VOC per year, per machine, does not interfere with attainment of the National Ambient Air Quality Standards, or interfere with any other requirement of the CAA, as required by section 110(l) of the CAA.

Under the CAA, the Administrator is required to approve a SIP submissionthat complies with the provisions of the CAA and applicable Federal regulations. 42 U.S.C. 7410(k); 40 CFR 52.02(a). Thus, in reviewing SIP submissions, EPA's role is to approve state choices, provided that they meet the criteria of the CAA. Accordingly, this action merely approves state law as meeting Federal requirements and does not impose additional requirements beyond those imposed by state law. For that reason, this action:

• Is not a “significant regulatory action” subject to review by the Office of Management and Budget under Executive Order 12866 (58 FR 51735, October 4, 1993);

• Does not impose an information collection burden under the provisions of the Paperwork Reduction Act (44 U.S.C. 3501et seq.);

• Is certified as not having a significant economic impact on a substantial number of small entities under the Regulatory Flexibility Act (5 U.S.C. 601et seq.);

• Does not contain any unfunded mandate or significantly or uniquely affect small governments, as described in the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4);

• Does not have Federalism implications as specified in Executive Order 13132 (64 FR 43255, August 10, 1999);

• Is not an economically significant regulatory action based on health or safety risks subject to Executive Order 13045 (62 FR 19885, April 23, 1997);

• Is not a significant regulatory action subject to Executive Order 13211 (66 FR 28355, May 22, 2001);

• Is not subject to requirements of Section 12(d) of the National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 note) because application of those requirements would be inconsistent with the Act; and

• Does not provide EPA with the discretionary authority to address, as appropriate, disproportionate human health or environmental effects, using practicable and legally permissible methods, under Executive Order 12898 (59 FR 7629, February 16, 1994).

In addition, this rule does not have tribal implications as specified by Executive Order 13175 (65 FR 67249, November 9, 2000), because the SIP is not approved to apply in Indian country located in the state, and EPA notes that it will not impose substantial direct costs on tribal governments or preempt tribal law.

The Congressional Review Act, 5 U.S.C. 801et seq.,as added by the Small Business Regulatory Enforcement Fairness Act of 1996, generally provides that before a rule may take effect, the agency promulgating the rule must submit a rule report, which includes a copy of the rule, to each House of the Congress and to the Comptroller General of the United States. EPA will submit a report containing this action 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 theFederal Register. A major rule cannot take effect until 60 days after it is published in theFederal Register. This action is not a “major rule” as defined by 5 U.S.C. 804(2).

Under section 307(b)(1) of the CAA, petitions for judicial review of this action must be filed in the United States Court of Appeals for the appropriate circuit by September 12, 2011. Filing a petition for reconsideration by the Administrator of this final rule does not affect the finality of this action 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. This action may not be challenged later in proceedings to enforce its requirements. (See section 307(b)(2).)

40 CFR part 52 is amended as follows:

Upon promulgation of a new or revised NAAQS, sections 110(a)(1) and (2) of the CAA require states to address basic SIP requirements, including emissions inventories, monitoring, and modeling to assure attainment and maintenance for that new NAAQS. On July 18, 1997, EPA promulgated a new NAAQS for ozone based on 8-hour average concentrations, thus states were required to provide submissions to address sections 110(a)(1) and (2) of the CAA for this new NAAQS. Kentucky provided its infrastructure submission for the 1997 8-hour ozone NAAQS on December 13, 2007. On March 17, 2011, EPA proposed to approve Kentucky's December 13, 2007, infrastructure submission for the 1997 8-hour ozone NAAQS.See76 FR 14626. A summary of the background for today's final action is provided below. See EPA's March 17, 2011, proposed rulemaking at 76 FR 14626 for more detail.

Section 110(a) of the CAA requires states to submit SIPs to provide for the implementation, maintenance, and enforcement of a new or revised NAAQS within three years following the promulgation of such NAAQS, or within such shorter period as EPA may prescribe. Section 110(a) imposes the obligation upon states to make a SIP submission to EPA for a new or revised NAAQS, but the contents of that submission may vary depending upon the facts and circumstances. In particular, the data and analytical tools available at the time the state develops and submits the SIP for a new or revised NAAQS affects the content of the submission. The contents of such SIP submissions may also vary depending upon what provisions the state's existing SIP already contains. In the case of the 1997 8-hour ozone NAAQS, states typically have met the basic program elements required in section 110(a)(2) through earlier SIP submissions in connection with previous ozone NAAQS.

More specifically, section 110(a)(1) provides the procedural and timing requirements for SIPs. Section 110(a)(2) lists specific elements that states must meet for “infrastructure” SIP requirements related to a newly established or revised NAAQS. As mentioned above, these requirements include SIP infrastructure elements such as modeling, monitoring, and emissions inventories that are designed to assure attainment and maintenance of the NAAQS. The requirements that are the subject of this final rulemaking are listed below1 and in EPA's October 2, 2007, memorandum entitled “Guidance on SIP Elements Required Under Section 110(a)(1) and (2) for the 1997 8-Hour Ozone and PM2.5National Ambient Air Quality Standards.”

• 110(a)(2)(A): Emission limits and other control measures.

• 110(a)(2)(B): Ambient air quality monitoring/data system.

• 110(a)(2)(C): Program for enforcement of control measures.2

• 110(a)(2)(D): Interstate transport.3

• 110(a)(2)(E): Adequate resources.

• 110(a)(2)(F): Stationary source monitoring system.

• 110(a)(2)(G): Emergency power.

• 110(a)(2)(H): Future SIP revisions.

• 110(a)(2)(I): Areas designated nonattainment and meet the applicable requirements of part D.4

• 110(a)(2)(J): Consultation with government officials; public notification; and PSD and visibility protection.

• 110(a)(2)(K): Air quality modeling/data.

• 110(a)(2)(L): Permitting fees.

• 110(a)(2)(M): Consultation/participation by affected local entities.

EPA is currently acting upon SIPs that address the infrastructure requirements of CAA section 110(a)(1) and (2) for ozone and PM2.5NAAQS for various states across the country. Commenters on EPA's recent proposals for some states raised concerns about EPA statements that it was not addressingcertain substantive issues in the context of acting on the infrastructure SIP submissions.5 The Commenters specifically raised concerns involving provisions in existing SIPs and with EPA's statements that it would address two issues separately and not as part of actions on the infrastructure SIP submissions: (i) Existing provisions related to excess emissions during periods of start-up, shutdown, or malfunction (“SSM”) at sources, that may be contrary to the CAA and EPA's policies addressing such excess emissions; and (ii) existing provisions related to “director's variance” or “director's discretion” that purport to permit revisions to SIP approved emission limits with limited public process or without requiring further approval by EPA, that may be contrary to the CAA. EPA notes that there are two other substantive issues for which EPA likewise stated that it would respond separately: (i) Existing provisions for minor source new source review programs that may be inconsistent with the requirements of the CAA and EPA's regulations that pertain to such programs (“minor source NSR”); and (ii) existing provisions for Prevention of Significant Deterioration programs that may be inconsistent with current requirements of EPA's “Final NSR Improvement Rule,” 67 FR 80186 (December 31, 2002), as amended by 72 FR 32526 (June 13, 2007) (“NSR Reform”). In light of the comments, EPA now believes that its statements in various proposed actions on infrastructure SIPs with respect to these four individual issues should be explained.

EPA intended the statements in the proposals concerning these four issues merely to be informational, and to provide general notice of the potential existence of provisions within the existing SIPs of some States that might require future corrective action. EPA did not want States, regulated entities, or members of the public to be under the misconception that the Agency's approval of the infrastructure SIP submission of a given State should be interpreted as a reapproval of certain types of provisions that might exist buried in the larger existing SIP for such State. Thus, for example, EPA explicitly noted that the Agency believes that some States may have existing SIP-approved SSM provisions that are contrary to the CAA and EPA policy, but that “in this rulemaking, EPA is not proposing to approve or disapprove any existing State provisions with regard to excess emissions during SSM of operations at facilities.” EPA further explained, for informational purposes, that “EPA plans to address such State regulations in the future.” EPA made similar statements, for similar reasons, with respect to the director's discretion, minor source NSR, and NSR Reform issues. EPA's objective was to make clear that approval of an infrastructure SIP for these ozone and PM2.5NAAQS should not be construed as explicit or implicit reapproval of any existing provisions that relate to these four substantive issues.

Unfortunately, the Commenters and others evidently interpreted these statements to mean that EPA considered action upon the SSM provisions and the other three substantive issues to be integral parts of acting on an infrastructure SIP submission, and therefore that EPA was merely postponing taking final action on the issue in the context of the infrastructure SIPs. This was not EPA's intention. To the contrary, EPA only meant to convey its awareness of the potential for certain types of deficiencies in existing SIPs, and to prevent any misunderstanding that it was reapproving any such existing provisions. EPA's intention was to convey its position that the statute does not require that infrastructure SIPs address these specific substantive issues in existing SIPs and that these issues may be dealt with separately, outside the context of acting on the infrastructure SIP submission of a State. To be clear, EPA did not mean to imply that it was not taking a full final agency action on the infrastructure SIP submission with respect to any substantive issue that EPA considers to be a required part of acting on such submissions under section 110(k) or under section 110(c). Given the confusion evidently resulting from EPA's statements, however, we want to explain more fully the Agency's reasons for concluding that these four potential substantive issues in existing SIPs may be addressed separately.

The requirement for the SIP submissions at issue arises out of CAA section 110(a)(1). That provision requires that States must make a SIP submission “within 3 years (or such shorter period as the Administrator may prescribe) after the promulgation of a national primary ambient air quality standard (or any revision thereof)” and that these SIPs are to provide for the “implementation, maintenance, and enforcement” of such NAAQS. Section 110(a)(2) includes a list of specific elements that “[e]ach such plan” submission must meet. EPA has historically referred to these particular submissions that States must make after the promulgation of a new or revised NAAQS as “infrastructure SIPs.” This specific term does not appear in the statute, but EPA uses the term to distinguish this particular type of SIP submission designed to address basic structural requirements of a SIP from other types of SIP submissions designed to address other requirements, such as “nonattainment SIP” submissions required to address the nonattainment planning requirements of part D, “regional haze SIP” submissions required to address the visibility protection requirements of CAA section 169A, new source review permitting program submissions required to address the requirements of part D, and a host of other specific types of SIP submissions that address other specific matters.

Although section 110(a)(1) addresses the timing and general requirements for these infrastructure SIPs, and section 110(a)(2) provides more details concerning the required contents of these infrastructure SIPs, EPA believes that many of the specific statutory provisions are facially ambiguous. In particular, the list of required elements provided in section 110(a)(2) contains a wide variety of disparate provisions, some of which pertain to required legal authority, some of which pertain to required substantive provisions, and some of which pertain to requirements for both authority and substantive provisions.6 Some of the elements of section 110(a)(2) are relatively straightforward, but others clearly require interpretation by EPA through rulemaking, or recommendations through guidance, in order to give specific meaning for a particular NAAQS.7

Upon promulgation of a new or revised NAAQS, sections 110(a)(1) and (2) of the CAA require states to address basic SIP requirements, including emissions inventories, monitoring, and modeling to assure attainment and maintenance for that new NAAQS. On July 18, 1997, EPA promulgated a new NAAQS for ozone based on 8-hour average concentrations, thus states were required to provide submissions to address sections 110(a)(1) and (2) of the CAA for this new NAAQS. Alabama provided its infrastructure submission for the 1997 8-hour ozone NAAQS on December 10, 2007. On March 17, 2011, EPA proposed to approve Alabama's December 10, 2007, infrastructure submission for the 1997 8-hour ozone NAAQS.See76 FR 14611. A summary of the background for today's final action is provided below. See EPA's March 17, 2011, proposed rulemaking at 76 FR 14611 for more detail.

Section 110(a) of the CAA requires states to submit SIPs to provide for the implementation, maintenance, and enforcement of a new or revised NAAQS within three years following the promulgation of such NAAQS, or within such shorter period as EPA may prescribe. Section 110(a) imposes the obligation upon states to make a SIP submission to EPA for a new or revised NAAQS, but the contents of that submission may vary depending upon the facts and circumstances. In particular, the data and analytical tools available at the time the state develops and submits the SIP for a new or revised NAAQS affects the content of the submission. The contents of such SIP submissions may also vary depending upon what provisions the state's existing SIP already contains. In the case of the 1997 8-hour ozone NAAQS, states typically have met the basic program elements required in section 110(a)(2) through earlier SIP submissions in connection with previous ozone NAAQS.

More specifically, section 110(a)(1) provides the procedural and timing requirements for SIPs. Section 110(a)(2) lists specific elements that states must meet for “infrastructure” SIP requirements related to a newly established or revised NAAQS. As already mentioned, these requirements include SIP infrastructure elements such as modeling, monitoring, andemissions inventories that are designed to assure attainment and maintenance of the NAAQS. The requirements that are the subject of this final rulemaking are listed below1 and in EPA's October 2, 2007, memorandum entitled “Guidance on SIP Elements Required Under Section 110(a)(1) and (2) for the 1997 8-Hour Ozone and PM2.5National Ambient Air Quality Standards.”

• 110(a)(2)(A): Emission limits and other control measures.

• 110(a)(2)(B): Ambient air quality monitoring/data system.

• 110(a)(2)(C): Program for enforcement of control measures.2

• 110(a)(2)(D): Interstate transport.3

• 110(a)(2)(E): Adequate resources.

• 110(a)(2)(F): Stationary source monitoring system.

• 110(a)(2)(G): Emergency power.

• 110(a)(2)(H): Future SIP revisions.

• 110(a)(2)(I): Areas designated nonattainment and meet the applicable requirements of part D.4

• 110(a)(2)(J): Consultation with government officials; public notification; and PSD and visibility protection.

• 110(a)(2)(K): Air quality modeling/data.

• 110(a)(2)(L): Permitting fees.

• 110(a)(2)(M): Consultation/participation by affected local entities.

EPA is currently acting upon SIPs that address the infrastructure requirements of CAA section 110(a)(1) and (2) for ozone and PM2.5NAAQS for various states across the country. Commenters on EPA's recent proposals for some states raised concerns about EPA statements that it was not addressing certain substantive issues in the context of acting on the infrastructure SIP submissions.5 The Commenters specifically raised concerns involving provisions in existing SIPs and with EPA's statements that it would address two issues separately and not as part of actions on the infrastructure SIP submissions: (i) Existing provisions related to excess emissions during periods of start-up, shutdown, or malfunction (“SSM”) at sources, that may be contrary to the CAA and EPA's policies addressing such excess emissions; and (ii) existing provisions related to “director's variance” or “director's discretion” that purport to permit revisions to SIP approved emission limits with limited public process or without requiring further approval by EPA, that may be contrary to the CAA. EPA notes that there are two other substantive issues for which EPA likewise stated that it would respond separately: (i) Existing provisions for minor source new source review programs that may be inconsistent with the requirements of the CAA and EPA's regulations that pertain to such programs (“minor source NSR”); and (ii) existing provisions for Prevention of Significant Deterioration programs that may be inconsistent with current requirements of EPA's “Final NSR Improvement Rule,” 67 FR 80186 (December 31, 2002), as amended by 72 FR 32526 (June 13, 2007) (“NSR Reform”). In light of the comments, EPA now believes that its statements in various proposed actions on infrastructure SIPs with respect to these four individual issues should be explained.

EPA intended the statements in the proposals concerning these four issues merely to be informational, and to provide general notice of the potential existence of provisions within the existing SIPs of some states that might require future corrective action. EPA did not want states, regulated entities, or members of the public to be under the misconception that the Agency's approval of the infrastructure SIP submission of a given state should be interpreted as a reapproval of certain types of provisions that might exist buried in the larger existing SIP for such state. Thus, for example, EPA explicitly noted that the Agency believes that some states may have existing SIP-approved SSM provisions that are contrary to the CAA and EPA policy, but that “in this rulemaking, EPA is not proposing to approve or disapprove any existing State provisions with regard to excess emissions during SSM of operations at facilities.” EPA further explained, for informational purposes, that “EPA plans to address such State regulations in the future.” EPA made similar statements, for similar reasons, with respect to the director's discretion, minor source NSR, and NSR Reform issues. EPA's objective was to make clear that approval of an infrastructure SIP for these ozone and PM2.5NAAQS should not be construed as explicit or implicit reapproval of any existing provisions that relate to these four substantive issues.

Unfortunately, the Commenters and others evidently interpreted these statements to mean that EPA considered action upon the SSM provisions and the other three substantive issues to be integral parts of acting on an infrastructure SIP submission, and therefore that EPA was merely postponing taking final action on the issue in the context of the infrastructure SIPs. This was not EPA's intention. To the contrary, EPA only meant to convey its awareness of the potential for certain types of deficiencies in existing SIPs, and to prevent any misunderstanding that it was reapproving any such existing provisions. EPA's intention was to convey its position that the statute does not require that infrastructure SIPs address these specific substantive issues in existing SIPs and that these issues may be dealt with separately, outside the context of acting on the infrastructure SIP submission of a state. To be clear, EPA did not mean to imply that it was not taking a full final agency action on the infrastructure SIP submission with respect to any substantive issue that EPA considers to be a required part of acting on suchsubmissions under section 110(k) or under section 110(c). Given the confusion evidently resulting from EPA's statements, however, we want to explain more fully the Agency's reasons for concluding that these four potential substantive issues in existing SIPs may be addressed separately.

The requirement for the SIP submissions at issue arises out of CAA section 110(a)(1). That provision requires that states must make a SIP submission “within 3 years (or such shorter period as the Administrator may prescribe) after the promulgation of a national primary ambient air quality standard (or any revision thereof)” and that these SIPs are to provide for the “implementation, maintenance, and enforcement” of such NAAQS. Section 110(a)(2) includes a list of specific elements that “[e]ach such plan” submission must meet. EPA has historically referred to these particular submissions that states must make after the promulgation of a new or revised NAAQS as “infrastructure SIPs.” This specific term does not appear in the statute, but EPA uses the term to distinguish this particular type of SIP submission designed to address basic structural requirements of a SIP from other types of SIP submissions designed to address other requirements, such as “nonattainment SIP” submissions required to address the nonattainment planning requirements of part D, “regional haze SIP” submissions required to address the visibility protection requirements of CAA section 169A, new source review permitting program submissions required to address the requirements of part D, and a host of other specific types of SIP submissions that address other specific matters.

Although section 110(a)(1) addresses the timing and general requirements for these infrastructure SIPs, and section 110(a)(2) provides more details concerning the required contents of these infrastructure SIPs, EPA believes that many of the specific statutory provisions are facially ambiguous. In particular, the list of required elements provided in section 110(a)(2) contains a wide variety of disparate provisions, some of which pertain to required legal authority, some of which pertain to required substantive provisions, and some of which pertain to requirements for both authority and substantive provisions.6 Some of the elements of section 110(a)(2) are relatively straightforward, but others clearly require interpretation by EPA through rulemaking, or recommendations through guidance, in order to give specific meaning for a particular NAAQS.7

Notwithstanding that section 110(a)(2) states that “each” SIP submission must meet the list of requirements therein, EPA has long noted that this literal reading of the statute is internally inconsistent, insofar as section 110(a)(2)(I) pertains to nonattainment SIP requirements that could not be met on the schedule provided for these SIP submissions in section 110(a)(1).8 This illustrates that EPA must determine which provisions of section 110(a)(2) may be applicable for a given infrastructure SIP submission. Similarly, EPA has previously decided that it could take action on different parts of the larger, general “infrastructure SIP” for a given NAAQS without concurrent action on all subsections, such as section 110(a)(2)(D)(i), because the Agency bifurcated the action on these latter “interstate transport” provisions within section 110(a)(2) and worked with states to address each of the four prongs of section 110(a)(2)(D)(i) with substantive administrative actions proceeding on different tracks with different schedules.9 This illustrates that EPA may conclude that subdividing the applicable requirements of section 110(a)(2) into separate SIP actions may sometimes be appropriate for a given NAAQS where a specific substantive action is necessitated, beyond a mere submission addressing basic structural aspects of the state's SIP. Finally, EPA notes that not every element of section 110(a)(2) would be relevant, or as relevant, or relevant in the same way, for each new or revised NAAQS and the attendant infrastructure SIP submission for that NAAQS. For example, the monitoring requirements that might be necessary for purposes of section 110(a)(2)(B) for one NAAQS could be very different than what might be necessary for a different pollutant. Thus, the content of an infrastructure SIP submission to meet this element from a state might be very different for an entirely new NAAQS, versus a minor revision to an existing NAAQS.10

Similarly, EPA notes that other types of SIP submissions required under the statute also must meet the requirements of section 110(a)(2), and this also demonstrates the need to identify the applicable elements for other SIP submissions. For example, nonattainment SIPs required by part D likewise have to meet the relevant subsections of section 110(a)(2) such as section 110(a)(2)(A) or (E). By contrast, it is clear that nonattainment SIPs would not need to meet the portion of section 110(a)(2)(C) that pertains to part C (i.e.,the PSD requirement applicable in attainment areas). Nonattainment SIPs required by part D also would not need to address the requirements of section 110(a)(2)(G) with respect to emergency episodes, as such requirements would not be limited to nonattainment areas. As this example illustrates, each type of SIP submission may implicate some subsections of section 110(a)(2) and not others.

Given the potential ambiguity of the statutory language of section 110(a)(1) and (2), EPA believes that it is appropriate for EPA to interpret that language in the context of acting on the infrastructure SIPs for a given NAAQS. Because of the inherent ambiguity of the list of requirements in section 110(a)(2), EPA has adopted an approach in which it reviews infrastructure SIPs against this list of elements “as applicable.” In other words, EPA assumes that Congress could not have intended that each and every SIP submission, regardless of the purpose of the submission or the NAAQS in question, would meet each of the requirements, or meet each of them in the same way. EPA elected to use guidance to make recommendations for infrastructure SIPs for these NAAQS.

On October 2, 2007, EPA issued guidance making recommendations for the infrastructure SIP submissions for both the 1997 8-hour ozone NAAQS and the 1997 PM2.5NAAQS.11 Within this guidance document, EPA described the duty of states to make these submissions to meet what the Agency characterized as the “infrastructure” elements for SIPs, which it further described as the “basic SIP requirements, including emissions inventories, monitoring, and modeling to assure attainment and maintenance of the standards.”12 As further identification of these basic structural SIP requirements, “attachment A” to the guidance document included a short description of the various elements of section 110(a)(2) and additional information about the types of issues that EPA considered germane in the context of such infrastructure SIPs. EPA emphasized that the description of the basic requirements listed on attachment A was not intended “to constitute an interpretation of” the requirements, and was merely a “brief description of the required elements.”13 EPA also stated its belief that with one exception, these requirements were “relatively self explanatory, and past experience with SIPs for other NAAQS should enable States to meet these requirements with assistance from EPA Regions.”14 For the one exception to that general assumption—how states should proceed with respect to the requirements of section 110(a)(2)(G) for the 1997 PM2.5NAAQS—EPA gave much more specific recommendations. But for other infrastructure SIP submittals, and for certain elements of the submittals for the 1997 PM2.5NAAQS, EPA assumed that each State would work with its corresponding EPA regional office to refine the scope of a State's submittal based on an assessment of how the requirements of section 110(a)(2) should reasonably apply to the basic structure of the State's SIP for the NAAQS in question.

Significantly, the 2007 Guidance did not explicitly refer to the SSM, director's discretion, minor source NSR, or NSR Reform issues as among specific substantive issues EPA expected states to address in the context of the infrastructure SIPs, nor did EPA give any more specific recommendations with respect to how states might address such issues even if they elected to do so. The SSM and director's discretion issues implicate section 110(a)(2)(A), and the minor source NSR and NSR Reform issues implicate section 110(a)(2)(C). In the 2007 Guidance, however, EPA did not indicate to states that it intended to interpret these provisions as requiring a substantive submission to address these specific issues in the context of the infrastructure SIPs for these NAAQS. Instead, EPA's 2007 Guidance merely indicated its belief a state's submission should establish that the state has the basic SIP structure necessary to implement, maintain, and enforce the NAAQS. EPA believes that states can establish that they have the basic SIP structure, notwithstanding that there may be potential deficiencies within the existing SIP. Thus, EPA's proposals mentioned these issues not because the Agency considers them issues that must be addressed in the context of an infrastructure SIP as required by section 110(a)(1) and (2), but rather because EPA wanted to be clear that it considers these potential existing SIP problems as separate from the pending infrastructure SIP actions.

EPA believes that this approach to the infrastructure SIP requirement is reasonable, because it would not be feasible to read section 110(a)(1) and (2) to require a top to bottom, stem to stern, review of each and every provision of an existing SIP for purposes of assuring that the state in question has the basic structural elements for a functioning SIP for a new or revised NAAQS. Because SIPs have grown by accretion over the decades as statutory and regulatory requirements under the CAA have evolved, they may include some outmoded provisions and historical artifacts that, while not fully up to date, nevertheless may not pose a significant problem for the purposes of “implementation, maintenance, and enforcement” of a new or revised NAAQS when EPA considers the overall effectiveness of the SIP. To the contrary, EPA believes that a better approach is for EPA to determine which specific SIP elements from section 110(a)(2) are applicable to an infrastructure SIP for a given NAAQS, and to focus attention on those elements that are most likely to need a specific SIP revision in light of the new or revised NAAQS. Thus, for example, EPA's 2007 Guidance specifically directed states to focus on the requirements of section 110(a)(2)(G) for the 1997 PM2.5NAAQS because of the absence of underlying EPA regulations for emergency episodes for this NAAQS and an anticipated absence of relevant provisions in existing SIPs.

Finally, EPA believes that its approach is a reasonable reading of section 110(a)(1) and (2) because the statute provides other avenues and mechanisms to address specific substantive deficiencies in existing SIPs. These other statutory tools allow the Agency to take appropriate tailored action, depending upon the nature and severity of the alleged SIP deficiency. Section 110(k)(5) authorizes EPA to issue a “SIP call” whenever the Agency determines that a state's SIP is substantially inadequate to attain or maintain the NAAQS, to mitigate interstate transport, or otherwise to comply with the CAA.15 Section 110(k)(6) authorizes EPA to correct errors in past actions, such as past approvals of SIP submissions.16 Significantly, EPA's determination that an action on the infrastructure SIP is not the appropriate time and place to address all potential existing SIP problems does not preclude the Agency's subsequent reliance on provisions in section 110(a)(2) as part of the basis for action at a later time. For example, although it may not be appropriate to require a state to eliminate all existing inappropriate director's discretion provisions in the course of acting on the infrastructure SIP, EPA believes that section 110(a)(2)(A) may be among the statutorybases that the Agency cites in the course of addressing the issue in a subsequent action.17

EPA is taking final action to approve Alabama's infrastructure submission as demonstrating that the State meets the applicable requirements of sections 110(a)(1) and (2) of the CAA for the 1997 8-hour ozone NAAQS. Section 110(a) of the CAA requires that each state adopt and submit a SIP for the implementation, maintenance, and enforcement of each NAAQS promulgated by the EPA, which is commonly referred to as an “infrastructure” SIP. Alabama, through ADEM, certified that the Alabama SIP contains provisions that ensure the 1997 8-hour ozone NAAQS is implemented, enforced, and maintained in Alabama.

Alabama's infrastructure submission, provided to EPA on December 10, 2007, addressed all the required infrastructure elements for the 1997 8-hour ozone NAAQS. EPA has determined that Alabama's December 10, 2007, infrastructure submission is consistent with section 110 of the CAA. Additionally, EPA is responding to adverse comments received on EPA's March 17, 2011, proposed approval of Alabama's December 10, 2007, infrastructure submission. The responses to comments are found in Section IV below.

EPA received one set of comments on the March 17, 2011, proposed rulemaking to approve Alabama's December 10, 2007, infrastructure submission as meeting the requirements of sections 110(a)(1) and (2) of the CAA for the 1997 8-hour ozone NAAQS. Generally, the Commenter's concerns relate to whether EPA's approval of Alabama's December 10, 2007, infrastructure submission is in compliance with section 110(l) of the CAA, and whether EPA's approval will interfere with the State's compliance with the CAA's prevention of significant deterioration (PSD) requirements. A full set of the comments provided on behalf of the Kentucky Environmental Foundation (hereinafter referred to as “the Commenter”) is provided in the docket for today's final action. A summary of the comments and EPA's response are provided below.

Comment 1:Under the header “No Clean Air Act Section 110(l) Analysis,” the Commenter states “Before providing the technical analysis for why finalizing this proposed rule would be contrary to the Clean Air Act, I wish to point out that it is 2011 and EPA has yet to ensure that these areas have plans to meet the 1997 National Ambient Air Quality Standard[s] (NAAQS) for ozone.” The Commenter goes on to state that “EPA acknowledged that the science indicates that the 1997 NAAQS, which is effectively 85 parts per billion (ppb), does not protect people's health or welfare when in 2008, EPA set a new ozone NAAQS at 75 ppb.”

Response 1:As noted in EPA's proposed rulemaking on Alabama's December 10, 2007, infrastructure submission and in today's final rulemaking, the very action that EPA is undertaking is a determination that Alabama has a plan to ensure compliance with the 1997 8-hour ozone NAAQS. Alabama's submission was provided on December 10, 2007, for the 1997 8-hour ozone NAAQS, thus the State's submission predates the release of the revision to the 8-hour ozone NAAQS on March 12, 2008, and is distinct from any plan that Alabama would have to provide to ensure compliance of the 2008 NAAQS. This action is meant to address, and EPA is approving, the 1997 ozone infrastructure requirements under section 110 of the Act. In today's action EPA is not addressing the 110 infrastructure requirements for the 2008 ozone NAAQS as they will be addressed in a separate rulemaking.

EPA notes that the 1997 8-hour ozone standards as published in a July 18, 1997, final rulemaking notice (62 FR 38856) and effective September 18, 1997, are 0.08 parts per million (ppm), which is effectively 0.084 ppm or 84 ppb due to the rounding convention and not “effectively 85 parts per billion (ppb)” as the Commenter stated. Further, EPA agrees that the Agency has made the determination that the 1997 8-hour ozone NAAQS is not as protective as needed for public health and welfare, and as the Commenter mentioned, the Agency established a new ozone NAAQS at 75 ppb. However, the Agency is currently reconsidering the 2008 8-hour ozone NAAQS, and has not yet designated areas for any subsequent NAAQS.

Finally, while it is not clear which areas the Commenter refers to in stating “EPA has yet to ensure these areas have plans to meet” the 1997 ozone NAAQS, EPA believes this concern is addressed by the requirements under section 172, Part D, Title I of the Act for states with nonattainment areas for the 1997 ozone NAAQS to submit nonattainment plans. As discussed in EPA's notice proposing approval of the Alabama infrastructure SIP, submissions required by section 110(a)(2)(I) which pertain to the nonattainment planning requirements of part D, Title I of the CAA are outside the scope of this action, as such plans are not due within three years after promulgation of a new or revised NAAQS, but rather are due at the time the nonattainment area plan requirements are due pursuant to section 172.18

Comment 2:Also under the header “No Clean Air Act Section 110(l) analysis,” the Commenter cites the section 110(l) CAA requirement, and states “Clean Air Act § 110(l) requires `EPA to evaluate whether the plan as revised will achieve the pollution reductions required under the Act, and the absence of exacerbation of the existing situation does not assure this result.'Hallv.EPA,273 F.3d 1146, 1152 (9th Cir. 2001).” The Commenter goes on to state that “* * * theFederal Registernotices are devoid of any analysis of how these rule makings will or will not interfere with attaining, making reasonable further progress on attaining and maintaining the 75 ppb ozone NAAQS as well as the 1-hour 100 ppb nitrogen oxides NAAQS.”

Response 2:EPA agrees with the Commenter's assertion that consideration of section 110(l) of the CAA is necessary for EPA's action with regard to approving the State's submission. However, EPA disagrees with the Commenter's assertion that EPA did not consider 110(l) in terms of the March 17, 2011, proposed action. Further, EPA disagrees with the Commenter's assertion that EPA's proposed March 17, 2011, action does not comply with the requirements of section 110(l). Section 110(l) provides in part: “[t]he Administrator shall not approve a revision of a plan if the revision would interfere with any applicable requirement concerning attainment and reasonable further progress * * *, or any other applicable requirement of this chapter.”

EPA has consistently interpreted section 110(l) as not requiring a new attainment demonstration for every SIP submission. The following actions are examples of where EPA has addressed110(l) in previous rulemakings: 70 FR 53, 57 (January 3, 2005); 70 FR 17029, 17033 (April 4, 2005); 70 FR 28429, 28431 (May 18, 2005); and 70 FR 58119, 58134 (October 5, 2005). Alabama's December 10, 2007, infrastructure submission does not revise or remove any existing emissions limit for any NAAQS, or any other existing substantive SIP provisions relevant to the 1997 8-hour ozone NAAQS. Simply put, it does not make any substantive revision that could result in any change in emissions. As a result, the submission does not relax any existing requirements or alter the status quo air quality. Therefore, approval of Alabama's December 10, 2007, infrastructure submission will not interfere with attainment or maintenance of any NAAQS.

Comment 3:Under the header “No Clean Air Act Section 110(l) analysis,” the Commenter states that “We are not required to guess what EPA's Clean Air Act 110(l) analysis would be. Rather, EPA must approve in part and disapprove in part these action and re-propose to approve the disapproved part with a Clean Air Act § 110(l) analysis.” Further, the Commenter states that “EPA cannot include its analysis in its response to comments and approve the actions without providing the public with an opportunity to comment on EPA's Clean Air Act § 110(l) analysis.”

Response 3:Please see Response 2 for a more detailed explanation regarding EPA's response to the Commenter's assertion that EPA's action is not in compliance with section 110(l) of the CAA. EPA does not agree with the Commenter's assertion that EPA's analysis did not consider section 110(l) and so therefore “EPA must approve in part and disapprove in part these action and re-propose to approve the disapproved part with a Clean Air Act § 110(l) analysis.” Every action that EPA takes to approve a SIP revision is subject to section 110(l) and thus EPA's consideration of whether a state's submission “would interfere with any applicable requirement concerning attainment and reasonable further progress * * *, or any other applicable requirement of this chapter” is inherent in EPA's action to approve or disapprove a submission from a state. In the “Proposed Action” section of the March 17, 2011, rulemaking, EPA notes that “EPA is proposing to approve Alabama's infrastructure submission for the 1997 8-hour ozone NAAQS because this submission is consistent with section 110 of the CAA.” Section 110(l) is a component of section 110, so EPA believes that this provides sufficient notice that EPA considered section 110(l) for the proposed action and concluded that section 110(l) was not violated.

Further, EPA does not agree with the Commenter's assertion that the Agency cannot provide additional clarification in response to a comment concerning section 110(l) and take a final approval action without “providing the public with an opportunity to comment on EPA's Clean Air Act § 110(l) analysis.” Clearly such a broad proposition is incorrect where the final rule is a logical outgrowth of the proposed rule. In fact, the proposition that providing an analysis for the first time in response to a comment on a rulemaking per se violates the public's opportunity to comment has been rejected by the D.C. Circuit Court of Appeals.See Int'l Harvester Co.v.Ruckelshaus,478 F.2d 615, 632 n.51 (D.C. Cir. 1973).

Finally, as previously mentioned, EPA's approval of Alabama's December 10, 2007, infrastructure submission does not make any substantive revision that could result in any change in emissions, so there is no further “analysis” beyond whether the state has adequate provisions in its SIP to address the infrastructure requirements for the 1997 8-hour ozone NAAQS. EPA's March 17, 2011, proposed rulemaking goes through each of the relevant infrastructure requirements and provides detailed information on how Alabama's SIP addresses the relevant infrastructure requirements. Beyond making a general statement indicating that Alabama's submission is not in compliance with section 110(l) of the CAA, the Commenter does not provide comments on EPA's detailed analysis of each infrastructure requirement to indicate that Alabama's infrastructure submission for the 1997 8-hour ozone NAAQS is deficient in meeting these individual requirements. Therefore, the Commenter has not provided a basis to question the Agency's determination that Alabama's December 10, 2007, infrastructure submission meets the requirements for the infrastructure submission for the 1997 8-hour ozone NAAQS, including section 110(l) of the CAA.

Comment 4:Under the header “No Clean Air Act Section 110(l) analysis,” the Commenter further asserts that “EPA's analysis must conclude that this proposed action would [violate] § 110(l) if finalized.” An example given by the Commenter is as follows: “For example, a 42 U.S.C. 7502(a)(2)(J) public notification program based on a 85 [parts per billion (ppb)] ozone level interferes with a public notification program that should exist for a 75 ppb ozone level. At its worst, the public notification system would be notifying people that the air is safe when in reality, based on the latest science, the air is not safe. Thus, EPA would be condoning the states providing information that can physical[ly] hurt people.”

Response 4:EPA disagrees with the Commenter's statement that EPA's analysis must conclude that this proposed action would be in violation of section 110(l) if finalized. As mentioned above, Alabama's December 10, 2007, infrastructure submission does not revise or remove any existing emissions limit for any NAAQS, nor does it make any substantive revision that could result in any change in emissions. EPA has concluded that Alabama's December 10, 2007, infrastructure submission does not relax any existing requirements or alter the status quo air quality. Therefore, approval of Alabama's December 10, 2007, infrastructure submission will not interfere with attainment or maintenance of any NAAQS. See Response 2 and Response 3 above for a more detailed discussion.

EPA also disagrees with the specific example provided by the Commenter that the section 110(a)(2)(J) requirement for public notification for the 1997 8-hour ozone NAAQS based on 85 ppb interferes with a public notification program that should exist for a 75 ppb ozone level, and “EPA would be condoning the states providing information that can physical[ly] hurt people.” As noted in Response 1, Alabama's December 10, 2007, infrastructure submission was provided to address the 1997 8-hour ozone NAAQS and was submitted prior to EPA's promulgation of the 2008 8-hour ozone in March 2008. Thus, Alabama provided sufficient information at that time to meet the requirement for the 1997 8-hour ozone NAAQS which is the subject of this action.

Finally, members of the public do get information related to the more recent NAAQS via the Air Quality Index (AQI) for ozone. When EPA promulgated the 2008 NAAQS (73 FR 16436, March 27, 2008), EPA revised the AQI for ozone to show that at the level of the 2008 ozone NAAQS the AQI is set to 100, which indicates unhealthful ozone levels. It is this revised AQI that EPA uses to both forecast ozone levels and to provide notice to the public of current air quality. The EPA AIRNOW system uses the revised AQI as its basis for ozone. In addition, when Alabama forecasts ozone and provides real-time ozone information to the public, either through the AIRNOW system or through its own internet based system, the State uses therevised ozone AQI keyed to the 2008 revised ozone NAAQS. EPA believes this should address the Commenter's legitimate assertion.

Comment 5:Under the header “No Clean Air Act Section 110(l) Analysis,” the Commenter asserts that “if a SIP provides an ozone NAAQS of 85 ppb for PSD purposes, this interferes with the requirement that PSD programs require sources to demonstrate that they will not cause or contribute to a violation of a NAAQS because this requirement includes the current 75 ppb ozone NAAQS.”

Response 5:EPA believes that this comment gives no basis for concluding that approval of the Alabama infrastructure SIP violates the requirements of section 110(l). EPA assumes that the comment refers to the requirement that owners and operators of sources subject to PSD demonstrate that the allowable emissions from the proposed source or emission increases from a proposed modification, in conjunction with all other applicable emissions increases or reductions (including secondary emissions) will not cause or contribute to a violation of any NAAQS. 40 CFR 51.166(k)(1).

EPA further assumes that the Commenter's statement “if a SIP provides an ozone NAAQS of 85 ppb for PSD purposes” refers to a hypothetical SIP-approved PSD program that only requires owners and operators of sources subject to PSD to make the demonstration discussed above for the 1997 ozone NAAQS, and not for the 2008 ozone NAAQS. However, the Commenter gives no indication that Alabama's SIP-approved PSD program suffers from this alleged defect. EPA has examined the relevant provision in Alabama's SIP, Regulation 335-3-14-.04(2)(10)—Air Permits Authorizing Construction in Clean Air Areas (Prevention of Significant Deterioration Permitting (PSD))—Definitions—Source Impact Analysis,and has determined that the language is nearly identical to that in 51.166(k)(1), and thus satisfies the requirements of this federal provision.

Furthermore, as discussed in detail above, the infrastructure SIP makes no substantive change to any provision of Alabama's SIP-approved PSD program, and therefore does not violate the requirements of section 110(l). Had Alabama submitted a SIP revision that substantively modified its PSD program to limit the required demonstration to just the 1997 ozone NAAQS, then the comment might have been relevant to a 110(l) analysis of that hypothetical SIP revision. However, in this case, the comment gives no basis for EPA to conclude that the Alabama infrastructure SIP would interfere with any applicable requirement of the Act.

EPA concludes that approval of Alabama's December 10, 2007, infrastructure submission will not make the status quo air quality worse and is in fact consistent with the development of an overall plan capable of meeting the Act's requirements. Accordingly, when applying section 110(l) to this submission, EPA finds that approval of Alabama's December 10, 2007, infrastructure submission is consistent with section 110 (including section 110(l)) of the CAA.

Comment 6:The Commenter provided comments opposing the proposed approval of the infrastructure submission because it did not identify a specific model to be used to demonstrate that a PSD source will not cause or contribute to a violation of the ozone NAAQS. Specifically, the Commenter stated: “[t]he SIP submittals do not comply with Clean Air Act 110(a)(2)(J), (K), and (D)(i)(II) because the SIP submittals do not identify a specific model to use in PSD permitting to demonstrate that a proposed source of modification will not cause or contribute to a violation [or] the ozone NAAQS.”

The commenter asserted that because EPA does not require the use of a specific model, states use no modeling or use deficient modeling to evaluate these impacts. Specifically, the commenter alleged: “[m]any states abuse this lack of an explicitly named model by claiming that because no model is explicitly named, no modeling is required or use of completely irrelevant modeling (e.g.Kentucky using modeling from Georgia for the J.K. Smith proposed facility) is allowed.”

To support the argument that EPA should designate a particular model and require states to use it, the Commenter attached and incorporated by reference a prior petition for rulemaking requesting that EPA designate such a model.19 The petition in question was submitted by Robert Ukeiley on behalf of the Sierra Club on July 28, 2010, requesting EPA to designate air quality models to use for PSD permit applications with regard to ozone and PM2.5. As supporting documentation for that petition for rulemaking, the Commenter also resubmitted 15 attachments in the comment on EPA's proposed approval of the infrastructure submission. These attachments were as follows:

1. Exhibit 1: Comments from Camille Sears on the Ninth Conference on Air Quality Modeling (Docket ID:EPA-HQ-OAR-2008-0604) (November 10, 2008);

2. Exhibit 2: “Response to Petitions for Review, Supplemental Briefs, and Amicus Brief” regarding the Desert Rock Energy Company, LLC from Ann Lyons, EPA Region 9—Office of Regional Counsel and Brian L. Doster/Elliot Zenick, EPA Headquarters—Office of General Counsel (January 8, 2009);

3. Exhibit 3: Report, The Kentucky Natural Resources and Environmental Protection Cabinet, A Cumulative Assessment of the Environmental Impacts Caused by Kentucky Electric Generating Units, (December 17, 2001);

4. Exhibit 4: Letter from Richard A. Wayland, Director of the Air Quality Assessment Division, EPA Office Air Quality and Planning Standards to Robert Ukeiley regarding Mr. Ukeiley's Freedom of Information Act (FOIA) request on behalf of the Sierra Club for documents related to EPA development of a modeling protocol for PM2.5(October 1, 2008);

5. Exhibit 5: Expert Report of Lyle R. Chinkin and Neil J. M. Wheeler, Analysis of Air Quality Impacts, prepared for Civil Action No. IP99-1693 C-M/SUnited Statesv.Cinergy Corp.,(August 28, 2008);

6. Exhibit 6: Illinois Environmental Protection Agency, Bureau of Air, Assessing the impact on the St. Louis Ozone Attainment Demonstration from the proposed electrical generating units in Illinois” (September 25, 2003);

7. Exhibit 7: Memorandum from Stephen D. Page, Director, EPA Office Air Quality and Planning Standards entitled, “Modeling Procedures for Demonstrating Compliance with the PM2.5NAAQS” (March 23, 2010);

8. Exhibit 8: E-mail from Scott B. (Title and Affiliation not provided), to Donna Lucchese, (Title and Affiliation not provided), entitled, “Ozone impact of point source” (Date described as “Early 2000”);

9. Exhibit 9: E-mail from Mary Portanova, EPA, Region 5, to Noreen Weimer, EPA, Region 5, entitled “FOIA—Robert Ukeiley—RIN-02114-09” (October 20, 2009, 10:05 CST);

10. Exhibit 10: Synopsis from PSD Modeling Workgroup—EPA/State/Local Workshop, New Orleans (May 17, 2005);

11. Exhibit 11: Letter from Carl E. Edlund, P.E., Director, EPA, Region 6 Multimedia Planning and Permitting Division to Richard Hyde, P.E. Deputy Director of the Office of Permitting and Registration, Texas Commission on Environmental Quality regarding“White Stallion Energy Center, PSD Permit Nos. PSD-TX-1160, PAL 26, and HAP 28” (February 10, 2010);

12. Exhibit 12: Memorandum from John S. Seitz, Director, EPA Office of Air Quality Planning & Standards entitled, “Interim Implementation of New Source Review Requirements for PM2.5” (October 23, 1997);

13. Exhibit 13: Presentation by Erik Snyder and Bret Anderson (Titles and Affiliations not provided), to R/S/L Workshop, Single Source Ozone/PM2.5Impacts in Regional Scale Modeling & Alternate Methods, (May 18, 2005);

14. Exhibit 14: Letter from Richard D. Scheffe, PhD, Senior Science Advisor, EPA, Office of Air Quality Planning & Standards to Abigail Dillen in response to an inquiry regarding the applicability of the Scheffe Point Source Screening Tables (July 28, 2000);

15. Exhibit 15: Presentation by Gail Tonnesen, Zion Wang, Mohammad Omary, Chao-Jung Chien (University of California, Riverside); Zac Adelman (University of North Carolina); Ralph Morris et al. (ENVIRON Corporation Int., Novato, CA) to the Ozone MPE, TAF Meeting, Review of Ozone Performance in WRAP Modeling and Relevance to Future Regional Ozone Planning, (July 30, 2008).

Finally, the Commenter stated that “EPA has issued guidance suggesting [that] PSD sources should use the ozone limiting method for NOXmodeling.” The Commenter referred to EPA's March 2011 NOXmodeling guidance to support this position.20 The Commenter then asserts that this “ozone modeling” helps sources demonstrate compliance and that sources should also do ozone modeling that may inhibit a source's permission to pollute. The Commenter argues that EPA's guidance supports the view that EPA must require states to require a specific model in their SIPs to demonstrate that proposed PSD sources do not cause or contribute to a violation the ozone NAAQS.

Response 6:EPA disagrees with the Commenter's views concerning modeling in the context of acting upon the infrastructure submission. The Commenter raised four primary interrelated arguments: (1) The state's infrastructure SIP must specify a required model; (2) the failure to specify a model leads to inadequate analysis; (3) the attached petition for rulemaking explains why EPA should require states to specify a model; and (4) a recent guidance document concerning modeling for NOXsources recommends using ozone limit methods for NOXsources and EPA could issue comparable guidance for modeling ozone from a single source.

At the outset, EPA notes that although the Commenter sought to incorporate by reference the prior petition for rulemaking requesting EPA to designate a particular model for use by states for this purpose, the Agency is not required to respond to that petition in the context of acting upon the infrastructure submission. In reviewing the infrastructure submission, EPA is evaluating the state's submission in light of current statutory and regulatory requirements, not in light of potential requirements that EPA has been requested to establish in a petition. Moreover, the petition arose in a different context, requests different relief, and raises other issues unrelated to those concerning ozone modeling raised by the Commenter in this action. EPA believes that the appropriate place to respond to the issues raised in the petition is in a petition response. Accordingly, EPA is not responding to the July 28, 2010 petition in this action. The issues raised in that petition are under separate consideration.

EPA believes that the comment concerning the approvability of the infrastructure submission based upon whether the SIP specifies the use of a particular model are germane to this action, but EPA disagrees with the Commenter's conclusions. The Commenter stated that the SIP submittals “do not comply with Clean Air Act 110(a)(2)(J), (K), and (D)(i)(II) because the SIP submittals do not identify a specific model to use in PSD permitting to demonstrate that a proposed source [or] modification will not cause or contribute to a violation of the ozone NAAQS.” EPA's PSD permitting regulations are found at 40 CFR 51.166 and 52.21. PSD requirements for SIPs are found in 40 CFR 51.166. Similar PSD requirements for SIPs that have been disapproved with respect to PSD and for SIPs incorporating EPA's regulations by reference are found in 40 CFR 52.21. The PSD regulations require an ambient impact analysis for ozone for proposed major stationary sources and major modifications to obtain a PSD permit (40 CFR 51.166(b)(23)(i), (i)(5)(i)(f),21 (k), (l) and (m) and 40 CFR 52.21(b)(23)(i), (i)(5)(i)(f),22 (k), (l) and (m)). The regulations at 40 CFR 51.166(l) state that for air quality models the SIP shall provide for procedures which specify that:

(1) All applications of air quality modeling involved in this subpart shall be based on the applicable models, data bases, and other requirements specified in Appendix W of this part (Guideline on Air Quality Models).

(2) Where an air quality model specified in Appendix W of this part (Guideline on Air Quality Models) is inappropriate, the model may be modified or another model substituted. Such a modification or substitution of a model may be made on a case-by-case basis or, where appropriate, on a generic basis for a specific State program. Written approval of the Administrator must be obtained for any modification or substitution. In addition, use of a modified or substituted model must be subject to notice and opportunity for public comment under procedures set forth in § 51.102.

These parts of 40 CFR part 51 and 52 are the umbrella SIP components that states have either adopted by reference or the states have been approved or delegated authority to incorporate the PSD requirements of the CAA. As discussed above, these part 51 and 52 PSD provisions refer to 40 CFR part 51, Appendix W for the appropriate model to utilize for the ambient impact assessment. 40 CFR part 51, Appendix W is the Guideline on Air Quality models and Section 1.0.a. states:

Appendix W Section 5.2.1. includes theGuidelinerecommendations for models to be utilized in assessing ambient air quality impacts for ozone. Specifically, Section 5.2.1.c. states:

Appendix W Section 5.2.1.c. provides that the model users (state and local permitting authorities and permitting applicants) should work with the appropriate EPA Regional Office on a case-by-case basis to determine an adequate method for performing an air quality analysis for assessing ozone impacts. Due to the complexity of modeling ozone and the dependency on the regional characteristics of atmospheric conditions, EPA believes this is an appropriate approach rather than specifying one particular preferred model nationwide, which may not be appropriate in all circumstances. Instead, the choice of method “depends on the nature of the source and its emissions. Thus, model users should consult with the Regional Office * * *.” Appendix W Section 5.2.1.c. Therefore, EPA continues to believe it is appropriate for permitting authorities to consult and work with EPA Regional Offices as described in Appendix W, including section 3.0.b and c, 3.2.2, and 3.3, to determine the appropriate approach to assess ozone impacts for each PSD required evaluation.23, 24, 25, 26 Although EPA has not selected one particular preferred model in Appendix A of Appendix W (Summaries of Preferred Air Quality Models) for conducting ozone impact analyses for individual sources, state/local permitting authorities must comply with the appropriate PSD FIP or SIP requirements with respect to ozone.

The current SIP meets the requirements of 40 CFR 51.166(l)(1). Specifically, the Alabama SIP states at Alabama Air Regulations 335-3-14-.04 (11)Air Quality Models:

This statement in the federally approved Alabama SIP is a direct reference to EPA's “Guideline on Air Quality Models” at 40 CFR part 51, Appendix W. The commitment in Alabama's SIP to implement and adopt air quality models utilizing 40 CFR part 51, Appendix W as a basis is appropriate and consistent with federal regulations.

Alabama requires that PSD permit applications contain an analysis of ozone impacts from the proposed project.27 As recommended by Appendix W, the methods used for the ozone impacts analysis for individual PSD permit actions are determined on a case-by-case basis. Alabama consults with EPA Region 4 on a case-by-case basis for evaluating the adequacy of the ozone impact analysis. When appropriate, EPA Region 4 provides input/comments on the analysis. As stated in Section 5.2.1.c. of Appendix W, the “[c]hoice of methods used to assess the impact of an individual source depends on the nature of the source and its emissions.” Therefore, based on an evaluation of the source, its emissions and background ozone concentrations, an ozone impact analysis other than modeling may be required. While in other cases a complex photochemical grid type modeling analysis, as discussed below, may be warranted. As noted, the appropriate methods are determined in consultation with EPA Region 4 on a case-by-case basis.

As a second point, the Commenter asserted that states abuse this lack of an explicitly named model by claiming that because no model is explicitly named, no modeling is required or use of completely irrelevant modeling is allowed.

EPA agrees that States should not be using inappropriate analytical tools in this context. For example, the Commenter's Exhibit 14 does discuss the inappropriateness of using a screening technique referred to as the “Scheffe Tables.” The Commenter is correct that the use of “Scheffe Tables” and other particular screening techniques, which involve ratios of nitrogen oxides (NOX) to volatile organic compounds (VOC) that do not consider the impact of biogenic emissions, or that use other outdated or irrelevant modeling, is inappropriate to evaluate a single source's ozone impacts on an air quality control region. More scientifically appropriate screening and refined tools are available and should be considered for use. Therefore, EPA continues to believe States should consult and work with EPA Regional Offices as described in Appendix W on a case-by-case basis to determine the appropriate method for estimating the impacts of these ozone precursors from individual sources.

For ozone, a proposed emission source's impacts are dependent upon local meteorology and pollution levels in the surrounding atmosphere. Ozone is formed from chemical reactions in the atmosphere. The impact a new or modified source can have on ozone levels is dependent, in part, upon the existing atmospheric pollutant loading already in the region with which emissions from the new or modified source can react. In addition, meteorological parameters such as windspeed, temperature, wind direction, solar radiation influx, and atmospheric stability are also important factors. The more sophisticated analyses consider meteorology and interactions with emissions from surrounding sources. EPA has not identified an established modeling system that would fit all situations and take into account all of the additional local information about sources and meteorological conditions. The Commenter submitted a number of exhibits (including Exhibits 10, 11, and 13) in which EPA has previously indicated a preference for using a photochemical grid model when appropriate modeling databases exist and when it is acceptable to use the photochemical grid modeling to assess a specific source.

Commenter's Exhibit 13 includes a list of issues to evaluate, which aid in considering if the existing photochemical grid modeling databases are acceptable, and discusses the need for permitting authorities to consult with the EPA Regional Office in determining if photochemical grid modeling would be appropriate for conducting an ozone impacts analysis. In these documents EPA has indicated that photochemical grid modeling (e.g.,CAMx or CMAQ) is generally the most sophisticated type of modeling analysis for evaluating ozone impacts, and it is usually conducted by adding a source into an existing modeling system to determine the change in impact from the source. The analysis is done by comparing the photochemical grid modeling results, which include the new or modified source under evaluation, with the results from the original modeling analysis that does not contain the source. Photochemical grid modeling is often an excellent modeling exercise for evaluating a single source's impacts on an air quality control region when such models are available and appropriate to utilize because they take into account the important parameters and the models have been used in regional modeling for attainment SIPs.

The use of reactive plume models may also be appropriate under certain circumstances. EPA has approved the use of plume models in some instances, but these models are not always appropriate because of the difficulty in obtaining the background information to make an appropriate assessment of the photochemistry and meteorology impacts.

EPA has not selected a specific “preferred” model for conducting an ozone impact analysis. Model selection normally depends upon the details about the modeling systems available and if they are appropriate for assessing the impacts from a proposed new source or modification. Considering that a photochemical modeling system with inputs, including meteorological and emissions data, that would also have to be evaluated for model performance, could potentially be costly and time consuming to develop, EPA has taken a case-by-case evaluation approach. Such photochemical modeling databases are typically developed so that impacts of regulatory actions across multiple sources can be evaluated, and therefore the time and financial costs can be absorbed by the regulatory body. It is these types of databases that have the potential to be used to assess single source ozone impacts after they have been developed as part of a regional modeling demonstration to support a SIP. From a cost and time requirement standpoint, EPA would generally not expect a single source to develop an entire photochemical modeling system just to evaluate its individual impacts on an air quality region, as long as other methods of analyzing ozone impacts are available and acceptable to EPA.

When an existing photochemical modeling system is deemed appropriate, it is an excellent tool to evaluate the ozone impact that a single source's emissions can have on an air quality region in the context of PSD modeling and should be evaluated for potential use. More often now than 10 or 15 years ago, a photochemical modeling system may be available that covers the geographic area of concern. EPA notes that even where photochemical modeling is readily available, it should be evaluated as part of the development of a modeling protocol, in consultation with the Regional Office to determine its appropriateness for conducting an impact analysis for a particular proposed source or modification.28 Factors to consider when evaluating the appropriateness of a particular photochemical modeling system include, but are not limited to, meteorology, year of emissions projections, model performance issues in the area of concern or in areas that might impact projections in the area of concern. Therefore, even where photochemical modeling systems exist, there may be circumstances where their use is inappropriate for estimating the ozone impacts of a proposed source or modification. Because of these scientific issues and the need for appropriate case-by-case technical considerations, EPA has not designated a single “Preferred Model” for conducting single source impact analyses for ozone in Appendix A of Appendix W.

In summary, the Commenter states that many States abuse this lack of an explicitly named model by claiming that because no model is explicitly named, no modeling is required or use of completely irrelevant modeling is allowed. For the reasons described in this response to comment, we do not believe that one modeling system is presently appropriate to designate for all situations, yet that does not relieve proposed sources and modifications from the obligation of making the required demonstration under the applicable PSD rules. The Alabama SIP contains a direct reference for use of the procedures specified in EPA's “Guideline on Air Quality Models” (40 CFR Part 51 Appendix W) for estimating ambient concentrations of criteria pollutants, including ozone (Alabama Air Pollution Control Regulation 335-3-14-.04(11)Air Quality Models). As such, Alabama requires that PSD permit applications contain an analysis of ozone impacts from the proposed project. As recommended by Appendix W, the methods used for the ozone impacts analysis are determined on a case-by-case basis. Alabama consults with EPA Region 4 on a case-by-case basis for evaluating the adequacy of the ozone impact analysis. When appropriate, EPA Region 4 provides input/comments on the analysis. Because EPA has not designated one particular model as being appropriate in all situations for evaluating single source ozone impacts, EPA Region 4 concurs with Alabama's proposed approach.

In conclusion, for the reasons stated above it is difficult to identify and implement a standardized national model for ozone. EPA has had a standard approach in its PSD SIP and FIP rules of not mandating the use of a particular model for all circumstances, instead treating the choice of a particular method for analyzing ozone impacts as circumstance-dependent. EPA then determines whether the State's implementation plan revision submittal meets the PSD SIP requirements. For purposes of review for this infrastructure SIP, Alabama has an EPA-approved PSD SIP that meets the EPA PSD SIP requirements.

Finally, the Commenter argued that EPA's March 2011 guidance concerning modeling for the 1-hour nitrogen dioxide (NO2) NAAQS demonstrates that similar single source modeling could be conducted for sources for purposes of the ozone NAAQS. Specifically, the commenter argued that the model used for other criteriapollutants (AERMOD), incorporates ozone chemistry for modeling NO2and therefore is modeling ozone chemistry for a single source. The Commenter stated that this guidance suggested that PSD sources should use the ozone limiting method for NOXmodeling.29 Further, the Commenter noted that this technique “is modeling of ozone chemistry for a single source” and therefore, that this modeling with ozone chemistry allows a source to be permitted. The commenter concludes with the assertion that EPA must require the SIPs to include a model to use to demonstrate that proposed PSD sources do not cause or contribute to a violation of an ozone NAAQS.

EPA's recent March 2011 guidance for the NO2NAAQS does discuss using two different techniques to estimate the amount of conversion of NOXemissions to NO2ambient NO2concentrations as part of the NO2modeling guidance. NOXemissions are composed of NO and NO2molecules. These two techniques, which have been available for years, are the Ozone Limiting Method (OLM), which was mentioned by the Commenter, and the Plume Volume Molar-Ratio-Method (PVMRM). Both of these techniques are designed and formulated based on the principle of assuming available atmospheric ozone mixes with NO/NO2emissions from sources. This “mixing” results in ozone molecules reacting with the NO molecules to form NO2and O2. This is a simple one-direction chemical reaction that is used to determine how much NO is converted to NO2for modeling of the NO2standard. Thus, these techniques do not predict ozone concentrations, rather they take ambient ozone data as model inputs to determine the calculation of NO conversion to NO2. These techniques are not designed to calculate the amount of ozone that might be generated as the NOXemissions traverses downwind of the source and potentially reacts with other pollutants in the atmosphere. Rather, these two techniques rely on a one-way calculation based on an ozone molecule (O3) reacting with an NO molecule to generate an NO2molecule and an O2molecule.30, 31

As previously mentioned, these two techniques do not attempt to estimate the amount of ozone that might be generated, and the models in which these techniques are applied are not designed or formulated to even account for the potential generation of ozone from emissions of NO/NO2. Ozone chemistry has many cycles of destruction and generation and is dependent upon a large number of variables, including VOC concentrations and the specific types of VOC molecules present, other atmospheric pollutant concentrations, meteorological conditions, and solar radiation levels as already discussed in this response. Since OLM and PVMRM do not include any of these scientific principles and do not account for any chemical mechanisms that would generate ozone, these techniques cannot be used for determining potential changes in ozone levels from a proposed source or modification.

In summary, the Commenter asserts that the OLM technique models of ozone chemistry for a single source and that this modeling helps a source demonstrate compliance with the NO2standard. The Commenter is concerned that EPA has not designated a single specific OLM technique is not also used to determine ozone impacts and believes that EPA should rectify this concern. To do so the Commenter concludes that EPA must require the SIPs to include a model to demonstrate that proposed PSD sources do not cause or contribute to a violation of an ozone NAAQS. As previously discussed, EPA disagrees and reiterates that the OLM (and PVMRM) are simple chemistry techniques that are not formulated to be capable to determine potential ozone impacts from a proposed source or modification.

For the reasons discussed above, EPA does not believe that the comments provide a basis for not approving the infrastructure submission. In short, EPA has not modified the Guidelines in Appendix W for ozone impacts analysis for a single source (Appendix W part 5.2.1.c.) to require use of a specific model as the Commenter requests. EPA finds that the State has the appropriate regulations to operate the PSD program consistent with federally-approved requirements. Furthermore, we disagree that states are required to designate a specific model in the SIP, because App. W states that state and local agencies should consult with EPA on a case-by-case basis to determine what analysis to require.

As already described, ADEM has addressed the elements of the CAA 110(a)(1) and (2) SIP requirements pursuant to EPA's October 2, 2007, guidance to ensure that the 1997 8-hour ozone NAAQS are implemented, enforced, and maintained in Alabama. EPA is taking final action to approve Alabama's December 10, 2007, infrastructure submission for the 1997 8-hour ozone NAAQS because this submission is consistent with section 110 of the CAA.

Under the CAA, the Administrator is required to approve a SIP submission that complies with the provisions of the Act and applicable federal regulations. 42 U.S.C. 7410(k); 40 CFR 52.02(a). Thus, in reviewing SIP submissions, EPA's role is to approve state choices, provided that they meet the criteria of the CAA. Accordingly, this action merely approves state law as meeting federal requirements and does not impose additional requirements beyond those imposed by state law. For that reason, this action:

• Is not a “significant regulatory action” subject to review by the Office of Management and Budget under Executive Order 12866 (58 FR 51735, October 4, 1993);

• Does not impose an information collection burden under the provisions of the Paperwork Reduction Act (44 U.S.C. 3501et seq.);

• Is certified as not having a significant economic impact on a substantial number of small entities under the Regulatory Flexibility Act (5 U.S.C. 601et seq.);

• Does not contain any unfunded mandate or significantly or uniquely affect small governments, as described in the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4);

• Does not have Federalism implications as specified in Executive Order 13132 (64 FR 43255, August 10, 1999);

• Is not an economically significant regulatory action based on health or safety risks subject to Executive Order 13045 (62 FR 19885, April 23, 1997);

• Is not a significant regulatory action subject to Executive Order 13211 (66 FR 28355, May 22, 2001);

• Is not subject to requirements of Section 12(d) of the National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 note) because application of those requirements would be inconsistent with the CAA; and

• Does not provide EPA with the discretionary authority to address, asappropriate, disproportionate human health or environmental effects, using practicable and legally permissible methods, under Executive Order 12898 (59 FR 7629, February 16, 1994).

The Congressional Review Act, 5 U.S.C. 801et seq.,as added by the Small Business Regulatory Enforcement Fairness Act of 1996, generally provides that before a rule may take effect, the agency promulgating the rule must submit a rule report, which includes a copy of the rule, to each House of the Congress and to the Comptroller General of the United States. EPA will submit a report containing this action 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 theFederal Register. A major rule cannot take effect until 60 days after it is published in theFederal Register. This action is not a “major rule” as defined by 5 U.S.C. 804(2).

Under section 307(b)(1) of the CAA, petitions for judicial review of this action must be filed in the United States Court of Appeals for the appropriate circuit by September 12, 2011. Filing a petition for reconsideration by the Administrator of this final rule does not affect the finality of this action 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. This action may not be challenged later in proceedings to enforce its requirements. (Seesection 307(b)(2)).

40 CFR part 52 is amended as follows:

Upon promulgation of a new or revised NAAQS, sections 110(a)(1) and (2) of the CAA require states to address basic SIP requirements, including emissions inventories, monitoring, and modeling to assure attainment and maintenance for that new NAAQS. On July 18, 1997, EPA promulgated a new NAAQS for ozone based on 8-hour average concentrations, thus states were required to provide submissions to address sections 110(a)(1) and (2) of the CAA for this new NAAQS. South Carolina provided its infrastructure submission for the 1997 8-hour ozone NAAQS on December 13, 2007. On March 17, 2011, EPA proposed to approve South Carolina's December 13, 2007, infrastructure submission for the 1997 8-hour ozone NAAQS.See76 FR 14606. A summary of the background for today's final actions is provided below. See EPA's March 17, 2011, proposed rulemaking at 76 FR 14606 for more detail.

Section 110(a) of the CAA requires states to submit SIPs to provide for the implementation, maintenance, and enforcement of a new or revised NAAQS within three years following the promulgation of such NAAQS, or within such shorter period as EPA may prescribe. Section 110(a) imposes the obligation upon states to make a SIP submission to EPA for a new or revised NAAQS, but the contents of that submission may vary depending upon the facts and circumstances. In particular, the data and analytical tools available at the time the state develops and submits the SIP for a new or revised NAAQS affects the content of the submission. The contents of such SIP submissions may also vary depending upon what provisions the state's existing SIP already contains. In the case of the 1997 8-hour ozone NAAQS, states typically have met the basic program elements required in section 110(a)(2) through earlier SIP submissions in connection with previous ozone NAAQS.

More specifically, section 110(a)(1) provides the procedural and timing requirements for SIPs. Section 110(a)(2) lists specific elements that states must meet for “infrastructure” SIP requirements related to a newly established or revised NAAQS. As mentioned above, these requirements include SIP infrastructure elements such as modeling, monitoring, and emissions inventories that are designed to assure attainment and maintenance of the NAAQS. The requirements that are the subject of this final rulemaking are listed below1 and in EPA's October 2, 2007, memorandum entitled “Guidance on SIP Elements Required Under Section 110(a)(1) and (2) for the 1997 8-Hour Ozone and PM2.5National Ambient Air Quality Standards.”

• 110(a)(2)(A): Emission limits and other control measures.

• 110(a)(2)(B): Ambient air quality monitoring/data system.

• 110(a)(2)(C): Program for enforcement of control measures.2

• 110(a)(2)(D): Interstate transport.3

• 110(a)(2)(E): Adequate resources.

• 110(a)(2)(F): Stationary source monitoring system.

• 110(a)(2)(G): Emergency power.

• 110(a)(2)(H): Future SIP revisions.

• 110(a)(2)(I): Areas designated nonattainment and meet the applicable requirements of part D.4

• 110(a)(2)(J): Consultation with government officials; public notification; and PSD and visibility protection.

• 110(a)(2)(K): Air quality modeling/data.

• 110(a)(2)(L): Permitting fees.

• 110(a)(2)(M): Consultation/participation by affected local entities.

EPA is currently acting upon SIPs that address the infrastructure requirements of CAA section 110(a)(1) and (2) for ozone and PM2.5NAAQS for various states across the country. Commenters on EPA's recent proposals for some states raised concerns about EPA statements that it was not addressing certain substantive issues in the context of acting on the infrastructure SIP submissions.5 The Commenters specifically raised concerns involving provisions in existing SIPs and with EPA's statements that it would address two issues separately and not as part of actions on the infrastructure SIP submissions: (i) Existing provisions related to excess emissions during periods of start-up, shutdown, or malfunction (“SSM”) at sources, that may be contrary to the CAA and EPA's policies addressing such excess emissions; and (ii) existing provisions related to “director's variance” or “director's discretion” that purport to permit revisions to SIP approved emission limits with limited public process or without requiring further approval by EPA, that may be contrary to the CAA (“director's discretion”). EPA notes that there are two other substantive issues for which EPAlikewise stated that it would respond separately: (i) Existing provisions for minor source new source review programs that may be inconsistent with the requirements of the CAA and EPA's regulations that pertain to such programs (“minor source NSR”); and (ii) existing provisions for Prevention of Significant Deterioration programs that may be inconsistent with current requirements of EPA's “Final NSR Improvement Rule,” 67 FR 80186 (December 31, 2002), as amended by 72 FR 32526 (June 13, 2007) (“NSR Reform”). In light of the comments, EPA now believes that its statements in various proposed actions on infrastructure SIPs with respect to these four individual issues should be explained.

EPA intended the statements in the proposals concerning these four issues merely to be informational, and to provide general notice of the potential existence of provisions within the existing SIPs of some states that might require future corrective action. EPA did not want states, regulated entities, or members of the public to be under the misconception that the Agency's approval of the infrastructure SIP submission of a given state should be interpreted as a reapproval of certain types of provisions that might exist buried in the larger existing SIP for such state. Thus, for example, EPA explicitly noted that the Agency believes that some states may have existing SIP-approved SSM provisions that are contrary to the CAA and EPA policy, but that “in this rulemaking, EPA is not proposing to approve or disapprove any existing State provisions with regard to excess emissions during SSM of operations at facilities.” EPA further explained, for informational purposes, that “EPA plans to address such State regulations in the future.” EPA made similar statements, for similar reasons, with respect to the director's discretion, minor source NSR, and NSR Reform issues. EPA's objective was to make clear that approval of an infrastructure SIP for these ozone and PM2.5NAAQS should not be construed as explicit or implicit reapproval of any existing provisions that relate to these four substantive issues.

Unfortunately, the Commenters and others evidently interpreted these statements to mean that EPA considered action upon the SSM provisions and the other three substantive issues to be integral parts of acting on an infrastructure SIP submission, and therefore that EPA was merely postponing taking final action on the issue in the context of the infrastructure SIPs. This was not EPA's intention. To the contrary, EPA only meant to convey its awareness of the potential for certain types of deficiencies in existing SIPs, and to prevent any misunderstanding that it was reapproving any such existing provisions. EPA's intention was to convey its position that the statute does not require that infrastructure SIPs address these specific substantive issues in existing SIPs and that these issues may be dealt with separately, outside the context of acting on the infrastructure SIP submission of a state. To be clear, EPA did not mean to imply that it was not taking a full final agency action on the infrastructure SIP submission with respect to any substantive issue that EPA considers to be a required part of acting on such submissions under section 110(k) or under section 110(c). Given the confusion evidently resulting from EPA's statements, however, we want to explain more fully the Agency's reasons for concluding that these four potential substantive issues in existing SIPs may be addressed separately.

The requirement for the SIP submissions at issue arises out of CAA section 110(a)(1). That provision requires that states must make a SIP submission “within 3 years (or such shorter period as the Administrator may prescribe) after the promulgation of a national primary ambient air quality standard (or any revision thereof)” and that these SIPs are to provide for the “implementation, maintenance, and enforcement” of such NAAQS. Section 110(a)(2) includes a list of specific elements that “[e]ach such plan” submission must meet. EPA has historically referred to these particular submissions that states must make after the promulgation of a new or revised NAAQS as “infrastructure SIPs.” This specific term does not appear in the statute, but EPA uses the term to distinguish this particular type of SIP submission designed to address basic structural requirements of a SIP from other types of SIP submissions designed to address other requirements, such as “nonattainment SIP” submissions required to address the nonattainment planning requirements of part D, “regional haze SIP” submissions required to address the visibility protection requirements of CAA section 169A, new source review permitting program submissions required to address the requirements of part D, and a host of other specific types of SIP submissions that address other specific matters.

Although section 110(a)(1) addresses the timing and general requirements for these infrastructure SIPs, and section 110(a)(2) provides more details concerning the required contents of these infrastructure SIPs, EPA believes that many of the specific statutory provisions are facially ambiguous. In particular, the list of required elements provided in section 110(a)(2) contains a wide variety of disparate provisions, some of which pertain to required legal authority, some of which pertain to required substantive provisions, and some of which pertain to requirements for both authority and substantive provisions.6 Some of the elements of section 110(a)(2) are relatively straightforward, but others clearly require interpretation by EPA through rulemaking, or recommendations through guidance, in order to give specific meaning for a particular NAAQS.7

Notwithstanding that section 110(a)(2) states that “each” SIP submission must meet the list of requirements therein, EPA has long noted that this literal reading of the statute is internally inconsistent, insofar as section 110(a)(2)(I) pertains to nonattainment SIP requirements that could not be met on the schedule provided for these SIP submissions in section 110(a)(1).8 This illustrates that EPA must determine which provisions of section 110(a)(2) may be applicable for a given infrastructure SIP submission. Similarly, EPA has previously decided that it could take action on different parts of the larger, general “infrastructure SIP” for a given NAAQS without concurrent action on all subsections, such as section 110(a)(2)(D)(i), because the Agency bifurcated the action on these latter “interstate transport” provisions within section 110(a)(2) and worked with states to address each of the four prongs ofsection 110(a)(2)(D)(i) with substantive administrative actions proceeding on different tracks with different schedules.9 This illustrates that EPA may conclude that subdividing the applicable requirements of section 110(a)(2) into separate SIP actions may sometimes be appropriate for a given NAAQS where a specific substantive action is necessitated, beyond a mere submission addressing basic structural aspects of the state's SIP. Finally, EPA notes that not every element of section 110(a)(2) would be relevant, or as relevant, or relevant in the same way, for each new or revised NAAQS and the attendant infrastructure SIP submission for that NAAQS. For example, the monitoring requirements that might be necessary for purposes of section 110(a)(2)(B) for one NAAQS could be very different than what might be necessary for a different pollutant. Thus, the content of an infrastructure SIP submission to meet this element from a state might be very different for an entirely new NAAQS, versus a minor revision to an existing NAAQS.10

Similarly, EPA notes that other types of SIP submissions required under the statute also must meet the requirements of section 110(a)(2), and this also demonstrates the need to identify the applicable elements for other SIP submissions. For example, nonattainment SIPs required by part D likewise have to meet the relevant subsections of section 110(a)(2) such as section 110(a)(2)(A) or (E). By contrast, it is clear that nonattainment SIPs would not need to meet the portion of section 110(a)(2)(C) that pertains to part C (i.e.,the PSD requirement applicable in attainment areas). Nonattainment SIPs required by part D also would not need to address the requirements of section 110(a)(2)(G) with respect to emergency episodes, as such requirements would not be limited to nonattainment areas. As this example illustrates, each type of SIP submission may implicate some subsections of section 110(a)(2) and not others.

Given the potential ambiguity of the statutory language of section 110(a)(1) and (2), EPA believes that it is appropriate for EPA to interpret that language in the context of acting on the infrastructure SIPs for a given NAAQS. Because of the inherent ambiguity of the list of requirements in section 110(a)(2), EPA has adopted an approach in which it reviews infrastructure SIPs against this list of elements “as applicable.” In other words, EPA assumes that Congress could not have intended that each and every SIP submission, regardless of the purpose of the submission or the NAAQS in question, would meet each of the requirements, or meet each of them in the same way. EPA elected to use guidance to make recommendations for infrastructure SIPs for these NAAQS.

On October 2, 2007, EPA issued guidance making recommendations for the infrastructure SIP submissions for both the 1997 8-hour ozone NAAQS and the 1997 PM2.5NAAQS.11 Within this guidance document, EPA described the duty of states to make these submissions to meet what the Agency characterized as the “infrastructure” elements for SIPs, which it further described as the “basic SIP requirements, including emissions inventories, monitoring, and modeling to assure attainment and maintenance of the standards.”12 As further identification of these basic structural SIP requirements, “attachment A” to the guidance document included a short description of the various elements of section 110(a)(2) and additional information about the types of issues that EPA considered germane in the context of such infrastructure SIPs. EPA emphasized that the description of the basic requirements listed on attachment A was not intended “to constitute an interpretation of” the requirements, and was merely a “brief description of the required elements.”13 EPA also stated its belief that with one exception, these requirements were “relatively self explanatory, and past experience with SIPs for other NAAQS should enable States to meet these requirements with assistance from EPA Regions.”14 For the one exception to that general assumption—how states should proceed with respect to the requirements of section 110(a)(2)(G) for the 1997 PM2.5NAAQS—EPA gave much more specific recommendations. But for other infrastructure SIP submittals, and for certain elements of the submittals for the 1997 PM2.5NAAQS, EPA assumed that each State would work with its corresponding EPA regional office to refine the scope of a State's submittal based on an assessment of how the requirements of section 110(a)(2) should reasonably apply to the basic structure of the State's SIP for the NAAQS in question.

Significantly, the 2007 Guidance did not explicitly refer to the SSM, director's discretion, minor source NSR, or NSR Reform issues as among specific substantive issues EPA expected states to address in the context of the infrastructure SIPs, nor did EPA give any more specific recommendations with respect to how states might address such issues even if they elected to do so. The SSM and director's discretion issues implicate section 110(a)(2)(A), and the minor source NSR and NSR Reform issues implicate section 110(a)(2)(C). In the 2007 Guidance, however, EPA did not indicate to states that it intended to interpret these provisions as requiring a substantive submission to address these specific issues in the context of the infrastructure SIPs for these NAAQS. Instead, EPA's 2007 Guidance merely indicated its belief a state's submission should establish that the state has the basic SIP structure necessary to implement, maintain, and enforce the NAAQS. EPA believes that states can establish that they have the basic SIP structure, notwithstanding that there may be potential deficiencies within the existing SIP. Thus, EPA's proposals mentioned these issues not because the Agency considers them issues that must be addressed in the context of an infrastructure SIP as required by section 110(a)(1) and (2), but rather because EPA wanted to be clear that it considers these potential existing SIP problems as separate from the pending infrastructure SIP actions.

EPA believes that this approach to the infrastructure SIP requirement isreasonable, because it would not be feasible to read section 110(a)(1) and (2) to require a top to bottom, stem to stern, review of each and every provision of an existing SIP for purposes of assuring that the state in question has the basic structural elements for a functioning SIP for a new or revised NAAQS. Because SIPs have grown by accretion over the decades as statutory and regulatory requirements under the CAA have evolved, they may include some outmoded provisions and historical artifacts that, while not fully up to date, nevertheless may not pose a significant problem for the purposes of “implementation, maintenance, and enforcement” of a new or revised NAAQS when EPA considers the overall effectiveness of the SIP. To the contrary, EPA believes that a better approach is for EPA to determine which specific SIP elements from section 110(a)(2) are applicable to an infrastructure SIP for a given NAAQS, and to focus attention on those elements that are most likely to need a specific SIP revision in light of the new or revised NAAQS. Thus, for example, EPA's 2007 Guidance specifically directed states to focus on the requirements of section 110(a)(2)(G) for the 1997 PM2.5NAAQS because of the absence of underlying EPA regulations for emergency episodes for this NAAQS and an anticipated absence of relevant provisions in existing SIPs.

Finally, EPA believes that its approach is a reasonable reading of section 110(a)(1) and (2) because the statute provides other avenues and mechanisms to address specific substantive deficiencies in existing SIPs. These other statutory tools allow the Agency to take appropriate tailored action, depending upon the nature and severity of the alleged SIP deficiency. Section 110(k)(5) authorizes EPA to issue a “SIP call” whenever the Agency determines that a state's SIP is substantially inadequate to attain or maintain the NAAQS, to mitigate interstate transport, or otherwise to comply with the CAA.15 Section 110(k)(6) authorizes EPA to correct errors in past actions, such as past approvals of SIP submissions.16 Significantly, EPA's determination that an action on the infrastructure SIP is not the appropriate time and place to address all potential existing SIP problems does not preclude the Agency's subsequent reliance on provisions in section 110(a)(2) as part of the basis for action at a later time. For example, although it may not be appropriate to require a state to eliminate all existing inappropriate director's discretion provisions in the course of acting on the infrastructure SIP, EPA believes that section 110(a)(2)(A) may be among the statutory bases that the Agency cites in the course of addressing the issue in a subsequent action.17

EPA is taking final action to approve South Carolina's infrastructure submission as demonstrating that the State meets the applicable requirements of sections 110(a)(1) and (2) of the CAA for the 1997 8-hour ozone NAAQS. Section 110(a) of the CAA requires that each state adopt and submit a SIP for the implementation, maintenance, and enforcement of each NAAQS promulgated by the EPA, which is commonly referred to as an “infrastructure” SIP. South Carolina, through SC DHEC, certified that the South Carolina SIP contains provisions that ensure the 1997 8-hour ozone NAAQS is implemented, enforced, and maintained in South Carolina. Additionally, on June 23, 2011, South Carolina's infrastructure submission, provided to EPA on December 13, 2007, addressed all the required infrastructure elements for the 1997 8-hour ozone NAAQS.

On June 23, 2011, EPA published a final rulemaking action approving revisions to South Carolina's New Source Review (NSR) requirements incorporating the Phase II NSR permitting requirements and specifically identifying nitrogen oxides (NOX) as an ozone precursor under the NSR program.See76 FR 36875. EPA is not taking action today on South Carolina's NSR program, as these requirements are already approved in South Carolina's SIP.

EPA is also correcting an inadvertent error found in the Section I of the March 17, 2011 proposed approval.See76 FR 14606. The last sentence in paragraph four of this Section states, “This action is not approving any specific rule, but rather proposing that Alabama's already approved SIP meets certain CAA requirements.” In this action, EPA is correcting this sentence to read, “This action is not approving any specific rule, but rather proposing that South Carolina's already approved SIP meets certain CAA requirements.” EPA can identify no particular reason why the public would be interested in being notified of the correction of this inadvertent error or in having the opportunity to comment on the correction prior to this action being finalized, since this correction action does not change the meaning of the regulations at issue or otherwise change EPA's analysis of South Carolina's 1997 8-hour ozone infrastructure submission.

EPA has determined that South Carolina's December 13, 2007, infrastructure submission is consistent with section 110 of the CAA and is responding to adverse comments received on EPA's March 17, 2011, proposed approval of South Carolina's December 13, 2007, infrastructure submission. The responses to comments are found in Section IV below.

EPA received one set of comments on the March 17, 2011, proposed rulemaking to approve South Carolina's December 13, 2007, infrastructure submission as meeting the requirements of sections 110(a)(1) and (2) of the CAA for the 1997 8-hour ozone NAAQS. Generally, the Commenter's concerns relate to whether EPA's approval of South Carolina's December 13, 2007, infrastructure submission is in compliance with section 110(l) of the CAA, and whether EPA's approval will interfere with the State's compliance with the CAA's prevention of significant deterioration (PSD) requirements. A full set of the comments provided on behalf of the Kentucky Environmental Foundation (hereinafter referred to as “the Commenter”) is provided in the docket for today's final action. A summary of the comments and EPA's response are provided below.

Comment 1:Under the header “No Clean Air Act Section 110(l) analysis,” the Commenter states “Before providing the technical analysis for why finalizing this proposed rule would be contrary to the Clean Air Act, I wish to point out that it is 2011 and EPA has yet to ensurethat these areas have plans to meet the 1997 National Ambient Air Quality Standard[s] (NAAQS) for ozone.” The Commenter goes on to state that “EPA acknowledged that the science indicates that the 1997 NAAQS, which is effectively 85 parts per billion (ppb), does not protect people's health or welfare when in 2008, EPA set a new ozone NAAQS at 75 ppb.”

Response 1:As noted in EPA's proposed rulemaking on South Carolina's December 13, 2007, infrastructure submission and in today's final rulemaking, the very action that EPA is undertaking is a determination that South Carolina has a plan to ensure compliance with the 1997 8-hour ozone NAAQS. South Carolina's submission was provided on December 13, 2007, for the 1997 8-hour ozone NAAQS, thus the State's submission predates the release of the revision to the 8-hour ozone NAAQS on March 12, 2008, and is distinct from any plan that South Carolina would have to provide to ensure compliance of the 2008 NAAQS. This action is meant to address, and EPA is approving the 1997 ozone infrastructure requirements under section 110 of the Act. In today's action EPA is not addressing the 110 infrastructure requirements for the 2008 ozone NAAQS as they will be addressed in a separate rulemaking.

EPA notes that the 1997 8-hour ozone standards as published in a July 18, 1997, final rulemaking notice (62 FR 38856) and effective September 18, 1997, are 0.08 parts per million (ppm), which is effectively 0.084 ppm or 84 ppb due to the rounding convention and not “effectively 85 parts per billion (ppb)” as the Commenter stated. Further, EPA agrees that the Agency has made the determination that the 1997 8-hour ozone NAAQS is not as protective as needed for public health and welfare, and as the Commenter mentioned, the Agency established a new ozone NAAQS at 75 ppb. However, EPA notes that the Agency is currently reconsidering the 2008 8-hour ozone NAAQS, and has not yet designated areas for any subsequent NAAQS.

Finally, while it is not clear which areas the Commenter refers to in stating “EPA has yet to ensure these areas have plans to meet” the 1997 ozone NAAQS, EPA believes this concern is addressed by the requirements under section 172, Part D, Title I of the Act for states with nonattainment areas for the 1997 ozone NAAQS to submit nonattainment plans. As discussed in EPA's notice proposing approval of the South Carolina infrastructure SIP, submissions required by section 110(a)(2)(I) which pertain to the nonattainment planning requirements of part D, Title I of the CAA are outside the scope of this action, as such plans are not due within three years after promulgation of a new or revised NAAQS, but rather are due at the time the nonattainment area plan requirements are due pursuant to section 172.18

Comment 2:Also under the header “No Clean Air Act Section 110(l) analysis,” the Commenter cites the section 110(l) CAA requirement, and states “Clean Air Act § 110(l) requires `EPA to evaluate whether the plan as revised will achieve the pollution reductions required under the Act, and the absence of exacerbation of the existing situation does not assure this result.'Hallv.EPA,273 F.3d 1146, 1152 (9th Cir. 2001).” The Commenter goes on to state that “* * * theFederal Registernotices are devoid of any analysis of how these rule makings will or will not interfere with attaining, making reasonable further progress on attaining and maintaining the 75 ppb ozone NAAQS as well as the 1-hour 100 ppb nitrogen oxides NAAQS.”

Response 2:EPA agrees with the Commenter's assertion that consideration of section 110(l) of the CAA is necessary for EPA's action with regard to approving the State's submission. However, EPA disagrees with the Commenter's assertion that EPA did not consider 110(l) in terms of the March 17, 2011, proposed action. Further, EPA disagrees with the Commenter's assertion that EPA's proposed March 17, 2011, action does not comply with the requirements of section 110(l). Section 110(l) provides in part: “[t]he Administrator shall not approve a revision of a plan if the revision would interfere with any applicable requirement concerning attainment and reasonable further progress * * *, or any other applicable requirement of this chapter.”

EPA has consistently interpreted section 110(l) as not requiring a new attainment demonstration for every SIP submission. The following actions are examples of where EPA has addressed 110(l) in previous rulemakings: 70 FR 53, 57 (January 3, 2005); 70 FR 17029, 17033 (April 4, 2005); 70 FR 28429, 28431 (May 18, 2005); and 70 FR 58119, 58134 (October 5, 2005). South Carolina's December 13, 2007, infrastructure submission does not revise or remove any existing emissions limit for any NAAQS, or any other existing substantive SIP provisions relevant to the 1997 8-hour ozone NAAQS or the new nitrogen dioxide (NO2) NAAQS. Simply put, it does not make any substantive revision that could result in any change in emissions. As a result, the submission does not relax any existing requirements or alter the status quo air quality. Therefore, approval of South Carolina's December 13, 2007, infrastructure submission will not interfere with attainment or maintenance of any NAAQS.

Comment 3:Under the header “No Clean Air Act Section 110(l) analysis,” the Commenter states that “We are not required to guess what EPA's Clean Air Act 110(l) analysis would be. Rather, EPA must approve in part and disapprove in part these action and re-propose to approve the disapproved part with a Clean Air Act § 110(l) analysis.” Further, the Commenter states that “EPA cannot include its analysis in its response to comments and approve the actions without providing the public with an opportunity to comment on EPA's Clean Air Act § 110(l) analysis.”

Response 3:Please see Response 2 for a more detailed explanation regarding EPA's response to the Commenter's assertion that EPA's action is not in compliance with section 110(l) of the CAA. EPA does not agree with the Commenter's assertion that EPA's analysis did not consider section 110(l) and so therefore “EPA must approve in part and disapprove in part these action and re-propose to approve the disapproved part with a Clean Air Act § 110(l) analysis.” Every action that EPA takes to approve a SIP revision is subject to section 110(l) and thus EPA's consideration of whether a state's submission “would interfere with any applicable requirement concerning attainment and reasonable further progress * * *, or any other applicable requirement of this chapter” is inherent in EPA's action to approve or disapprove a submission from a state. In the “Proposed Action” section of the March 17, 2011, rulemaking, EPA notes that “EPA is proposing to approve South Carolina's infrastructure submission for the 1997 8-hour ozone NAAQS because this submission is consistent with section 110 of the CAA.” Section 110(l) is a component of section 110, so EPA believes that this provides sufficient notice that EPA considered section 110(l) for the proposed action and concluded that section 110(l) was not violated.

Further, EPA does not agree with the Commenter's assertion that the Agency cannot provide additional clarification in response to a comment concerningsection 110(l) and take a final approval action without “providing the public with an opportunity to comment on EPA's Clean Air Act § 110(l) analysis.” Clearly such a broad proposition is incorrect where the final rule is a logical outgrowth of the proposed rule. In fact, the proposition that providing an analysis for the first time in response to a comment on a rulemaking per se violates the public's opportunity to comment has been rejected by the D.C. Circuit Court of Appeals.See Int'l Harvester Co.v.Ruckelshaus,478 F.2d 615, 632 n.51 (D.C. Cir. 1973).

Finally, as previously mentioned, EPA's approval of South Carolina's December 13, 2007, infrastructure submission does not make any substantive revision that could result in any change in emissions, so there is no further “analysis” beyond whether the state has adequate provisions in its SIP to address the infrastructure requirements for the 1997 8-hour ozone NAAQS. EPA's March 17, 2011, proposed rulemaking goes through each of the relevant infrastructure requirements and provides detailed information on how South Carolina's SIP addresses the relevant infrastructure requirements. Beyond making a general statement indicating that South Carolina's submission is not in compliance with section 110(l) of the CAA, the Commenter does not provide comments on EPA's detailed analysis of each infrastructure requirement to indicate that South Carolina's infrastructure submission for the 1997 8-hour ozone NAAQS is deficient in meeting these individual requirements. Therefore, the Commenter has not provided a basis to question the Agency's determination that South Carolina's December 13, 2007, infrastructure submission meets the requirements for the infrastructure submission for the 1997 8-hour ozone NAAQS, including section 110(l) of the CAA.

Comment 4:Under the header “No Clean Air Act Section 110(l) analysis,” the Commenter further asserts that “EPA's analysis must conclude that this proposed action would [violate] § 110(l) if finalized.” An example given by the Commenter is as follows: “For example, a 42 U.S.C. 7502(a)(2)(J) public notification program based on a 85 [parts per billion (ppb)] ozone level interferes with a public notification program that should exist for a 75 ppb ozone level. At its worst, the public notification system would be notifying people that the air is safe when in reality, based on the latest science, the air is not safe. Thus, EPA would be condoning the states providing information that can physical[ly] hurt people.”

Response 4:EPA disagrees with the Commenter's statement that EPA's analysis must conclude that this proposed action would be in violation of section 110(l) if finalized. As mentioned above, South Carolina's December 13, 2007, infrastructure submission does not revise or remove any existing emissions limit for any NAAQS, nor does it make any substantive revision that could result in any change in emissions. EPA has concluded that South Carolina's December 13, 2007, infrastructure submission does not relax any existing requirements or alter the status quo air quality. Therefore, approval of South Carolina's December 13, 2007, infrastructure submission will not interfere with attainment or maintenance of any NAAQS. See Response 2 and Response 3 above for a more detailed discussion.

EPA also disagrees with the specific example provided by the Commenter that the section 110(a)(2)(J) requirement for public notification for the 1997 8-hour ozone NAAQS based on 85 ppb interferes with a public notification program that should exist for a 75 ppb ozone level, and “EPA would be condoning the states providing information that can physical[ly] hurt people.” As noted in Response 1, South Carolina's December 13, 2007, infrastructure submission was provided to address the 1997 8-hour ozone NAAQS and was submitted prior to EPA's promulgation of the 2008 8-hour ozone in March 2008. Thus, South Carolina provided sufficient information at that time to meet the requirement for the 1997 8-hour ozone NAAQS which is the subject of this action.

Finally, members of the public do get information related to the more recent NAAQS via the Air Quality Index (AQI) for ozone. When EPA promulgated the 2008 NAAQS (73 FR 16436, March 27, 2008) EPA revised the AQI for ozone to show that at the level of the 2008 ozone NAAQS the AQI is set to 100, which indicates unhealthful ozone levels. It is this revised AQI that EPA uses to both forecast ozone levels and to provide notice to the public of current air quality. The EPA AIRNOW system uses the revised AQI as its basis for ozone. In addition, when South Carolina forecasts ozone and provides real-time ozone information to the public, either through the AIRNOW system or through its own Internet based system, the State uses the revised ozone AQI keyed to the 2008 revised ozone NAAQS. EPA believes this should address the Commenter's legitimate assertion.

Comment 5:Under the header “No Clean Air Act Section 110(l) analysis,” the Commenter asserts that “if a SIP provides an ozone NAAQS of 85 ppb for PSD purposes, this interferes with the requirement that PSD programs require sources to demonstrate that they will not cause or contribute to a violation of a NAAQS because this requirement includes the current 75 ppb ozone NAAQS.”

Response 5:EPA believes that this comment gives no basis for concluding that approval of the South Carolina infrastructure SIP violates the requirements of section 110(l). EPA assumes that the comment refers to the requirement that owners and operators of sources subject to PSD demonstrate that the allowable emissions from the proposed source or emission increases from a proposed modification, in conjunction with all other applicable emissions increases or reductions (including secondary emissions) will not cause or contribute to a violation of any NAAQS. 40 CFR 51.166(k)(1).

EPA further assumes that the Commenter's statement “if a SIP provides an ozone NAAQS of 85 ppb for PSD purposes” refers to a hypothetical SIP-approved PSD program that only requires owners and operators of sources subject to PSD to make the demonstration discussed above for the 1997 ozone NAAQS, and not for the 2008 ozone NAAQS. However, the Commenter gives no indication that South Carolina's SIP-approved PSD program suffers from this alleged defect. EPA has examined the relevant provision in South Carolina's SIP, Regulation 62.5, Standard No. 7(k)—Prevention of Significant Deterioration, Source Impact Analysis,and has determined that the language is nearly identical to that in 51.166(k)(1), and thus satisfies the requirements of this Federal provision.

Furthermore, as previously discussed in detail above, the infrastructure SIP makes no substantive change to any provision of South Carolina's SIP-approved PSD program, and therefore does not violate the requirements of section 110(l). Had South Carolina submitted a SIP revision that substantively modified its PSD program to limit the required demonstration to just the 1997 ozone NAAQS, then the comment might have been relevant to a 110(l) analysis of that hypothetical SIP revision. However, in this case, the comment gives no basis for EPA to conclude that the South Carolina infrastructure SIP would interfere with any applicable requirement of the Act to protect any NAAQS for ozone.

EPA concludes that approval of South Carolina's December 13, 2007, infrastructure submission will not make the status quo air quality worse and is in fact consistent with the development of an overall plan capable of meeting the Act's requirements. Accordingly, when applying section 110(l) to this submission, EPA finds that approval of South Carolina's December 13, 2007, infrastructure submission is consistent with section 110 (including section 110(l)) of the CAA.

Comment 6:The Commenter provided comments opposing the proposed approval of the infrastructure submission because it did not identify a specific model to be used to demonstrate that a PSD source will not cause or contribute to a violation of the ozone NAAQS. Specifically, the commenter stated: “[t]he SIP submittals do not comply with Clean Air Act 110(a)(2)(J), (K), and (D)(i)(II) because the SIP submittals do not identify a specific model to use in PSD permitting to demonstrate that a proposed source of modification will not cause or contribute to a violation [or] the ozone NAAQS.”

The commenter asserted that because EPA does not require the use of a specific model, states use no modeling or use deficient modeling to evaluate these impacts. Specifically, the commenter alleged: “[m]any states abuse this lack of an explicitly named model by claiming that because no model is explicitly named, no modeling is required or use of completely irrelevant modeling (e.g. Kentucky using modeling from Georgia for the J.K. Smith proposed facility) is allowed.”

To support the argument that EPA should designate a particular model and require states to use it, the Commenter attached and incorporated by reference a prior petition for rulemaking requesting that EPA designate such a model.19 The petition in question was submitted by Robert Ukeiley on behalf of the Sierra Club on July 28, 2010, requesting EPA to designate air quality models to use for PSD permit applications with regard to ozone and PM2.5. As supporting documentation for that petition for rulemaking, the Commenter also resubmitted 15 attachments in the comment on EPA's proposed approval of the infrastructure submission. These attachments were as follows:

1. Exhibit 1: Comments from Camille Sears on the Ninth Conference on Air Quality Modeling (Docket ID: EPA-HQ-OAR-2008-0604) (November 10, 2008);

2. Exhibit 2: “Response to Petitions for Review, Supplemental Briefs, and Amicus Brief ” regarding the Desert Rock Energy Company, LLC from Ann Lyons, EPA Region 9—Office of Regional Counsel and Brian L. Doster/Elliot Zenick, EPA Headquarters—Office of General Counsel (January 8, 2009);

3. Exhibit 3: Report, The Kentucky Natural Resources and Environmental Protection Cabinet, A Cumulative Assessment of the Environmental Impacts Caused by Kentucky Electric Generating Units, (December 17, 2001);

4. Exhibit 4: Letter from Richard A. Wayland, Director of the Air Quality Assessment Division, EPA Office Air Quality and Planning Standards to Robert Ukeiley regarding Mr. Ukeiley's Freedom of Information Act (FOIA) request on behalf of the Sierra Club for documents related to EPA development of a modeling protocol for PM2.5(October 1, 2008);

5. Exhibit 5: Expert Report of Lyle R. Chinkin and Neil J. M. Wheeler, Analysis of Air Quality Impacts, prepared for Civil Action No. IP99-1693 C-M/SUnited Statesv.Cinergy Corp.,(August 28, 2008);

6. Exhibit 6: Illinois Environmental Protection Agency, Bureau of Air, Assessing the impact on the St. Louis Ozone Attainment Demonstration from the proposed electrical generating units in Illinois” (September 25, 2003);

7. Exhibit 7: Memorandum from Stephen D. Page, Director, EPA Office Air Quality and Planning Standards entitled, “Modeling Procedures for Demonstrating Compliance with the PM2.5NAAQS” (March 23, 2010);

8. Exhibit 8: E-mail from Scott B. (Title and Affiliation not provided), to Donna Lucchese, (Title and Affiliation not provided), entitled, “Ozone impact of point source” (Date described as “Early 2000”);

9. Exhibit 9: E-mail from Mary Portanova, EPA, Region 5, to Noreen Weimer, EPA, Region 5, entitled “FOIA—Robert Ukeiley—RIN-02114-09” (October 20, 2009, 10:05 CST);

10. Exhibit 10: Synopsis from PSD Modeling Workgroup—EPA/State/Local Workshop, New Orleans (May 17, 2005);

11. Exhibit 11: Letter from Carl E. Edlund, P.E., Director, EPA, Region 6 Multimedia Planning and Permitting Division to Richard Hyde, P.E. Deputy Director of the Office of Permitting and Registration, Texas Commission on Environmental Quality regarding “White Stallion Energy Center, PSD Permit Nos. PSD-TX-1160, PAL 26, and HAP 28” (February 10, 2010);

12. Exhibit 12: Memorandum from John S. Seitz, Director, EPA Office of Air Quality Planning & Standards entitled, “Interim Implementation of New Source Review Requirements for PM2.5” (October 23, 1997);

13. Exhibit 13: Presentation by Erik Snyder and Bret Anderson (Titles and Affiliations not provided), to R/S/L Workshop, Single Source Ozone/PM2.5 Impacts in Regional Scale Modeling & Alternate Methods, (May 18, 2005);

14. Exhibit 14: Letter from Richard D. Scheffe, PhD, Senior Science Advisor, EPA, Office of Air Quality Planning & Standards to Abigail Dillen in response to an inquiry regarding the applicability of the Scheffe Point Source Screening Tables (July 28, 2000);

15. Exhibit 15: Presentation by Gail Tonnesen, Zion Wang, Mohammad Omary, Chao-Jung Chien (University of California, Riverside); Zac Adelman (University of North Carolina); Ralph Morris et al. (ENVIRON Corporation Int., Novato, CA) to the Ozone MPE, TAF Meeting, Review of Ozone Performance in WRAP Modeling and Relevance to Future Regional Ozone Planning, (July 30, 2008).

Finally, the Commenter then stated that “EPA has issued guidance suggesting [that] PSD sources should use the ozone limiting method for NOXmodeling.” The Commenter referred to EPA's March 2011 NOXmodeling guidance to support this position.20 The Commenter then asserts that this “ozone modeling” helps sources demonstrate compliance and that sources should also do ozone modeling that may inhibit a source's permission to pollute. The Commenter argued that EPA's guidance supports the view that EPA must require states to require a specific model in their SIPs to demonstrate that proposed PSD sources do not cause or contribute to a violation of an ozone NAAQS.

Response 6:EPA disagrees with the Commenter's views concerning modeling in the context of acting upon the infrastructure submission. The Commenter raised four primary interrelated arguments: (1) The state's infrastructure SIP must specify a required model; (2) the failure to specify a model leads to inadequate analysis; (3) the attached petition for rulemaking explains why EPA should require states to specify a model; and (4) a recent guidance document concerning modeling for NOXsources recommendsusing ozone limit methods for NOXsources and EPA could issue comparable guidance for modeling ozone from a single source.

At the outset, EPA notes that although the Commenter sought to incorporate by reference the prior petition for rulemaking requesting EPA to designate a particular model for use by states for this purpose, the Agency is not required to respond to that petition in the context of acting upon the infrastructure submission. In reviewing the infrastructure submission, EPA is evaluating the state's submission in light of current statutory and regulatory requirements, not in light of potential future requirements that EPA has been requested to establish in a petition. Moreover, the petition arose in a different context, requests different relief, and raises other issues unrelated to those concerning ozone modeling raised by the Commenter in this action. EPA believes that the appropriate place to respond to the issues raised in the petition is in a petition response. Accordingly, EPA is not responding to the July 28, 2010 petition in this action. The issues raised in that petition are under separate consideration.

EPA believes that the comment concerning the approvability of the infrastructure submission based upon whether the state's SIP specifies the use of a particular model are germane to this action, but EPA disagrees with the Commenter's conclusions. The Commenter stated that the SIP submittals “do not comply with Clean Air Act 110(a)(2)(J), (K), and (D)(i)(II) because the SIP submittals do not identify a specific model to use in PSD permitting to demonstrate that a proposed source [or] modification will not cause or contribute to a violation of the ozone NAAQS.” EPA's PSD permitting regulations are found at 40 CFR 51.166 and 52.21. PSD requirements for SIPs are found in 40 CFR 51.166. Similar PSD requirements for SIPs that have been disapproved with respect to PSD and for SIPs incorporating EPA's regulations by reference are found in 40 CFR 52.21. The PSD regulations require an ambient impact analysis for ozone for proposed major stationary sources and major modifications to obtain a PSD permit (40 CFR 51.166 (b)(23)(i), (i)(5)(i)(f)21 , (k), (l) and (m) and 40 CFR 52.21 (b)(23)(i), (i)(5)(i)(f)22 , (k), (l) and (m)). The regulations at 40 CFR 51.166(l) state that for air quality models the SIP shall provide for procedures which specify that:

(1) All applications of air quality modeling involved in this subpart shall be based on the applicable models, data bases, and other requirements specified in Appendix W of this part (Guideline on Air Quality Models).

(2) Where an air quality model specified in Appendix W of this part (Guideline on Air Quality Models) is inappropriate, the model may be modified or another model substituted. Such a modification or substitution of a model may be made on a case-by-case basis or, where appropriate, on a generic basis for a specific State program. Written approval of the Administrator must be obtained for any modification or substitution. In addition, use of a modified or substituted model must be subject to notice and opportunity for public comment under procedures set forth in § 51.102.

These parts of 40 CFR Part 51 and 52 are the umbrella SIP components that states have either adopted by reference or have been approved by the states and delegated authority to incorporate the PSD requirements of the CAA. As discussed above, these CFR part 51 and 52 PSD provisions refer to 40 CFR Part 51, Appendix W for the appropriate model to utilize for the ambient impact assessment. 40 CFR Part 51, Appendix W is the Guideline on Air Quality models and Section 1.0.a. states:

Appendix W Section 5.2.1. includes theGuidelinerecommendations for models to be utilized in assessing ambient air quality impacts for ozone. Specifically, Section 5.2.1.c. states: “Estimating the Impact of Individual Sources. Choice of methods used to assess the impact of an individual source depends on the nature of the source and its emissions. Thus, model users should consult with the Regional Office to determine the most suitable approach on a case-by-case basis (subsection 3.2.2).”

Appendix W Section 5.2.1.c. provides that the model users (state and local permitting authorities and permitting applicants) should work with the appropriate EPA Regional Office on a case-by-case basis to determine an adequate method for performing an air quality analysis for assessing ozone impacts. Due to the complexity of modeling ozone and the dependency on the regional characteristics of atmospheric conditions, EPA believes this is an appropriate approach rather than specifying one particular preferred model nationwide, which may not be appropriate in all circumstances. Instead, the choice of method “depends on the nature of the source and its emissions. Thus, model users should consult with the Regional Office * * *” Appendix W Section 5.2.1.c. Therefore, EPA continues to believe it is appropriate for permitting authorities to consult and work with EPA Regional Offices as described in Appendix W, including section 3.0.b and c, 3.2.2, and 3.3, to determine the appropriate approach to assess ozone impacts for each PSD required evaluation.23 24 25 26 Although EPA has not selected one particular preferred model in Appendix A to Appendix W (Summaries of Preferred Air Quality Models) for conducting ozone impact analyses for individual sources, state/local permitting authorities must comply with the appropriate PSD FIP or SIP requirements with respect to ozone.

The current SIP meets the requirements of 40 CFR 51.166(l)(1). Specifically, the South Carolina SIP states at Regulation 62.5, Standard No. 7(l)—Air Quality Models,

South Carolina requires that PSD permit applications contain an analysis of ozone impacts from the proposed project. As recommended by Appendix W, the methods used for the ozone impacts analysis for individual PSD permit actions are determined on a case-by-case basis. South Carolina consults with EPA Region 4 on a case-by-case basis for evaluating the adequacy of the ozone impact analysis. When appropriate, EPA Region 4 provides input/comments on the analysis. As stated in Section 5.2.1.c. of Appendix W, “[c]hoice of methods used to assess the impact of an individual source depends on the nature of the source and its emissions.” Therefore, based on an evaluation of the source, its emissions and background ozone concentrations, an ozone impact analysis other than modeling may be required. While in other cases a complex photochemical grid type modeling analysis, as discussed below, may be warranted. As noted, the appropriate methods are determined in consultation with EPA Region 4 on a case-by-case basis.

As a second point, the Commenter asserted that states abuse this lack of an explicitly named model by claiming that because no model is explicitly named, no modeling is required or use of completely irrelevant modeling is allowed.

EPA agrees that States should not be using inappropriate analytical tools in this context. For example, the Commenter's Exhibit 14 does discuss the inappropriateness of using a screening technique referred to as the “Scheffe Tables.” The Commenter is correct that the use of “Scheffe Tables” and other particular screening techniques, which involve ratios of nitrogen oxides (NOX) to volatile organic compounds (VOC) that do not consider the impact of biogenic emissions, or that use other outdated or irrelevant modeling, is inappropriate to evaluate a single source's ozone impacts on an air quality control region. More scientifically appropriate screening and refined tools are available and should be considered for use. Therefore, EPA continues to believe States should consult and work with EPA Regional Offices as described in Appendix W on a case-by-case basis to determine the appropriate method for estimating the impacts of these ozone precursors from individual sources.

For ozone, a proposed emission source's impacts are dependent upon local meteorology and pollution levels in the surrounding atmosphere. Ozone is formed from chemical reactions in the atmosphere. The impact a new or modified source can have on ozone levels is dependent, in part, upon the existing atmospheric pollutant loading already in the region with which emissions from the new or modified source can react. In addition, meteorological parameters such as wind speed, temperature, wind direction, solar radiation influx, and atmospheric stability are also important factors. The more sophisticated analyses consider meteorology and interactions with emissions from surrounding sources. EPA has not identified an established modeling system that would fit all situations and take into account all of the additional local information about sources and meteorological.conditions. The Commenter submitted a number of exhibits (including Exhibits 10, 11, and 13) in which EPA has previously indicated a preference for using a photochemical grid model when appropriate modeling databases exist and when t is acceptable to use the photochemical grid modeling to assess a specific source.

Commenter's Exhibit 13 includes a list of issues to evaluate, which aid in considering if the existing photochemical grid modeling databases are acceptable, and discusses the need for permitting authorities to consult with the EPA Regional Office in determining if photochemical grid modeling would be appropriate for conducting an ozone impacts analysis. In these documents EPA has indicated that photochemical grid modeling (e.g.,CAMx or CMAQ) is generally the most sophisticated type of modeling analysis for evaluating ozone impacts, and it is usually conducted by adding a source into an existing modeling system to determine the change in impact from the source. The analysis is done by comparing the photochemical grid modeling results which include the new or modified source under evaluation with the results from the original modeling analysis that does not contain the source. Photochemical grid modeling is often an excellent modeling exercise for evaluating a single source's impacts on an air quality control region when such models are available and appropriate to utilize because they take into account the important parameters and the models have been used in regional modeling for attainment SIPs.

The use of reactive plume models may also be appropriate under certain circumstances. EPA has approved the use of plume models in some instances, but these models are not always appropriate because of the difficulty in obtaining the background information to make an appropriate assessment of the photochemistry and meteorology impacts.

EPA has not selected a specific “preferred” model for conducting an ozone impact analysis. Model selection normally depends upon the details about the modeling systems available and if they are appropriate for assessing the impacts from a proposed new source or modification. Considering that a photochemical modeling system with inputs, including meteorological and emissions data, that would also have to be evaluated for model performance, could potentially be costly and time consuming to develop, EPA has taken a case-by-case evaluation approach. Such photochemical modeling databases are typically developed so that impacts of regulatory actions across multiple sources can be evaluated, and therefore the time and financial costs can be absorbed by the regulatory body. It is these types of databases that have the potential to be used to assess single source ozone impacts after they have been developed as part of a regional modeling demonstration to support a SIP. From a cost and time requirement standpoint, EPA would generally not expect a single source to develop an entire photochemical modeling system just to evaluate its individual impacts on an air quality region, as long as other methods of analyzing ozone impacts are available and acceptable to EPA.

When an existing photochemical modeling system is deemed appropriate, it is an excellent tool to evaluate the ozone impact that a single source's emissions can have on an air quality region in the context of PSD modeling and should be evaluated for potential use. More often now than 10 or 15 years ago, a photochemical modeling system may be available that covers the geographic area of concern. EPA notes that even where photochemical modeling is readily available, it should be evaluated as part of the development of a modeling protocol, in consultation with the Regional Office to determine its appropriateness for conducting an impact analysis for a particular proposed source or modification.27 Factors to consider when evaluating the appropriateness of a particular photochemical modeling system include, but are not limited to, meteorology, year of emissions projections, model performance issues in the area of concern or in areas that might impact projections in the area of concern. Therefore, even where photochemical modeling systems exist, there may be circumstances where their use is inappropriate for estimating the ozone impacts of a proposed source or modification. Because of these scientific issues and the need for appropriate case-by-case technical considerations, EPA has not designated a single “Preferred Model” for conducting single source impact analyses for ozone in Appendix A of Appendix W.

In summary, the Commenter states that many States abuse this lack of an explicitly named model by claiming that because no model is explicitly named, no modeling is required or use of completely irrelevant modeling is allowed. For the reasons described in this response to comment, we do not believe that one modeling system is presently appropriate to designate for all situations, yet that does not relieve proposed sources and modifications from the obligation of making the required demonstration under the applicable PSD rules. The South Carolina SIP contains a direct reference for use of the procedures specified in EPA's “Guideline on Air Quality Models” (40 CFR part 51 Appendix W) for estimating ambient concentrations of criteria pollutants, including ozone (Regulation 62.5, Standard No. 7(l)—Air Quality Models). As such, South Carolina requires that PSD permit applications contain an analysis of ozone impacts from the proposed project. As recommended by Appendix W, the methods used for the ozone impacts analysis are determined on a case-by-case basis. South Carolina consults with EPA Region 4 on a case-by-case basis for evaluating the adequacy of the ozone impact analysis. When appropriate, EPA Region 4 provides input/comments on the analysis. Because EPA has not designated one particular model as being appropriate in all situations for evaluating single source ozone impacts, EPA Region 4 concurs with Alabama's proposed approach.

In conclusion, for the reasons stated above it is difficult to identify and implement a standardized national model for ozone. EPA has had a standard approach in its PSD SIP and FIP rules of not mandating the use of a particular model for all circumstances, instead treating the choice of a particular method for analyzing ozone impacts as circumstance-dependent. EPA then determines whether the State's implementation plan revision submittal meets the PSD SIP requirements. For purposes of review for this infrastructure SIP, South Carolina has an EPA-approved PSD SIP that meets the EPA PSD SIP requirements.

Finally, the Commenter argued that EPA's March 2011 guidance concerning modeling for the 1-hour nitrogen dioxide (NO2) NAAQS demonstrates that similar single source modeling could be conducted for sources for purposes of the ozone NAAQS. Specifically, the commenter argued that the model used for other criteria pollutants (AERMOD), incorporates ozone chemistry for modeling NO2and therefore is modeling ozone chemistry for a single source. The Commenter stated that this guidance suggested that PSD sources should use the ozone limiting method for NOXmodeling28 Further, the Commenter noted that this technique “* * * is modeling of ozone chemistry for a single source” and therefore that that this modeling with ozone chemistry allows a source to be permitted. The commenter concludes with the assertion that EPA must require the SIPs to include a model to use to demonstrate that proposed PSD sources do not cause or contribute to a violation of an ozone NAAQS.

EPA's recent March 2011 guidance for the NO2NAAQS does discuss using two different techniques to estimate the amount of conversion of NOXemissions to NO2ambient NO2concentrations as part of the NO2modeling guidance. NOXemissions are composed of NO and NO2molecules. These two techniques which have been available for years, are the Ozone Limiting Method (OLM), which was mentioned by the Commenter, and the Plume Volume Molar-Ratio-Method (PVMRM). Both of these techniques are designed and formulated based on the principle of assuming available atmospheric ozone mixes with NO/NO2emissions from sources. This “mixing” results in ozone molecules reacting with the NO molecules to form NO2and O2. This is a simple one-direction chemical reaction that is used to determine how much NO is converted to NO2for modeling of the NO2standard. Thus, these techniques do not predict ozone concentrations, rather they take ambient ozone data as model inputs to determine the calculation of NO conversion to NO2. These techniques are not designed to calculate the amount of ozone that might be generated as the NOXemissions traverses downwind of the source and potentially reacts with other pollutants in the atmosphere. Rather, these two techniques rely on a one-way calculation based on an ozone molecule (O3) reacting with an NO molecule togenerate an NO2molecule and an O2molecule.29 30

As previously mentioned, these two techniques do not attempt to estimate the amount of ozone that might be generated, and the models in which these techniques are applied are not designed or formulated to even account for the potential generation of ozone from emissions of NO/NO2. Ozone chemistry has many cycles of destruction and generation and is dependent upon a large number of variables, including VOC concentrations and the specific types of VOC molecules present, other atmospheric pollutant concentrations, meteorological conditions, and solar radiation levels as already discussed in this response. Since OLM and PVMRM do not include any of these scientific principles and do not account for any chemical mechanisms that would generate ozone, these techniques cannot be used for determining potential changes in ozone levels from a proposed source or modification.

In summary, the Commenter asserts that the OLM technique models of ozone chemistry for a single source and that this modeling helps a source demonstrate compliance with the NO2standard. The Commenter is concerned that EPA has not designated a single specific OLM technique is not also used to determine ozone impacts and believes that EPA should rectify this concern. To do so the Commenter concludes that EPA must require the SIPs to include a model to demonstrate that proposed PSD sources do not cause or contribute to a violation of an ozone NAAQS. As previously discussed, EPA disagrees and reiterates that the OLM (and PVMRM) are simple chemistry techniques that are not formulated to be capable to determine potential ozone impacts from a proposed source or modification.

For the reasons discussed above, EPA does not believe that the comments provide a basis for not approving the infrastructure submission. In short, EPA has not modified the Guidelines in Appendix W for ozone impacts analysis for a single source (Appendix W Part 5.2.1.c.) to require use of a specific model as the Commenter requests. EPA finds that the State has the appropriate regulations to operate the PSD program consistent with federal requirements. Furthermore, we disagree that states are required to designate a specific model in the SIP, because App. W states that state and local agencies should consult with EPA on a case-by-case basis to determine what analysis to require.

As described above, SC DHEC has addressed the elements of the CAA 110(a)(1) and (2) SIP requirements pursuant to EPA's October 2, 2007, guidance to ensure that the 1997 8-hour ozone NAAQS are implemented, enforced, and maintained in South Carolina. EPA is taking final action to approve South Carolina's December 13, 2007, infrastructure submission for the 1997 8-hour ozone NAAQS because this submission is consistent with section 110 of the CAA.

Under the CAA, the Administrator is required to approve a SIP submission that complies with the provisions of the Act and applicable federal regulations. 42 U.S.C. 7410(k); 40 CFR 52.02(a). Thus, in reviewing SIP submissions, EPA's role is to approve state choices, provided that they meet the criteria of the CAA. Accordingly, this action merely approves state law as meeting Federal requirements and does not impose additional requirements beyond those imposed by state law. For that reason, this action:

• Is not a “significant regulatory action” subject to review by the Office of Management and Budget under Executive Order 12866 (58 FR 51735, October 4, 1993);

• Does not impose an information collection burden under the provisions of the Paperwork Reduction Act (44 U.S.C. 3501et seq.);

• Is certified as not having a significant economic impact on a substantial number of small entities under the Regulatory Flexibility Act (5 U.S.C. 601et seq.);

• Does not contain any unfunded mandate or significantly or uniquely affect small governments, as described in the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4);

• Does not have Federalism implications as specified in Executive Order 13132 (64 FR 43255, August 10, 1999);

• Is not an economically significant regulatory action based on health or safety risks subject to Executive Order 13045 (62 FR 19885, April 23, 1997);

• Is not a significant regulatory action subject to Executive Order 13211 (66 FR 28355, May 22, 2001);

• Is not subject to requirements of Section 12(d) of the National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 note) because application of those requirements would be inconsistent with the CAA; and

• Does not provide EPA with the discretionary authority to address, as appropriate, disproportionate human health or environmental effects, using practicable and legally permissible methods, under Executive Order 12898 (59 FR 7629, February 16, 1994).

The Congressional Review Act, 5 U.S.C. 801et seq.,as added by the Small Business Regulatory Enforcement Fairness Act of 1996, generally provides that before a rule may take effect, the agency promulgating the rule must submit a rule report, which includes a copy of the rule, to each House of the Congress and to the Comptroller General of the United States. EPA will submit a report containing this action 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 theFederal Register. A major rule cannot take effect until 60 days after it is published in theFederal Register. This action is not a “major rule” as defined by 5 U.S.C. 804(2).

Under section 307(b)(1) of the CAA, petitions for judicial review of this action must be filed in the United States Court of Appeals for the appropriate circuit by September 12, 2011. Filing a petition for reconsideration by the Administrator of this final rule does not affect the finality of this action 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. This action may not be challenged later in proceedings to enforce its requirements. (Seesection 307(b)(2)).

40 CFR part 52 is amended as follows:

Upon promulgation of a new or revised NAAQS, sections 110(a)(1) and (2) of the CAA require states to address basic SIP requirements, including emissions inventories, monitoring, and modeling to assure attainment and maintenance for that new NAAQS. On July 18, 1997, EPA promulgated a new NAAQS for ozone based on 8-hour average concentrations, thus states were required to provide submissions to address sections 110(a)(1) and (2) of the CAA for this new NAAQS. Mississippi provided its infrastructure submission for the 1997 8-hour ozone NAAQS onDecember 7, 2007. On March 17, 2011, EPA proposed to approve Mississippi's December 7, 2007, infrastructure submission for the 1997 8-hour ozone NAAQS.See76 FR 14631. A summary of the background for today's final action is provided below. See EPA's March 17, 2011, proposed rulemaking at 76 FR 14631 for more detail.

Section 110(a) of the CAA requires states to submit SIPs to provide for the implementation, maintenance, and enforcement of a new or revised NAAQS within three years following the promulgation of such NAAQS, or within such shorter period as EPA may prescribe. Section 110(a) imposes the obligation upon states to make a SIP submission to EPA for a new or revised NAAQS, but the contents of that submission may vary depending upon the facts and circumstances. In particular, the data and analytical tools available at the time the state develops and submits the SIP for a new or revised NAAQS affects the content of the submission. The contents of such SIP submissions may also vary depending upon what provisions the state's existing SIP already contains. In the case of the 1997 8-hour ozone NAAQS, states typically have met the basic program elements required in section 110(a)(2) through earlier SIP submissions in connection with previous ozone NAAQS.

More specifically, section 110(a)(1) provides the procedural and timing requirements for SIPs. Section 110(a)(2) lists specific elements that states must meet for “infrastructure” SIP requirements related to a newly established or revised NAAQS. As mentioned above, these requirements include SIP infrastructure elements such as modeling, monitoring, and emissions inventories that are designed to assure attainment and maintenance of the NAAQS. The requirements that are the subject of this final rulemaking are listed below1 and in EPA's October 2, 2007, memorandum entitled “Guidance on SIP Elements Required Under Section 110(a)(1) and (2) for the 1997 8-Hour Ozone and PM2.5National Ambient Air Quality Standards.”

• 110(a)(2)(A): Emission limits and other control measures.

• 110(a)(2)(B): Ambient air quality monitoring/data system.

• 110(a)(2)(C): Program for enforcement of control measures.2

• 110(a)(2)(D): Interstate transport.3

• 110(a)(2)(E): Adequate resources.

• 110(a)(2)(F): Stationary source monitoring system.

• 110(a)(2)(G): Emergency power.

• 110(a)(2)(H): Future SIP revisions.

• 110(a)(2)(I): Areas designated nonattainment and meet the applicable requirements of part D.4

• 110(a)(2)(J): Consultation with government officials; public notification; and PSD and visibility protection.

• 110(a)(2)(K): Air quality modeling/data.

• 110(a)(2)(L): Permitting fees.

• 110(a)(2)(M): Consultation/participation by affected local entities.

EPA is currently acting upon SIPs that address the infrastructure requirements of CAA section 110(a)(1) and (2) for ozone and PM2.5 NAAQS for various states across the country. Commenters on EPA's recent proposals for some states raised concerns about EPA statements that it was not addressing certain substantive issues in the context of acting on the infrastructure SIP submissions.5 The Commenters specifically raised concerns involving provisions in existing SIPs and with EPA's statements that it would address two issues separately and not as part of actions on the infrastructure SIP submissions: (i) Existing provisions related to excess emissions during periods of start-up, shutdown, or malfunction (“SSM”) at sources, that may be contrary to the CAA and EPA's policies addressing such excess emissions; and (ii) existing provisions related to “director's variance” or “director's discretion” that purport to permit revisions to SIP approved emission limits with limited public process or without requiring further approval by EPA, that may be contrary to the CAA. EPA notes that there are two other substantive issues for which EPA likewise stated that it would respond separately: (i) Existing provisions for minor source new source review programs that may be inconsistent with the requirements of the CAA and EPA's regulations that pertain to such programs (“minor source NSR”); and (ii) existing provisions for Prevention of Significant Deterioration programs that may be inconsistent with current requirements of EPA's “Final NSR Improvement Rule,” 67 FR 80186 (December 31, 2002), as amended by 72 FR 32526 (June 13, 2007) (“NSR Reform”). In light of the comments, EPA now believes that its statements in various proposed actions on infrastructure SIPs with respect to these four individual issues should be explained.

EPA intended the statements in the proposals concerning these four issues merely to be informational, and to provide general notice of the potential existence of provisions within the existing SIPs of some states that might require future corrective action. EPA did not want states, regulated entities, or members of the public to be under the misconception that the Agency's approval of the infrastructure SIP submission of a given state should be interpreted as a reapproval of certain types of provisions that might exist buried in the larger existing SIP for such state. Thus, for example, EPA explicitly noted that the Agency believes that some states may have existing SIP-approved SSM provisions that are contrary to the CAA and EPA policy, but that “in this rulemaking, EPA is not proposing to approve or disapprove anyexisting State provisions with regard to excess emissions during SSM of operations at facilities.” EPA further explained, for informational purposes, that “EPA plans to address such State regulations in the future.” EPA made similar statements, for similar reasons, with respect to the director's discretion, minor source NSR, and NSR Reform issues. EPA's objective was to make clear that approval of an infrastructure SIP for these ozone and PM2.5NAAQS should not be construed as explicit or implicit reapproval of any existing provisions that relate to these four substantive issues.

Unfortunately, the Commenters and others evidently interpreted these statements to mean that EPA considered action upon the SSM provisions and the other three substantive issues to be integral parts of acting on an infrastructure SIP submission, and therefore that EPA was merely postponing taking final action on the issue in the context of the infrastructure SIPs. This was not EPA's intention. To the contrary, EPA only meant to convey its awareness of the potential for certain types of deficiencies in existing SIPs, and to prevent any misunderstanding that it was reapproving any such existing provisions. EPA's intention was to convey its position that the statute does not require that infrastructure SIPs address these specific substantive issues in existing SIPs and that these issues may be dealt with separately, outside the context of acting on the infrastructure SIP submission of a state. To be clear, EPA did not mean to imply that it was not taking a full final agency action on the infrastructure SIP submission with respect to any substantive issue that EPA considers to be a required part of acting on such submissions under section 110(k) or under section 110(c). Given the confusion evidently resulting from EPA's statements, however, we want to explain more fully the Agency's reasons for concluding that these four potential substantive issues in existing SIPs may be addressed separately.

The requirement for the SIP submissions at issue arises out of CAA section 110(a)(1). That provision requires that states must make a SIP submission “within 3 years (or such shorter period as the Administrator may prescribe) after the promulgation of a national primary ambient air quality standard (or any revision thereof)” and that these SIPs are to provide for the “implementation, maintenance, and enforcement” of such NAAQS. Section 110(a)(2) includes a list of specific elements that “[e]ach such plan” submission must meet. EPA has historically referred to these particular submissions that states must make after the promulgation of a new or revised NAAQS as “infrastructure SIPs.” This specific term does not appear in the statute, but EPA uses the term to distinguish this particular type of SIP submission designed to address basic structural requirements of a SIP from other types of SIP submissions designed to address other requirements, such as “nonattainment SIP” submissions required to address the nonattainment planning requirements of part D, “regional haze SIP” submissions required to address the visibility protection requirements of CAA section 169A, new source review permitting program submissions required to address the requirements of part D, and a host of other specific types of SIP submissions that address other specific matters.

Although section 110(a)(1) addresses the timing and general requirements for these infrastructure SIPs, and section 110(a)(2) provides more details concerning the required contents of these infrastructure SIPs, EPA believes that many of the specific statutory provisions are facially ambiguous. In particular, the list of required elements provided in section 110(a)(2) contains a wide variety of disparate provisions, some of which pertain to required legal authority, some of which pertain to required substantive provisions, and some of which pertain to requirements for both authority and substantive provisions.6 Some of the elements of section 110(a)(2) are relatively straightforward, but others clearly require interpretation by EPA through rulemaking, or recommendations through guidance, in order to give specific meaning for a particular NAAQS.7

Notwithstanding that section 110(a)(2) states that “each” SIP submission must meet the list of requirements therein, EPA has long noted that this literal reading of the statute is internally inconsistent, insofar as section 110(a)(2)(I) pertains to nonattainment SIP requirements that could not be met on the schedule provided for these SIP submissions in section 110(a)(1).8 This illustrates that EPA must determine which provisions of section 110(a)(2) may be applicable for a given infrastructure SIP submission. Similarly, EPA has previously decided that it could take action on different parts of the larger, general “infrastructure SIP” for a given NAAQS without concurrent action on all subsections, such as section 110(a)(2)(D)(i), because the Agency bifurcated the action on these latter “interstate transport” provisions within section 110(a)(2) and worked with states to address each of the four prongs of section 110(a)(2)(D)(i) with substantive administrative actions proceeding on different tracks with different schedules.9 This illustrates that EPA may conclude that subdividing the applicable requirements of section 110(a)(2) into separate SIP actions may sometimes be appropriate for a given NAAQS where a specific substantive action is necessitated, beyond a mere submission addressing basic structural aspects of the state's SIP. Finally, EPA notes that not every element of section 110(a)(2) would be relevant, or as relevant, or relevant in the same way, for each new or revised NAAQS and the attendant infrastructure SIP submission for that NAAQS. For example, the monitoring requirements that might be necessary for purposes of section 110(a)(2)(B) for one NAAQS could be very different than what might be necessary for a different pollutant. Thus, the content of an infrastructure SIP submission to meet this element from a state might be very different for an entirely new NAAQS, versus a minor revision to an existing NAAQS.10

You may be potentially affected by this action if you are an agricultural producer, food manufacturer, or pesticide manufacturer. Potentially affected entities may include, but are not limited to:

• Crop production (NAICS code 111).

• Animal production (NAICS code 112).

• Food manufacturing (NAICS code 311).

• Pesticide manufacturing (NAICS code 32532).

This listing is not intended to be exhaustive, but rather provides a guide for readers regarding entities likely to be affected by this action. Other types of entities not listed in this unit could also be affected. The North American Industrial Classification System (NAICS) codes have been provided to assist you and others in determining whether this action might apply to certain entities. If you have any questions regarding the applicability of this action to a particular entity, consult the person listed underFOR FURTHER INFORMATION CONTACT.

You may access a frequently updated electronic version of 40 CFR part 180 through the Government Printing Office's e-CFR site athttp://ecfr.gpoaccess.gov/cgi/t/text/text-idx?&c=ecfr&tpl=/ecfrbrowse/Title40/40tab_02.tpl.

Under FFDCA section 408(g), 21 U.S.C. 346a, any person may file an objection to any aspect of this regulation and may also request a hearing on those objections. You must file your objection or request a hearing on this regulation in accordance with the instructions provided in 40 CFR part 178. To ensure proper receipt by EPA, you must identify docket ID number EPA-HQ-OPP-2011-0327 in the subject line on the first page of your submission. All objections and requests for a hearing must be in writing, and must be received by the Hearing Clerk on or before September 12, 2011. Addresses for mail and hand delivery of objections and hearing requests are provided in 40 CFR 178.25(b).

In addition to filing an objection or hearing request with the Hearing Clerk as described in 40 CFR part 178, please submit a copy of the filing that does not contain any CBI for inclusion in the public docket. Information not marked confidential pursuant to 40 CFR part 2 may be disclosed publicly by EPA without prior notice. Submit a copy of your non-CBI objection or hearing request, identified by docket ID number EPA-HQ-OPP-2011-0327, by one of the following methods.

•Federal eRulemaking Portal: http://www.regulations.gov.Follow the on-line instructions for submitting comments.

•Mail:Office of Pesticide Programs (OPP) Regulatory Public Docket (7502P), Environmental Protection Agency, 1200 Pennsylvania Ave., NW., Washington, DC 20460-0001.

•Delivery:OPP Regulatory Public Docket (7502P), Environmental Protection Agency, Rm. S-4400, One Potomac Yard (South Bldg.), 2777 S. Crystal Dr., Arlington, VA. Deliveries are only accepted during the Docket Facility's normal hours of operation (8:30 a.m. to 4 p.m., Monday through Friday, excluding legal holidays). Special arrangements should be made for deliveries of boxed information. The Docket Facility telephone number is (703) 305-5805.

In theFederal Registerof April 20, 2011 (76 FR 22069) (FRL-8869-7), EPA issued a notice pursuant to section 408 of FFDCA, 21 U.S.C. 346a, announcing the receipt of a pesticide petition (PP 1E7834) filed by Akzo Nobel Surface Chemistry LLC, 909 Mueller Avenue, Chattanooga, TN 37406. The petition requested that 40 CFR 180.960 be amended by establishing an exemption from the requirement of a tolerance for residues of 2-Propenoic acid, 2-methyl-,phenylmethyl ester, polymer with 2-propenoic acid and sodium 2-methyl-2-[(1-oxo-2-propen-1-yl)amino]-1-propanesulfonate (1:1), peroxydisulfuric acid ([HO)S(O)2]202) sodium salt (1:2)-initiated (CASRN 1246766-57-3). That notice included a summary of the petition prepared by the petitioner and solicited comments on the petitioner's request. The Agency did not receive any comments. Section 408(c)(2)(A)(i) of FFDCA allows EPA to establish an exemption from the requirement for a tolerance (the legal limit for a pesticide chemical residue in or on a food) only if EPA determines that the exemption is “safe.” Section 408(c)(2)(A)(ii) of FFDCA defines “safe” to mean that “there is a reasonable certainty that no harm will result from aggregate exposure to the pesticide chemical residue, including all anticipated dietary exposures and all other exposures for which there is reliable information.” This includes exposure through drinking water and use in residential settings, but does not include occupational exposure. Section 408(b)(2)(C) of FFDCA requires EPA to give special consideration to exposure of infants and children to the pesticide chemical residue in establishing an exemption from the requirement of a tolerance and to “ensure that there is a reasonable certainty that no harm will result to infants and children from aggregate exposure to the pesticide chemical residue * * *” and specifies factors EPA is to consider in establishing an exemption.

EPA establishes exemptions from the requirement of a tolerance only in those cases where it can be shown that the risks from aggregate exposure to pesticide chemical residues under reasonably foreseeable circumstances will pose no appreciable risks to human health. In order to determine the risks from aggregate exposure to pesticide inert ingredients, the Agency considers the toxicity of the inert in conjunction with possible exposure to residues of the inert ingredient through food, drinking water, and through other exposures that occur as a result of pesticide use in residential settings. If EPA is able to determine that a finite tolerance is not necessary to ensure that there is a reasonable certainty that no harm will result from aggregate exposure to the inert ingredient, an exemption from the requirement of a tolerance may be established.

Consistent with FFDCA section 408(b)(2)(D), EPA has reviewed the available scientific data and other relevant information in support of this action and considered its validity, completeness and reliability and the relationship of this information to human risk. EPA has also considered available information concerning the variability of the sensitivities of major identifiable subgroups of consumers, including infants and children. In the case of certain chemical substances that are defined as polymers, the Agency has established a set of criteria to identify categories of polymers expected to present minimal or no risk. The definition of a polymer is given in 40 CFR 723.250(b) and the exclusion criteria for identifying these low-risk polymers are described in 40 CFR 723.250(d). 2-Propenoic acid, 2-methyl-,phenylmethyl ester, polymer with 2-propenoic acid and sodium 2-methyl-2-[(1-oxo-2-propen-1-yl)amino]-1-propanesulfonate (1:1), peroxydisulfuric acid ([HO)S(O)2]202) sodium salt (1:2)-initiated conforms to the definition of a polymer given in 40 CFR 723.250(b) and meets the following criteria that are used to identify low-risk polymers.

1. The polymer is not a cationic polymer nor is it reasonably anticipated to become a cationic polymer in a natural aquatic environment.

2. The polymer does contain as an integral part of its composition the atomic elements carbon, hydrogen, and oxygen.

3. The polymer does not contain as an integral part of its composition, except as impurities, any element other than those listed in 40 CFR 723.250(d)(2)(ii).

4. The polymer is neither designed nor can it be reasonably anticipated to substantially degrade, decompose, or depolymerize.

5. The polymer is manufactured or imported from monomers and/or reactants that are already included on the TSCA Chemical Substance Inventory or manufactured under an applicable TSCA section 5 exemption.

6. The polymer is not a water absorbing polymer with a number average molecular weight (MW) greater than or equal to 10,000 daltons.

Additionally, the polymer also meets as required the following exemption criteria specified in 40 CFR 723.250(e).

7. The polymer's number average MW is greater than 1,000 and less than 10,000 daltons. The polymer contains less than 10% oligomeric material below MW 500 and less than 25% oligomeric material below MW 1,000, and the polymer does not contain any reactive functional groups.

Thus, “the Polymer” meets the criteria for a polymer to be considered low risk under 40 CFR 723.250. Based on its conformance to the criteria in this unit, no mammalian toxicity is anticipated from dietary, inhalation, or dermal exposure to “the Polymer”.

For the purposes of assessing potential exposure under this exemption, EPA considered that 2-Propenoic acid, 2-methyl-, phenylmethyl ester, polymer with 2-propenoic acid and sodium 2-methyl-2-[(1-oxo-2-propen-1-yl)amino]-1-propanesulfonate (1:1), peroxydisulfuric acid ([HO)S(O)2]202) sodium salt (1:2)-initiated could be present in all raw and processed agricultural commodities and drinking water, and that non-occupational non-dietary exposure was possible. The number average MW of “the Polymer” is 1,000 daltons. Generally, a polymer of this size would be poorly absorbed through the intact gastrointestinal tract or through intact human skin. Since “the Polymer” conform to the criteria that identify a low-risk polymer, there are no concerns for risks associated with any potential exposure scenarios that are reasonably foreseeable. The Agency has determined that a tolerance is not necessary to protect the public health.

Section 408(b)(2)(D)(v) of FFDCA requires that, when considering whether to establish, modify, or revoke a tolerance, the Agency consider “available information” concerning the cumulative effects of a particular pesticide's residues and “other substances that have a common mechanism of toxicity.”

EPA has not found “the Polymer” to share a common mechanism of toxicity with any other substances, and “the Polymer” does not appear to produce a toxic metabolite produced by other substances. For the purposes of this tolerance action, therefore, EPA has assumed that “the Polymer” does not have a common mechanism of toxicity with other substances. For information regarding EPA's efforts to determine which chemicals have a common mechanism of toxicity and to evaluate the cumulative effects of such chemicals, see EPA's Web site athttp://www.epa.gov/pesticides/cumulative.

Section 408(b)(2)(C) of FFDCA provides that EPA shall apply an additional tenfold margin of safety for infants and children in the case of threshold effects to account for prenatal and postnatal toxicity and the completeness of the data base unless EPA concludes that a different margin of safety will be safe for infants andchildren. Due to the expected low toxicity of “the Polymer”, EPA has not used a safety factor analysis to assess the risk. For the same reasons the additional tenfold safety factor is unnecessary.

Based on the conformance to the criteria used to identify a low-risk polymer, EPA concludes that there is a reasonable certainty of no harm to the U.S. population, including infants and children, from aggregate exposure to residues of 2-Propenoic acid, 2-methyl-, phenylmethyl ester, polymer with 2-propenoic acid and sodium 2-methyl-2-[(1-oxo-2-propen-1-yl)amino]-1-propanesulfonate (1:1), peroxydisulfuric acid ([HO)S(O)2]202) sodium salt (1:2)-initiated.

An analytical method is not required for enforcement purposes since the Agency is establishing an exemption from the requirement of a tolerance without any numerical limitation.

In making its tolerance decisions, EPA seeks to harmonize U.S. tolerances with international standards whenever possible, consistent with U.S. food safety standards and agricultural practices. EPA considers the international maximum residue limits (MRLs) established by the Codex Alimentarius Commission (Codex), as required by FFDCA section 408(b)(4). The Codex Alimentarius is a joint U.N. Food and Agriculture Organization/World Health Organization food standards program, and it is recognized as an international food safety standards-setting organization in trade agreements to which the United States is a party. EPA may establish a tolerance that is different from a Codex MRL; however, FFDCA section 408(b)(4) requires that EPA explain the reasons for departing from the Codex level.

The Codex has not established a MRL for “the Polymer”.

Accordingly, EPA finds that exempting residues of 2-Propenoic acid, 2-methyl-, phenylmethyl ester, polymer with 2-propenoic acid and sodium 2-methyl-2-[(1-oxo-2-propen-1-yl)amino]-1-propanesulfonate (1:1), peroxydisulfuric acid ([HO)S(O)2]202) sodium salt (1:2)-initiated from the requirement of a tolerance will be safe.

This final rule establishes a tolerance under section 408(d) of FFDCA in response to a petition submitted to the Agency. The Office of Management and Budget (OMB) has exempted these rules from review under Executive Order 12866, entitledRegulatory Planning and Review(58 FR 51735, October 4, 1993). Because this final rule has been exempted from review under Executive Order 12866, this final rule is not subject to Executive Order 13211, entitledActions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use(66 FR 28355, May 22, 2001) or Executive Order 13045, entitledProtection of Children from Environmental Health Risks and Safety Risks(62 FR 19885, April 23, 1997). This final rule does not contain any information collections subject to OMB approval under the Paperwork Reduction Act (PRA), 44 U.S.C. 3501et seq.,nor does it involve any technical standards that would require Agency consideration of voluntary consensus standards pursuant to section 12(d) of the National Technology Transfer and Advancement Act of 1995 (NTTAA), Public Law 104-113, section 12(d) (15 U.S.C. 272 note).

Since tolerances and exemptions that are established on the basis of a petition under section 408(d) of FFDCA, such as the tolerance in this final rule, do not require the issuance of a proposed rule, the requirements of the Regulatory Flexibility Act (RFA) (5 U.S.C. 601et seq.) do not apply.

This final rule directly regulates growers, food processors, food handlers, and food retailers, not States or tribes, nor does this action alter the relationships or distribution of power and responsibilities established by Congress in the preemption provisions of section 408(n)(4) of FFDCA. As such, the Agency has determined that this action will not have a substantial direct effect on States or tribal governments, on the relationship between the national government and the States or tribal governments, or on the distribution of power and responsibilities among the various levels of government or between the Federal Government and Indian tribes, or otherwise have any unique impacts on local governments. Thus, the Agency has determined that Executive Order 13132, entitledFederalism(64 FR 43255, August 10, 1999) and Executive Order 13175, entitledConsultation and Coordination with Indian Tribal Governments(65 FR 67249, November 9, 2000) do not apply to this final rule. In addition, this final rule does not impose any enforceable duty or contain any unfunded mandate as described under Title II of the Unfunded Mandates Reform Act of 1995 (UMRA) (Pub. L. 104-4).

Although this action does not require any special considerations under Executive Order 12898, entitledFederal Actions to Address Environmental Justice in Minority Populations and Low-Income Populations(59 FR 7629, February 16, 1994), EPA seeks to achieve environmental justice, the fair treatment and meaningful involvement of any group, including minority and/or low-income populations, in the development, implementation, and enforcement of environmental laws, regulations, and policies. As such, to the extent that information is publicly available or was submitted in comments to EPA, the Agency considered whether groups or segments of the population, as a result of their location, cultural practices, or other factors, may have atypical or disproportionately high and adverse human health impacts or environmental effects from exposure to the pesticide discussed in this document, compared to the general population.

The Congressional Review Act, 5 U.S.C. 801et seq.,generally provides that before a rule may take effect, the agency promulgating the rule must submit a rule report to each House of the Congress and to the Comptroller General of the United States. EPA will submit a report containing this rule and other required information to the U.S. Senate, the U.S. House of Representatives, and the Comptroller General of the United States prior to publication of this rule in theFederal Register. This rule is not a “major rule” as defined by 5 U.S.C. 804(2).

Therefore, 40 CFR chapter I is amended as follows:

Pursuant to 49 U.S.C. 33112,Insurer reports and information, NHTSA requires certain passenger motor vehicle insurers to file an annual report with the agency. Each insurer's report includes information about thefts and recoveries of motor vehicles, the rating rules used by the insurer to establish premiums for comprehensive coverage, the actions taken by the insurer to reduce such premiums, and the actions taken by the insurer to reduce or deter theft. Pursuant to 49 U.S.C. Section 33112(f), the following insurers are subject to the reporting requirements:

(1) Issuers of motor vehicle insurance policies whose total premiums account for 1 percent or more of the total premiums of motor vehicle insurance issued within the United States;

(2) issuers of motor vehicle insurance policies whose premiums account for 10 percent or more of total premiums written within any one state and;

(3) rental and leasing companies with a fleet of 20 or more vehicles not covered by theft insurance policies issued by insurers of motor vehicles, other than any governmental entity.

Pursuant to its statutory exemption authority, the agency exempted certain passenger motor vehicle insurers from the reporting requirements.

Section 33112(f)(2) provides that the agency shall exempt small insurers of passenger motor vehicles if NHTSA finds that such exemptions will not significantly affect the validity or usefulness of the information in the reports, either nationally or on a state-by-state basis. The term “small insurer” is defined, in Section 33112(f)(1)(A) and (B), as an insurer whose premiums for motor vehicle insurance issued directly or through an affiliate, including pooling arrangements established under state law or regulation for the issuance of motor vehicle insurance, account for less than 1 percent of the total premiums for all forms of motor vehicle insurance issued by insurers within the United States. However, that section also stipulates that if an insurance company satisfies this definition of a “small insurer,” but accounts for 10 percent or more of the total premiums for all motor vehicle insurance issued in a particular state, the insurer must report about its operations in that state.

In the final rule establishing the insurer reports requirement (49 CFR part 544; 52 FR 59, January 2, 1987), NHTSA exercised its exemption authority by listing in Appendix A each insurer that must report because it had at least 1 percent of the motor vehicle insurance premiums nationally. Listing the insurers subject to reporting, instead of each insurer exempted from reporting because it had less than 1 percent of the premiums nationally, is administratively simpler, since the former group is much smaller than the latter. In Appendix B, NHTSA lists those insurers required to report for particular states because each insurer had a 10 percent or greater market share of motor vehicle premiums in those states. In the January 1987 final rule, the agency stated that it would update Appendices A and B annually. NHTSA updates the appendices based on data voluntarily provided by insurance companies to A.M. Best, which A.M. Best1 publishes in itsState/Line Report each spring. The agency uses the data to determine the insurers' market shares nationally and in each state.

In addition, upon making certain determinations, NHTSA grants exemptions to self-insurers, i.e., any person who has a fleet of 20 or more motor vehicles (other than any governmental entity) used for rental or lease whose vehicles are not covered by theft insurance policies issued by insurers of passenger motor vehicles, 49 U.S.C. 33112(b)(1) and (f). Under 49 U.S.C. 33112(e)(1) and (2), NHTSA may exempt a self-insurer from reporting, if the agency determines:

(1) The cost of preparing and furnishing such reports is excessive in relation to the size of the business of the insurer;

(2) the insurer's report will not significantly contribute to carrying out the purposes of Chapter 331.

In a final rule published June 22, 1990 (55 FR 25606), the agency granted a class exemption to all companies that rent or lease fewer than 50,000 vehicles, because it believed that the largest companies' reports sufficiently represent the theft experience of rental and leasing companies. NHTSA concluded that smaller rental and leasing companies' reports do not significantly contribute to carrying out NHTSA's statutory obligations and that exempting such companies will relieve an unnecessary burden on them. As a result of the June 1990 final rule, the agency added Appendix C, consisting of an annually updated list of the self-insurers subject to Part 544. Following the same approach as in Appendix A, NHTSA included, in Appendix C, each of the self-insurers subject to reporting instead of the self-insurers which are exempted. NHTSA updates Appendix C based primarily on information fromAutomotive Fleet MagazineandAuto Rental News. 2

Under Part 544, as long as an insurer is listed, it must file reports on or before October 25 of each year. Thus, any insurer listed in the appendices must file a report before October 25, 2011, and by each succeeding October 25, absent an amendment removing the insurer's name from the appendices.

On April 12, 2011, NHTSA published a notice of proposed rulemaking (NPRM) to update the list of insurers in Appendices A, B, and C required to file reports (76 FR 20298). Appendix A lists insurers that must report because each had 1 percent of the motor vehicle insurance premiums on a national basis. The list was last amended in a final rule published on September 3, 2010 (75 FR 54041). Based on the 2008 calendar year market share data from A.M. Best, NHTSA proposed to remove California State Auto Group and Safeco Insurance Group from Appendix A.

Appendix B lists insurers required to report because each insurer had a 10 percent or greater market share of motor vehicle premiums in a particular State. Based on the 2008 calendar year data for market shares from A.M. Best, we proposed to remove Balboa Insurance Group of South Dakota from Appendix B.

Appendix C lists rental and leasing companies required to file reports. NHTSA proposed to make no change to Appendix C.

The agency received no comments in response to the NPRM. Therefore, this final rule adopts the proposed changes to Appendices A and B. Accordingly, NHTSA has determined that each of the 17 insurers listed in Appendix A, each of the eight insurers listed in Appendix B and each of five companies listed in Appendix C are required to submit an insurer report on its experience for calendar year 2008 no later than October 25, 2011, and set forth the information required by Part 544. As long as these insurers and companies remain listed, they would be required to submit reports before each subsequent October 25 for the calendar year ending slightly less than 3 years before.

Passenger motor vehicle insurers listed in the appendices can forward their theft loss reports to the agency in several ways:

a.Mail:Carlita Ballard, Office of International Policy, Fuel Economy and Consumer Programs, Department of Transportation, NHTSA, West Building, 1200 New Jersey Avenue, SE., NVS-131, Room W43-439, Washington, DC 20590

b.E-Mail: carlita.ballard@dot.gov;or

c.Fax:(202) 493-2990.

Theft loss reports may also be submitted to the docket electronically [identified by Docket No. NHTSA-2011-0016] by:

d.Logging onto the Federal eRulemaking Portal:Go tohttp://www.regulations.gov. Follow the online instructions for filing the document electronically.

This notice has not been reviewed under Executive Order 12866, Regulatory Planning and Review. NHTSA has considered the impact of this final rule and determined that the action is not “significant” within the meaning of the Department of Transportation's regulatory policies and procedures. This final rule implements the agency's policy of ensuring that all insurance companies that are statutorily eligible for exemption from the insurer reporting requirements are in fact exempted from those requirements. Only those companies that are not statutorily eligible for an exemption are required to file reports.

NHTSA does not believe that this rule, reflecting current data, affects the impacts described in the final regulatory evaluation prepared for the final rule establishing Part 544 (52 FR 59; January 2, 1987). Accordingly, a separate regulatory evaluation has not been prepared for this rulemaking action. The cost estimates in the 1987 final regulatory evaluation should be adjusted for inflation, using the Bureau of Labor Statistics Consumer Price Index for 2011 (see http://www.bls.gov/cpi). The agency estimates that the cost of compliance is $50,000 (1987 dollars) for any insurer added to Appendix A, $20,000 (1987 dollars) for any insurer added to Appendix B, and $5,770 (1987 dollars) for any insurer added to Appendix C. This final rule proposed to remove two companies from Appendix A, remove one company from Appendix B, and make no change to Appendix C. Therefore, the net effect of this final rule is a decreased cost of $120,000 (1987 dollars) to insurers as a group.

Interested persons may wish to examine the 1987 final regulatory evaluation. Copies of that evaluation were placed in Docket No. T86-01; Notice 2. Any interested person may obtain a copy of this evaluation by writing to NHTSA, Technical Reference Division, 1200 New Jersey Avenue, SE., East Building (Ground Floor), Room E12-100, Washington, DC 20590, or by calling (202) 366-2588.

The information collection requirements in this final rule were submitted and approved by the Office of Management and Budget (OMB) pursuant to the requirements of the Paperwork Reduction Act (44 U.S.C. 3501et seq.). The existing information collection indicates that the number of respondents for this collection is thirty, however, the actual number of respondents fluctuate from year to year. Therefore, because the number of respondents required to report for this final rule does not exceed the number of respondents indicated in the existing information collection, the agency does not believe that an amendment to the existing information collection is necessary. This collection of information is assigned OMB Control Number 2127-0547 (“Insurer Reporting Requirements”).

The agency also considered the effects of this rulemaking under the Regulatory Flexibility Act (RFA) (5 U.S.C. 601et seq.). I certify that this final rule will not have a significant economic impact on a substantial number of small entities. The rationale for the certification is that none of the companies listed on Appendices A, B or C are construed to be a small entity within the definition of the RFA. “Small insurer” is defined, in part under 49 U.S.C. 33112, as any insurer whose premiums for all forms of motor vehicle insurance account for less than 1 percent of the total premiums for all forms of motor vehicle insurance issued by insurers within the United States, or any insurer whose premiums within any State, account for less than 10 percent of the total premiums for all forms of motor vehicle insurance issued by insurers within the State. This notice exempts all insurers meeting those criteria. Any insurer too large to meet those criteria is not a small entity. In addition, in this rulemaking, the agency exempts all “self insured rental and leasing companies” that have fleets of fewer than 50,000 vehicles. Any self-insured rental and leasing company too large to meet that criterion is not a small entity.

This action has been analyzed according to the principles and criteria contained in Executive Order 12612, and it has been determined that the final rule does not have sufficient federalism implications to warrant the preparation of a Federalism Assessment.

In accordance with the National Environmental Policy Act, NHTSA has considered the environmental impacts of this final rule and determined that it would not have a significant impact on the quality of the human environment.

This final rule does not have any retroactive effect, and it does not preempt any State law, 49 U.S.C. 33117 provides that judicial review of this rule may be obtained pursuant to 49 U.S.C. 32909, and section 32909 does not require submission of a petition for reconsideration or other administrative proceedings before parties may file suit in court.

The Department of Transportation assigns a regulation identifier number (RIN) to each regulatory action listed in the Unified Agenda of Federal Regulations. The Regulatory Information Service Center publishes the Unified Agenda in April and October of each year. You may use the RIN contained in the heading, at the beginning, of this document to find this action in the Unified Agenda.

Executive Order 12866 requires each agency to write all rules in plain language. Application of the principles of plain language includes consideration of the following questions:

☐ Have we organized the material to suit the public's needs?

☐ Are the requirements in the proposal clearly stated?

☐ Does the proposal contain technical language or jargon that is not clear?

☐ Would a different format (grouping and order of sections, use of headings, paragraphing) make the rule easier to understand?

☐ Would more (but shorter) sections be better?

☐ Could we improve clarity by adding tables, lists, or diagrams?

☐ What else could we do to make the proposal easier to understand?

If you have any responses to these questions, you can forward them to me several ways:

a.Mail: Carlita Ballard, Office of International Policy, Fuel Economy and Consumer Programs, NHTSA, West Building, 1200 New Jersey Avenue, SE., NVS-131, Room W43-439, Washington, DC 20590

b.E-mail: carlita.ballard@dot.gov;orFax:(202) 493-2990

In consideration of the foregoing, 49 CFR Part 544 is amended as follows:

The snapper-grouper fishery of the South Atlantic is managed under the Fishery Management Plan for the Snapper-Grouper Fishery of the South Atlantic Region (FMP). The FMP was prepared by the South Atlantic Fishery Management Council and is implemented under the authority of the Magnuson-Stevens Fishery Conservation and Management Act (Magnuson-Stevens Act) by regulations at 50 CFR part 622. Those regulations set the commercial quota for black sea bass in the South Atlantic at 309,000 lb (140,160 kg) for the current fishing year, June 1, 2011, through May 31, 2012, as specified in 50 CFR 622.42(e)(5)(iii).

Black sea bass are managed throughout their range. In the South Atlantic EEZ, black sea bass are managed by the Council from 35°15.19′ N. lat., the latitude of Cape Hatteras Light, North Carolina, south. From Cape Hatteras Light, North Carolina, through Maine, black sea bass are managed jointly by the Mid-Atlantic Fishery Management Council and the Atlantic States Marine Fisheries Commission. Therefore, the closure provisions contained in this notice are applicable to those vessels harvesting or possessing black sea bass from Key West, Florida, through Cape Hatteras Light, North Carolina.

Under 50 CFR 622.43(a), NMFS is required to close the commercial sector for a species or species group when the quota for that species or species group is reached, or is projected to be reached, by filing a notification to that effect with the Office of the Federal Register. Based on current statistics, NMFS has determined that the available commercial quota of 309,000 lb (140,160 kg) for black sea bass will be reached on or before July 15, 2011. Accordingly, NMFS is closing the commercial sector for black sea bass in the South Atlantic EEZ from 12:01 a.m., local time, on July 15, 2011, through 12:01 a.m., local time, on June 1, 2012. The operator of a vessel with a valid commercial vessel permit for snapper-grouper having black sea bass onboard must have landed and bartered, traded, or sold such black sea bass prior to 12:01 a.m., local time, July 15, 2011.

During the closure, the bag limit and possession limits specified in 50 CFR 622.39(d)(1)(vii) and (d)(2), respectively, apply to all harvest or possession of black sea bass in or from the South Atlantic EEZ, and the sale or purchase of black sea bass taken from the EEZ is prohibited. The prohibition on sale or purchase does not apply to sale or purchase of black sea bass that were harvested, landed ashore, and sold prior to 12:01 a.m., local time, July 15, 2011, and were held in cold storage by a dealer or processor. For a person on board a vessel for which a Federal commercial or charter vessel/headboat permit for the South Atlantic snapper-grouper fishery has been issued, the sale and purchase provisions of the commercial closure for black sea bass would apply regardless of whether the fish are harvested in state or Federal waters, as specified in 50 CFR 622.43(a)(5)(ii).

This action responds to the best available information recently obtained from the fishery. The Assistant Administrator for Fisheries, NOAA (AA), finds that the need to immediately implement this action to close the commercial sector to the harvest of black sea bass constitutes good cause to waive the requirements to provide prior notice and opportunity for public comment pursuant to the authority set forth in 5 U.S.C. 553(b)(B), as such procedures would be unnecessary and contrary to the public interest. Such procedures would be unnecessary because the rule itself already has been subject to notice and comment, and all that remains is to notify the public of the closure.

Allowing prior notice and opportunity for public comment is contrary to the public interest because of the need to immediately implement this action to protect the black sea bass stock because the capacity of the fishing fleet allows for rapid harvest of the quota. Prior notice and opportunity for public comment would require time and would potentially result in a harvest well in excess of the established quota.

For the aforementioned reasons, the AA also finds good cause to waive the 30-day delay in effectiveness of the action under 5 U.S.C. 553(d)(3).

This action is taken under 50 CFR 622.43(a) and is exempt from review under Executive Order 12866.