[Federal Register Volume 78, Number 183 (Friday, September 20, 2013)]
[Notices]
[Pages 58090-58121]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2013-22930]
[[Page 58089]]
Vol. 78
Friday,
No. 183
September 20, 2013
Part IV
Environmental Protection Agency
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California State Nonroad Engine Pollution Control Standards; Off-Road
Compression Ignition Engines--In-Use Fleets; Notice of Decision; Notice
Federal Register / Vol. 78 , No. 183 / Friday, September 20, 2013 /
Notices
[[Page 58090]]
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ENVIRONMENTAL PROTECTION AGENCY
[EPA-HQ-OAR-2008-0691; FRL-9901-18-OAR]
California State Nonroad Engine Pollution Control Standards; Off-
Road Compression Ignition Engines--In-Use Fleets; Notice of Decision
AGENCY: Environmental Protection Agency (EPA).
ACTION: Notice of decision.
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SUMMARY: The Environmental Protection Agency (EPA) is granting the
California Air Resources Board's (CARB's) request for authorization of
California regulations applicable to in-use fleets that operate off-
road (nonroad or NR), diesel-fueled (compression-ignition or CI)
vehicles with engines 25 horsepower and greater. The regulations
require such fleets to meet fleet average emissions standards for
oxides of nitrogen (NOX) and particulate matter (PM), or,
alternatively, to comply with best available control technology (BACT)
requirements for the vehicles in those fleets. This decision is issued
under the authority of the Clean Air Act (CAA or Act).
DATES: Petitions for review must be filed by November 19, 2013.
ADDRESSES: EPA has established a docket for this action under Docket ID
EPA-HQ-OAR-2008-0691. All documents relied upon in making this
decision, including those submitted to EPA by CARB, are contained in
the public docket. Publicly available docket materials are available
either electronically through www.regulations.gov or in hard copy at
the Air and Radiation Docket in the EPA Headquarters Library, EPA West
Building, Room 3334, located at 1301 Constitution Avenue NW.,
Washington, DC. The Public Reading Room is open to the public on all
federal government working days from 8:30 a.m. to 4:30 p.m.; generally,
it is open Monday through Friday, excluding holidays. The telephone
number for the Reading Room is (202) 566-1744. The Air and Radiation
Docket and Information Center's Web site is http://www.epa.gov/oar/docket.html. The electronic mail (email) address for the Air and
Radiation Docket is: [email protected], the telephone number is
(202) 566-1742, and the fax number is (202) 566-9744. An electronic
version of the public docket is available through the federal
government's electronic public docket and comment system. You may
access EPA dockets at http://www.regulations.gov. After opening the
www.regulations.gov Web site, enter EPA-HQ-OAR-2008-0691 in the ``Enter
Keyword or ID'' fill-in box to view documents in the record. Although a
part of the official docket, the public docket does not include
Confidential Business Information (CBI) or other information whose
disclosure is restricted by statute.
EPA's Office of Transportation and Air Quality (OTAQ) maintains a
Web page that contains general information on its review of California
waiver requests. Included on that page are links to prior waiver
Federal Register notices, some of which are cited in today's notice;
the page can be accessed at http://www.epa.gov/otaq/cafr.htm.
FOR FURTHER INFORMATION CONTACT: David Dickinson, Attorney-Advisor,
Compliance Division, Office of Transportation and Air Quality, U.S.
Environmental Protection Agency, 1200 Pennsylvania Avenue (6405J) NW.,
Washington, DC 20460. Telephone: (202) 343-9256. Email:
[email protected].
SUPPLEMENTARY INFORMATION:
Table of Contents
I. Executive Summary
II. Background
A. California's Nonroad CI In-Use Fleet Requirements
B. Clean Air Act Nonroad Engine and Vehicle Authorizations
C. Deference to California
D. Burden and Standard of Proof
E. EPA's Administrative Process in Consideration of California's
Nonroad CI In-Use Fleet Requirements
III. Discussion
A. California Protectiveness Determination
1. Based on EPA's Traditional Analysis, is California's
Protectiveness Determination Arbitrary and Capricious?
2. Is CARB's Protectiveness Determination Arbitrary and
Capricious Based on Other Effects of California's Fleet
Requirements?
3. Section 209 (e)(2)(A)(i) Conclusion
B. Does California Need its Standards to Meet Compelling and
Extraordinary Conditions?
1. Should EPA Review This Criterion Based on the Need for
California's Nonroad Program or the Need for the Fleet Requirements?
a. Comment from Pacific Legal Foundation
b. EPA Response
2. Does California Need its Nonroad Program to Meet Compelling
and Extraordinary Conditions?
3. In the Alternative, does California Need its Nonroad Fleet
Requirements to Meet Compelling and Extraordinary Conditions?
a. California Air Quality Today and Moving Forward
b. PM Health Effects
c. Additional PM Comments
4. Section 209(e)(2)(A)(ii) Conclusion
C. Consistency with Section 209 of the Clean Air Act
1. Consistency with Section 209(a)
2. Consistency with Section 209(e)(1)
3. Consistency with Section 209(b)(1)(C)
a. Technological Feasibility
b. Consistency of Certification Procedures
D. Additional Issues Raised in Comment
1. Request for a Public Hearing In California
2. Request for EPA to Reopen the Comment Period
3. Claims Outside the Scope of the Clean Air Act
4. Constitutional Claims
E. Authorization Determination for California's Fleet
Requirements
IV. Decision
V. Statutory and Executive Order Review
I. Executive Summary
Today, the Environmental Protection Agency (EPA) is granting a
California Air Resources Board (CARB) request for authorization of
regulations designed to reduce PM and NOX emissions from in-
use nonroad diesel engines. The California In-Use Off-Road Diesel-
Fueled Fleets Regulation (Fleet Requirements) applies to fleets with NR
CI vehicles or equipment greater than 25 horsepower. The regulation
takes effect beginning as early as 2014, depending on fleet size. It
requires fleet operators to meet a progressively more stringent
combined PM and NOX standard, or to reduce emissions through
technology upgrades such as retrofit or replacement. Today's decision
pertains to CARB's request of March 1, 2012, for authorization of the
Fleet Requirements as amended in 2010.
The legal framework for this decision stems from the provisions
first adopted by Congress in 1967, and later modified in 1977, with
respect to state emission requirements for motor vehicles and motor
vehicle engines; and from similar language adopted by Congress in 1990
with respect to preemption of state emission requirements for certain
nonroad vehicles and equipment. Section 209(e)(2) of the Act, 42 U.S.C.
7543(e)(2), specifies that EPA must authorize California to adopt and
enforce covered nonroad standards if California determines that its
standards are, in the aggregate, at least as protective of the public
health and welfare as applicable Federal standards, unless EPA makes
one of three findings specified under the Clean Air Act: (1) That
California's protectiveness finding is arbitrary and capricious; (2)
that California does not need such California standards to meet
compelling and extraordinary conditions; or (3) that California
standards and accompanying enforcement procedures are not consistent
with this section. As explained below, EPA interprets the
[[Page 58091]]
statutory language ``consistent with this section'' to mean consistent
with section 209 (e.g. section 209(a), section 209(e)(1), and section
209(b)(1)(C)) of the Act. EPA's role upon receiving an authorization
request is to determine whether it is appropriate to make any of these
three specified findings. Opponents of authorization bear the burden of
proving that at least one of the three bases for denial of
authorization has been satisfied. If the Agency cannot make at least
one of the three findings, then it must grant the requested
authorization. EPA has evaluated CARB's request with regard to each of
these three authorization criteria, in light of the evidence in the
public record, and is granting CARB its authorization request as
required under the Clean Air Act.
This Notice of Decision provides a full discussion of EPA's
evaluation of each of the three criteria, including EPA's evaluation of
the record and its determination that those opposing the authorization
have not met their burden of proof with regard to any of the three
criteria in section 209(e)(2)(A).
II. Background
A. California's Nonroad CI In-Use Fleet Requirements
CARB initially approved the Fleet Requirements on July 26, 2007.
CARB subsequently amended the regulation after the Board conducted
hearings in December 2008, January 2009, July 2009, and most recently
in December 2010. As explained below, the December 2010 amendments
significantly modified the regulation's compliance dates and in-use
performance requirements.
The Fleet Requirements establish statewide in-use performance
standards applicable to any person, business, or government agency that
owns and operates in-use nonroad diesel vehicles in California with a
maximum power of 25 horsepower (hp) or greater. The regulation applies
to engines that are used to provide motive power, and in some cases
auxiliary power, to nonroad vehicles, which are defined as vehicles
that (1) cannot be registered and driven safely on-road, and (2) are
not implements of husbandry or recreational off-highway vehicles.
The Fleet Requirements phase in according to fleet size as defined
by total fleet horsepower. Requirements begin for large fleets (greater
than 5,000 hp) in 2014; for medium fleets (2,500-5,000 hp) in 2017; and
for small fleets, 2,500 hp or less, in 2019. The regulation establishes
two general compliance pathways. Fleets may either (1) meet fleet
average emission targets (based on the combined horsepower of the
vehicles in the fleet) that become increasingly stringent over a ten-
year period, or (2) satisfy best available control technology (BACT)
requirements within a given compliance year. The BACT pathway requires
fleets to retire, repower, designate for low use, and/or retrofit a
certain percentage of the fleet's total horsepower each year. Fleets
demonstrate compliance for a given year by taking a sufficient number
of such actions in the prior year or by utilizing previously earned
BACT credits associated with these actions. For large fleets, the
annual BACT rates (demonstrated either through utilization of credits
or through action taken during the previous calendar year) start out at
4.8 percent of the fleet's total horsepower in 2014 and increase to 8
percent for each year from 2015 through 2017, and to 10 percent for
each year from 2018 through 2023. For medium fleets, the annual BACT
rate is 8 percent in 2017, increasing to 10 percent for each year from
2018 through 2023. Small fleets have an annual BACT rate of 10 percent
for each year from 2019 through 2028. After the final compliance year,
all fleets must continue to either (1) meet the fleet average emission
target rate for the final target year, or (2) satisfy the applicable
final annual BACT compliance rate (e.g. 10 percent) each year until the
fleet comes into compliance with the fleet average emission target. The
Fleet Requirements also restrict fleets from adding older dirtier
vehicles to their vehicle inventories.
The regulation EPA is authorizing in this decision reflects
amendments that CARB adopted in 2010. Compared to the original Fleet
Requirements, the 2010 amendments delay the original compliance
schedule by four years. The 2010 amendments also simplified the annual
requirements so that in each compliance year a fleet must only meet a
single emissions target--a combined NOX plus PM standard--
rather than separate targets for each of these two pollutants. The
amendments reduced the annual BACT requirements from a 28 percent
turnover and retrofit requirement in the prior version of the
regulation, to a combined 4.8 percent to 10 percent requirement (as
outlined above). Finally, the amendments removed mandatory retrofitting
requirements so that retrofit is now a compliance option under the BACT
pathway rather than a mandate. Additional information about the
original and amended Fleet Requirements is provided below in the
section discussing the consistency of the Fleet Requirements with
section 202(a) of the Act.
B. Clean Air Act Nonroad Engine and Vehicle Authorizations
Section 209(e)(1) of the Act permanently preempts any state, or
political subdivision thereof, from adopting or attempting to enforce
any standard or other requirement relating to the control of emissions
for certain new nonroad engines or vehicles.\1\ For all other nonroad
engines (including ``non-new'' engines), states generally are preempted
from adopting and enforcing standards and other requirements relating
to the control of emissions, except that section 209(e)(2)(A) of the
Act requires EPA, after notice and opportunity for public hearing, to
authorize California to adopt and enforce such regulations unless EPA
makes one of three enumerated findings. Specifically, EPA must deny
authorization if the Administrator finds that (1) California's
protectiveness determination (that California standards will be, in the
aggregate, as protective of public health and welfare as applicable
federal standards) is arbitrary and capricious, (2) California does not
need such standards to meet compelling and extraordinary conditions, or
(3) the California standards and accompanying enforcement procedures
are not consistent with section 209 of the Act. Other states with state
air quality implementation plans may also adopt and enforce such
regulations if the standards are identical to California's standards.
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\1\ States are expressly preempted from adopting or attempting
to enforce any standard or other requirement relating to the control
of emissions from new nonroad engines which are used in construction
equipment or vehicles or used in farm equipment or vehicles and
which are smaller than 175 horsepower. Such express preemption under
section 209(e)(1) of the Act also applies to new locomotives or new
engines used in locomotives.
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On July 20, 1994, EPA promulgated a rule interpreting the three
criteria set forth in section 209(e)(2)(A) that EPA must consider
before granting any California authorization request for nonroad engine
or vehicle emission standards.\2\ EPA revised these regulations in
1997.\3\ As stated in the preamble to the 1994 rule, EPA historically
has interpreted the consistency inquiry under the third criterion
outlined above (set forth in section 209(e)(2)(A)(iii)) to require, at
minimum, that California standards and enforcement procedures be
consistent
[[Page 58092]]
with section 209(a), section 209(e)(1), and section 209(b)(1)(C) (as
EPA has interpreted that subsection in the context of section 209(b)
motor vehicle waivers) of the Act.\4\
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\2\ 59 FR 36969 (July 20, 1994).
\3\ See 62 FR 67733 (December 30, 1997). The applicable
regulations are now found in 40 CFR part 1074, subpart B, Sec.
1074.105.
\4\ See 59 FR 36969 (July 20, 1994).
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In order to be consistent with section 209(a), California's nonroad
standards and enforcement procedures must not apply to new motor
vehicles or new motor vehicle engines. To be consistent with section
209(e)(1), California's nonroad standards and enforcement procedures
must not attempt to regulate engine categories that are permanently
preempted from state regulation. To determine consistency with section
209(b)(1)(C), EPA typically reviews nonroad authorization requests
under the same ``consistency'' criteria that are applied to motor
vehicle waiver requests under section 209(b)(1)(C). That provision
provides that the Administrator shall not grant California a motor
vehicle waiver if she finds that California ``standards and
accompanying enforcement procedures are not consistent with section
202(a)'' of the Act. Previous decisions granting waivers and
authorizations have noted that state standards and enforcement
procedures will be found to be inconsistent with section 202(a) if: (1)
There is inadequate lead time to permit the development of the
necessary technology, giving appropriate consideration to the cost of
compliance within that time, or (2) the federal and state testing
procedures impose inconsistent certification requirements.
In light of the similar language of sections 209(b) and
209(e)(2)(A), EPA has analyzed requests for California authorization of
standards for nonroad vehicles or engines under section 209(e)(2)(A)
using the same principles that it has historically applied in analyzing
requests for waivers of preemption for new motor vehicle or new motor
vehicle engine standards under section 209(b).\5\ These principles
include, among other things, that EPA should limit its inquiry to the
three specific authorization criteria identified in section
209(e)(2)(A),\6\ and that EPA will give substantial deference to the
policy judgments California has made in adopting its regulations. In
previous waiver decisions, EPA has stated that Congress intended EPA's
review of California's decision-making be narrow. EPA has rejected
arguments that are not specified in the statute as grounds for denying
a waiver:
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\5\ See Engine Manufacturers Association v. EPA, 88 F.3d 1075
(D.C. Cir. 1996). ``. . . EPA was within the bounds of permissible
construction in analogizing Sec. 209(e) on nonroad sources to Sec.
209(a) on motor vehicles.''
\6\ See EPA's Final 209(e) rulemaking at 59 FR 36969, 36983
(July 20, 1994).
The law makes clear that the waiver requests cannot be denied
unless the specific findings designated in the statute can properly
be made. The issue of whether a proposed California requirement is
likely to result in only marginal improvement in air quality not
commensurate with its costs or is otherwise an arguably unwise
exercise of regulatory power is not legally pertinent to my decision
under section 209, as long as the California requirement is
consistent with section 202(a) and is more stringent than applicable
Federal requirements in the sense that it may result in some further
reduction in air pollution in California.\7\
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\7\ 36 FR 17458 (Aug. 31, 1971). Note that the more stringent
standard expressed here, in 1971, was superseded by the 1977
amendments to section 209, which established that California must
determine that its standards are, in the aggregate, at least as
protective of public health and welfare as applicable Federal
standards. In the 1990 amendments to section 209, Congress
established section 209(e) and similar language in section
209(e)(1)(i) pertaining to California's nonroad emission standards
which California must determine to be, in the aggregate, at least as
protective of public health and welfare as applicable Federal
standards.
This principle of narrow EPA review has been upheld by the U.S.
Court of Appeals for the District of Columbia Circuit.\8\ Thus, EPA's
consideration of all the evidence submitted concerning an authorization
decision is circumscribed by its relevance to those questions that may
be considered under section 209(e)(2)(A).
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\8\ See, e.g., Motor and Equip. Mfrs Assoc. v. EPA, 627 F.2d
1095 (D.C. Cir. 1979) (``MEMA I'').
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C. Deference to California
In previous waiver decisions, EPA has recognized that the intent of
Congress in creating a limited review based on the section 209(b)(1)
criteria was to ensure that the federal government did not second-guess
state policy choices. As the agency explained in one prior waiver
decision:
It is worth noting * * * I would feel constrained to approve a
California approach to the problem which I might also feel unable to
adopt at the federal level in my own capacity as a regulator. The
whole approach of the Clean Air Act is to force the development of
new types of emission control technology where that is needed by
compelling the industry to ``catch up'' to some degree with newly
promulgated standards. Such an approach * * * may be attended with
costs, in the shape of reduced product offering, or price or fuel
economy penalties, and by risks that a wider number of vehicle
classes may not be able to complete their development work in time.
Since a balancing of these risks and costs against the potential
benefits from reduced emissions is a central policy decision for any
regulatory agency under the statutory scheme outlined above, I
believe I am required to give very substantial deference to
California's judgments on this score.\9\
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\9\ 40 FR 23102, 23103-23104 (May 28, 1975).
Similarly, EPA has stated that the text, structure, and history of
the California waiver provision clearly indicate both a congressional
intent and appropriate EPA practice of leaving the decision on
``ambiguous and controversial matters of public policy'' to
California's judgment.\10\ This interpretation is supported by relevant
discussion in the House Committee Report for the 1977 amendments to the
Clean Air Act.\11\ Congress had the opportunity through the 1977
amendments to restrict the preexisting waiver provision, but elected
instead to expand California's flexibility to adopt a complete program
of motor vehicle emission controls. The report explains that the
amendment is intended to ratify and strengthen the preexisting
California waiver provision and to affirm the underlying intent of that
provision, that is, to afford California the broadest possible
discretion in selecting the best means to protect the health of its
citizens and the public welfare.\12\
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\10\ Id. at 23104; 58 FR 4166 (January 13, 1993).
\11\ MEMA I, 627 F.2d at 1110 (citing H.R. Rep. No. 294, 95th
Cong., 1st Sess. 301-302 (1977)).
\12\ Id.
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D. Burden and Standard of Proof
As the U.S. Court of Appeals for the D.C. Circuit has made clear in
MEMA I, opponents of a waiver request by California bear the burden of
showing that the statutory criteria for a denial of the request have
been met:
[T]he language of the statute and its legislative history
indicate that California's regulations, and California's
determinations that they must comply with the statute, when
presented to the Administrator are presumed to satisfy the waiver
requirements and that the burden of proving otherwise is on whoever
attacks them. California must present its regulations and findings
at the hearing and thereafter the parties opposing the waiver
request bear the burden of persuading the Administrator that the
waiver request should be denied.\13\
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\13\ Id.
The Administrator's burden, on the other hand, is to make a
reasonable evaluation of the information in the record in coming to the
waiver decision. As the court in MEMA I stated: ``here, too, if the
Administrator ignores evidence demonstrating that the waiver should not
be granted, or if he seeks to overcome that evidence with unsupported
assumptions of his own, he runs the risk of having his waiver decision
set aside as `arbitrary and
[[Page 58093]]
capricious.''' \14\ Therefore, the Administrator's burden is to act
``reasonably.'' \15\
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\14\ Id. at 1126.
\15\ Id. at 1126.
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With regard to the standard of proof, the court in MEMA I explained
that the Administrator's role in a section 209 proceeding is to:
consider all evidence that passes the threshold test of
materiality and * * * thereafter assess such material evidence
against a standard of proof to determine whether the parties
favoring a denial of the waiver have shown that the factual
circumstances exist in which Congress intended a denial of the
waiver.\16\
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\16\ Id. at 1122.
In that decision, the court considered the standards of proof under
section 209 for the two findings related to granting a waiver for an
``accompanying enforcement procedure.'' Those findings involve: (1)
Whether the enforcement procedures impact California's prior
protectiveness determination for the associated standards, and (2)
whether the procedures are consistent with section 202(a). The
principles set forth by the court, however, are similarly applicable to
an EPA review of a request for a waiver of preemption for a standard.
The court instructed that ``the standard of proof must take account of
the nature of the risk of error involved in any given decision, and it
therefore varies with the finding involved. We need not decide how this
standard operates in every waiver decision.'' \17\
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\17\ Id.
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With regard to the protectiveness finding, the court upheld the
Administrator's position that, to deny a waiver, there must be ``clear
and compelling evidence'' to show that proposed enforcement procedures
undermine the protectiveness of California's standards.\18\ The court
noted that this standard of proof also accords with the congressional
intent to provide California with the broadest possible discretion in
setting regulations it finds protective of the public health and
welfare.\19\
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\18\ Id.
\19\ Id.
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With respect to the consistency finding, the court did not
articulate a standard of proof applicable to all proceedings, but found
that the opponents of the waiver were unable to meet their burden of
proof even if the standard were a mere preponderance of the evidence.
Although MEMA I did not explicitly consider the standards of proof
under section 209 concerning a waiver request for ``standards,'' as
compared to a waiver request for accompanying enforcement procedures,
there is nothing in the opinion to suggest that the court's analysis
would not apply with equal force to such determinations. EPA's past
waiver decisions have consistently made clear that: ``[E]ven in the two
areas concededly reserved for Federal judgment by this legislation--the
existence of `compelling and extraordinary' conditions and whether the
standards are technologically feasible--Congress intended that the
standards of EPA review of the State decision to be a narrow one.''
\20\
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\20\ See, e.g., 40 FR 21102-22103 (May 28, 1975).
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E. EPA's Administrative Process in Consideration of California's
Nonroad CI In-Use Fleet Requirements
EPA has conducted three separate public notice and comment periods
associated with three successive versions of CARB's NR CI in-use Fleet
Requirements.
On August 8, 2008, CARB requested that EPA authorize California to
enforce its original In-Use Off-Road Diesel-Fueled Fleets regulation
adopted at its July 26, 2007 public hearing.\21\ CARB's original
regulations required fleets that operate nonroad, diesel fueled
equipment with engines 25 hp and greater to meet separate fleet average
emission standards for NOX and PM, respectively.
Alternatively, the regulations required the vehicles in those fleets to
comply with BACT requirements. Based on this request, EPA noticed and
conducted a public hearing on October 27, 2008, and provided an
opportunity to submit written comment through December 19, 2008.\22\
CARB amended the regulations between December 2008 and mid-2009. On
February 11, 2010 CARB requested that EPA grant California
authorization to enforce its In-Use Off- Road Diesel-Fueled Fleets
regulation as amended.\23\ Based on CARB's February 11, 2010 request,
EPA noticed and conducted a public hearing on April 14, 2010, and
provided an opportunity to submit written comment through May 18,
2010.\24\
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\21\ See CARB Resolution 07-19) and subsequently modified after
supplemental public comment by CARB's Executive Officer by the In-
Use Regulation in Executive Order R-08-002 on April 4, 2008 (these
regulations are codified at Title 13, California Code of Regulations
sections 2449 through 2449.3).
\22\ See 73 FR 58585 (October 7, 2008) and 73 FR 67509 (November
14, 2008).
\23\ CARB's amendments included those of December 2008 (and
formally adopted in California on October 19, 2009); January 2009
(and formally adopted in California on December 31, 2009); and, a
certain subset of amendments adopted by the Board in July 2009 in
response to California Assembly Bill 8 2X (and formally adopted on
December 3, 2009). In CARB's February 11, 2010 request letter to EPA
it also noted additional amendments adopted in July 2009 and not yet
formally adopted by California's Office of Administrative Law. Once
this last subset of amendments was formally adopted CARB planned to
submit them to EPA for subsequent consideration.
\24\ See 75 FR 11880 (March 12, 2010).
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CARB again amended its regulations in December 2010 and these
amendments were formally adopted in California on December 14, 2011--
resulting in the current version of the Fleet Requirements which are
the subject of this authorization decision. On March 1, 2012, CARB
submitted a request that EPA grant California authorization to enforce
its Fleet Requirements as most recently amended (Authorization
Request).\25\ Based on CARB's Authorization Request, on August 21, 2012
EPA invited comment on whether (a) CARB's determination that its
standards, in the aggregate, are at least as protective of public
health and welfare as applicable federal standards is arbitrary and
capricious, (b) California needs separate standards to meet compelling
and extraordinary conditions, and (c) California's standards and
accompanying enforcement procedures are consistent with section 209 of
the Act.\26\ The Federal Register notice stated that EPA would only
consider testimony and comment submitted in response to the current
request for comment because the CARB regulations were substantially
amended in December 2010.\27\ EPA conducted a hearing on the
Authorization Request on September 20, 2012, in Washington, DC.\28\ The
written
[[Page 58094]]
comment period closed on October 22, 2012.\29\ In addition, to provide
further opportunity to submit direct verbal comment for affected
parties who could not participate in the public hearing, EPA conducted
an informal teleconference on October 19, 2012.\30\
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\25\ See EPA-HQ-OAR-2008-0691-0270.
\26\ 77 FR 50500 (August 21, 2012).
\27\ ``Therefore, EPA will not be considering oral testimony or
written comments based on the prior Federal Register notices, since
CARB's December 2010 amendments are likely to affect many of these
prior comments. To the extent any entity believes that its prior
comments remain pertinent then EPA is requiring such comments be
resubmitted or incorporated into new comments.'' Id. at 50502. EPA
did not receive any adverse comment or suggestions that it is
inappropriate to exclude comments submitted prior to the August 12,
2012 Federal Register notice. As noted by AGC, ``While the Clean Air
Act has not changed, and the questions that EPA must address are one
and the same, the rule that CARB now seeks the authority to enforce
is very different from the rule that CARB originally submitted to
EPA.'' See EPA's Hearing transcript at 84 (EPA-HQ-OAR-2008-0691-
0298). CARB reincorporated by reference all of its prior submissions
regarding the Fleet Requirements.
\28\ The written transcript of this hearing is at EPA-HQ-OAR-
2008-0691-0298 (Hearing Transcript). EPA received testimony from
CARB, the Pacific Legal Foundation (PLF), the American Road and
Transportation Builders Association (ARTBA), the Manufacturers of
Emission Controls Association (MECA), the Associated General
Contractors of America (AGC), the Construction Industry Air Quality
Association (CIAQC), and the California Construction Trucking
Association (CCTA).
\29\ EPA received written comment from: Airlines for America
(A4A)--EPA-HQ-OAR-2008-0691-0297; Manufacturers of Emission Controls
Association (MECA) (Copy of oral testimony)--EPA-HQ-OAR-2008-0691-
0300; Steve Milloy (Copy of oral testimony)--EPA-HQ-OAR-2008-0691-
0301; Pacific Legal Foundation (PLF) (copy of oral testimony)--EPA-
HQ-OAR-2008-0691-0302; Associated General Contractors of America
(AGC) (Copy of oral testimony)--EPA-HQ-OAR-2008-0691-0303; PLF--EPA-
HQ-OAR-2008-0691-0304; Altfillisch Contractors (ACI)--EPA-HQ-OAR-
2008-0691-0305; Savala Equipment Company--EPA-HQ-OAR-2008-0691-0306;
Dr. Matthew Malkan--EPA-HQ-OAR-2008-0691-0307; Dr. James Enstrom--
EPA-HQ-OAR-2008-0691-0308; Dr. Phalen--EPA-HQ-OAR-2008-0691-0313;
California Construction Trucking Association (CCTA)--EPA-HQ-OAR-
2008-0691-0309; American Road & Transportation Builders Association
(ARTBA)--EPA-HQ-OAR-2008-0691-0310; Bay Cities Paving and Grading
(Bay Cities)--EPA-HQ-OAR-2008-0691-0311; Nick Silicz--EPA-HQ-OAR-
2008-0691-0313; Granite Rock--EPA-HQ-OAR-2008-0691-0314; Delta
Construction--EPA-HQ-OAR-2008-0691-0315; United Contractors--EPA-HQ-
OAR-2008-0691-0316; Construction Industry Air Quality Coalition
(CIAQC)--EPA-HQ-OAR-2008-0691-0317; California Air Resources Board--
EPA-HQ-OAR-2008-0691-0318 (CARB Written Comments) and EPA-HQ-OAR-
2008-0691-0319 (CARB Supplemental Comments); PLF Request to Reopen
Comment Period, etc--EPA-HQ-OAR-2008-0691-0320.
\30\ EPA-HQ-OAR-2008-0691-0321. As discussed below, EPA believes
that interested parties have adequate opportunity to present their
views through both the public hearing and by submitting written
comment.
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III. Discussion
A. California's Protectiveness Determination
Section 209(e)(2)(A)(i) of the Act sets forth the first of the
three criteria governing a request for authorization of relevant
standards--providing that EPA cannot grant the request if the agency
finds that California was arbitrary and capricious in its determination
that California standards will be, in the aggregate, at least as
protective of public health and welfare as applicable federal
standards.\31\
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\31\ As explained above, EPA's authorization analysis is guided
by precedent related to both section 209(e)(2) and to section
209(b), which contains similar, and in some cases identical,
language. See Engine Manufacturers Ass'n v. EPA (EMA), 88 F.3d 1075,
1085-87 (D.C. Cir. 1996).
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EPA maintains that the phrase ``California standards'' means
California's entire group of standards (i.e. the overall program) that
is applicable to nonroad engine emissions. As explained below, while
evaluating California's protectiveness determination, EPA compares
California's standards to applicable federal standards. That comparison
is undertaken within the broader context of the California program
applicable to nonroad vehicles and engines, for which EPA previously
has granted authorization and which relies upon protectiveness
determinations that EPA in its authorization decisions found not to be
arbitrary and capricious.\32\
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\32\ In situations where there are no Federal standards directly
comparable to the specific California standards under review, the
analysis then occurs against the backdrop of previous waivers which
determined that the California program was at least as protective of
the federal program. In a prior EPA waiver pertaining to
California's zero-emission vehicle program (ZEV) for which there are
no comparable Federal standards, EPA also took into consideration
California's existing low-emission vehicle program (LEV II) and
greenhouse gas emission standards (GHG) applicable to light-duty
vehicles. ((LEV II + ZEV) + GHG). See 71 FR 78190 (December 28,
2006), Decision Document for Waiver of Federal Preemption for
California Zero Emission Vehicle (ZEV) Standards (December 21,
2006).
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As noted above, EPA is guided in its interpretation of the section
209(e)(2) authorization criteria by the similar language in section
209(b) pertaining to waivers of preemption for new motor vehicle
standards. Therefore, the evaluation of the protectiveness of CARB's
nonroad standards under section 209(e)(2)(A)(i) follows the instruction
of section 209(b)(2), which states: ``If each State standard is at
least as stringent as the comparable applicable Federal standard, such
State standard shall be deemed to be at least as protective of health
and welfare as such Federal standards for purposes of [209(b)(1)].''
EPA evaluates the stringency of California's standards relative to
comparable EPA emission standards. To review California's
protectiveness determination under section 209(e)(2)(A)(i), EPA
conducts its own analysis comparing the newly adopted California
standards to comparable applicable Federal standards. EPA traditionally
makes a quantitative comparison of relevant numeric emission standards
to determine whether the California standards are more or less
protective than the Federal standards.\33\
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\33\ In situations where there are no Federal standards directly
comparable to the specific California standards under review, the
analysis then occurs against the backdrop of previous waivers which
determined that the California program was at least as protective of
the federal program ((LEV II + ZEV) + GHG). See 71 FR 78190
(December 28, 2006), Decision Document for Waiver of Federal
Preemption for California Zero Emission Vehicle (ZEV) Standards
(December 21, 2006).
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As explained above in the section on burden and standard of proof,
any finding that California's determination was arbitrary and
capricious under section 209(b)(1)(A) must be based upon '''clear and
compelling evidence' to show that proposed [standards] undermine the
protectiveness of California's standards.'' \34\ Accordingly, even if
EPA's own analysis of comparable protectiveness, or one submitted by a
commenter, might diverge from California's analysis, that alone would
not provide a sufficient basis for EPA to make a section 209(b)(1)(A)
finding that California's protectiveness finding is arbitrary and
capricious.
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\34\ MEMA I, 627 F.2d at 1122.
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1. Based on EPA's Traditional Analysis, is California's Protectiveness
Determination Arbitrary and Capricious?
In adopting the initial version of the Fleet Requirements, CARB
approved Resolution 07-19, in which it declared:
Be it further resolved that the Board hereby determines, in
accordance with CAA section 209(e)(2), that to the extent the
regulations approved herein affect nonroad vehicles or nonroad
engines as defined in CAA section 216(10) and (11), the emission
standards and other requirements related to the control of emissions
in the regulations approved herein are, in the aggregate, at least
as protective of public health and welfare as applicable federal
standards, California needs its nonroad emission standards to meet
compelling and extraordinary conditions, and the standards and
accompanying enforcement procedures approved herein are consistent
with CAA section 209.\35\
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\35\ CARB Authorization Request at 17.
With the most recent Fleet Requirements amendments in 2010, the
Board reaffirmed its protectiveness finding in Resolution 10-47.\36\
CARB maintains that there is no basis for EPA to find the Board's
determination (which applies solely to standards for in-use nonroad
engines) is arbitrary and capricious since EPA's authority, under the
CAA, is limited to new engines, vehicles, and equipment. As a result,
EPA has not adopted any federal standards or requirements for in-use
nonroad engines. CARB notes that there is no question that its Fleet
Requirements are at least as protective of public health and welfare as
[[Page 58095]]
applicable federal standards, given the lack of any comparable EPA
standards.\37\
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\36\ ``BE IT FURTHER RESOLVED that the Board hereby determines,
in accordance with CAA section 209(e)(2), that the proposed
amendments as they affect nonroad vehicles or nonroad engines as
defined in CAA section 216 (10) and (11), do not undermine the
Board's previous determination that the regulation's emission
standards, other emissions related requirements, and associated
enforcement procedures are, in the aggregate, at least as protective
of public health and welfare as applicable federal standards, are
necessary as part of ARB's off-road emission program to meet
compelling and extraordinary conditions existing in the state, and
are consistent with CAA section 209.'' CARB Resolution 10-47EPA-HQ-
OAR-2008-0691-0283.
\37\ Authorization Request at 18, citing Engine Manufacturers
Association v. EPA, (D.C. Cir. 1996) 88 F.3d at 1075, 1089-1090.
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As described above, EPA's traditional analysis has been to evaluate
California's protectiveness determination by comparing the newly
adopted California standards to applicable EPA emission standards for
the same pollutants from the industry sector. CARB is correct that
EPA's authority to adopt emission standards and other requirements
related to the control of nonroad emissions is limited to new engines,
vehicles, and equipment,\38\ and that as a result EPA has not adopted
any standards or requirements for in-use nonroad engines.
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\38\ See 42 U.S.C. 7547 (Section 213 of Clean Air Act).
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EPA already has determined that California was not arbitrary and
capricious in its determination that California standards applicable to
new nonroad CI engines are at least as protective as comparable Federal
standards.\39\ The in-use Fleet Requirements will achieve emission
reductions in addition to those achieved by the previously authorized
new nonroad engine standards, for which CARB made a protectiveness
finding that EPA found not to be arbitrary and capricious. According to
CARB, the Fleet Requirements are expected to result in a reduction of
0.5 tons/day of NOX in the South Coast and 0.3 tons/days in
San Joaquin Valley in 2014, along with 3.2 tons/day and 1.9 tons/day in
these respective areas in 2023.\40\ As such, the Fleet Requirements
achieve additional emission reductions beyond those attained under CARB
emission standards applicable to new nonroad CI engines, which EPA has
already determined to be as protective, in the aggregate, as applicable
federal standards. Accordingly, there is no basis for determining that
CARB's protectiveness finding with regard to the in-use Fleet
Requirements is arbitrary and capricious.
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\39\ 75 FR 8056 (February 23, 2010).
\40\ CARB Written Comments at 10.
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Further, as noted above, EPA is guided in its interpretation of
209(e)(2)(A)(i) by section 209(b)(2). Section 209(b)(2) states: ``If
each State standard is at least as stringent as the comparable
applicable Federal standard, such State standard shall be deemed to be
at least as protective of public health and welfare as such Federal
standards for purposes of paragraph (1).'' In this instance there is no
comparable applicable Federal standard for in-use nonroad CI engines
and thus there is no basis for determining the CARB's protectiveness
finding is arbitrary and capricious through the application of section
209(b)(2).
Finally, EPA received no comments or evidence suggesting that
CARB's protectiveness determination, under EPA's traditional analysis,
is arbitrary and capricious. In particular, no commenter disputes that
California standards, whether looking at the particular California
standards being authorized in this proceeding or the entire suite of
California standards for nonroad engines, are at least as stringent, in
the aggregate, as applicable federal standards.
In light of the foregoing, EPA finds that CARB's Fleet Requirements
achieve additional emission reductions beyond CARB's requirements
applicable to new nonroad CI engines, and further finds that the
opponents of authorization have not presented evidence to show that
CARB's protectiveness determination is arbitrary and capricious.
Accordingly, applying the traditional comparative analysis, we cannot
find that CARB's protectiveness determination is arbitrary and
capricious.
2. Is CARB's Protectiveness Determination Arbitrary and Capricious
Based on Other Effects of California's Fleet Requirements?
Having addressed the protectiveness inquiry under EPA's traditional
analysis, we turn now to the question whether we should use a different
analytical approach and, if so, whether a different approach would
yield a different outcome. EPA received one comment suggesting that
EPA's analysis under section 209(e)(2)(A)(i) should be based on a
broader inquiry into the effects of CARB's Fleet Requirements.\41\
Relatedly, EPA received one other comment specifically questioning
whether CARB's Fleet Requirements are as protective of applicable
Federal requirements in light of the Fleet Requirements' alleged
adverse impacts on needed transportation and infrastructure development
across the country as well as in California.\42\ The latter commenter
suggested, for example, that CARB's rule ``could'' severely impact
efforts at improving the nation's infrastructure because transportation
projects by necessity involve moving construction equipment across
state lines. The commenter stated that equipment associated with such
national projects would necessarily have to meet CARB's Fleet
Requirements, increasing costs, unless fleet operators were able to
differentiate such equipment that would only be used for California
projects.\43\ The commenter argues that increased costs as a result of
the Fleet Requirements could in turn prevent or delay needed
construction of infrastructure such as roads, schools, housing and
levees, and that such delay or prevention could adversely affect public
health and safety impacts in California and in other states.\44\ EPA
received further comment suggesting that CARB is prioritizing one
public health issue (air quality) over another (safe roads and
infrastructure improvements) and thus California's protectiveness
determination is ``arbitrary and capricious.'' \45\
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\41\ See Delta Construction.
\42\ See Hearing Transcript and written comment (ARTBA).
\43\ Id.
\44\ Id.
\45\ Id.
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EPA also received a series of comments from general contracting
companies and others that highlighted what they believe to be the
adverse economic impacts of the Fleet Requirements. For example,
several commenters stated that the regulation would have some
combination of the following impacts: Significant layoffs, increased
unemployment, and disadvantage to family-owned and other small
businesses. Such impacts, the commenters argue, would have negative
rather than the intended positive effects on public health.\46\ One
commenter asserted that the correlation between poor health and poverty
or lack of employment is much stronger than the correlation between
poor health and air pollution. The commenter claims that because of
such economic and social impacts, regulations such as the Fleet
Requirements will be harmful to California's citizens and that the
health benefits from CARB's regulation are dubious if not
counterproductive.\47\ These comments, by and large, do not refer
specifically to CARB's protectiveness determination or section
209(e)(2)(A)(i) and it is not clear whether commenters are referring to
EPA's analysis under that section.
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\46\ Id, see also CCTA, Savala Equipment Rentals, Delta
Construction.
\47\ See Delta Construction. This comment is also addressed
below under the second authorization criterion of whether California
needs its standards to meet compelling and extraordinary conditions.
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Finally, EPA received comment that does refer to CARB's
protectiveness determination, suggesting it was arbitrary and
capricious, but basing this claim on a variety of concerns that do not
directly relate to CARB's actual protectiveness determination (e.g.
[[Page 58096]]
alleged flaws in CARB's emission modeling--including CARB's estimates
of economic recovery scenarios--as well as concerns with the alleged
impact of the Fleet Requirements on fleet operator assets leading to
more unemployment and associated poor health, and concerns related to
the health effects of PM2.5).\48\
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\48\ See CCTA.
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CARB's written comments note that the Board has repeatedly
determined that its in-use off-road regulations are, in the aggregate,
at least as protective of public health and welfare as applicable
federal standards. In addition to the fact that EPA only has authority
to adopt standards related to the control of emissions for new nonroad
engines, CARB notes that EPA has previously stated that the phrase
``state standards'' as used in the protectiveness determination means
the entire California set of standards (i.e. program) applicable to the
relevant category of vehicles or engines. Further, CARB asserts that
EPA has previously granted authorization to California's emission
standards for new nonroad engines, and the in-use Fleet Requirements
will yield emission reductions in addition to the new nonroad engine
standards that were the subject of prior protectiveness findings, thus
ensuring that the Fleet Requirements are of necessity more stringent
than those covered by federal new engine emission standards alone.\49\
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\49\ See CARB's Written Comments.
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CARB responds to criticisms that it prioritized air quality health
benefits and did not consider dis-benefits (e.g. increased costs for,
and possible delay of, needed highway safety projects and improvements
or other infrastructure) by stating that the latter set of concerns
falls outside the scope of a section 209 protectiveness determination.
CARB maintains that the plain language and intent of section
209(e)(2)(A)(i) is that review of California's protectiveness
determination should be based exclusively on whether its ``standards
will be, in the aggregate, at least as protective of public health and
welfare as applicable Federal standards.'' Since this language is
almost identical to the protectiveness criterion language in section
209(b)(1), CARB maintains that EPA should thus follow the directive of
Congress in section 209(b)(2) that:
If each State standard is at least as stringent as the
comparable applicable Federal standard, such State standard shall be
deemed to be at least as protective of health and welfare as such
Federal standards for purpose of paragraph (1).
CARB points to EPA's 2009 waiver of California's light-duty
greenhouse gas standards (EPA's 2009 GHG Waiver) where EPA concluded
that, in considering whether California's protectiveness determination
is arbitrary and capricious under section 209(b)(1)(A), the agency
``has always interpreted `applicable Federal Standards' as limiting
EPA's inquiry to motor vehicle emission standards established by EPA
under the Clean Air Act that apply to the same cars and the same air
pollutants or group of pollutants as considered by California's
aggregate protectiveness finding.'' \50\ CARB argues that same analysis
should apply to nonroad authorizations. CARB maintains that if EPA were
to require the Board to consider factors other than aggregate emission
standards in making the Board's protectiveness determination, this
would undermine the broad discretion that Congress intended to provide
California in making policy decisions on how best to address
California's severe air pollution.\51\
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\50\ See EPA's greenhouse gas waiver decision issued in 2009
(2009 GHG Waiver Decision) at 74 FR 32743 (July 8, 2009).
\51\ Id. at 4-5 (citing MEMA I, 627 F.2d at 1122
[``(C)ongressional intent to provide California with the broadest
discretion in setting regulations it finds protective of the public
health and welfare.'']); see also 40 FR 23102, 23104 (May 28, 1975).
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CARB also disagrees with opponents' arguments that the Fleet
Requirements will delay highway safety improvements. CARB notes that,
even before the 2010 amendments, the regulations' expected maximum
costs were projected to be so small (less than one percent) compared to
overall construction spending, that they would not be expected to
decrease or delay constructions projects. With the 2010 amendments,
CARB expects compliance costs to be significantly lower and even less
likely to delay construction projects, including highway safety
projects.\52\
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\52\ Id.
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EPA agrees that the phrase ``California standards'' means the
entire California nonroad emissions program (i.e. the set of all
nonroad standards), or at the very least all of California's standards
for nonroad CI engines, which is the category of engines being
regulated by California in the Fleet Requirements. Therefore, as
explained above, when evaluating California's protectiveness
determination, EPA compares the California requirements to federal
standards applicable to the relevant category of engines. Again, that
comparison is undertaken within the broader context of the previously
authorized California standards for the relevant category of engines,
which rely upon protectiveness determinations that EPA previously has
found were not arbitrary and capricious. Finally, as discussed above,
no commenter disputes that California standards, whether looking at the
particular standards being authorized in this proceeding or the entire
suite of standards for nonroad engines, are more stringent than federal
standards.
The only issue in dispute is whether other information provided by
commenters, outlined at the beginning of this section, provides clear
and compelling evidence that California was arbitrary and capricious in
finding its standards are in the aggregate at least as protective of
public health and welfare as applicable federal standards.
EPA previously has considered whether its traditional analysis is
sufficient to properly review CARB's protectiveness determination with
regard to the ``in-use effects'' of CARB's regulations. Analysis of
such in-use effects remained focused on the actual emission reductions/
benefits expected from CARB's regulation.\53\ In EPA's 2009 GHG Waiver
Decision granting a waiver of preemption for CARB's greenhouse gas
(GHG) standards for light duty vehicles, we noted that, given the
legislative history and text of section 209(b)(2), EPA would need a
concrete factual basis to examine the in-use effect of California's GHG
standards on its broader LEV II program as compared to the Federal Tier
II program. EPA did not take a position as to the validity of the
suggestion that the type of analysis discussed in EPA's traditional
protectiveness analysis is insufficient. Rather, EPA reached the
conclusion that commenters who opposed the GHG waiver did not meet
their burden of proof in presenting clear and compelling factual
evidence (in the context of the regulatory effect on real-world in-use
emissions) that CARB's protectiveness determination was arbitrary and
capricious.
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\53\ See (2009 GHG Waiver Decision) at 74 FR 32743, 32758.
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We recount this history to contrast it with the comments received
opposing the Fleet Requirements authorization on the basis of various
safety, economic, and health arguments. In the instant proceeding, EPA
received no comments indicating why EPA's review of CARB's
protectiveness determination with regard to the Fleet Requirements
should be broader than past reviews, and/or should be based on anything
other than an examination of the stringency of comparable applicable
federal standards.
[[Page 58097]]
Further, the opponents of the Authorization Request provide no
analysis of the statutory language or history of section
209(e)(2)(A)(i) to support their view that the review of the
``protectiveness'' finding should be broader than EPA's traditional
review. Nor do they provide any significant analysis or calculus as to
how EPA should or would weigh these competing interests (i.e. those
that go beyond the comparative stringency of applicable state and
federal emission standards) in making its determination. While EPA
recognizes that commenters have expressed significant concerns
regarding the potential business impacts of the Fleet Requirements on
individual contractors and on employment, a review of CARB's
protectiveness determination based upon such factors would be
inconsistent with the broad discretion that Congress intended to
provide California in making policy decisions on how best to address
California's severe air pollution.\54\ As EPA has previously concluded:
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\54\ See MEMA I, 627 F.2d at 1122 [``(C)ongressional intent to
provide California with the broadest possible discretion in setting
regulations it finds protective of the public health and
welfare.'']; see also 40 FR 23102, 23104 (May 28, 1975).
[Congressional] sponsors of the (waiver) language eventually
adopted referred repeatedly to their intent to make sure that no
``Federal bureaucrat'' would be able to tell the people of
California what auto emission standards were good for them as long
as they were stricter than the Federal standards.\55\
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\55\ 40 FR 23101, 23102 (May 28, 1975).
In our view, the statutory language of section 209(e)(2)(A)(i)--
both on its face and as read together with 209(b)(2)--reflects
Congress's intention that EPA evaluate only the comparative stringency
of the relevant California and EPA emission standards. As discussed
above, the text, structure, and history of the California waiver
provision clearly indicate a congressional intent that EPA leave the
decision on ``ambiguous and controversial matters of public policy'' to
California's judgment. That has been EPA's consistent practice under
section 209. As the court stated in MEMA I, Congress's intent in
amending the protectiveness determination language in 1977 was to
afford California the broadest possible discretion in selecting the
best means to protect the health of its citizens. EPA therefore
considers it inappropriate, in the context of reviewing CARB's
protectiveness determination, to second-guess CARB's policy choices or
to weigh competing health and welfare interests that are best left to
California.
As explained below under the third authorization criterion--
consistency with section 209 (including consistency with 202(a))--EPA
interprets the ``cost of compliance'' in section 202(a) to refer to the
direct economic costs of CARB's standards and the timing of a
particular emission control regulation rather than to its social
implications.\56\ Similarly, EPA believes it appropriate to limit our
examination for purposes of the protectiveness comparison to the
specific effects the California and EPA emission standards have on
emissions rather than performing an analysis of social impacts or other
secondary implications. Policy decisions with regard to how various
potential non-emissions impacts of an emission regulation can or should
be weighed against one another is inherently and properly within the
sphere of the state regulatory authority promulgating the regulation.
Such decisions should not be made or reviewed by EPA, which Congress
has given the limited role of reviewing the regulations based on the
three specified and relatively narrow statutory criteria, consistent
with Congress's intent to uphold California's broad regulatory
discretion in this sphere.
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\56\ See S. Rep. No. 192, 89th Cong., 1st Sess. 5-8 (1965); H.R.
Rep. No. 728, 90th Cong., 1st Sess. 23 (1967), U.S. Code Cong. &
Admin. News 1967, p. 1938.
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For all these reasons, EPA declines to depart from its traditional
analysis of the protectiveness criterion under section 209(e)(2)(A)(i),
as discussed above. Even if there were a valid basis for considering
the types of non-air quality impacts alleged by the opponents of the
Authorization Request, the opponents did not meet their burden to
provide clear and convincing evidence that CARB's analysis of the
effects of the Fleet Requirements is unreasonable. For EPA to make a
section 209(e)(2)(A)(i) finding that California's protectiveness
determination is arbitrary and capricious, it is not enough for
authorization opponents to provide competing analysis or alternative
policy considerations and arguments. To support a denial of
authorization under this criterion, commenters must show that
California's analysis, or the assumptions on which California relied to
support its protectiveness determination, were arbitrary and
capricious. In this instance, the opponents of the authorization have
suggested that CARB's Fleet Requirements could make construction
projects more expensive and this could lead to delays. But they have
not introduced any actual evidence that such projects will be suspended
due to the costs associated with the Fleet Requirements, and certainly
not that the projected increase in costs, as estimated by CARB after
the 2010 amendments, will be significant enough to delay or prevent
such projects. Similarly, the opponents of the waiver have not
introduced substantial evidence that the Fleet Requirements
themselves--as opposed to a host of other factors, including the
economic downturn, that have affected the economy over the last several
years--will result in a loss in the number of employees or actual
business. In the absence of any such evidence, EPA could not find
California's protectiveness determination to be arbitrary and
capricious even if these alleged impacts were an appropriate subject
for analysis under section 209(e)(2)(A)(i).
Regarding the comment that CARB's regulation could adversely affect
health and welfare in other states, EPA does not find the comment to be
a basis for judging California's protectiveness determination to be
arbitrary and capricious for two reasons. First, a change in emissions
outside of California would not lead to a different conclusion
regarding the relative protectiveness of the Fleet Requirements to
federal requirements within California. Second, the commenters do not
provide any substantive or factual evidence to show significant
emissions impacts in other states. We would also note that other states
may decide independently to adopt California's regulations.
In response to the comment that California's regulations are
arbitrary and capricious, we note that EPA's sole review under section
209(e)(2)(A)(i) is whether California's protectiveness determination
was arbitrary and capricious. Congress did not give EPA wide-ranging
authority to examine the overall reasonableness of California's
regulations. As discussed above, the policy decisions made by CARB in
enacting its regulations are not reviewed generally by EPA, and, as
Congress intended, EPA leaves such policy decisions to California.
3. Section 209(e)(2)(A)(i) Conclusion
In light of the foregoing, based on the record before us, EPA finds
that opponents of the authorization have not shown that California was
arbitrary and capricious in its determination that its standards are,
in the aggregate, at least as protective of public health and welfare
as applicable federal standards.
[[Page 58098]]
B. Does California need its standards to meet compelling and
extraordinary conditions?
Section 209(e)(2)(A)(ii) instructs that EPA cannot grant an
authorization if the Agency finds that California ``does not need such
California standards to meet compelling and extraordinary conditions .
. ..'' EPA's inquiry under this second criterion (found both in
paragraphs 209(b)(1)(B) and 209(e)(2)(A)(ii)) has been to determine
whether California needs its own mobile source pollution program (i.e.
set of standards) for the relevant class or category of vehicles or
engines to meet compelling and extraordinary conditions, and not
whether the specific standards that are the subject of the
authorization or waiver request are necessary to meet such
conditions.\57\ In a 2009 waiver action, for example, EPA examined the
language of section 209(b)(1)(B) and reiterated its longstanding
traditional interpretation that the better approach for analyzing the
need for ``such State standards'' to meet ``compelling and
extraordinary conditions'' is to review California's need for its
program (i.e. set of standards) as a whole, for the class or category
of vehicles being regulated, as opposed to its need for the individual
standards that are the subject of a waiver or authorization
request.\58\
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\57\ See 74 FR 32744, 32761 (July 8, 2009); 49 FR 18887, 18889-
18890 (May 3, 1984).
\58\ See EPA's 2009 GHG Waiver Decision wherein EPA rejected the
suggested interpretation of section 209(b)(1)(B) as requiring a
review of the specific need for California's new motor vehicle
greenhouse gas emission standards as opposed to the traditional
interpretation (need for the program as a whole) applied to local or
regional air pollution problems.
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As noted above, CARB first adopted its Fleet Requirements in 2007.
CARB designed the 2007 regulation to address its determination that
legacy fleets--and particularly nonroad CI vehicles--were responsible
for significant PM and NOX emissions. CARB's Initial
Statement of Reasons (ISOR) states, in part:
Off-road vehicles are a significant source of diesel particulate
matter, as well as NOX emissions that lead to ozone and
ambient PM. Statewide, they are responsible for nearly a quarter of
the total PM emissions from mobile diesel sources and nearly a fifth
of the total NOX emissions from mobile diesel sources.
Although increasingly stringent new engine standards are reducing
emissions from off-road diesel vehicles over time, because of their
durability, most vehicles operate for several decades before being
retired. Thus, in-use off-road diesel vehicles would continue to
pose significant health risk for many years if this proposed
regulation is not adopted. . . . without reductions from this large
source category, the South Coast and San Joaquin Valley would be
unable to attain the federal ambient air quality standards.
. . . [E]missions would trend naturally down as the fleet
gradually turned over to newer, cleaner engines. However, these
reductions are not sufficient for many areas of the state to meet
clean air standards. Because of this, the proposed regulation
accelerates this anticipated reduction in emissions.\59\
\59\ See STAFF REPORT: INITIAL STATEMENT OF REASONS FOR PROPOSED
RULEMAKING (ISOR) at EPA-HQ-OAR-2008-0691-0002, attachment A at 7-
10. EPA notes that while CARB has incorporated by reference its
earlier submissions to EPA docket EPA-HQ-OAR-2008-0691 we recognize
that CARB has modified its emission inventory modeling.
Nevertheless, the NR CI legacy fleet in California continues to
present California with serious air quality issues according to
CARB.
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The 2010 amendments affirmed CARB's longstanding position that
California continues to need its own nonroad engine and vehicle program
to address serious air pollution problems the state still
confronts.\60\ CARB's Authorization Request notes that California and
particularly the South Coast and San Joaquin Valley air basins continue
to experience some of the worst air quality in the nation and continue
to be in non-attainment with national ambient air quality standards
(NAAQS) for fine particulate matter (PM2.5) and ozone.\61\
``The unique geographical and climatic conditions, and the tremendous
growth in California's on- and off-road vehicle population, which moved
Congress to authorize the State to establish on-road motor vehicle
standards in 1970 and off-road engine standards in 1990, still exist
today. . . . Nothing in these conditions has changed to warrant a
change in this determination. Accordingly, there can be no doubt of the
continuing existence of compelling and extraordinary conditions
justifying California's need for its own mobile source emissions
control program.'' \62\
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\60\ See CARB Resolution 10-47 at EPA-HQ-OAR-2008-0691-0283.
Specifically, the Board stated, in part:
WHEREAS, in-use off-road diesel vehicles operating in the state,
as a class, continue to be a significant source of air pollution
emissions in California that contribute to continuing violations of
the national ambient air quality standards (NAAQS) for both
particulate matter (PM) less than 2.5 microns (PM2.5) and
ozone, and to continuing localized health risk, including premature
death, associated with exposure to PM2.5;
WHEREAS, Staff Report 2007 further discussed the results of ARB
staff's evaluations of the non-cancer health effects of exposure to
primary and secondary PM emissions from the vehicles subject to the
initially proposed Off-Road regulation, and these evaluations
indicated that exposure to these emissions can be associated with
premature deaths and other non-cancer health impacts;
WHEREAS, the United States Environmental Protection Agency (U.S.
EPA) in a recently published review of the PM-related health science
literature, which is the first part of an ongoing review of the
national ambient air quality standards for PM, concluded that long-
term exposure to PM2.5 is causally associated with
premature mortality, and that premature deaths caused by
PM2.5 occur at levels as low as 5.8 micrograms per cubic
meter, which is considerably lower than the current national
standard of 15 micrograms per cubic meter;
WHEREAS, the U.S. EPA risk assessment methodology is the basis
for ARB's estimate that 9,200 (7,300 to 11,000, 95 percent
confidence interval) premature deaths occur annually in California
and that reducing emissions to meet the Federal standard would
result in 2,700 fewer premature deaths annually;
WHEREAS, the Board further finds based on its independent
judgment and analysis of the entire record before it that:
In-use off-road diesel vehicles and engines that operate in the
State--whether based in California or not--continue to be
significant contributors of diesel PM and NOX emissions,
which California must reduce to attain the ozone and
PM2.5 NAAQS and to reduce the health risks associated
with such pollutants;
Even with the amendments and economic relief proposed, the
proposed amended regulation would significantly reduce diesel PM and
NOX emissions and associated cancer, premature mortality,
and other adverse health effects statewide, such that emission
reductions from the proposed amended regulation are expected to
prevent 470 premature deaths from 2014 to 2029.
\61\ CARB Authorization Request at 18, citing 7 FR 4052, 4054
(July 11, 2011).
\62\ CARB Authorization Request at 18, citing 74 FR 32744, 32762
(July 8, 2009); 76 FR 77515, 77518 (December 13, 2011).
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CARB's Authorization Request also notes the continuing importance
and need to address the NAAQS for pollutants considered to be harmful
to public health, including PM2.5 and ozone.\63\ For areas
in California that exceed the NAAQS, CARB is responsible under CAA
section 110 for developing a State Implementation Plan (SIP) that
describes how the state will attain the standards by certain deadlines.
The South Coast Air Basin and the San Joaquin Valley Air Basin are in
nonattainment for both PM2.5 and the 8-hour ozone standard.
Significant reductions in NOX emissions are needed to attain
the standards because NOX leads to formation in the
atmosphere of both ozone and PM2.5. Diesel PM emissions
reductions are also needed because diesel PM contributes to ambient
concentrations of PM2.5. The South Coast and San Joaquin
Valley air basins are both required to be in attainment with the
PM2.5 standard by 2014. The San Joaquin Valley and South
Coast air basins are required to be in
[[Page 58099]]
attainment of the 8-hour ozone standard by 2023.\64\
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\63\ CARB notes: Ambient PM2.5 is associated with
premature mortality, aggravation of respiratory and cardiovascular
disease, asthma exacerbation, chronic and acute bronchitis and
reductions in lung function. Ozone is a powerful oxidant. Exposure
to ozone can result in reduced lung function, increased respiratory
symptoms, increased airway hyper-reactivity, and increased airway
inflammation. Exposure to ozone is also associated with premature
death, hospitalization for cardiopulmonary causes, and emergency
room visits for asthma.
\64\ CARB Authorization Request at 3-4.
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The SIP for the South Coast and San Joaquin air basins demonstrates
attainment of the PM2.5 standard by 2014, but only based on
projected achievement of PM2.5 emission reductions of nearly
15 percent in the South Coast Air Basin and 25 percent in the San
Joaquin Valley Air Basin. CARB's Authorization Request states that
NOX emissions must be reduced by approximately 50 percent to
meet the PM2.5 standard in the South Coast and the San
Joaquin Valley air basins. Even greater NOX reductions, on
the order of 75 to 88 percent, will be needed to achieve the 8-hour
ozone standard by 2023. California's 2007 SIP included the initial
version of the Fleet Requirements as a control measure. CARB's legal
commitment to achieve the emission reductions specified in the SIP
relies upon the emission reductions from the Fleet Requirements
regulation in the South Coast and the San Joaquin Valley.\65\ In its
ISOR, CARB notes ``Despite the major economic recession and revisions
to the off-road regulation inventory, the in-use off-road diesel
vehicle category remains an important source of emissions. In 2010,
staff estimates the off-road vehicles subject to the off-road
regulation are the fourth largest source of diesel PM in California (7
percent of total) and the sixth largest source of NOX from
all sources (4 percent of total).'' \66\
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\65\ Id.
\66\ EPA-HQ-OAR-2008-0691-0002 Attachment A, at 13.
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1. Should EPA Review this Criterion Based on the Need for California's
Nonroad Program or the Need for the Fleet Requirements?
In addressing whether California needs ``such State standards to
meet compelling and extraordinary conditions,'' we must first address
the question whether it is appropriate for EPA to evaluate this
criterion based on California's need for its nonroad emission program
as a whole, or whether we instead should evaluate only the particular
standards being addressed in this authorization proceeding.
As noted above, CARB maintains that the relevant inquiry is whether
California needs its own emission control program as opposed to the
need for any given standard as necessary to meet compelling and
extraordinary conditions. CARB notes that in prior decisions the
Administrator has determined that:
``[C]ompelling and extraordinary conditions'' does not refer to
levels of pollution directly, but primarily to the factors that tend
to produce them: Geographical and climatic conditions that, when
combined with large numbers and high concentrations of automobiles
create serious air pollution problems.\67\
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\67\ CARB Authorization Request at 18.
EPA has also consistently held that the phrase ``the need for
California emission standards'' refers to the need for California's
program (i.e. set of standards) applicable to the relevant category of
vehicles or engines, and not the need for the particular standards that
are the subject of an authorization request. In the instant proceeding,
EPA received comments disputing this approach, which we discuss below.
a. Comment From Pacific Legal Foundation
EPA received comment from the Pacific Legal Foundation (PLF)
challenging both California's and EPA's interpretation of the
``compelling and extraordinary conditions'' criterion in section
209(e)(2)(A)(ii). PLF asserts that based on both the plain language of
the provision and its legislative history, the word ``standards''
should be read to refer only to particular standards, and not to the
entire California program for the relevant category of engines or
vehicles.\68\
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\68\ As explained below, EPA believes it important to examine
the language of section 209(e)(2)(A)(ii) precisely as Congress set
it forth. Therefore, to be clear, the phrase ``the need for
California emission standards'' does not appear in this section.
Rather, the language is ``No such authorization shall be granted if
the Administrator determines that--(ii) California does not need
such California standards to meet compelling and extraordinary
conditions.'' EPA's interpretation of this section includes an
examination of the significance of the word ``such'' before
``California standards.''
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PLF contends that California must apply for a waiver or
authorization on a case-by-case basis \69\ and that the Clean Air Act
requires EPA not grant California any waiver or authorization unless
California makes a showing that it has ``compelling and extraordinary
conditions'' necessitating the particular standards for which a waiver
or authorization is sought. PLF argues that CARB has put little
evidence in the record about the need for the Fleet Requirements.
Further, PLF asserts that ``Congress intended the word `standard' in
section 209 to mean quantitative level of emissions'' \70\ and that
there is no indication in the text or legislative history that by using
the term ``standard'' Congress really meant ``program'' or anything
other than ``standard.'' PLF states that Congress could have used the
term ``program'' rather than the term ``standards'' in the statute and
delegated to EPA the responsibility to make case by case decisions on
whether a particular standard was required or needed.
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\69\ PLF at 1.
\70\ PLF cites MEMA I at 1112-1113.
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In addition, PLF cites the legislative history of section 209 to
support its position that standards need to be justified on an
individual basis. Specifically, PLF cites the Senate Committee report
for the 1967 legislation, which in discussing section 208 (the
predecessor to what is now section 209) refers to California's
``compelling and extraordinary circumstances'' that are ``sufficiently
different from the nation as a whole to justify standards . . . [that]
may, from time to time, need to be more stringent than national
standards.'' \71\ PLF argues that this language indicates that Congress
intended California to justify specific standards ``from time to
time,'' and that it intended EPA to deny a waiver if California does
not require or need particular standards. PLF claims that if Congress
wanted to apply a need tests based on California's need for a program
as a whole then it could have stated so.
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\71\ S Rep No 90-403 at 33 (1967) (emphasis added).
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PLF further contends that in 1977, when Congress amended section
209(b)--Congress continued to focus on ``standards'' but with two
important additions. First, Congress amended the language relating to
the protectiveness determination to clarify that California's standards
need only be at least as protective as federal standards ``in the
aggregate''--making clear that California did not need to determine
that each individual standard would be more protective or stringent
than applicable federal standards. PLF asserts that this clarification,
however, applied only to the protectiveness determination. Second,
Congress tightened section 209(b)(1)(B) to provide that ``no such
waiver shall be granted if EPA finds that California . . . does not
need such standards to meet compelling and extraordinary conditions . .
..'' (emphasis added). PLF asserts that the preexisting 1967 language
had provided that EPA ``shall'' grant a waiver unless it finds
California did ``not require'' the underlying standards, whereas the
1977 amendments expressly prohibited EPA from granting a waiver where
California did not ``need'' a particular emissions standard. Based on
the foregoing, PLF argues that the 1977 amendments created two separate
tests for ``standards.'' The ``protectiveness'' test (under the first
waiver criterion), which
[[Page 58100]]
applies to the protectiveness of California's aggregate set of
standards, and the ``needs'' test (under the second waiver criterion),
which is based on a need for the particular standards for which a
waiver is sought and focuses on whether there are compelling conditions
in the state necessitating that particular standard.
PLF also maintains that EPA's traditional interpretation is
contrary to plain meaning of the CAA. PLF asserts that the term
``program'' is not used in section 209 and that the phrase ``such
California standards'' in 209(e)(2)(A)(ii) does not refer to the entire
California mobile source emissions program. PLF states that the phrase
``in the aggregate'' appears only once in section 209 and only under
the first waiver prong added in the 1977 amendments. ``In the
aggregate'' is set off by commas, PLF argues, providing evidence that
it pertains only to protectiveness under the first waiver criterion,
and does not apply to the ``needs'' inquiry under the second waiver
criterion. PLF maintains that the outcome of the protectiveness test
depends on California making a determination, whereas the outcome of
the needs tests depends on EPA making a finding. Further, PLF argues
that the protectiveness test affirmatively mandates that EPA approve
the waiver application if California makes the protectiveness
determination, while the ``needs test'' expressly prohibits EPA from
granting a waiver if EPA makes the requisite finding. Thus, PLF argues,
the first prong is written to broaden the likelihood of issuing a
waiver, whereas the second prong is written to narrow it.
PLF maintains that the two waiver prongs were intended to address
entirely different issues. Congress gave EPA greater authority to
approve waivers under the first prong, PLF asserts, but lesser
authority to approve waivers under the independent needs test. PLF
highlights that the sentence regarding ``protectiveness'' applies to
both ``standards and other requirements,'' whereas the sentence
establishing the needs test refers only to standards. This makes sense,
according to PLF, because Congress intended EPA to look holistically at
protectiveness and not at whether an individual standard was as
protective. To ensure CARB did not abuse the privilege, PLF argues,
Congress provided under the ``needs'' criterion that California could
not adopt any standard that it did not need or that was not
specifically designed to address California's ``peculiar'' conditions.
Finally, PLF maintains that EPA's traditional interpretation leads
to absurd results. PLF states that EPA itself has acknowledged that
conditions in California may improve, thereby eliminating the need for
the authority to waive preemption of California standards.\72\ Under
EPA's traditional interpretation, PLF argues, EPA would be forced to
deny a waiver request based on a finding that there is no longer a need
for the California program. PLF argues that such a finding would put in
jeopardy past waivers, as the positive (program-wide) ``needs'' finding
underpinning those past waivers would no longer be valid. PLF further
comments that a broad negative finding with regard to ``needs'' would
eliminate CARB's ability to maintain its own mobile source emission
standards program, separate from the federal program. In such
circumstances, PLF argues, EPA would be substituting its policy
judgment for that of Congress. If one interpretation leads to absurd
results and another does not, PLF argues, then the former must be
rejected.
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\72\ See 74 FR 32744, 32762 (July 8, 2009).
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b. EPA Response
EPA examined these same issues at length in the Agency's 2009
decision granting California's request for a waiver of preemption of
its GHG standards for light duty vehicles.\73\ Consistent with that
examination, EPA continues to believe that the traditional approach to
the compelling and extraordinary conditions criterion is appropriate.
That is, EPA believes it is proper to review California's need for its
emission program (i.e. set of standards) applicable to the relevant
category of vehicles or engines as a whole, rather than to follow an
interpretation that applies this criterion to specific standards that
are the subject of an authorization request.
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\73\ 74 FR 32744, 32759-32762 (July 8, 2009).
---------------------------------------------------------------------------
EPA's traditional interpretation is the most straightforward
reading of the text and legislative history of section 209(b) and
section 209(e). First, EPA disagrees with PLF's assertions regarding
the original language of the preemption provision promulgated in 1967.
The critical language in section 208(b) of the 1967 legislation
required that EPA`s predecessor department grant California a waiver of
section 208(a) preemption unless it found that California ``does not
require standards more stringent than applicable Federal standards to
meet compelling and extraordinary conditions . . ..'' This language did
not suggest a searching review of every California standard. Rather, it
required a waiver of preemption unless the agency determined that
California did not require more stringent ``standards''--a term that is
both general and plural--to meet compelling and extraordinary
conditions. This language is fully consistent with a review of
California's general need for more stringent standards and thus for its
own program (i.e. its own set of standards).
PLF's emphasis on the word ``standards,'' as opposed to ``program''
in this section is inapposite. EPA's use of the word ``program'' in
this context is simply meant to describe the group of standards
applicable to the engines and vehicles in question under California's
regulatory program, compared to those under the federal program. The
``program'' in this context is merely the standards being considered
together. It is fully consistent with the language of the statute to
review the need for the program (i.e. the set of relevant standards) as
a whole, rather than the need for individual standards. PLF's reference
to legislative history is consistent with EPA's view that the relevant
issue in determining whether a waiver is justified is California's
``circumstances'' being ``sufficiently different'', rather than the
specific need for any particular standard.\74\
---------------------------------------------------------------------------
\74\ PLF at 4.
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Beginning prior to the 1977 amendments, EPA has consistently
interpreted the ``compelling and extraordinary conditions'' criterion
to apply to the full California program (i.e. set of standards).\75\
When Congress re-evaluated this provision in 1977, it could have
revised the criterion to make clear that California must show each
standard is necessary. Instead, as discussed below, Congress went out
of its way to indicate that California is to be given even more
flexibility in designing its own motor vehicle program.\76\
---------------------------------------------------------------------------
\75\ See 38 FR 30136 (November 1, 1973).
\76\ MEMA I, 627 F.2d at 1110.
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PLF, moreover, does not take proper account of the critical
statutory change Congress made in 1977, which allowed California to
promulgate individual standards that are not as stringent as comparable
federal standards, as long as the standards are ``in the aggregate, at
least as protective of public health and welfare as applicable federal
standards.'' This decision by Congress requires EPA to waive preemption
of individual California standards that, in and of themselves, might
not be considered needed to meet compelling and extraordinary
circumstances, but are part of California's overall approach to
reducing vehicle emissions to address air pollution problems.
Although PLF is correct that the 1977 amendments formally separated
the ``protectiveness'' criterion from the ``need'' criterion, the
latter continues to
[[Page 58101]]
refer back to the language regarding protectiveness, by using the term
``such state standards.'' In addition, contrary to PLF's comments, the
creation of the ``in the aggregate'' test for protectiveness is
supportive of the argument that EPA is not to look at the need for each
individual standard. If EPA were required to look independently at the
need for each individual standard, any individual standard that was
less stringent than a federal standard might be considered unnecessary.
This would obviate the rationale for looking at the protectiveness of
California's standards ``in the aggregate'' under the first criterion--
effectively requiring EPA to give back in the second criterion what
Congress explicitly gave California in its revision to the first
criterion. Finally, it bears emphasis that the 1977 amendments
continued to require that EPA grant a waiver of preemption unless it
makes one of the findings in section 209(b)(1), thus continuing to put
the burden of proof on those opposing the waiver.\77\
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\77\ Id.
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Congress, in 1990, added language in section 209(e)(2)(A) creating
criteria for EPA authorization of California nonroad engine standards
that are essentially identical to the criteria for EPA waiver of
preemption of California's standards for new motor vehicles in section
209(b). In particular, Congress provided California with the discretion
to create a broad emissions program (i.e. ``California standards'')
that needs only to be as stringent as applicable EPA standards, in the
aggregate. Further, section 209(e)(2)(A)(ii) refers to whether ``such
California standards'' are needed to meet compelling and extraordinary
conditions, referring back to the general and plural term ``California
standards'' in the protectiveness finding.
The language of section 209(e)(2)(A) regarding the
``protectiveness'' determination by California refers only to
``California standards,'' not to each California standard individually.
Moreover, the use of the term ``in the aggregate'' makes clear that the
set of standards to be reviewed is the aggregate set of standards
applicable to the engines and vehicles being regulated. EPA is to
determine whether California's determination is arbitrary and
capricious under section 209(e)(2)(A)(i), and is to determine whether
California does not need ``such California standards'' to meet
compelling and extraordinary conditions. The natural reading of these
provisions leads EPA, in addressing the ``needs'' criterion, to
consider the same group of standards that California considered in
making its protectiveness determination. While the words ``in the
aggregate'' are not specifically applicable to section
209(e)(2)(A)(ii), this criterion does refer to the need for ``such
California standards,'' rather than ``each California standard'' or
otherwise indicate a standard-by-standard analysis. The text thus
indicates that the proper analysis is to review the aggregate set of
standards (i.e. the program) applicable to the regulated vehicles and
engines.\78\
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\78\ To the extent the provision is ambiguous, EPA's
interpretation is, at minimum, one that is reasonable and entitled
to deference under Chevron U.S.A. Inc. v. Natural Resources Defense
Council, Inc., 467 U.S. 837 (1984). It certainly is not
``unambiguously precluded'' by the language of the statute. See
Entergy Corp. v. Riverkeeper, Inc., 129 S.Ct. 1498 (2009) (``That
view governs if it is a reasonable interpretation of the statute--
not necessarily the only possible interpretation, nor even the
interpretation deemed most reasonable by the courts. Chevron U.S.A.
Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837, 843-
844 (1984).'') (``It seems to us, therefore, that the phrase ``best
available,'' even with the added specification ``for minimizing
adverse environmental impact,'' does not unambiguously preclude
cost-benefit analysis.''). Carrow v. Merit Systems Protection Board,
564 F.3d 1359 (Fed. Cir. 2009) (``[W]e are obligated to give
controlling effect to [agency's] interpretation if it is reasonable
and is not contrary to the unambiguously expressed intent of
Congress'', citing Entergy Corp.).
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PLF's discussion of case law interpreting the term ``standard'' is
inapposite. For example, although PLF points to both MEMA I and EMA,
those decisions address an entirely different issue relevant to section
209--i.e., whether the regulation set by California is, in fact, a
``standard,'' as opposed to another type of provision, like an
enforcement provision. These cases do not illuminate the issue of
whether EPA reviews each standard individually under sections
209(b)(1)(B) and 209(e)(2)(A)(ii), or whether it reviews California's
standards as a group (i.e. California's program for such engines) under
those provisions.
EPA's 2009 decision waiving preemption of California's GHG
standards for light duty vehicles considered the plain language and
legislative history of section 209(b)(1)(B) and determined that for all
pollutants, it was appropriate to review section 209(b)(1)(B) by
reviewing the need for California's motor vehicle program, rather than
individual standards. We incorporate that discussion into this decision
by reference because, as explained above, the language of section
209(e)(2)(A)(ii) is substantively the same as that in section
209(b)(1)(B) on this issue.
The 2009 GHG waiver decision included the following discussion,
which in particular addressed a 1984 decision waiving preemption for
earlier California PM standards:
[I]n the legislative history of section 209, the phrase
``compelling and extraordinary circumstances'' refers to ``certain
general circumstances, unique to California, primarily responsible
for causing its air pollution problem,'' like the numerous thermal
inversions caused by its local geography and wind patterns. The
Administrator also noted that Congress recognized ``the presence and
growth of California's vehicle population, whose emissions were
thought to be responsible for ninety percent of the air pollution in
certain parts of California.'' EPA reasoned that the term compelling
and extraordinary conditions ``do not refer to the levels of
pollution directly.'' Instead, the term refers primarily to the
factors that tend to produce higher levels of pollution--
``geographical and climatic conditions (like thermal inversions)
that, when combined with large numbers and high concentrations of
automobiles, create serious air pollution problems.''
The Administrator summarized that under this interpretation the
question to be addressed in the second criterion is whether these
``fundamental conditions'' (i.e. the geographical and climate
conditions and large motor vehicle population) that cause air
pollution continued to exist, not whether the air pollution levels
for PM were compelling and extraordinary, or the extent to which
these specific PM standards will address the PM air pollution
problem.\79\
\79\ 74 FR 32744, 32759 (July 8, 2009) (citations omitted).
The structure of section 209, as adopted in 1967 and as amended in
1977 and 1990, is notable in its focus on limiting the ability of EPA
to deny a waiver or authorization. This limitation preserves discretion
for California to construct its motor vehicle and nonroad programs as
it deems appropriate to protect the health and welfare of its citizens.
The legislative history indicates Congress quite intentionally
restricted and limited EPA's review of California's standards, and that
its express legislative intent was to ``provide the broadest possible
discretion [to California] in selecting the best means to protect the
health of its citizens and the public welfare.'' \80\ The D.C. Circuit
recognized that ``[t]he history of the congressional consideration of
the California waiver provision, from its original enactment up through
1977, indicates that Congress intended the State to continue and expand
its pioneering efforts at adopting and enforcing motor vehicle emission
standards different from and in large measure more advanced than the
corresponding federal program. In short to act as a kind of laboratory
for innovation. * * * For a court [to limit
[[Page 58102]]
California's authority] despite the absence of such an indication would
only frustrate the congressional intent.'' \81\
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\80\ 105 H.R. Rep. No. 294, 95th Cong., 1st Sess. 301-302
(1977). See MEMA, 627 F.2d at 1110-11.
\81\ MEMA, 627 F. 2d at 1111.
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In this context, it is fully consistent with the expressed
intention of Congress to interpret section 209(e)(2)(A)(ii) in a manner
that allows California the policy discretion to set its emission
program as it sees fit, subject to the limitation that its standards
remain, in the aggregate, as protective of public health and welfare as
applicable federal standards and that California continue to experience
compelling and extraordinary conditions. Congress intended to provide
California the broadest possible discretion to develop its nonroad
emissions program. Neither the text nor the legislative history of
section 209(b) or 209(e) indicates that Congress intended to limit this
broad discretion by requiring EPA to determine, on a case-by-case
basis, whether each specific standard is necessary or appropriate for
California. EPA's longstanding interpretation, accordingly, is directly
in line with the purpose of Congress.
This approach does not make section 209(b)(1)(B) or section
209(e)(2)(A)(ii) a nullity. EPA must still determine whether opponents
of authorization have met their burden to establish that California
does not need its nonroad program to meet the compelling and
extraordinary conditions. As discussed below, EPA does not believe that
burden has been met in this instance. We acknowledge, however, that
conditions in California may one day improve such that it no longer has
the need for a separate nonroad program to address certain air quality
problems. The statute contemplates that such improvement is possible.
PLF is incorrect in concluding that EPA's approach would lead to an
absurd outcome. EPA would not deny an authorization request under
section 209(e)(2)(A)(ii) unless it determined that the regulatory
program was not needed because compelling and extraordinary conditions
no longer exist in California. Furthermore, the basis for previously
waived or authorized standards would remain valid unless EPA determined
that the compelling and extraordinary conditions would not exist even
without those standards in place. This is consistent with the intent of
Congress to permit California to maintain separate emission standards
when compelling and extraordinary conditions exist. Thus, there would
be no absurd results regarding such standards.
Congress has directed EPA to exercise its technical judgment with
regard to all three authorization criteria, but has not authorized EPA
to substitute its policy judgment for California's judgment with regard
to which of its specific standards are or are not needed to meet its
compelling and extraordinary conditions. Those who oppose California
regulations for reasons other than the three criteria that Congress
specified in the statute have the ability to raise their legal, policy,
and other concerns in the state administrative process, or through
judicial review of the regulations themselves.
For these reasons, EPA believes that the better approach for
analyzing the need for ``such State standards'' to meet ``compelling
and extraordinary conditions'' is to review California's need for its
program, as a whole, for the class or category of vehicles being
regulated, as opposed to its need for the individual standards that are
the subject of an authorization request.
2. Does California Need its Nonroad Program to Meet Compelling and
Extraordinary Conditions?
Applying the traditional approach to application of the compelling
and extraordinary circumstances criterion under section
209(e)(2)(A)(ii), EPA cannot deny the authorization of the Fleet
Requirements on this basis.
CARB has repeatedly demonstrated the need for its nonroad program
to address compelling and extraordinary conditions in California. As
noted above, in its Authorization Request, CARB stated that the unique
geographical and climatic conditions and the tremendous growth in
California's onroad and nonroad vehicle population, giving rise to
serious air quality problems and NAAQS nonattainment in California,
still exist today and that nothing in these conditions has changed to
warrant a change in this determination. As such CARB notes that there
can be no doubt of the continuing existence of compelling and
extraordinary conditions justifying California's need for its own
mobile source emissions control program.
EPA received some comment from those that otherwise oppose the
authorization but implicitly recognize the underlying compelling and
extraordinary conditions in California. For example, the American Road
and Transportation Builders Association (ARTBA) notes that it is ``very
supportive of both EPA and ARB's goal of reducing PM and NOX
emissions,'' but ``does not believe ARB has considered fully some of
the air quality improvements already occurring in California and the
nation. These improvements in air quality undercut the need for a
measure as severe as the ARB proposal.'' \82\ ARTBA notes that the air
quality is significantly improving without the Fleet Requirements.\83\
However, EPA received no evidence to suggest that California's air
quality is improving to the point that it will attain the NAAQS for PM
and ozone without the Fleet Requirements or that California continues
to experience serious air quality concerns based on continuing
compelling and extraordinary conditions, as EPA and CARB have outlined
in this and previous actions. Based on the record, EPA is unable to
identify any change in circumstances or any evidence to suggest that
the conditions that Congress identified as giving rise to serious air
quality problems in California no longer exist. As noted by CARB, there
continue to be underlying compelling conditions in California giving
rise to a significant number of California air basins that continue to
be in nonattainment with NAAQS for PM2.5 and ozone.
---------------------------------------------------------------------------
\82\ ARTBA at 2.
\83\ Id.
---------------------------------------------------------------------------
To the degree that commenters question the stringency of the Fleet
Requirements or whether the emission reductions projected from this
rule are needed, EPA received no comment that addressed the fundamental
question of whether California continues to experience compelling and
extraordinary conditions giving rise to the need of a nonroad emissions
program. The design, or stringency of such an emission program, is
irrelevant to EPA's review of section 209(e)(2)(A)(ii). Such review
would be inconsistent with the express indication from Congress to
provide California with the ``broadest possible discretion'' in
selecting the best means to protect the health of its citizens and the
public welfare. Accordingly, applying the traditional approach of
reviewing the need for a separate California nonroad program to meet
compelling and extraordinary conditions, EPA cannot deny the
authorization based on this criterion.
3. In the alternative, does California need its nonroad Fleet
Requirements to meet compelling and extraordinary conditions?
As discussed above, EPA is maintaining its interpretation of
section 209(e)(2)(A)(ii) as requiring a review of whether compelling
and extraordinary conditions give rise to a need for a California
nonroad emission program. Nevertheless, because EPA received
[[Page 58103]]
comment urging an alternative interpretation (based on a review of
whether the Fleet Requirements are per se needed to meet compelling and
extraordinary conditions) and because we received other comments
concerning the specific need for or benefits of the Fleet Requirements,
EPA has also evaluated this criterion in the alternative by reviewing
the Fleet Requirements separately.
Although EPA received a wide variety of comments questioning the
``need'' for CARB's Fleet Requirements, we did not receive any comments
or explanation as to how an evaluation of ``need'' should be performed
by EPA. As discussed below, in light of the lack of criteria by which
to judge such need (including how to weigh or balance evidence and
provide CARB with the requisite policy deference described above), the
lack of any explanation of the relevant facts that EPA must or could
consider, and the failure of commenters to satisfy their burden of
proof to overcome CARB's stated need for its Fleet Requirements, even
if EPA were to apply the alternative interpretation proposed by
commenters, the agency would be unable to make an affirmative finding
under section 209(e)(2)(A)(ii). Therefore, EPA is unable to deny CARB's
request on this basis.
a. California's Air Quality Today and Moving Forward
The Agency received a number of comments suggesting that
California's air quality is improving on its own. ARTBA notes that
levels of PM2.5 and NOX have declined
significantly since 1980 and since 2001, while numerous economic
indicators have increased. The Associated General Contractors of
America (AGC) note the significant decline in emissions from off-road
diesel equipment due to a decline in activity and other factors. The
Construction Industry Air Quality Coalition (CIAQC) claims that
emissions from the existing fleet are naturally declining and that
additional regulation is not needed to reach the emission levels CARB
attributes to implementation of the Fleet Requirements. The California
Construction Trucking Association (CCTA) and CIAQC state that CARB's
emission modeling was overstated and continues to be inaccurate because
it presumes too optimistic a scenario of economic recovery and
therefore more activity and emissions from nonroad fleets than there
actually has been. We also received comments that the cost of CARB's
regulation compared to the benefits supports a finding that such
standards are not needed, and that the health benefits are either
overstated or non-existent. In related comments, commenters stated that
the Fleet Requirements are likely to do harm to the public health of
Californians and that the economic impacts of the regulation are likely
to lead to significant adverse health effects.\84\ We also received
comment from Altfillisch Contractors (ACI) suggesting that the
California Environmental Quality Act (CEQA) renders the Fleet
Requirements unnecessary.
---------------------------------------------------------------------------
\84\ These comments are addressed in the ``protectiveness'' or
section 209(e)(2)(i) discussion above. As discussed in that section,
the Agency believes it appropriate to limit our examination to the
specific effects the California and EPA emission standards have on
emissions rather than performing an analysis of social impacts or
other secondary implications. The determination of how numerous
possible impacts of emission regulation can or should be weighed in
determining public policy is one inherently directed to the
regulatory authority promulgating the regulation, not to an
authority whose limited role is to review the regulations based on
three narrow criteria and who has been directed by Congress to
provide broad discretion in its review.
---------------------------------------------------------------------------
CARB explains in its comments that for areas that exceed the NAAQS,
California is responsible under the CAA section 110 for developing a
state implementation plan (SIP) that describes how the state will
attain the standards by certain deadlines.
CARB notes that its Fleet Requirements are part of an integral
strategy to attain the NAAQS in both the San Joaquin Valley Air Basin
and South Coast Air Basin. CARB notes there is no question that areas
of California continue to be in nonattainment for PM2.5, as
well as for ozone, and that the Fleet Requirements and other
regulations and incentives are needed to achieve attainment.\85\
Additionally, CARB states that despite the economic recession and
downward revisions to the in-use off-road emissions inventory, off-road
diesel vehicles remain a significant source of emissions.\86\ Thus,
CARB states, there continues to be a strong need for further regulation
of all emission source categories, including off-road vehicles. ``As
EPA has long-confirmed, questions of what sources to regulate and how
to regulate them are policy questions that Congress has determined is
best left to the State.'' \87\
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\85\ CARB notes in its Authorization Request that two air basins
in California--South Coast Air Basin and San Joaquin Valley Air
Basin--are in nonattainment for both PM2.5 and the 8-hour
ozone standard. This nonattainment is based on the 2006 NAAQS for PM
(71 FR 61144, October 17, 2006) and which EPA has subsequently made
more stringent in 2012 (78 FR 3086, January 15, 2013). The
nonattainment for ozone is based on EPA's 2008 NAAQS 8-hour ozone
standard (73 FR 16436, March 27, 2008). CARB notes that significant
emission reductions of NOX are needed because it leads to
formation in the atmosphere of ozone and PM2.5, and that
diesel PM emission reductions are also needed because diesel PM
contributes to ambient concentrations of PM2.5.
California submitted a revision to its SIP (State Strategy) in
2007 for the South Coast and San Joaquin Valley Air Basins that
demonstrates attainment of the PM2.5 standard by 2014
(needed by 2015), but only after achieving significant reductions of
PM2.5 (and NOX). In addition, additional
reductions of NOX emissions are needed to achieve the 8-
hour ozone standard by 2023. EPA approved the Stated Strategy for
both PM2.5 and NOX for the South Coast and San
Joaquin Air Basins on November 9, 2011 and March 1, 2012,
respectively. CARB projects that the Fleet Regulations will achieve
a 17 percent reduction in NOX emissions and a 21 percent
reduction in PM2.5 emissions in 2023 that would not occur
without the regulation and that Fleet Requirements are an integral
part of the SIP and are laid out in EPA's proposed rulemaking to
approve the State Strategy and that no ``margin of safety''
otherwise exists.
\86\ CARB notes in its Written Comments at 10-11 that the Fleet
Requirements are part of the approved SIP for the South Coast and
San Joaquin valley, both extreme nonattainment areas for ozone and
nonattainment for PM2.5 and that specific emission
benefits from the Fleet Requirements are laid out in EPA's proposed
rulemaking to approve the State Strategy.
\87\ CARB Written Comments at 12-13.
---------------------------------------------------------------------------
CARB also notes, and the EPA agrees, that the CEQA does not render
the Fleet Requirements unnecessary. The purposes of the CEQA and the
Fleet Requirements are different. The CEQA, which is applied in only a
few air districts, is essentially designed to identify when projects
will result in significant harm and to mitigate that harm (to make sure
air quality does not worsen), whereas the Fleet Requirements are
proactive measures applicable statewide as part of coordinated strategy
designed to improve air quality throughout the state.
EPA believes that CARB's initial filings and additional submissions
to the record, responding to arguments that the Fleet Requirements are
not needed because of the economic downturn and because of CARB's
overestimation of inventory and emissions, are reasonable. Mere
assertions by commenters that CARB's most recent emission modeling is
inaccurate do not meet the burden of proof to demonstrate otherwise. As
noted above, CARB has submitted updated estimates of projected emission
reductions expected from the Fleet Requirements, and there is no
evidence in the record to demonstrate that CARB's projections are
unreasonable. EPA further finds that the opponents have not met their
burden of demonstrating that such considerations would render the Fleet
Requirements unnecessary. In adopting the 2010 amendments, CARB
acknowledged that past and future emissions from in-use nonroad CI
vehicles were significantly lower than originally projected, and CARB
states that the amendments for
[[Page 58104]]
which authorization is requested provide economic relief to fleets
while still achieving the emission reductions necessary to attain
federal ambient air quality standards (NAAQS). CARB indicates that
despite the smaller inventory contribution from in-use nonroad CI
engines than CARB projected in the initial rulemaking, emissions from
these engines still represent a significant portion of the overall
emissions inventory. The opponents provide no evidence to refute CARB's
assertion that despite the economic recession and revised inventory,
the in-use nonroad CI fleet remains a significant source of emissions.
Moreover, as CARB notes, there continues to be a strong need for
emission reductions from all emission categories, including the in-use
nonroad CI fleet, to meet the PM2.5 and ozone NAAQS. As CARB
notes, it is not for EPA to decide which types of sources to regulate
and in what manner to do so.\88\ Congress intended to leave such policy
questions in the hands of the state. As discussed below, EPA finds that
CARB has promulgated the Fleet Requirements, in part, to satisfy its
PM2.5 and 8-hour ozone NAAQS requirements and no evidence
exists in the record to explicitly demonstrate why the emission
reductions projected by CARB are not needed in order to meet
California's NAAQS obligations.
---------------------------------------------------------------------------
\88\ Consistent with MEMA I, the Agency has evaluated costs in
this authorization in the evaluation of the technological
feasibility below. The Agency looks at the actual cost of compliance
in the time provided by the regulation, not the regulation's cost-
effectiveness. The appropriate cost-effectiveness for a regulation
is a policy decision of California that is considered and made when
California adopts the regulations, and EPA, historically, has
deferred to these policy decisions. EPA has stated in this regard,
``the law makes it clear that the waiver request cannot be denied
unless the specific findings designated in the statute can be made.
The issue of whether a proposed California requirement is likely to
result in only marginal improvement in air quality not commensurate
with its cost or is otherwise an arguably unwise exercise of
regulatory power is not legally pertinent to my decision under
section 209. Therefore, EPA declines to review CARB's Fleet
Requirements for their cost-effectiveness or the cost-benefits of
the regulation in the context of any of the authorization criteria
set forth in section 209(e)(2).
---------------------------------------------------------------------------
Lastly, CARB restates its legal obligation to achieve PM emission
reductions and the expected benefits associated with the Fleet
Requirements:
ARB adopted the Off-Road regulation, in part, to meet
California's legal obligations under federal law to achieve
attainment with the NAAQS for PM2.5 by 2014. The emission
reductions in the regulation are critical to attaining federally
mandated air quality standards. Primary diesel PM emissions are a
significant contributor to overall PM2.5. In 2008, 20,600
tons of diesel PM were emitted in California. The present amendments
to the Off-Road regulation have been adopted to accommodate the
economic hardship of affected businesses while still meeting the
legal requirements and protecting the public health of all
Californians.\89\
---------------------------------------------------------------------------
\89\ Id.
In order to properly evaluate whether California has a need for its
Fleet Requirements under the alternative approach to section
209(e)(2)(A)(ii) described above, EPA believes it would be necessary
only to examine whether the identified ``compelling and extraordinary
conditions'' in California are giving rise to an air quality problem
that CARB seeks to address with the Fleet Requirements. EPA has
received no comment suggesting that EPA's historically recognized
``conditions'' in California (e.g. geographic and climatic conditions,
number of vehicles operating in California, etc.) do not continue to
give rise to elevated concentrations of particulate matter and
NOX. In addition, EPA has received no comment rebutting
CARB's statement that it is legally required to demonstrate compliance
with the CAA's NAAQS requirements (for PM2.5 and 8-hour
ozone) and that CARB is currently committed to achieve such compliance
in part through the promulgation of emission standards such as its
Fleet Requirements. As noted by CARB, the Fleet Requirements were
initially set in response to the NAAQS requirements for
PM2.5 and the 8-hour ozone set in 2006 and 2008,
respectively. The state of California has a greater level of
nonattainment under those NAAQS than other states. Since that time, EPA
in 2012 has completed review of the PM NAAQS and has strengthened the
primary annual standard for PM2.5, and California continues
to set regulations in response to such requirements.\90\ EPA believes
that to the extent that a review of the need for the Fleet Requirements
(as opposed to CARB's nonroad program) is required, that CARB has
reasonably demonstrated such need due to its obligation to comply with
federal law (including section 110 of the CAA); CARB needs its Fleet
Requirements and a host of other regulatory measures in order to
adequately meet its SIP obligations. Because EPA has received
additional comment suggesting that the PM conditions in California are
not a serious air quality issue the Agency addresses those comments
below.
---------------------------------------------------------------------------
\90\ 78 FR 3086 (January 15, 2013).
---------------------------------------------------------------------------
b. PM Health Effects
EPA received several comments that question the public health
benefits associated with the Fleet Requirements. EPA received comment
stating that PM2.5, and specifically PM2.5 from
diesel combustion, does not present a public health risk in
general,\91\ and that there is no measurable or detectable relationship
between PM2.5 and mortality.\92\ Separately EPA also
received comment that PM2.5 from diesel combustion located
in California does not present a public health risk.
---------------------------------------------------------------------------
\91\ EPA received only one comment suggesting that
NOX and ozone do not pose a public health issue. This
comment did not include any data or other evidence to support this
assertion. See Milloy written testimony.
\92\ See Milloy. EPA notes that Mr. Milloy, who submitted
comment on behalf of the California Construction Trucking
Association, separately brought litigation against EPA in which he
signed a sworn declaration comparing exposure of human test subjects
being voluntarily exposed to forms of particulate matter to Nazi
death camp experimentation. Declaration of Steven J Milloy in Case
1:12-cv-01066-AJT-TCB pp. 2-3; see also the complaint in the same
matter which states that such studies ``ris[k] the lives and health
of human study subjects'' and that ``Mr. Milloy is appalled by this
inhumanity''(complaint para. 15). These sworn statements are
diametrically at odds with Mr. Milloy's presentation and testimony
here that exposure to particulate matter does not pose a public
health concern. Needless to say, when a commenter publically
espouses positions that are at a 180 degree remove from each other,
the credibility of the assertions is greatly diminished. This
lawsuit was dismissed as lacking any legal basis. Dr. Enstrom states
in his comment ``There is now overwhelming epidemiologic evidence
that PM2.5 and diesel PM are not related to total
mortality in California. This evidence has most recently been
summarized in my thirteen-page September 28, 2012 paper,
``Particulate Matter is Not Killing Californians. This paper was
presented on August 1, 2012 at the American Statistical Association
Joint Statistical Meeting in San Diego. It is currently posted
online and will be published later this year in the 2012 JMS
Proceedings (http://www.scientificintegrityinstitute.org/ASAS092812.pdf).''
---------------------------------------------------------------------------
With regard to the suggestion that PM2.5 from diesel
combustion does not present a public health risk, EPA received comment
stating that ``the claimed toxic effects of diesel particulate matter
are hundreds of times smaller than, for example, the increased risk of
lung cancer caused by cigarette smoking. This commenter asserts that
these possible effects are smaller than any previously discovered in
medical history, the actual exposure levels are so difficult to
estimate, and there are so many confounding health factors (smoking and
lifestyle) that are impossible to control, that the entire scientific
basis of the regulatory policy needs to be broadly re-assessed before
allowing CARB any kind of waiver in PM2.5 enforcement.''
\93\
---------------------------------------------------------------------------
\93\ See Dr. Malken.
---------------------------------------------------------------------------
EPA also received comment questioning whether PM2.5 from
diesel exhaust is causing cancer, premature death, or other health
effects in
[[Page 58105]]
California. For example, one commenter stated that ``we don't know
yet'' and we ``can't rule out'' that exposure to diesel PM might
statistically be related to zero premature deaths.\94\ This commenter
suggests that the toxic effects of diesel particulate matter are so
small that the scientific basis for concerns about PM2.5
impacts on health needs to be re-assessed before EPA authorizes
California's regulation. This commenter maintains that science does not
know yet if fine particulate matter is causing cancer and the premature
death of a measurable number of Californians, and that other factors
like smoking and lifestyle may confound any effects.\95\ EPA also
received comment suggesting that the scientific evidence on the health
effects of particulate air pollution (specifically PM2.5) in
California does not support its further control or regulation at this
time. This commenter maintains that ``[o]ur PM2.5 is
different in composition and is less toxic than that in many Eastern
regions of the U.S.'' \96\ In addition, two commenters stated that
strong epidemiologic evidence shows ambient PM2.5 and diesel
PM is not related to total mortality in California.\97\ The commenters
also note studies published in 2005 and 2011 for support.\98\ One
commenter notes the 2011 study for California-specific evidence
regarding PM2.5 and diesel PM and mortality and claims it
demonstrates no current relationship between PM2.5 and
mortality in California and may show no scientific or public health
justification for this regulation.\99\
---------------------------------------------------------------------------
\94\ See Dr. Malken. This commenter also suggests that the
PM2.5 from diesel exhaust in California might be
inherently different than the PM studied in the eastern half of the
United States.
\95\ Id. at 2.
\96\ See Dr. Phalen.
\97\ See Delta and Dr. Enstrom. Delta also comments that the
least healthy county in California has low diesel PM air
concentrations, but high poverty and unemployment levels. Delta
states that California is the fourth healthiest state as measured by
premature death rates. EPA notes that Delta makes no attempt to
connect these general views on health with the specific issue of
whether emissions of PM2.5 have any effect on health.
\98\ See Dr. Enstrom and Dr. Malken. Dr. Malken claims that the
CARB-funded Jerrett et al. (2011) study of the LA subset of ACS data
was the only one which utilized data from particle monitors and
``they found no significant correlation between PM2.5 and
`premature deaths.' '' This commenter also states that weighing all
of the studies that CARB has considered is more a matter of
subjective taste than a scientific process and that CARB has
``cherry-picked'' the few results that have supported their
position.
\99\ Dr. Enstrom. This commenter maintains that EPA's June 2012
``Regulatory Impact Analysis related to the Proposed Revisions to
the National Ambient Air Quality Standards for Particulate Matter''
erroneously concluded that ``most of the cohort studies conducted in
California report central effect estimates similar to the (nation-
wide) all-cause mortality risk estimate'' but EPA's Table 5 B-10 was
inaccurate or misleading, including the hazard ratio used from his
2005 paper. EPA notes that the proper place to contest the
methodology and findings of the Agency in its NAAQS review process
is in that federal context. This commenter also claims that ``[a]
glaring omission was the detailed evidence from the October 28, 2011
CARB-funded Report, ``Spatiotemporal Analysis of Air Pollution and
Mortality in California Based on the American Cancer Society Cohort:
Final Report,'' by Drs. Michael Jerrett, Richard T. Burnett, C.
Arden Pope III, Daniel Krewski, Michael Thun, and nine others http://www.scientificintegrityinstitute.org/JerrettCriticism102811.pdf).''
This commenter also claims that his September 28, 2012 paper
summarizes the epidemiologic evidence that PM2.5 and
diesel PM are not related to total mortality in California.
---------------------------------------------------------------------------
Separately, the commenter also takes issue with EPA's Regulatory
Impact Analysis for its proposed PM NAAQS rule (which has since been
finalized), claiming the Regulatory Impact Analysis is misleading and
contains omissions.\100\
---------------------------------------------------------------------------
\100\ Id.
---------------------------------------------------------------------------
Lastly, we received comment from CCTA that references a paper
titled ``Mortality Among Members of a Truck Driver Trade Association''
(Truck Driver study) suggesting that any research on exposure to diesel
exhaust should necessarily include truck drivers. CCTA maintains that
the study results indicate that those in closest proximity and duration
of high levels of exposure to diesel exhaust don't seem to share the
same deleterious effects to exposure claimed in other studies.
In response to claims that the Fleet Requirements are not needed
because there is no causal connection existing between PM2.5
exposure and premature mortality and other health effects, CARB states:
Staff carefully reviewed all peer-reviewed studies that have
been performed in the United States on the relationship between
long-term PM2.5 exposure and mortality, as has the U.S.
EPA in its recent review of the National Ambient Air Quality
Standard for particulate matter. U.S. EPA's 2009 science assessment
states ``Collectively, the evidence is sufficient to conclude that
the relationship between long-term PM2.5 exposures and
mortality is causal.'' U.S. EPA and ARB have critically evaluated
the methods used in each study so that we can place the most weight
on the studies that have used the strongest methodologies . . ..
ARB's conclusions about the relationship between long-term exposure
to PM2.5 and mortality are aligned with the findings of
the U.S. EPA, the World Health Organization, Health Canada, and the
British government. Those findings have been publicly peer reviewed
by multiple independent bodies worldwide.\101\
---------------------------------------------------------------------------
\101\ See CARB Written Comments.
With respect to the questions about the health effects associated
---------------------------------------------------------------------------
with exposure to diesel exhaust PM, CARB notes:
Staff agrees that ambient PM2.5 arises from many
different sources, including diesel exhaust, and there are no
established methods for routinely measuring the concentration of
PM2.5 in ambient air from any specific source. Diesel PM
is primarily less than 2.5 microns in diameter, and consequently
falls into the PM2.5 size category. As discussed above,
exposure to PM in this size fraction is strongly associated with
premature death. Also, the results of animal exposure studies
suggest that diesel PM is at least as toxic as other species within
this size range.\102\
---------------------------------------------------------------------------
\102\ Id.
Further, with respect to questions about the specific health
effects of diesel exhaust PM in California, CARB cites, in its
responsive comments during the waiver proceeding, the large body of
peer-reviewed scientific studies evaluated by CARB and EPA that have
identified a broad range of health effects associated with
PM2.5 exposures.\103\ CARB states that ``[t]he national
studies reviewed by the U.S. EPA for the NAAQS assessment apply to
California. In fact, as part of the federal standards review process,
U.S. EPA estimated the premature deaths associated with
PM2.5 in two California cities--Los Angeles and
Fresno.''\104\ CARB also cites EPA's Quantitative Health Risk
Assessment, which estimates that, based on 2005 ambient mean levels of
PM2.5, approximately 63,000 to 80,000 premature deaths each
year are related to PM2.5 exposures in the United States.
CARB also conducted its own California-focused study, which estimated
that in California, exposure to PM2.5 results in
approximately 9,200 deaths each year.\105\ In further comments, CARB
states that the pre-2010 studies cited by Drs. Enstrom and Malkan in
their comments were reviewed by CARB, as well as by the EPA in the
development of the PM Integrated Science Assessment (ISA).
---------------------------------------------------------------------------
\103\ Id. at 12, citing attachments 1-3.
\104\ Id.
\105\ CARB Written Comments at 12, citing attachments 1 and 2 of
its October 19, 2012 submissions to EPA, including the ``Estimate of
Premature Deaths Associated with Fine Particle Pollution
(PM2.5) in California Using a U.S. Environmental
Protection Agency Methodology,'' August 31, 2010.
---------------------------------------------------------------------------
Separately, CARB also reviewed the 2011 Jerrett et al. study,
referenced by commenters.106 107 CARB notes that the
[[Page 58106]]
study found that ``[c]ardiovascular disease (CVD) deaths, particularly
those from ischemic heart disease (IHD), are consistently and robustly
associated with fine particulate and traffic-related air pollution. The
effects on CVD and IHD in California are virtually identical to those
of the national . . . study.'' The study also found that ``[a]ll-cause
mortality is significantly associated with PM2.5 exposure,
but the results are sensitive to statistical model specification and to
the exposure model used to generate the estimates.'' \108\
---------------------------------------------------------------------------
\106\ CARB Supplemental Comments.
\107\ The Jerrett et al., 2011 report was not included in EPA's
PM ISA because it was completed after the ISA was published. It was
also not included in the Provisional Science Assessment because it
was not a peer-reviewed publication at the time. However, the work
conducted by Jerrett et al. was recently published and can now be
found in the peer-reviewed literature [http://www.atsjournals.org/doi/pdf/10.1164/rccm.201303-0609OC]. EPA will consider this study in
the next round of NAAQS reviews that include PM. We note, however,
that the inclusion or exclusion of one report such as Jerrett would
not materially change the large body of scientific evidence
indicating an effect of PM2.5 exposure on human health.
\108\ CARB Supplemental Comments at 13, citing ``Spatiotemporal
Analysis of Air Pollution and Mortality in California Based on the
American Cancer Society Cohort: Final Report,'' Michael Jerrett,
Ph.D., 2011, at 6-7.
---------------------------------------------------------------------------
CARB also included a copy of the 2011 Jerrett et al. study in its
comments and indicated the study reached the following conclusion:
Taken together, the results from this investigation indicate
consistent and robust effects of PM2.5--and other
pollutants commonly found in the combustion-source mixture with
PM2.5--on deaths from CVD and IHD. We also found
significant associations between PM2.5 and all causes of
death, although these findings were sensitive to model
specification. In Los Angeles, where the monitoring network is
capable of detecting intra urban variations in PM2.5, we
observed large effects on death from all causes, CVD, IHD, and
respiratory disease. These results were consistent with past ACS
[American Cancer Society cohort] analyses and with findings from
other national or international studies reviewed in this report. Our
strongest results were from a land use regression estimate of
NO2, which is generally thought to represent traffic
sources, where significant elevated effects were found on deaths
from all causes, CVD, IHD, and lung cancer. We therefore concluded
that combustion-source air pollution as significantly associated
with premature death in this large cohort of Californians.\109\
---------------------------------------------------------------------------
\109\ Id.
EPA will address in turn: (1) Suggestions that PM2.5
does not present a public health risk in general; (2) suggestions that
PM2.5 from diesel combustion does not present a public
health risk; and (3) suggestions that PM2.5 from diesel
combustion located in California does not present a public health risk.
EPA disagrees with the commenters regarding the evidence associated
with PM exposure in the context of all three suggestions noted above.
Regarding the claim that there is no link between health effects,
including mortality, and exposure to PM2.5, EPA disagrees
with this comment and notes the large body of scientific literature
that was thoroughly evaluated during the NAAQS review process is
discussed in detail in EPA's Integrated Science Assessment (ISA) for
Particulate Matter.\110\ The ISA characterizes the weight of evidence
for different health effects and makes causal determinations for both
short-term (i.e., hours to days) and long-term (i.e., months to years)
exposures to PM2.5, PM10-2.5, and ultrafine
particles. Specifically in the ISA, the EPA carefully evaluated and
integrated the scientific evidence from across epidemiological,
toxicological and controlled human exposure studies to make inferences
about causality. The PM ISA considered and assessed an extensive body
of scientific information, all of which had undergone peer-review prior
to being published.\111\
---------------------------------------------------------------------------
\110\ U.S. EPA. (2009). Integrated Science Assessment for
Particulate Matter (Final Report). U.S. Environmental Protection
Agency, Washington, DC, EPA/600/R-08/139F. Docket entry EPA-HQ-OAR-
2008-0691-0318-attachments 2.1 through 2.5
\111\ Id. at 1-22. See http://www.epa.gov/ttn/naaqs/standards/pm/data/20121214rtc.pdf at II-9 to II-12 for discussion of EPA's
application of its framework for causal determinations and
recognition of the distinction between evaluating the relative
scientific quality of individual study results and the evaluation of
the pattern of results within the broader body of scientific
evidence. This discussion also addresses allegations of cherry-
picking studies and ignoring studies that reported no association
with PM2.5.
---------------------------------------------------------------------------
Overall, the PM ISA provides a concise evaluation and integration
of the policy-relevant science. This includes key science judgments
upon which EPA based its Quantitative Health Risk Assessment for
Particulate Matter (PM RA, U.S. EPA, 2010), and the Policy Assessment
for the Review of Particulate Matter National Ambient Air Quality
Standards (PM PA, U.S. EPA, 2011).\112\ These documents informed EPA's
2012 rule completing review of the PM NAAQS.\113\
---------------------------------------------------------------------------
\112\ See EPA-HQ-OAR-2008-0691-0318-attachment 3 and http://yosemite.epa.gov/sab/sabproduct.nsf/368203f97a15308a852574ba005bbd01/8bee96ad3228eabe8525760400702786!OpenDocument.
\113\ EPA incorporates by reference our 2012 PM NAAQS review and
associated rulemaking documents. EPA also notes that the reasoning
and conclusions reached in the PM NAAQS review are not being
revisited in the context of this authorization decision but are
cited for the purposes of demonstrating the vast body of peer
reviewed evidence and findings that is not contravened by the few
studies submitted by commenters to the authorization docket. EPA
also states that to the extent the comments take issue with the
determinations made in the context of the PM NAAQS rulemaking, the
proper place to bring challenges to those decisions would be in the
context of that rule.
---------------------------------------------------------------------------
After a thorough evaluation and integration of the evidence across
scientific disciplines, the PM ISA made causal determinations for the
health effects associated with both short- and long-term exposures to
PM2.5.\114\ For short-term exposures, the PM ISA concludes
that cardiovascular effects (e.g., emergency department (ED) visits and
hospital admissions for ischemic heart disease (IHD) and congestive
heart failure (CHF), changes in cardiovascular function, and myocardial
ischemia), and premature mortality are causally associated with short-
term exposure to PM2.5. It also concludes that respiratory
effects (e.g., ED visits and hospital admissions for chronic
obstructive pulmonary disease (COPD), respiratory infections, and
asthma; and exacerbation of respiratory symptoms in asthmatic children)
are likely to be causally associated with short-term exposure to
PM2.5. For long-term exposures, the PM ISA concludes that
there are causal associations between long-term exposure to
PM2.5 and cardiovascular effects, such as the development/
progression of cardiovascular disease (CVD), and premature mortality,
particularly from cardiovascular causes. It also concludes that long-
term exposure to PM2.5 is likely to be causally associated
with respiratory effects, such as reduced lung function growth,
increased respiratory symptoms, and asthma development. The ISA
characterizes the evidence as suggestive of a causal relationship for
associations between long-term PM2.5 exposure and
reproductive and developmental outcomes, such as low birth weight and
infant mortality. It also characterizes the evidence as suggestive of a
causal relationship between PM2.5 and cancer incidence,
mutagenicity, and genotoxicity.\115\ EPA's evaluation of the
[[Page 58107]]
studies presented in the ISA, as well as the causal framework and
determinations upon which the Assessment is based, have undergone
extensive critical review by the EPA, CASAC, and the public during its
development. The rigor of the review makes the ISA the most reliable
source of scientific information on the subject of PM and health and
welfare effects.
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\114\ Id. EPA also noted in this Response to Significant
Comments document that ``The EPA's evaluation of the scientific
evidence and its application of the causal framework used in the
current PM NAAQS review was the subject of exhaustive and detailed
review by CASAC and the public. Prior to finalizing the ISA, two
drafts were released for CASAC and public review to evaluate the
scientific integrity of the documents. Evidence related to the
substantive issues raised by CASAC and public commenters with regard
to the content of the first and second draft ISAs were discussed at
length during these public CASAC meetings and considered in
developing the final ISA. CASAC supported the development of the
EPA's causality framework and its use in the current PM NAAQS review
and concluded: The five-level classification of strength of evidence
for causal inference has been systematically applied; this approach
has provided transparency and a clear statement of the level of
confidence with regard to causation, and we recommend its continued
use in future Integrated Science Assessments (Samet 2009f, p. 1).''
(At II-9).
\115\ U.S. EPA. (2009). Integrated Science Assessment for
Particulate Matter (Final Report) (ISA). U.S. Environmental
Protection Agency, Washington, DC, EPA/600/R-08/139F. Section 2.3.5
and Table 2-6. EPA also notes that the ISA assessed the body of
scientific evidence regarding particles available through mid-2009,
which included over two thousand new studies. The ISA received two
rigorous rounds of peer review by the independent Clean Air
Scientific Advisory Committee (CASAC) and two draft PM ISAs were
made available for public review and comment.
---------------------------------------------------------------------------
Additionally, new health studies published since the completion of
the ISA were discussed in EPA's Provisional Science Assessment (U.S.
EPA, 2012), which was used to ensure-the Administrator was fully aware
of the ``new'' science that developed since 2009 before making final
decisions on whether to retain or revise the ambient PM standards.
Overall, the new health studies were found not to materially change the
conclusions of the 2009 ISA. As in prior NAAQS reviews, the EPA based
its final decisions on the studies and related information included in
the ISA, RA, and PA which had undergone CASAC and public review. To the
extent that the commenters attempt to introduce new arguments or new
studies that have not been peer-reviewed, including the 2011 Jerrett
study, EPA believes the new science published after the ISA does not
materially change the conclusions found within the ISA.\116\ As noted
above, EPA has recently concluded its PM NAAQS review. No comments
submitted in the context of this authorization proceeding lead the
Agency to reassess (for purposes of this authorization) the findings
related to PM exposure and health effects. EPA notes that the study
referenced by Mr. Milloy in his comments was never provided to EPA nor
has EPA found it in the peer-reviewed literature. Therefore EPA has no
basis to review the technical methods used or the summary results.\117\
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\116\ Id. EPA is only reviewing the comments submitted to the
EPA-HQ-OAR-008-0691 public docket for CARB's authorization request
and EPA the responses to such comments are not intended to imply
that EPA is engaged in a reexamination of the issues thoroughly
examined in the recent PM NAAQS review.
\117\ EPA is only reviewing the comments submitted to the EPA-
HQ-OAR-2008-0691 public docket for CARB's authorization request and
EPA's responses to such comments are not intended to imply that EPA
is engaged in a reexamination of the issues thoroughly examined in
the recent PM NAAQS review.
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With regard to suggestions that PM2.5 from diesel
combustion does not present a public health risk or assertions that
PM2.5 composition is determinative to risk, EPA believes
that the available scientific evidence linking mortality and morbidity
effects with long-and short-term exposures to fine particles continue
to be largely indexed by PM2.5 mass. In the PM NAAQS review
completed in 2012, EPA concluded that it was appropriate to retain
PM2.5 as the indicator for fine particles due to the
inability to differentiate those components or sources that are more
closely related to specific health outcomes nor to exclude any
component or group of components from the mix of fine particles
included in the PM2.5 indicator. As EPA previously stated in
the ISA ``overall, the results indicate that many constituents of PM
can be linked with differing health effects and the evidence is not yet
sufficient to allow differentiation of those constituents or sources
that are more closely related to specific health outcomes.'' \118\
---------------------------------------------------------------------------
\118\ See ISA at 2-26.
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With regard to suggestions that EPA did not properly consider prior
reports (including the 2005 Dr. Enstrom study), EPA notes the Enstrom
study was included in summary figures depicting the totality of the
evidence for long-term PM2.5 exposure and mortality.\119\ It
is important to note that Dr. Enstrom based his comments solely on
statistical significance. Another commenter also asserts that studies
looking at associations between PM and premature mortality do not have
statistically significant results.\120\ EPA responded in the NAAQS
rulemaking to the issue of relying on statistical significance and why
it is not appropriate to only focus on it when evaluating a body of
evidence.\121\ Specifically, EPA stated:
---------------------------------------------------------------------------
\119\ EPA noted that an association was reported for long-term
PM2.5 exposure with all-cause deaths from 1973-1982.
However, no significant associations were reported with deaths in
later time periods when PM2.5 levels had decreased in the
most polluted counties (1983-2002). The PM2.5 data were
obtained from the EPA's Inhalation Particle Network (collected 1979-
1983), and the locations represented a subset of data used in the
50-city ACS study (Pope et al., 1995, 045159). However, the use of
average values for California counties as exposure surrogates likely
leads to significant exposure error, as many California counties are
large and quite topographically variable. ISA, at 7-85.
\120\ See Dr.Malkan.
\121\ See ``Responses to Significant Comments on the 2012
Proposed Rule on the National Ambient Air Quality Standards for
Particulate Matter (June 29, 2012; 77 FR 38890). http://www.epa.gov/ttn/naaqs/standards/pm/data/20121214rtc.pdf at II-9 to II-12 for
discussion of EPA's application of its framework for causal
determinations and recognition of the distinction between evaluating
the relative scientific quality of individual study results and the
evaluation of the pattern of results within the broader body of
scientific evidence.
Statistical significance is an indicator of the precision of a
study's results, which is influenced by a variety of factors
including, but not limited to, the size of the study, exposure and
measurement error, and statistical model specifications. Statistical
significance is just one of the means of evaluating the validity of
the relationships determined with epidemiological studies. The EPA
can reasonably look to other indicia of reliability such as the
consistency and coherence of a body of studies as well as other
confirming data to justify reliance on the results of a body of
epidemiological studies, even if individual studies may lack
statistical significance. American Trucking Association v. EPA, 283
F. 3d 355, 371 (D.C. Cir. 2002). As a result, in developing an
integrated assessment of the health effects evidence for PM, the EPA
has emphasized the importance of examining the pattern of results
across various studies and their coherence and consistency, and has
not focused solely on statistical significance as a criterion of
study reliability.
It has been clearly articulated throughout the epidemiological
and causal inference literature that it is important not to focus on
results of statistical tests to the exclusion of other information.
For example, Rothman (1998) stated: ``Many data analysts appear to
remain oblivious to the qualitative nature of significance testing
[and that] . . . statistical significance is itself only a
dichotomous indicator. As it has only two values, significant or not
significant.'' As a result, Rothman recommended that P-values be
omitted as long as point and interval estimates are available.
The concepts underlying the EPA's approach to evaluating
statistical associations reported for the health effects on
PM2.5 have been discussed in numerous publications,
including a report by the U.S. Surgeon General on the health
consequences of smoking (Centers for Disease Control and Prevention,
2004). This report cautions against overreliance on statistical
significance in evaluating the overall evidence for an exposure-
response relationship: Hill made a point of commenting on the value,
or lack thereof, of statistical testing in the determination of
cause: ``No formal tests of significance can answer those [causal]
questions. Such tests can, and should, remind us of the effects the
play of chance can create, and they will instruct us in the likely
magnitude of those effects. Beyond that, they contribute nothing to
the `proof' of our hypothesis'' (Hill 1965, p. 299). Hill's warning
was in some ways prescient, as the reliance on statistically
significant testing as a substitute for judgment in a causal
inference remains today (Savitz et al., 1994; Holman et al., 2001;
Poole 2001). To understand the basis for this warning, it is
critical to recognize the difference between inductive inferences
about the truth of underlying hypotheses, and deductive statistical
calculations that are relevant to those inferences, but that are not
inductive statements themselves. The latter include p values,
confidence intervals, and hypothesis tests (Greenland 1998; Goodman
1999). The dominant approach to statistical inference today, which
employs those
[[Page 58108]]
statistical measures, obscures this important distinction between
deductive and inductive inferences (Royall 1997), and has produced
the mistaken view that inferences flow directly and inevitably from
data. There is no mathematical formula that can transform data into
a probabilistic statement about the truth of an association without
introducing some formal quantification of external knowledge, such
as in Bayesian approaches to inference (Goodman 1993; Howson and
Urbach, 1993). Significance testing and the complementary estimation
of confidence intervals remain useful for characterizing the role of
chance in producing the association in hand (CDC, 2003, pp. 23 to
24).
Accordingly, the statistical significance of findings from an
individual study has played an important role in the EPA's
evaluation of the study's results and overall the EPA has placed
greater emphasis on studies reporting statistically significant
results in making determinations as to the elements of the standard.
In particular, as noted in section III.E.4.b.i of the preamble to
the final rule, the EPA identified long- and short-term exposure
studies considered ``key'' multi-city studies for consideration for
informing the decisions on the appropriate standard levels and
included those studies observing effects for which the evidence
supported a causal or likely causal association. Figure 4 in the
preamble to the final rule (also Figure 4 in the proposal, 77 FR
38933) represents the subset of multi-city studies included in
Figures 1 through 3 of the preamble to the final rule (also Figures
1 through 3 in the proposal, 77 FR 38929 to 38931) that provided
evidence of positive and generally statistically significant effects
associated in whole, or in part, with more recent air quality data,
generally representing health effects associated with lower
PM2.5 concentrations than had previously been considered
in the last review.
The EPA notes that many of these studies evaluated multiple
health endpoints, and not all of the effects evaluated provided
evidence of positive and statistically significant effects. For
purposes of informing the Administrator's decision on the
appropriate standard levels, the Agency considers the full body of
scientific evidence and focuses on those aspects of the key studies
that provided evidence of positive and generally statistically
significant effects. However, in the broader evaluation of the
evidence from many epidemiological studies, and subsequently during
the process of forming causality determinations, the EPA has
emphasized the pattern of results across epidemiological studies for
drawing conclusions on the relationship between PM2.5 and
health outcomes, and whether the effects observed are coherent
across the scientific disciplines. Thus, in making causality
determinations, the EPA did not limit its focus or consideration to
just studies that reported positive associations or where the
results were statistically significant.\122\
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\122\ Id.
In addition, EPA has previously addressed the issue of what one
commenter calls ``confounding health factors.'' In the case of short-
term exposure studies, a confounder would need to vary on a day-to-day
basis with both air pollution and with the specific health outcome
being evaluated (e.g., mortality or hospital admissions or emergency
department visits). The confounders that fit these criteria for short-
term exposure studies are related to weather (e.g., temperature, dew
point, relative humidity). The short-term exposure studies,
specifically time-series studies, evaluated in the ISA all included
weather covariates in their models to account for their potential
---------------------------------------------------------------------------
confounding effects (U.S. EPA, 2009a, Chapter 6).
With regard to long-term exposure studies, a number of
multilevel cohort studies (Naess et al. 2007; Jerrett et al. 2003;
Jerrett et al. 2005) have evaluated individual-level and contextual,
or ecologic-level variables as potential confounders. As reported in
Jerrett et al. (2005), ``Contextual effects occur when individual
differences in health outcomes are associated with the grouped
variables that represent the social, economic, and environmental
settings where the individuals live, work, or spend time (e.g.,
poverty or crime rate in a neighborhood). These contextual effects
often operate independently from (or interactively with) the
individual-level variables such as smoking.'' These studies found
that the inclusion of contextual variables tended to attenuate the
risk estimates for the association between long-term exposure to
PM2.5 and mortality, but that an independent effect of
PM2.5 on mortality remains. For example, Jerrett et al.
(2005) found that for PM2.5 (controlling for age, sex,
and race), the relative risk was 1.24 (95% CI 1.11, 1.37) for a 10
[micro]g/m3 exposure contrast. In a parsimonious model that
controlled for 44 different individual covariates and ecological
confounder variables that both reduced the pollution coefficient and
had associations with mortality, the relative risk was 1.11 (95% CI
0.99, 1.25) for the same exposure contrast. The EPA believes that
the results of these studies provide confidence that more recent
reports with updated datasets are showing independent effects of
PM2.5.\123\
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\123\ Id.
One commenter's assertion that the risk from PM is hundreds of
times smaller than the increased risk of lung cancer caused by
cigarette smoking, and difficult to estimate, has been previously
addressed during the PM NAAQS review. The ``Responses to Significant
Comments on the 2012 Proposed Rule on the National Ambient Air Quality
---------------------------------------------------------------------------
Standards for Particulate Matter'' stated:
The comparison of smoking and ambient PM-related effect
estimates was not considered relevant for the PM NAAQS review, and
thus, was not considered in the ISA. This issue was not raised
during the CASAC and public review of the drafts of the ISA. In
order to address the comments submitted, the EPA conducted a
provisional review of the ``new'' literature published since the
close of the ISA including studies cited by commenters, and
identified several relevant studies that compared and evaluated
effect estimates determined for relationships between specific
health outcomes and ambient particulate matter and active smoking
(Pope et al. 2009; Pope et al. 2011). These authors analyzed data
from the American Cancer Society cohort in order to evaluate the
shape of the exposure-response relationship for PM2.5 and
both lung cancer mortality (Pope et al. 2011) and cardiovascular
disease (CVD) mortality (Pope et al. 2009; Pope et al. 2011). In
these studies, the authors evaluated three sources of exposure to
PM2.5: active smoking, passive smoking, and ambient air
pollution.
For lung cancer mortality, the authors observed ``a monotonic,
nearly linear exposure response relationship with fairly constant
marginal increases in RR [relative risk] with increasing exposure''
across the full range of observed exposures (Pope et al. 2011). When
the authors evaluated CVD mortality, they observed ``an exposure-
response relationship that is substantially non-linear, that is,
much steeper at the very low levels of exposure compared with higher
levels of exposure'' (Pope et al. 2011). In fact, the study authors
noted that ``For lung cancer mortality, the RRs steadily increase to
nearly 40 at the highest increment of cigarette smoking (>42
cigarettes per day), whereas for CVD mortality, the RRs level off at
approximately 2.0-2.5.''
Because of the much steeper exposure-response relationship for
long-term exposure to PM2.5 and CVD mortality at low
PM2.5 concentrations, which flattens out at higher
PM2.5 concentrations (i.e., those associated with passive
and active cigarette smoking), it is biologically plausible that the
risk estimates for CVD mortality due to exposure to ambient
concentrations of PM2.5 would be similar to risk
estimates for CVD mortality due to active cigarette smoking. These
results are consistent with the results observed in epidemiological
studies of long-term exposure to PM2.5 and mortality, and
with the conclusions drawn in the ISA. For example, Dockery et al.
(1993) found essentially the same risk estimates for CVD mortality
associated with both ambient PM2.5 concentrations and
active cigarette smoking in an area with relatively high levels of
ambient PM2.5concentration.
Additionally, there could be non-traditional confounders have
not been accounted for in epidemiological studies of short- and
long-term exposure to air pollution. These confounders include
physical and psychological population stress factors. The EPA
disagrees with these commenters because: (1) There is very limited
evidence of stress affecting the air pollution-health effect
relationship upon which to base the commenters assertion; (2) in
order for stress to be a true confounder it would need to vary
temporally (for short-term exposure studies) and spatially (for
long-term exposure studies) with both air pollution concentrations
and the health effect of interest, which has not been demonstrated;
[[Page 58109]]
and (3) rather than stress acting as a true confounder, more than
likely stress is on the causal pathway to the health effects that
have been observed to be associated with air pollution. The EPA
acknowledges that stress may contribute bias to epidemiological
studies; however, stress more than likely would influence the
magnitude of individual effect estimates in a single-city or multi-
city study and not the trends of positive associations observed
across studies conducted in multiple locations.'' \124\
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\124\ EPA's Response to Comments: http://www.epa.gov/ttn/naaqs/standards/pm/data/20121214rtc.pdf at II 23-25.
With regard to the third set of PM2.5 health effect
comments noted above (suggestions that PM2.5 from diesel
combustion located in California does not present a public health
risk), we note that the isolated studies noted by the commenters are
either consistent with past peer-reviewed studies supportive of
PM2.5-related health effects, or have been considered
previously by EPA and were considered as part of the weight of evidence
used to make conclusions in the ISA.
Some of the commenters asserted that the composition of PM in
California is less toxic than the PM in other areas of the country. One
commenter asserted that ``[t]he scientific evidence on the health
effect of particulate matter air pollution in CA does not support its
further control or regulation at this time. Our PM2.5 is
different in composition and is less toxic than that in many Eastern
regions of the U.S.'' \125\ Another commenter states that ``[t]he
composition of what CARB defines as PM2.5 has changed over
time, and is not the same as what has been studied in the Eastern half
of the United States.'' \126\ EPA responded to questions about
heterogeneity in risk estimates in the PM NAAQS Review and that
response is included here. EPA finds that no new evidence has been
submitted in the context of the authorization proceeding to change this
conclusion.
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\125\ See Dr. Phalen comment.
\126\ See Dr. Malkan comment.
---------------------------------------------------------------------------
EPA responded in the PM NAAQS review that with respect to
understanding the nature and magnitude of PM2.5-related
risks:
[T]he EPA agrees that epidemiological studies evaluating health
effects associated with long- and short-term PM2.5
exposures have reported heterogeneity in responses between cities
and effect estimates across geographic regions of the U.S. (U.S.
EPA, 2009a, sections 6.2.12.1, 6.3.8.1, 6.5.2, and 7.6.1; U.S. EPA,
2011a, p. 2-25). For example, when focusing on short-term
PM2.5 exposure, the ISA found that multi-city studies
that examined associations with mortality and cardiovascular and
respiratory hospital admissions and emergency department visits
demonstrated greater cardiovascular effects in the eastern versus
the western U.S. (Dominici, et al., 2006a; Bell et al., 2008;
Franklin et al. (2007, 2008)). However, the rationale that
heterogeneity in risk estimates presents a potential bias as posed
by the commenters is simplistic and does not account for a number of
factors that have been shown to influence city-specific risk
estimates in epidemiologic studies. As discussed in the ISA, the EPA
recognizes that there are compositional differences in
PM2.5 across the country and that the county-level air
quality data used in epidemiological studies may result in exposure
error, which could in part account for variability in city-specific
risk estimates (U.S. EPA, 2009a, section 2.3.2).
There are a limited number of studies that evaluated regional
heterogeneity in the association between long-term exposure to
PM2.5 and mortality. Krewski et al. (2009a) conducted
subset analyses of the ACS cohort in Los Angeles, CA and New York
City, NY, and observed a relative risk in Los Angeles that was
greater in magnitude than what was observed in the full ACS cohort,
while the relative risk in New York City was less than what was
observed in the full ACS cohort. These observations are likely due
to the greater spatial heterogeneity in PM2.5
concentrations observed in Los Angeles, and the overall spatial
homogeneity of PM2.5 concentrations in New York City.
In another retrospective cohort, Zeger et al. (2008) observed
associations between long term exposure to PM2.5 and
mortality for the eastern and central ZIP codes that were similar to
those reported in the ACS and Harvard Six Cities studies, though no
association was observed in the western region. The lack of the
association in the western region is ``largely because the Los
Angeles basin counties (California) have higher PM levels than other
West Coast urban centers, but not higher adjusted mortality rates''
(Zeger et al. 2008). The ISA also evaluated studies that provided
some evidence for seasonal differences in PM2.5 risk
estimates, specifically in the northeast. The ISA found evidence
indicating that individuals may be at greater risk of dying from
higher exposures to PM2.5 in the warmer months, and at
greater risk of PM2.5 associated hospitalization for
cardiovascular and respiratory diseases during colder months of the
year. The limited influence of seasonality on PM risk estimates in
other regions of the U.S. may be due to a number of factors
including varying PM composition by season, exposure
misclassification due to regional tendencies to spend more or less
time outdoors and air conditioning usage, and the prevalence of
infectious diseases during the winter months (U.S. EPA, 2009a, p. 3-
182).
Overall, the EPA recognizes that uncertainties still remain
regarding various factors that contribute to heterogeneity observed
in epidemiological studies (77 FR 38909/3). Nonetheless, the EPA
recognizes that this heterogeneity could be attributed, at least in
part, to differences in PM2.5 composition across the
U.S., as well as to exposure differences that vary regionally such
as personal activity patterns, microenvironmental characteristics,
and the spatial variability of PM2.5 concentrations in
urban areas (U.S. EPA, 2009a, section 2.3.2; 77 FR 38910).
As recognized in the PA, the current epidemiological evidence
and the limited amount of city-specific speciated PM2.5
data does not allow conclusions to be drawn that specifically
differentiate effects of PM in different locations (U.S. EPA, 2011a,
p. 2-25). Furthermore, as discussed in section III.E.1 of the
preamble to the final rule, the ISA concluded, ``that many
constituents of PM2.5 can be linked with multiple health
effects, and the evidence is not yet sufficient to allow
differentiation of those constituents or sources that are more
closely related to specific health outcomes'' (U.S. EPA, 2009a, p.
2-17). CASAC thoroughly reviewed the EPA's presentation of the
scientific evidence indicating heterogeneity in PM2.5
effect estimates in epidemiological studies and concurred with the
overall conclusions presented in the ISA (Pages 6-179-180, Figure 6-
25, Figure 6-26).\127\
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\127\ See ``Responses to Significant Comments on the 2012
Proposed Rule on the National Ambient Air Quality Standards for
Particulate Matter (June 29, 2012; 77 FR 38890). http://www.epa.gov/ttn/naaqs/standards/pm/data/20121214rtc.pdf at II-37-II-38.
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In the PM ISA EPA has also stated:
Additionally it is important to point out that there are a few
CA-specific time-series studies conducted by Ostro et al. that did
find associations with PM2.5. These are discussed in the
ISA PM2.5-Mortality Associations on a Regional Scale:
California. Ostro et al. (2006, 087991) examined associations
between PM2.5 and daily mortality in nine heavily
populated California counties (Contra Costa, Fresno, Kern, Los
Angeles, Orange, Riverside, Sacramento, San Diego, and Santa Clara)
using data from 1999 through 2002. The authors used a two-stage
model to examine all-cause, respiratory, cardiovascular, ischemic
heart disease, and diabetes mortality individually and by potential
effect modifier (i.e., age, gender, race, ethnicity, and education
level). The a priori exposure periods examined included the average
of 0- and 1-day lags (lag 0-1) and the 2-day lag (lag 2). The
authors selected these non-overlapping lags (i.e., rather than
selecting lag 1 as the single-day lag) because previous studies have
reported stronger associations at lags of 1 or 2 days or with
cumulative exposure over three days. It is unclear why the
investigators chose these non-overlapping lags (i.e., single-day lag
of 2 instead of 1) even though they state they based the selection
of their lag days on results presented in previous studies, which
found the strongest association for PM lagged 1 or 2 days. Using the
average of 0- and 1-day lags Ostro et al. (2006, 087991) reported
combined estimates of: 0.6% (95% CI: 0.2-1.0), 0.6% (95% CI: 0.0-
1.1), 0.3% (95% CI: -0.5 to 1.0), 2.2% (95% CI: 0.6-3.9), and 2.4%
(95% CI: 0.6-4.2) for all-cause, cardiovascular, ischemic heart
disease, respiratory, and diabetes deaths, respectively, per 10
[micro]g/m\3\.
[[Page 58110]]
. . . Five of the nine counties examined in the Ostro et al.
(2006, 087991) analysis contain cities that are among the 2 cities
examined in the Franklin et al. (2007, 091257) analysis for the same
period, 1999-2002. While the lags used were different between these
two studies, both presented PM2.5 risk estimates in
individual cities or counties (graphically in the Franklin et al.
study (2007, 091257); in a table in the Ostro et al. study (2006,
087991)), which allowed for a cursory evaluation of consistency
between the two analyses. In Franklin et al. (2007, 091257),
PM2.5 risk estimates at lag 1 day for the cities Los
Angeles and Riverside were slightly negative, whereas Fresno,
Sacramento, and San Diego showed positive values above 1% per 10
[micro]g/m3 increase in PM2.5. The 2-day lag result
presented in Ostro et al. (2006, 087991) is qualitatively
consistent, with Los Angeles and Riverside, both of which show
slightly negative estimates, while the other 3 locations all show
positive, but somewhat smaller estimates, than those reported by
Franklin et al. (2007, 091257). The estimates for the average of 0-
and 1-day lags for these five counties in Ostro et al. (2006,
087991), which contain cities examined in Franklin et al. (2007,
091257), were all positive. Thus, these two PM2.5 studies
showed some consistencies in risk estimates even though they used
different lag periods and a different definition for the study areas
of interest (i.e., counties vs. cities).\128\
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\128\ See EPA-HQ-OAR-2008-0691-0318-attachment 3 and http://yosemite.epa.gov/sab/sabproduct.nsf/368203f97a15308a852574ba005bbd01/8bee96ad3228eabe8525760400702786!OpenDocument at 6-179.
Thus, as noted in EPA's PM NAAQS review and the Response to
Comments document referenced above, EPA has stated it agrees that
epidemiological studies evaluating health effects associated with long-
and short-term PM2.5 exposures have reported heterogeneity
in responses between cities and effect estimates across geographic
regions of the United States. However, EPA believes it critical to
understand the issue in context and EPA's overall approach in
concluding as it did in the ISA, ``that many constituents of
PM2.5 can be linked with multiple health effects, and the
evidence is not yet sufficient to allow differentiation of those
constituents or sources that are more closely related to specific
health outcomes.'' EPA finds that no new evidence has been submitted in
the context of the authorization proceeding to change this conclusion.
With regard to the claims made by Dr. Phalen in comments on this
authorization proceeding, Dr. Phalen does not provide any evidence or
studies to support the proposition that PM2.5 is not only
different in composition in California but as a result is less toxic,
or present evidence as to the level of reduced toxicity. With regard to
Dr. Enstrom's comments regarding differences in PM health risk in
California compared to other locations, as discussed above, EPA has
previously reviewed Dr. Enstrom's studies and has responded to his
comments, as well as others, on this issue. As explained above, EPA has
examined the issue of whether PM2.5 composition is
determinative and found that the scientific evidence is not yet
sufficient to allow differentiation of those components or sources that
are more closely related to specific health outcomes nor to exclude any
component or group of components from the mix of fine particles
included in the PM2.5 indicator. EPA similarly concluded
that current evidence does not allow conclusions to be drawn that
differentiate effects of PM in different locations.
With regard to the claims of omissions in EPA's Regulatory Impact
Analysis (RIA) for its proposed PM air quality standards, it is
necessary to understand that only the peer-reviewed studies cited in
the PM ISA (2009) or PM Provisional Science Assessment (2012) were
listed in the RIA table. Furthermore, the inclusion or exclusion of a
study published after the Provisional Science Assessment would not
materially change the large body of scientific evidence indicating an
effect of PM2.5 exposure on human health.
With regard to the claims based on the Trucker Study noted above,
the study does not attempt to examine air pollution-related health
effects or provide any measure of air pollution exposure in the cohort
examined. The study looked only at mortality rates for certain deaths
within the population studied. EPA notes that the Truck Driver study
contains a research abstract that plainly states ``[t]he absence of
disease mortality deserves careful interpretation, and may be due to
both a strong healthy worker effect and a short monitoring period.''
\129\ We note that this study did not include an actual close study of
air quality and PM exposure levels and otherwise is not of scientific
significance. This type of study as well as the other few studies
submitted in isolation does not overcome the significant evidence and
scientific evidence that has been peer reviewed and found PM to be
associated with health effects.
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\129\ CCTA; ``Mortality Among Members of a Truck Driver Trade
Associations'' AAOHN Journal Vol. 58. No. 11, 2010 at 473.
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The comments provided do not provide sufficient evidence to meet
the authorization opponents' burden of showing that PM emissions in
California do not create any risk to public health, particularly given
the substantial body of evidence suggesting such a risk. Therefore,
even if EPA were to apply the alternative interpretation of section
209(e)(2)((A)(ii) and examine whether CARB has a specific need for its
Fleet Requirements, the opponents of the authorization have not met
their burden of proof to demonstrate that California no longer
continues to have serious air quality issues related to PM and
NOX, that are created by California's underlying compelling
and extraordinary conditions. The evidence submitted to the record, in
addition to EPA's own PM NAAQS review and the multitude of studies
reviewed therein and conclusions of EPA that were peer reviewed by
CASAC, continue to demonstrate requisite health effects due to PM
exposure and therefore the authorization cannot be denied on this
basis.
Finally, EPA notes that CARB's Fleet Requirements are designed not
only to reduce PM emissions and public health consequences, as
discussed above, but also to address the harmful effects of ozone by
reducing emissions of NOX, as an ozone precursor, from the
in-use fleet.\130\ There is no evidence in the record to suggest that
ozone pollution is not harmful to public health or that CARB's Fleet
Requirements are not needed in that context.
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\130\ See CARB Authorization Request at 4 (``Even as amended to
provide immediate short-term relief to fleets adversely impacted by
the recession, the In-Use Off-Road Regulation is expected to achieve
a 17 percent reduction in NOX emissions and a 21 percent
reduction in PM2.5 emissions in 2023 from forecasted
emissions that would exist without a regulation in place.'').
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In conclusion, even if EPA were to use the alternative approach
outlined above--that of reviewing the need for the Fleet Requirements
per se to meet compelling and extraordinary conditions in California--
EPA finds that the opponents of the authorization have not met their
burden of proof. Therefore, even if EPA were to use this alternative
approach, we could not deny the authorization on this basis.
c. Additional PM Comments
EPA also received comment from the PLF focused on the recent
decision issued by the United States Court of Appeals for the District
of Columbia Circuit in Natural Resources Defense Counsel v. EPA, No 08-
1250, January 4, 2013, (NRDC v. EPA) concerning implementation
regulations applicable to the 1997 PM2.5 NAAQS. PLF
characterizes the court's decision as requiring EPA itself to adopt
stringent
[[Page 58111]]
federal implementation standards for PM2.5 throughout the
nation, including California. Because California asserted that it
``needs'' nonroad diesel PM standards that are more stringent than
federal nonroad PM standards, and because (in PLF's view) EPA is now
required to use the ``stringent, action-forcing provisions'' of section
188-188(b) of the Clean Air Act as a result of the Decision, PLF
maintains that it is appropriate to complete EPA's administrative
proceedings on remand (from the decision) for implementation
regulations before EPA is able to determine the extent to which there
is a ``need'' for California to have its own PM2.5 nonroad
diesel standard for engines and vehicles based on ``compelling and
extraordinary conditions'' in California. In addition, PLF highlights
EPA's most recent revision of the primary annual NAAQS for
PM2.5, which lowered the prior standard from 15.0 micrograms
per cubic meter to 12.0 micrograms per cubic meter, and the concomitant
revision to the Air Quality Index for PM2.5. PLF asserts
that these events provide additional reasons to question California's
``need'' for its own PM2.5 nonroad diesel standard.
PLF's reliance on NRDC v. EPA is misplaced. That decision pertains
only to EPA's regulations governing how states should address the
statutory requirements for attainment plans. It does not require EPA
``to move ahead in implementing strict federal PM2.5
controls,'' through its own regulations as opposed to state regulation
of PM2.5 and PM2.5 precursors. The Clean Air Act
generally requires states to have state implementation plans (SIPs)
that provide for attainment and maintenance of the NAAQS, and nothing
in the Court's opinion obviates or supplants that statutory
requirement. Further, the NRDC v. EPA decision will not result in EPA
itself issuing new regulatory controls that impose any specific
emission reductions requirements on mobile sources. To the extent that
PLF is suggesting that EPA itself is now required to regulate any
particular sources more stringently, through national standards, such
suggestion is incorrect.
To the extent EPA imposes the ``more stringent'' NAAQS
implementation requirements of sections 188 through 190 of the Act on
the state (rather than the ``less stringent'' implementation
requirements of sections 171 through 179B of the Act), then the state
will still be required to adopt its own regulations (e.g. Fleet
Requirements) to get necessary emission reductions to attain and
maintain the applicable NAAQS. While this may create somewhat lesser
flexibility for states in developing attainment plan measures in the
future, it by no means negates their SIP obligations today. The
emission reductions from the Fleet Requirements take effect at the
beginning of 2014, and California has shown that it needs these
reductions as part of the suite of control measures that are necessary
for purposes of attaining and maintaining the PM2.5 and
ozone NAAQS expeditiously. Moreover, states still have a great deal of
flexibility in designing their emission control program to achieve
needed emission reductions, and nothing in the court's opinion in NRDC
v. EPA indicates any attempt by the court to preclude California from
using the specific flexibility provided by section 209(e)(2)(A) to
reduce emissions through regulation of nonroad engines. Such emission
reductions have been instrumental in California's strategy to meet its
NAAQS requirements.
With respect to the revisions to the primary annual
PM2.5 NAAQS issued in December of 2012, the revisions have
increased the stringency of the standard. Thus, if anything, the new
PM2.5 standard will increase California's need to find
reductions in emissions of PM2.5 and PM2.5
precursors from regulated sources, which should only increase the need
for such regulations such as the Fleet Requirements.
For the reasons set forth above, EPA believes that under the
alternative interpretation of the compelling need criterion discussed
above, opponents of authorization have not meet their burden of
demonstrating that California's Fleet Requirements do not have a
rational relationship to contributing to amelioration of serious air
quality problems in California, including its PM2.5 and
ozone. Accordingly, commenters' assertions to the contrary provide no
basis for denying authorization.
4. Section 209(e)(2)(A)(ii) Conclusion
With respect to the need for California's standards to meet
compelling and extraordinary conditions, after an examination of the
text of section 209 and the legislative history, EPA again concludes
that the best way to interpret this provision is to apply the
traditional interpretation. Under this interpretation, EPA can deny
authorization under section 209(e)(2)(A)(ii) only if it finds that
opponents of authorization have demonstrated that California does not
need a separate nonroad program to address compelling and extraordinary
conditions. Under this traditional interpretation, EPA cannot find that
opponents of the authorization have demonstrated that California does
not need its state standards to meet compelling and extraordinary
conditions. The opponents of the waiver have not adequately
demonstrated that California no longer has a need for its nonroad
emissions program.
Even if EPA were to apply the alternative interpretation advocated
by commenters--that EPA is required to review, on a case by case basis,
whether the specific standard submitted by CARB is needed to meet
compelling and extraordinary conditions--EPA cannot find that the
opponents of the waiver have demonstrated that California does not need
its Fleet Requirements to meet compelling and extraordinary conditions.
Accordingly, EPA has determined that it cannot deny the
authorization request under section 209(e)(2)(A)(ii).
C. Consistency with Section 209 of the Clean Air Act
Section 209(e)(2)(A)(iii) of the Act instructs that EPA cannot
grant an authorization if California's standards and enforcement
procedures are not consistent with ``this section.'' As described
above, EPA's section 209(e) rule states that the Administrator shall
not grant authorization to California if she finds (among other tests)
that the ``California standards and accompanying enforcement procedures
are not consistent with section 209.'' EPA has interpreted the
requirement to mean that California standards and accompanying
enforcement procedures must be consistent with at least section 209(a),
section 209(e)(1), and section 209(b)(1)(C), as EPA has interpreted
this last subsection in the context of motor vehicle waivers.\131\
Thus, this can be viewed as a three-pronged test.
1. Consistency with Section 209(a)
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\131\ See 59 FR 36969 (July 20, 1994).
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Section 209(a) of the Clean Air Act prohibits states or any
political subdivisions of states from setting emission standards for
new motor vehicles or new motor vehicle engines. Section 209(a) is
modified in turn by section 209(b) which allows California to set such
standards if other statutory requirements are met. To find a standard
to be inconsistent with section 209(a) for purposes of section
209(e)(2)(A)(iii), EPA must find that the standard in question actually
regulates new motor vehicles or new motor vehicle engines.
In its authorization request, CARB stated that by definition, the
section
[[Page 58112]]
209(a) preemption does not apply to vehicles covered by the Fleet
Requirements because the regulation only applies to non-new, in-use
vehicles and engines and not to new motor vehicles and engines. CARB
also stated that with a few limited exceptions--workover rigs, two-
engine cranes, and certain other two-engine vehicles--vehicles covered
under the Fleets Requirements are not motor vehicles under the Clean
Air Act definition of motor vehicles.\132\ No commenter argued the
contrary or otherwise asserted that the Fleet Requirements are not
consistent with section 209(a).
---------------------------------------------------------------------------
\132\ CARB Authorization Request. CARB noted that these limited
exceptions are provided to afford fleet operators of such vehicles
additional flexibility to address both the in-use on-highway
requirements associated with the engines designed to propel the
equipment and the nonroad engines on the vehicles designed to
perform other functions. Since the regulation of such non-new (in
use) on-highway vehicles (and the engines designed to propel such
vehicles) is not preempted under section 209(a) CARB did not seek a
waiver under section 209(b) and instead only sought an authorization
under section 209(e) for the in use nonroad engines associated with
such on-highway vehicles.
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Therefore, EPA cannot deny California's request on the basis that
California's Fleet Requirements are not consistent with section 209(a).
2. Consistency with Section 209(e)(1)
To be consistent with section 209(e)(1) of the Clean Air Act,
California's standards or other requirements relating to the control of
emissions must not relate to new engines which are used in farm or
construction equipment or vehicles and which are smaller than 175
horsepower (hp), and new locomotives or new engines used in
locomotives.
In its Authorization Request, CARB stated that the Fleet
Requirements specifically ``do not apply to locomotives and do not
apply to new farm and construction vehicles and equipment less than 175
hp.'' \133\ CARB notes that ``implements of husbandry, regardless of
engine size, are expressly excluded from coverage.'' While CARB
acknowledged that nonroad construction vehicles and engines used in
such vehicles are covered by the Fleets Requirements, CARB stated that
the regulation does not apply to new construction vehicles or engines.
---------------------------------------------------------------------------
\133\ Id at 20.
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CARB stated that the Fleet Requirements do not attempt to regulate
new construction sources covered by the section 209(e)(1) preemption.
New, as it applies to nonroad engines and equipment other than
locomotives and engine used in locomotives, means engines and equipment
whose legal title has not been transferred to an ultimate purchaser, or
in certain cases, to engines or vehicles that have been placed into
service.\134\ The Fleet Requirements do not regulate engines and
vehicles immediately after their titles are transferred or they enter
service; instead, the regulation exempts any vehicle that is less than
ten years old from the BACT requirements. CARB states that while a
fleet owner may elect to comply with the fleet average or BACT
requirements by purchasing or repowering a vehicle primarily used in
construction with a new nonroad engine under 175 hp, that outcome also
does not run afoul of the 209(e)(1) preemption. CARB notes that this
new engine is only required to be certified to the existing federal
nonroad emission standards.\135\ Therefore, the Fleet Requirements do
not establish standards for such new engines.
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\134\ See 40 CFR Sec. 1074.5.
\135\ CARB's regulations establishing new emission standards for
engines less than 175 hp specifically do not cover engines that are
primarily used in farm and construction vehicles and equipment.
---------------------------------------------------------------------------
EPA received comment from ARTBA suggesting that CARB's regulations
run afoul of section 209(e)(1)'s preemption for ``new engines which are
used in construction equipment or vehicles or farm equipment or
vehicles and which are smaller than 175 horsepower.'' ARTBA argues that
section 209(e)(1)'s limitation on state standards or emission-related
requirements for these engine/equipment categories lasts throughout the
useful life of the equipment.\136\ ARTBA stated in comment that under
this interpretation, California's authorization request should be
denied because the Fleet Requirements apply to all in-use off-road
diesel construction equipment greater than 25 HP, including equipment
in the permanently preempted power range. ARTBA did not provide any
further explanation in its written comments or at the public hearing as
to why this permanent preemption of certain types of ``new'' vehicles
should be interpreted as extending throughout the useful life of the
vehicles.
---------------------------------------------------------------------------
\136\ See Hearing Transcript at 51-52, and ARTBA at 2.
---------------------------------------------------------------------------
CARB, in response to comments made by ARTBA at EPA's public
hearing, noted that the contention that the preemption under section
209(e)(1) extends throughout the useful life of the new engine is
simply wrong. CARB noted that EPA considered and rejected this extended
definition of ``new'' in section 209(e)(1) during the 209(e) rulemaking
process.\137\ CARB also noted in its Authorization Request that the
Court of Appeals in Engine Manufacturers Association v. EPA (EMA),
affirmed EPA's definition of ``new'' as it is applied to off-road
sources other than locomotives.\138\ In EMA, the court discussed the
issue of whether EPA's definition of new nonroad engines would
effectively undermine the section 209(e)(1) preemption that states are
prohibited from adopting emission standards for new farm and
construction vehicles with less than 175 hp. CARB noted that the court
concluded that EPA's definition of new did not undermine the preemption
in 209(e)(1).\139\
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\137\ 59 FR 31306, 31328-31 (June 17, 1994).
\138\ EMA 88 F3d 1075, 1082-1086 (D.C. Cir. 1996).
\139\ A more recent opinion in the Court of Appeals for the
Ninth Circuit agreed with the D.C. Circuit's decision on this issue.
National Association of Home Builders v. San Joaquin UAPCD, 627 F.
3d 730 (9th Cir. 2010).
---------------------------------------------------------------------------
CARB also notes the more recent history on this issue. In a 2002
petition to EPA, ARTBA requested that EPA revise its regulations such
that nonroad engines in the categories covered under section 209(e)(1)
are preempted for their useful lives. EPA denied ARTBA's request,\140\
and subsequently the United States Court of Appeals for the District of
Columbia dismissed ARTBA's petition for review of that denial.\141\
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\140\ 73 FR 59034, 59130 (October 8, 2008).
\141\ ARTBA v. EPA, 558 F.3d 1109 (D.C. Cir. 2009), certiorari
denied 131 S.Ct. 338, 178 L.Ed.2d 38. A more recent opinion from the
Court of Appeals for the D.C. Circuit came to the same conclusion.
ARTBA v. EPA, 705 F.3d 453 (D.C. Cir. 2013)
---------------------------------------------------------------------------
At the outset, we note that no commenter disputes CARB's assertion
that its regulations do not violate section 209(e)(1) as EPA's current
regulations implement that provision. Rather, ARTBA's comments appear
to go to the validity of EPA's longstanding regulations, as opposed to
the validity of California standards currently being reviewed under
those regulations. As such, EPA believes ARTBA's comments are
peripheral to this proceeding. EPA is not reviewing its authorization
regulations in this proceeding, but is instead reviewing the validity
of California's Fleet Requirements under those regulations.
In any event, EPA fully considered the scope of preemption issue
(the definition of ``new'') during its 1994 rulemaking which
implemented the provisions of section 209(e). The rationale contained
in that rulemaking was affirmed by the Court of Appeals in EMA.\142\ As
CARB notes, EPA fully reviewed its rationale regarding the definition
of ``new'' in the context of ARTBA's earlier petition to reconsider its
regulations and EPA denied the petition. No information or argument
[[Page 58113]]
has been submitted to the record of this proceeding to rebut EPA's
interpretation. ARTBA provides no new information or argument in the
record of this proceeding to suggest that EPA should change its
longstanding interpretation of ``new'' in section 209(e), \143\ and as
stated above, EPA is not in any case reviewing its regulations in the
context of this proceeding. Moreover, ARTBA does not make any factual
argument regarding the consistency with section 209(e)(1) of the
particular regulations for which CARB is requesting authorization, even
under ARTBA's own definition.
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\142\ EMA, 88 F3d 1075, (D.C. Cir. 1996).
\143\ ARTBA had previously, though not in this proceeding,
provided a fuller explanation of its view regarding the
interpretation of 209(e)(1) and we have previously responded that
ARTBA's arguments were not persuasive. See 73 FR 59034, 59130
(October 8, 2008). The U.S. Court of Appeals for the District of
Columbia subsequently dismissed ARTBA's petition for review of EPA's
response. ARTBA v. EPA (2009 D.C. Cir. (588 F.3d 1109, rehearing en
banc denied (March 5, 2010), certiorari denied 131 S.Ct. 388, 178
L.Ed2d 38. ARTBA has not made similar or other arguments in this
proceeding beyond an unsupported statement regarding how it
interprets the length of the preemption, and we do not address that
issue in depth here, except to say that ARTBA makes no attempt to
support its assertion.
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In light of the lack of information in the record, and giving due
consideration to the burden of proof being on the opponents of the
waiver, EPA cannot make a finding that CARB's Fleet Requirements are
inconsistent with section 209(e)(1)(i). Therefore, EPA cannot deny
CARB's authorization request on this basis.
3. Consistency With Section 209(b)(1)(C)
The requirement that California's standards be consistent with
section 209(b)(1)(C) of the Clean Air Act effectively requires
consistency with section 202(a) of the Act. To determine this
consistency, EPA has applied to California nonroad standards the same
test it has used previously for California motor vehicle standards;
namely, state standards are inconsistent with section 202(a) of the Act
if there is inadequate lead-time to permit the development of
technology necessary to meet those requirements, giving appropriate
consideration to the cost of compliance within that timeframe.
California's accompanying enforcement procedures would also be
inconsistent with section 202(a) if federal and California test
procedures conflicted. The scope of EPA's review of whether
California's action is consistent with section 202(a) is narrow. The
determination is limited to whether those opposed to the authorization
or waiver have met their burden of establishing that California's
standards are technologically infeasible, or that California's test
procedures impose requirements inconsistent with the federal test
procedures.\144\
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\144\ MEMA I, 627 F.2d at 1126.
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EPA does not believe that there is any reason to review these
criteria any differently for EPA's evaluation of California's Fleet
Requirements. There is nothing inherently different about how the Fleet
Requirement control technologies should be reviewed when making a
determination about technological feasibility or consistency of text
procedures.
a. Technological Feasibility
The legislative history of section 209 (including the ``consistency
with section 202(a) requirement in 209(b)((1)(C)) indicates that this
provision is intended to relate to technological feasibility.\145\
Section 202(a)(2) states, in relevant part, that any regulation
promulgated under its authority ``shall take effect after such period
as the Administrator finds necessary to permit the development and
application of the requisite technology, giving appropriate
consideration to the cost of compliance within such period.'' Section
202(a) thus requires the Administrator to first determine whether
adequate technology already exists; or if it does not, whether there is
adequate time to develop and apply the technology before the standards
go into effect. The latter scenario also requires the Administrator to
decide whether the cost of developing and applying the technology
within that time is feasible. Previous EPA waivers are in accord with
this position.\146\ For example, EPA in a 1976 waiver decision
considered California's standards and enforcement procedures to be
consistent with section 202(a) because adequate technology existed as
well as adequate lead-time to implement that technology.\147\ The
legislative history of the 1977 amendments to the Clean Air Act
indicates Congress' view that, generally, EPA's construction of the
waiver provision had been consistent with congressional intent.\148\
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\145\ H.R. Rep. No. 95-294, 95th Cong., 1st Sess. 301 (1977).
\146\ See, e.g., 49 FR 1887, 1895 (May 3, 1984); 43 FR 32182,
32183 (July 25, 1978); 41 FR 44209, 44213 (October 7, 1976).
\147\ 41 FR 44209 (October 7, 1976).
\148\ H.R. Rep. No. 95-294, 95th Cong., 1st Sess. 301 (1977).
---------------------------------------------------------------------------
EPA also evaluates CARB's request in light of congressional intent
regarding the waiver program generally. This is consistent with the
motivation behind section 209(b)--to foster California's role as a
laboratory for motor vehicle emission control, in order ``to continue
the national benefits that might flow from allowing California to
continue to act as a pioneer in this field.'' \149\ For these reasons,
EPA believes that California must be given substantial deference to
adopt not only new motor vehicle emission standards, but to adopt new
and in-use nonroad emission standards which may require new and/or
improved technology. This deference was discussed in an early waiver
decision when EPA approved the waiver request for California's 1977
model year standards:
---------------------------------------------------------------------------
\149\ 40 FR 23102, 23103 (waiver decision citing views of
Congressman Moss and Senator Murphy) (May 28, 1975).
Even on this issue of technological feasibility I would feel
constrained to approve a California approach to the problem which I
might feel unable to adopt at the Federal level in my own capacity
as a regulator. The whole approach to the Clean Air Act is to force
the development of new types of emission control technology where
that is needed by compelling the industry to `catch up' to some
degree with newly promulgated standards. Such an approach to
automotive emission control might be attended with costs, in the
shape of reduced product offering, or price and fuel economy
penalties, and by risks that a wider number of vehicle classes may
not be able to complete their development work in time. Since a
balancing of these risks and costs against the potential benefits
from reduced emissions is a central policy decision for any
regulatory agency, under the statutory scheme outlined above I
believe I am required to give very substantial deference to
California's judgment on that score.\150\
---------------------------------------------------------------------------
\150\ Id. at 23103.
In MEMA I, the court addressed the cost of compliance relative to
technological feasibility issue at some length in reviewing a waiver
---------------------------------------------------------------------------
decision. According to the court:
Section 202's cost of compliance concern, juxtaposed as it is
with the requirement that the Administrator provide the requisite
lead time to allow technological developments, refers to the
economic costs of motor vehicle emission standards and accompanying
enforcement procedures. See S. Rep. No. 192, 89th Cong., 1st Sass.
5-8 (1965); H.R. Rep. No. 728 90th Cong., 1st Sass. 23 (1967),
reprinted in U.S. Code Cong. & Admin. News 1967, p. 1938. It relates
to the timing of a particular emission control regulation rather
than to its social implications. Congress wanted to avoid undue
economic disruption in the automotive manufacturing industry and
also sought to avoid doubling or tripling the cost of motor vehicles
to purchasers. It, therefore, requires that the emission control
regulations be technologically feasible within economic parameters.
Therein lies the intent of the cost of compliance requirement
(emphasis added).\151\
---------------------------------------------------------------------------
\151\ MEMA I at 1118 (emphasis added). See also id. at 1114 n.
40 ([T])he `cost of compliance' criterion relates to the timing of
standards and procedures.
[[Page 58114]]
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Previous waiver decisions are fully consistent with MEMA I, which
indicates that the cost of compliance must reach a very high level
before the EPA can deny a waiver. Therefore, past decisions indicate
that the costs must be excessive to find that California's standards
are inconsistent with section 202(a).\152\ It should be noted that, as
with other issues related to the determination of consistency with
section 202(a), the burden of proof regarding the cost issue falls upon
the opponents of the grant of the waiver.
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\152\ See, e.g. 47FR 7306, 7309 (Feb. 18, 1982), 43 FR 25735
(June 14, 1978), and 78 FR 2112, 2134 (Jan. 9, 2013).
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Consistent with MEMA I, the Agency has evaluated costs in the
waiver and authorization context by looking at the actual cost of
compliance in the time provided by the regulation, not the regulation's
cost-effectiveness. The appropriate level of cost-effectiveness for any
given California regulation is a policy decision that state regulators
must consider in adopting the regulation. EPA, historically, has
deferred to these policy decisions. EPA has stated in this regard,
``the law makes it clear that the waiver request cannot be denied
unless the specific findings designated in the statute can be made. The
issue of whether a proposed California requirement is likely to result
in only marginal improvement in air quality not commensurate with its
cost or is otherwise an arguably unwise exercise of regulatory power is
not legally pertinent to my decision under section 209 * * *.'' \153\
Thus, although EPA may evaluate whether compliance costs to
manufacturers (or in this case, fleet operators) are so excessive as to
implicate the regulation's technological feasibility, EPA does not look
at cost-effectiveness when making a waiver decision.
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\153\ 36 FR 17158 (August 31, 1971). See also 40 FR 23102,
23104; 58 FR 4166 (January 7, 1993), LEV Waiver Decision Document at
20.
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In evaluating the Fleet Requirements' consistency with section
202(a), EPA finds that CARB provided a series of flexibilities in order
to address concerns expressed by some about cost and cost-
effectiveness. CARB, in its Authorization Request, notes that section
2449.1 of its 2010 amendments, requires all fleets to comply with
annual fleet average emission targets or, alternatively, meet the
annual BACT requirements for specified percentages of the fleet. The
fleet average targets, CARB states, have been set to progressively
become more stringent over the years to ensure that fleets modernize to
achieve the necessary emission reductions for California to meet the
federal NAAQS for NOX and PM2.5 and to meet its
2020 goal set forth in CARB's 2000 Diesel Risk Reduction Plan.\154\
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\154\ CARB Authorization Request at 21. CARB notes that meeting
the 2020 target would reduce diesel PM from all diesel sources by 85
percent from the 2000 baseline and would prevent thousands of
premature deaths and medical infirmities.
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CARB notes that to meet the fleet average targets or the
alternative BACT requirements, a large or medium fleet may comply by
using a variety of different strategies, including: replacing the
engines in existing vehicles with cleaner engines, purchasing newer
vehicles with cleaner engines to replace older, higher emitting
vehicles, retiring vehicles from service, designating vehicles as
permanent low use, or retrofitting engines with verified diesel
emission control strategies (VDECS). Compliance with the amended
regulation will require most large and medium fleets to phase-out use
of Tier 0 and Tier 1 engines through replacement or repowering of
vehicles, but CARB also notes that fleets will be able to meet the
fleet average targets by replacing such vehicles and engines with a
combination of higher-tiered engines. Therefore, it is not until 2018
that the regulation actually requires large and medium fleets to
replace vehicles and engines with only Tier 3 and 4 engines.
CARB states that by 2018, Tier 3 engines will have been available
for at least ten years, Interim Tier 4 engines for at least seven
years, and Tier 4 engines for at least three years. In addition, CARB
notes that the Fleet Requirements provide relief to fleets if there is
a delay in the availability of vehicles that would be required to use
Tier 3, Tier 4 interim, or final Tier 4 emission standards. Therefore,
CARB notes, it is anticipated that large and medium fleet owners with
high natural turnover of vehicles will be able to meet the fleet
average targets through normal replacement and repowering of vehicles.
Fleets may also choose to meet the BACT fleet average requirements by
either installing retrofits, or by modernizing the fleet by turning
over older, dirtier engines and vehicles to newer (not necessarily new)
and cleaner models; by retiring older vehicles or designating them as
low use; or by using the other exemptions, compliance extensions, and
credit provisions. Additionally, CARB explains that the 2010 amendments
provide even further flexibility and relief for the smaller fleets,
including, but not limited to, an additional five year delay in the
implementation date (2019) of the fleet average targets beyond that
applicable to large fleets, a variety of exemptions from the BACT
requirements including an exemption if the vehicle is less than ten
years old, or if the vehicle has already been retrofitted with a level
2 or 3 VDECS that was the highest level PM VDECS at the time of
installation, etc. The 2010 amendments also included a new compliance
path for small fleets whereby such fleets could comply by phasing out
their Tier 0 and Tier 1 vehicles between 2019 and 2029--and if they
meet such compliance targets for a specific year then no other
compliance requirements would apply.
EPA received multiple comments regarding the cost of the CARB Fleet
Requirements. The comments address both the cost to fleet operators and
cost-effectiveness of the regulations. Almost all of the comments argue
that authorization should be denied because of the high compliance
costs for fleet operators. The comments claim that these costs are
excessive for an industry characterized by small, independent
companies, and they claim that many will be forced out of business by
the cost of compliance with the Fleet Requirements. EPA also received
comments on other aspects of technological feasibility including
technology availability and safety issues. A detailed discussion of
these comments is presented below.
EPA received comment from a variety of contractors and associations
claiming that while the nation and California continue to experience a
sluggish economic recovery, employment in the construction sector has
continued to decline. As a result, these commenters argue, the market
is less prepared to handle the Fleet Requirements than even before the
2010 amendments.
EPA also received a variety of comments stating that the Fleet
Requirements require the use of new equipment that might not be
available for purchase until 2014 or later. In this context, one
commenter noted that, where technology is available, a sudden increase
in demand could cause supplies to be exhausted and that contractors may
be barred from their work if they are not able to make necessary
purchases. As such, the commenter argues that CARB must allow
technology to catch up to the point that compliant equipment is broadly
available. The comment states that without a period for technology to
catch up, contractors will be unable to meet the Fleet Requirements,
triggering negative impacts on California's infrastructure rebuilding
efforts, the health of the state's construction industry, and its
overall economy.
[[Page 58115]]
Similarly, EPA received comment that the eventual elimination of
Tier 0 and Tier 1 equipment has significantly diminished the resale
value of such equipment and, combined with the recession in California,
has forced the sale of this older equipment to out-of-state
contractors. The commenter claims that this has caused a reduction in
the size of the fleet and has probably eliminated up to 15,000 jobs in
California and has also diminished the bonding capacity of contractors
(equipment is used as collateral) and severely limited the size and
number of construction projects which a contractor could undertake.
EPA also received a number of comments suggesting that the larger
fleet companies may fare better than the smaller companies in terms of
compliance with the Fleet Requirements. One commenter noted that larger
companies have already begun the process of repowering or retrofitting
their equipment: however the smaller companies (less than 10 employees)
will be severely hampered by the costs of repowering or retrofitting
equipment that, in some cases, is the sole asset of their family-owned
businesses. Commenters asserted that many of these smaller companies do
not have the resources or access to capital to repower or retrofit
their engines and may be forced to park the equipment. Due to the
annual emission reduction targets required by the Fleet Requirements,
these commenters argue, many contractors will be required to first
repower or retrofit an engine, only to have to turn around a few years
later and replace the entire piece of equipment when the technology to
do the job right finally hits the marketplace.
Another commenter maintains that the ongoing economic recession in
conjunction with CARB's ``draconian set of diesel regulations that
denies normal industry replacement cycles'' has placed many businesses
in a ``catch-22'' situation.\155\ Many businesses face having to
replace and/or modify both on-road and off-road diesel powered
equipment, yet the net effect of CARB's regulations has been to devalue
their current equipment to the point they have lost equity necessary to
secure financing. To the extent they may secure financing, the comment
states, many could not secure enough work to satisfy a mortgage
obligation.
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\155\ California Construction Trucking Association (CCTA).
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EPA also received comment stating that regardless of whether EPA
reconsiders its ``case-by-case'' implementation of section 209 waivers
by revisiting what it means for California to need this regulation to
meet its air quality goals,\156\ the Fleet Requirements still suffer
from gross inefficiencies, amortized over a smaller-than-expected
market, for smaller-than-expected gains which should defeat the
authorization as inconsistent with section 202(a), including
technological feasibility, the cost of compliance, safety, and lead
time.
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\156\ To the extent that the ``need'' for the Fleet Requirements
to meet California's air quality goals is relevant to EPA's
consideration of CARB's authorization request we examine this under
the second authorization criterion of section 209(e)(2)(ii) above.
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EPA received a variety of comments concerning the reliability and
safety of diesel retrofits. One commenter noted that the California
Occupational Health and Safety Board has established safety standards
for installation and operation of the retrofits.\157\ Another commenter
noted that attempts to meet emission levels by using filtering
equipment have failed--to the extent that the 2010 amendments
eliminated the retrofit requirement altogether and made diesel
particulate filters (DPFs) voluntary only, due to limitations in
safety, reliability, and functionality.\158\
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\157\ ARTBA and Allfishch Contractors.
\158\ United Contractors.
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In addition to the concerns about retrofits noted above, EPA also
received comment questioning whether EPA's regulation for replacement
engines has eliminated fleets' ability to choose engine replacement or
repower compliance strategies, which the commenter claimed to be the
only cost effective means to achieve the fleet average emission
standards. This commenter noted that one compliance option is to
replace equipment with the newest equipment available but that this is
impractical for most contractors due to the cost of new equipment. For
example, a new scraper or bulldozer can cost over $1,000,000. The
second option is to repower an older machine with a new engine
(replacing a Tier 0 engine with a Tier 3 engine with a cost of $150,000
or more). The commenter suggested this second option is far more
practical as the equipment is designed to last for 30 years or more.
The commenter contends that EPA's replacement engine regulation at 40
CFR 1068.240 prohibits the repowering of a machine unless the engine
has ``prematurely failed.'' This roadblock makes compliance impossible
according to the commenter.\159\
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\159\ See CIACQ.
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EPA also received comment stating that attempts to repower or
replace existing older engines with newer, cleaner technology have
encountered the practical issue of compatibility. ``The new engines
either don't fit the old chassis, or require additional alterations or
replacement of other systems (such as cooling units) in the old unit.
Thus, cost-effectiveness of modifying such older units becomes
problematical.'' \160\ This commenter does not note the availability of
retrofit, but instead noted that the alternative to repower is
retirement and replacement.
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\160\ See United Contractors.
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Finally, EPA received a number of comments suggesting that the
Fleet Requirements are generally not cost-effective, given the makeup
of the current fleet.
EPA received comment in favor of CARB's Authorization Request from
the Manufacturers of Emission Control Association (MECA), which
supported CARB's original 2007 rule, and continues to support the
current rule while requesting that EPA grant this authorization. MECA
contends that a number of advanced emission control technologies
already exist with the capability to significantly reduce PM and
NOX emissions from the engines subject to CARB's regulation,
and that over 250,000 systems (retrofits) have been installed on off-
road engines worldwide. MECA also disputes safety concerns surrounding
these systems, citing statistics that 35,000 diesel particulate filters
have been installed in California, with fewer than 15 safety-related
issues, all of which ``were shown to be attributed to poor engine or
device maintenance, misapplication of devices, or the ignoring of
warning alarms by the operator.'' MECA does not support the
implementation delays built into the CARB's 2010 amendments, but
nonetheless asks EPA to grant the request.
In response to comments from opponents of the authorization, CARB
states that the opponents have not met their burden of showing that the
regulation is inconsistent with section 209(b)(1)(C). CARB continues to
rely upon the information presented in its Authorization Request and
earlier submissions and maintains that California has amply
demonstrated that the performance standards of the regulation are
technologically feasible in the lead time provided, giving appropriate
consideration to costs. CARB states that its position that the
feasibility of the performance standards of the regulation are amply
demonstrated is consistent with past EPA authorizations for in-use
vehicles
[[Page 58116]]
and equipment, in which EPA has stated:
[S]ection 202(a) consistency calls for a limited review of
technological feasibility, including analysis of the cost of new
technology, if technology does not currently exist. Section 202(a)
does not allow EPA to conduct a more searching review of whether the
costs are outweighed by the overall benefits of the California
regulations.
CARB notes that the costs of the regulation, which was amended for
the express purpose of providing fleets with significant economic
relief during the recovery from the nation's economic downturn, cannot
be characterized as so prohibitive as to render the regulation
infeasible. In fact, CARB notes the 2010 amendments have significantly
reduced the costs of compliance for all fleets by reducing the number
of specific compliance actions that a fleet must undertake:
By delaying initial implementation of the regulation, revising
target and BACT compliance rates downward, and by providing fleets
with greater compliance flexibility (vehicle exemptions, compliance
extensions, and special credits), between 2010 and 2015, the costs
for large fleets will be reduced by approximately 97 percent, from
over $1 billion to approximately $33 million (2010 dollars). Total
costs over the life of the off-road regulation would be reduced by
approximately 72 percent, which represents a cost savings of over
$1.5 billion (2010 dollars). Peak year costs would be postponed from
2013 to 2019 and reduced almost 73 percent, from $542 million to
$146 million (2010 dollars).
With the amendments, CARB maintains fleets are in a better position
today to effectively pass on the reduced amortized costs of the
regulation to their customers.
CARB references the testimony of AGC at EPA's public hearing which
characterized the regulation's cost as reasonable.\161\
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\161\ CARB Written Comments at 15, citing to the Hearing
Transcript at p. 87. AGC noted that California's construction
contractors invested enormous sums in the equipment in the
reasonable expectation that they could lawfully operate and use it
for the duration of its useful life. AGC also noted, anecdotally,
that contractor defaults in 2012 will be higher than in any of the
previous three years and thus EPA's review of CARB's most recent
amendments is of interest and concern to AGC's members. AGC had
requested EPA to delay prior proceedings on California's Fleet
Requirements given ongoing announced plans by CARB to revisit at
least portions of CARB's rule. AGC had been deeply concerned about
the costs and other estimates CARB had made, about the technology
that contractors would require to comply, and the lead time
provided. AGC noted at EPA's authorization hearing that ``reasonable
people may disagree about whether the rule merits federal approval,
but AGC is not prepared to dispute a resolution that goes either
way.'' ``At the time [of the 2010 amendments], from our members in
California [AGC members], . . ., the costs of the amended rule were
considered reasonable. We would not have agreed to that package of
amendments . . . if they were not considered to be reasonable.''
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CARB also notes, that to the extent that some companies may be more
adversely impacted than others, CARB had previously stated in its
authorization request:
The costs to fleets for compliance varies dramatically,
depending upon the size of the fleet, the type of vehicles and
equipment used by the fleet, the age of the vehicles in the fleet,
the fleet's normal fleet replacement practices, and the compliance
pathway chosen. Regarding the last variable, fleets have wide
discretion on how they choose to comply; which vehicles should be
controlled first, should a [verified diesel emission control
strategy] VDECS be installed, or should the vehicle or engine be
turned over. If turnover is selected, does the fleet choose to
rebuild a vehicle's existing engine, report the engine with a newer,
cleaner engine, replace the older vehicle with a newer vehicle with
a cleaner engine, etc; does the fleet elect to designate a vehicle
as low use. Each of these decisions will determine the actual
compliance costs for the fleet.
In the context of responding to fleet contractors who may have the
financial inability to meet the compliance costs, CARB states that EPA
has previously addressed this general issue in a separate proceeding:
Regarding small businesses, the Owner-Operator Independent
Drivers Association (OOIDA) commented that the transport
refrigeration units (TRU) air toxic control measure (ATCM) places a
``particularly onerous financial burden on small business truckers''
with small fleets (20 or fewer trucks) making up 95% of the industry
. . .. EPA believes that the CARB regulations are feasible with
respect to cost objectively; i.e., all fleet operators face the same
cost per unit to comply. While this cost may have different impacts
on fleets of varying sizes, EPA recognizes that it is up to CARB to
choose who it will regulate under its standards. Because these TRU
engines do emit significant amount of pollution and the cost of
compliance are not so large as to render the compliance options
objectively out-of-reach, the fact that some operators may have
difficulties with the cost of the program does not make the Program
infeasible.
CARB notes that EPA's previous statements regarding feasibility
with regard to analyzing cost objectively and CARB's discretion to
choose who and how it may regulate under its standards also holds true
for its Fleet Requirements. CARB notes that in the context of the Fleet
Requirements the technology itself is feasible and has not been
questioned; and that the objective costs of the regulation--as conceded
by some members of industry--are reasonable.
With regard to ARTBA and other commenters' contention that small
companies will be severely affected by the Fleet Requirements because
of the costs of repowering and retrofitting vehicles and that these
companies do not have the resources to comply, CARB states that this
overlooks the fact that the amended regulations have significantly
reduced the costs of compliance and have extended the date of
compliance along with a variety of compliance options. CARB notes that
the total costs of compliance of the regulation have been reduced by
approximately 72 percent. In addition, the compliance costs for smaller
fleets are lower than the costs for larger fleets in that small fleets
are exempted from having to turnover vehicles to meet the regulation's
BACT requirements.\162\
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\162\ Title 13, CCR, section 2449.1(b)(3)(C).
---------------------------------------------------------------------------
CARB also addressed the issue of whether its new engine replacement
provisions are inconsistent with EPA's regulations and therefore not a
feasible compliance path for fleet operators in California. As CARB
notes, and CIAQC's comments maintain, repowering under CARB's existing
regulatory authority pertaining to new nonroad CI engine regulations
is, in many instances, technologically feasible at a significantly
lower cost than replacing an older vehicle with a new one. CARB
acknowledges that repowering is not possible in all circumstances but
nevertheless is often a cost-effective option for older equipment and
vehicles. CARB references comment from Altfillisch, as one example,
that it has been able to repower at least 71 nonroad vehicles and
equipment between 2001 and 2005, years before the Fleet Requirements
went into effect.
With respect to whether EPA's replacement engine regulations are
inconsistent with CARB's replacement engine regulations, CARB notes
that EPA has previously authorized the CARB nonroad CI emission
standards applicable to new engines and equipment which included CARB's
replacement engine regulations.\163\ Therefore California fleet
operators are subject to CARB's replacement engine regulations which
substitute for EPA's replacement engine provisions in California.\164\
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\163\ See 75 FR 8056, 8060 (February 23, 2010).
\164\ See CARB Mail Out MSC 13-07 (March 11, 2013),
see also CARB Supplemental Comments.
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In response to concerns that the Fleet Requirements are not
technically feasible due to the unavailability of Tier 4 engines, CARB
references its March 1, 2012 Authorization Request wherein it states:
[[Page 58117]]
It is not until 2018 that the regulation requires large and
medium fleets to replace vehicles and engines with only Tier 3 and
Tier 4 engines. By 2018, Tier 3 engines will have been available for
at least ten years, Interim Tier 4 engines for at least 7 years, and
Tier 4 engines for at least 3 years. Additionally, the regulation
provides relief to fleets if there is a delay in availability of
vehicles that would be required to use Tier 3 or Tier 4 interim of
final Tier 4 emission standards.
CARB noted that there is no basis to ARTBA's conjecture regarding
Tier 4 engine unavailability during the applicable time frame.\165\
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\165\ CARB Written Comments at 17.
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Finally, with respect to the compliance option of VDECS or
retrofits, CARB's supplemental comments clarify that the regulation
never required unsafe retrofits to be installed, and retrofit safety is
even less of a concern since the regulation, as amended, removes all
mandatory installation of VDECS. CARB explains that the regulation, as
initially adopted, only required retrofit of a specified percentage of
vehicles if the fleet operator could not meet the PM fleet average
targets. The amendments have since removed this requirement and, in
addition, the California Occupational Health Standards Safety Board
(OSHSB) has adopted amendments to its construction safety orders (after
working with CARB) to ensure that any retrofit will not affect the
capacity, structural integrity, or safe performance of the vehicle in
which it is installed nor create a risk of fire or operator contact
with the exhaust system or impair the vision of the operator. CARB's
2010 amendments to the Fleet Requirements continue to provide that no
VDECS are required to be installed if in violation of the amended OSHSB
safety order and, as noted above, there is no longer a mandate that a
specified percentage of vehicles be retrofitted if the fleet average is
not met.\166\
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\166\ Id. at 17-18.
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As explained below, EPA agrees with CARB's presentation of how
technological feasibility should be evaluated, for purposes of
authorization review by EPA, and that CARB has provided ample evidence
of the feasibility of the Fleet Requirements overall, and the
feasibility with respect to individual compliance options. CARB has
presented appropriate evidence of the feasibility and availability of
new nonroad CI engines along with appropriate replacement engines and
retrofits.
CARB has also properly set forth the role of EPA in reviewing
California in-use performance standards which require legacy fleets to
achieve challenging emission reductions. EPA is not setting its own
standards under section 202(a) of the Clean Air Act, rather EPA's role
within its authorization review is more limited and takes place in the
context of deference that Congress envisioned for California. This
deference was discussed in an early waiver decision when EPA approved
the waiver request for California's 1977 model year standards:
Even on this issue of technological feasibility I would feel
constrained to approve a California approach to the problem which I
might also feel unable to adopt at the Federal level in my own
capacity as a regulator. The whole approach to the Clean Air Act is
to force the development of new types of emission control technology
where that is needed by compelling the industry to `catch up' to
some degree with newly promulgated standards. Such an approach to
automotive emission control might be attended with costs, in the
shape of a reduced product offering, or price or fuel economy
penalties, and by risks that a wider number of vehicle classes may
not be able to complete their development work in time. Since a
balancing of these risks and costs against the potential benefits
from reduced emissions is a central policy decision for any
regulatory agency, under the statutory scheme outlined above I
believe I am required to give very substantial deference to
California's judgement on that score.\167\
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\167\ 40 FR 23102, 23103 (May 28, 1975); see also 78 FR 2112
(January 9, 2013).
CARB has set forth a series of compliance options to address
emissions from its legacy fleet of NR CI engines. Fleet operators may
choose from these compliance options. As explained below, EPA does not
believe those opposing these regulations have met their burden of
showing that the regulations are not technologically feasible.
Further, while EPA acknowledges the comments it has received that
claim that the Fleet Requirements may have significant adverse economic
affect on individual fleet operators, the Agency finds no factual basis
for determining that the Fleet Requirements are objectively cost
prohibitive. To the extent that a balancing of risks attendant with
adverse effect on some fleet operators against the benefits of
addressing the emission inventory associated with the legacy fleet in
California, EPA gives that the same substantial deference (as with past
waivers) to California's judgment regarding the balancing of the risks
and costs of regulation against the potential benefits from reduced
emissions. CARB has gone through several significant rounds of
amendments to address in part the economic cost associated with the
Fleet Requirements and has afforded the fleet operators a significant
number of compliance options and delays in initial compliance in order
to objectively address the risks associated with costs.
At the outset, EPA believes it important to note that we agree with
CARB's assessment that the Fleet Requirements will be feasible given
the technology available today along with the technologies that CARB
projects to be available in the lead time provided.
First, several commenters noted their concern that one of the more
cost effective compliance options, the replacement of engines or
repowering, is precluded as it conflicts with EPA's engine replacement
policy at 40 CFR 1068.240. EPA has previously authorized CARB's
emission standards applicable to new NR CI engines and the regulations
in that authorization included CARB's replacement engine provisions.
Therefore, CARB's replacement engine provisions, not EPA's provisions,
are the applicable provisions for the purposes of these Fleet
Requirements. In addition, EPA has recently published a direct final
rule and accompanying notice of proposed rulemaking that adopts
modifications to the Agency's replacement engine provisions to allow,
on a limited basis, the practice of replacing engines with engines that
are cleaner, but not certified to the most stringent standards, even
where the original engines have not failed prematurely.\168\ Therefore,
EPA's replacement engine provisions do not prevent use of repowering as
a method of complying with CARB's regulations.
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\168\ See http://www.epa.gov/otaq/climate/documents/420f13001.pdf, and http://www.gpo.gov/fdsys/pkg/FR-2013-06-17/pdf/2013-11980.pdf. The EPA received adverse comment on a portion of the
Direct Final Rule, but no commenter objected to the provision
allowing repowering using engines that are not certified to the most
stringent standards.
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Second, with respect to fleet operators choosing to replace their
equipment with new cleaner vehicles and commenters questioning the
availability of such vehicles (e.g., Tier 3, interim Tier 4, and Tier
4), EPA notes that these standards have already been reviewed by EPA in
the context of its own rulemakings, and EPA has found these standards
to be feasible in a timeframe allowing even less lead time than that
provided by California. EPA annually certifies new NR CI engines and
the certification data to date strongly suggest that engine
manufacturers are certifying to meet the newest applicable standards,
and that these standards are
[[Page 58118]]
feasible.\169\ EPA believes CARB is reasonable in its depiction of
currently available emission control technology and with its projection
of sufficient lead time being available to ensure that a sufficient
supply of newer emission control technologies (meeting newer Tier 3,
and interim and final Tier 4 emission standards) is in place to meet
the demands of fleet operators. As CARB notes, the comments contending
otherwise have not provided any evidence that in 2018 large and medium-
sized fleet operators will not be able to replace vehicles and engines
with Tier 3 and Tier 4 engines. In addition, to the extent a fleet
operator replaces such vehicles and engines, CARB's Fleet Requirements
also provide relief to fleets if there is a delay in availability of
vehicles that would be required to use Tier 3 or Tier 4 interim or
final Tier 4 emission standards. Finally, there is no evidence in the
record indicating a shortage of certified engines during the time frame
for which they will be needed for this rule, given the flexibilities
provided by the amendments. The opponents of the waiver have not met
their burden of proof to demonstrate the lack of commercial
availability of appropriate engines to the extent that the regulations
would be infeasible.
---------------------------------------------------------------------------
\169\ http://www.epa.gov/otaq/certdata.htm#nrci.
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Third, with respect to the technical feasibility of exhaust
retrofits (VDECS) and the safety-related and compatibility concerns
expressed by commenters, EPA believes that CARB's 2010 amendments add
both the needed flexibility, with respect to not mandating retrofits,
and sufficiently clarify when a NR CI vehicle is exempted due to
expressed safety concerns. The Fleet Requirements never required unsafe
retrofits be installed, and retrofit safety is even less of a concern
now that the regulation has been amended to remove all mandatory
installation of VDECS, even if fleet average targets are not met.\170\
EPA believes that CARB has also appropriately addressed expressed
concerns regarding retrofit safety, including referencing the
amendments adopted by OSHSB. These amendments, adopted in March 2012,
state that a safety order will be provided in order to ensure that a
retrofitted VDECS shall not affect the capacity, structural integrity,
and safe performance of the vehicle in which it is installed nor create
a fire or safety risk or impair the operators' vision.\171\ EPA also
notes that the CARB staff reviewed retrofit field experience since
2002. Of the 35,000 diesel particulate filters (DPFs) deployed in the
state, less than 15 safety-related issues were identified and all of
these were shown to be attributed to poor engine or device maintenance,
misapplication of devices, or the ignoring of warning alarms by the
operator.\172\ With regard to the availability of VDECS in general,
there is no evidence in the record to refute CARB's view that the Fleet
Requirements are likely to continue to increase the demand for
retrofits and that CARB's anticipation that an increase in supply will
occur as compliance deadlines approach is reasonable. CARB has
identified a number of verified Level 3 VDECS and the commenters have
not shown that this option does not provide a feasible alternative in
many cases to meeting the Fleet Requirements.\173\
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\170\ CARB Supplemental Comments at 17-18.
\171\ Id.
\172\ MECA at 4. ``Regarding the safe installation of retrofit
devices, retrofit manufacturers have shown that off-road retrofits
can be installed to comply with the Cal/OSHA retrofit visibility/
safety requirements finalized last year. Retrofit manufacturers are
using the best engineering judgment and installation practices to
ensure the safe installation of devices. In general, retrofit
installations in California have had an excellent safety record.
\173\ Authorization Request at 24. See also EPA's list of
currently verified technologies at: http://www.epa.gov/cleandiesel/verification/verif-list.htm, and generally: http://www.epa.gov/cleandiesel/technologies/.
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EPA also believes it important to note that CARB's fleet average
targets have been set so that they progressively become more stringent
over the years in order that CARB's emission reductions goals are met
while affording fleet operators with necessary flexibility and
compliance options. In addition, CARB's four-year delay in compliance
(from 2010 to 2014) helps ensure the feasibility of the regulation
along with built-in provisions that ensure against noncompliance with
the Fleet Requirements due to the unavailability of the highest tiered
engines or VDECS. In addition, CARB's BACT credits compliance path
includes a number of accommodations (e.g. accrual of credits earned
prior to March 1, 2010 may in certain circumstances be applied toward a
large fleets' January 1, 2014 compliance deadline; double credits for
early installation of VDECS; credit for reduced horsepower of the
fleet, etc). There are also a number of exemptions under the BACT
requirements applicable to large and medium fleets, and separately for
small fleets. For example, vehicles in any size fleet are exempt from
the BACT credit requirement calculation if on any given annual
compliance date the vehicle is less than ten years old from the date of
manufacture, and specialty vehicles are exempt if the fleet has applied
BACT to all other vehicles in the fleet and no engine is available to
repower the specialty vehicle and instead has the highest level VDECS
available installed. In addition, for large and medium fleets, a
vehicle is exempt if it had a Level 2 or 3 p.m. VDECS installed within
the last six years and for small fleets the vehicle is exempt if has
already been retrofitted with a Level 2 or 3 VDECS that was the highest
level PM VDECS available at the time of installation. Regarding the
claim that the regulations require an initial repower or retrofit and
then a replacement of an entire piece of equipment shortly thereafter,
CARB's 2010 amendments also provide an exemption for vehicles that have
had a level 2 or 3 p.m. VDECS installed within the last six years and
an exemption for original equipment manufacturer diesel PM equipped
vehicles and, with certain limitations, to vehicles that installed
highest level VDECS prior to 2013. These further accommodations help
assure the feasibility of the Fleet Requirements.
Although certain fleet operators contend that their business will
either be severely or irreparably harmed (as reviewed further below),
the commenters opposing the authorization have not provided any factual
evidence in the record to demonstrate that a mix of available
compliance options and flexibilities is not feasible.
EPA believes that CARB has afforded a variety of compliance options
(and initial delays of the phase-in periods for compliance) that
individual fleet operators can employ in a variety of ways depending on
the nature of their business and the composition of their fleets.
Accordingly, with regard to the consideration of cost of the Fleet
Requirements (including comments that the regulation will diminish the
net value of certain fleet operators which will further impair their
ability to finance the upgrades necessary to comply with the regulation
or to obtain construction bonds), we note at the outset that many
factors affect the ability of certain fleet operators to meet the Fleet
Requirements. While it is possible that some diminishment in value of
certain fleet operator equipment will occur as a result of the Fleet
Requirements (while recognizing that CARB has significantly delayed the
requirement that such engines be replaced), there is no evidence or
data in the record to demonstrate that the loss in value to the fleet
operator is the proximate cause of such operations going out of
business or that such
[[Page 58119]]
economic results render the Fleet Requirements infeasible for the
broader regulated community. EPA believes that CARB has reasonably
responded to concerns expressed about the costs of the Fleet
Requirements, including the availability of engine replacements and
retrofits. EPA notes that even some commenters otherwise opposed to the
authorization have recognized the feasibility of early engine
replacement. In addition, there is no evidence in the record to reflect
a widespread or significant economic disruption to regulated fleet
operators that is proximately caused by the Fleet Requirements.\174\
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\174\ Regarding comments that these regulations would stop
valuable work to be performed by this industry in California, there
is no evidence that this rule has led to the widespread cancelation
of projects.
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More importantly, EPA believes that the CARB regulations are
feasible with respect to cost objectively; i.e., although fleets are
likely to be comprised differently, all fleet operators are
nevertheless facing the same cost per unit to comply. While this cost
may have different impacts on fleets of varying sizes, EPA recognizes
that it is up to CARB to choose who it will regulate under its
standards.\175\ The fact that some operators may have difficulties with
the cost of the program does not make the program infeasible.\176\
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\175\ CARB notes that the increased costs, due to the Fleet
Requirements, to small fleet operators is on the magnitude of
$38,000 for the youngest fleets to $173,000 for the oldest fleets
(cite) and such costs have not been countered by opponents of the
authorization.
\176\ EPA has previously stated that it is up to CARB to choose
who it will regulate under its standards, even though such costs may
have differing impacts for different fleets. See 74 FR 3030 (January
16, 2009), TRU Decision Document at 63.
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In addition, under the guidelines of MEMA I, EPA believes that it
should evaluate costs in authorization requests by looking at the
actual costs of compliance in terms of the lead time provided by the
regulations, and not at the regulation's cost-effectiveness. It is
CARB's responsibility to determine the best way to reduce emissions in
its state, and EPA does not reevaluate California's policy decisions in
deciding whether to grant authorization, as long as, pursuant to
section 209(e), the regulations can be met without making the costs
prohibitive. The comments received regarding cost-effectiveness do not
show that the costs for fleet operators generally will be prohibitive.
California's estimates of the costs of the regulation are reasonable
and CARB has rebutted the argument that small fleet operators in
general will not be able to meet the requirements.\177\ EPA also agrees
with CARB's statement that EPA has long deferred to California's policy
judgments associated with cost-effectiveness ``EPA will not look into
the question of cost-effectiveness--that is, whether the overall
benefits of the regulation are outweighed by the regulation's costs of
compliance.'' \178\ Consequently, based on the record, EPA is unable to
make the finding that the Fleet Requirements are not technologically
feasible with the available lead time giving consideration to the cost
of compliance.
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\177\ CARB's Authorization Request at 25. CARB notes that small
fleets are expected to be able to fully comply with the regulation
if it routinely turns over its vehicles and equipment and meet the
emission target rates and have little or no compliance costs
associated with the regulation. To the extent normal turnover is
insufficient, CARB notes small fleets are expected to comply through
installation of VDECS (If a small fleet cannot be retrofitted with a
VDECS that vehicle is exempt from the BACT requirements, including
turnover), by exercising the special option for fleets with less
than 500 total horsepower, designating vehicles as low-use, and by
exercising the small fleet vehicle exemptions along various other
exemptions, credits, etc.
\178\ Id., citing 58 FR 4166 (January 7, 1993), Decision
Document at 20 [``Since a balancing of these . . . costs against the
potential benefits from reduced emissions is a central policy
decision [of CARB is adopting the regulation] I believe I am
required to give very substantial deference to California's
judgments on this score.''].
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b. Consistency of Certification Procedures
California's standards and accompanying enforcement procedures
would also be inconsistent with section 202(a) if the California test
procedures were to impose certification requirements inconsistent with
the federal certification requirements. Such inconsistency would mean
that manufacturers would be unable to meet both the California and
federal testing requirements using the same test vehicle or
engine.\179\ CARB presents that the Fleet Requirements raise no issue
regarding incompatibility of California and federal test procedures.
``There is no requirement on engine manufacturers or fleet owners to
certify engines beyond existing federal and state certification testing
for new engines. Additionally, there are no conflicts between federal
and California test procedures for verification testing for diesel
emission control strategies in that there is no comparable mandatory
federal program.'' \180\ EPA received no comments suggesting that
CARB's Fleet Requirements pose any test procedure consistency problem.
Therefore, based on the record, EPA cannot find that CARB's testing
procedures are inconsistent with section 202(a) and cannot deny CARB's
request based on this criterion.
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\179\ See, e.g., 43 FR 32182 (July 25, 1978).
\180\ CARB Authorization Request at 28.
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D. Additional Issues Raised in Comment
EPA received a series of comments on grounds other than those
specified in section 209(e)(2)(A) of the Act. These comments include
several administrative concerns including the lack of a public hearing
in California and a request to reopen the public comment period (and to
stay the issuance of a final EPA decision). We also received a number
of comments objecting to the authorization based on other federal law
or constitutional claims. As set forth below, EPA has complied with all
relevant administrative process requirements for this proceeding and
none of the comments described above provide any basis for denying
CARB's Authorization Request.
1. Request for a Public Hearing in California
EPA received comment during the course of the public comment period
associated with EPA's August 12, 2012 Federal Register notice
requesting that EPA conduct a public hearing or hearings in California
in order for those affected by CARB's regulation, the fleet operators,
to be directly heard and for those unable to travel to Washington, DC
be afforded the opportunity to express their concerns to EPA.
Section 209(e)(2)(A) states in part that ``. . . the Administrator
shall, after notice and opportunity for public hearing, authorize
California to adopt and enforce standards and other requirements
relating to the control of emissions from such nonroad vehicles or
engines . . . .'' EPA's process for providing an opportunity for public
comment on the CARB Fleet Requirements was consistent with the normal
process EPA applies in response to this language. EPA has consistently
announced in the Federal Register the opportunity for a public hearing
for any authorization request received from CARB. As a general matter
EPA has also offered an opportunity for written comment which has
opened on the date of the Federal Register notice and closed on a date
after the public hearing. As part of EPA's public hearings, the
presiding officer has consistently stated that the hearing was being
conducted in accordance with section 209(e) of the Clean Air Act and
that any interested parties have the opportunity to present both oral
testimony and written comments. While EPA occasionally has held
hearings in California, the vast
[[Page 58120]]
majority of hearings on section 209 proceedings have occurred in
Washington, DC. EPA has been conducting its section 209(b) waiver
proceedings and section 209(e) authorization proceedings in this manner
for decades, and although Congress has amended provisions in section
209 on two separate occasions, Congress has not chosen to alter EPA's
administrative requirements.
EPA is guided by the principles of fair public notice and
opportunity for comment. In this instance, EPA published notice of
CARB's authorization request in the Federal Register, including the
Clean Air Act prescribed authorization criteria EPA would review in
consideration of CARB's request, and provided more than 30 days of
notice before conducting a public hearing. EPA conducted a properly
noticed public hearing in Washington, DC which was attended by several
trade associations representing numerous members and fleet operators
within California.\181\ EPA has placed the transcript of the public
hearing into the public docket. After the public hearing EPA provided
an additional 30 days for interested parties to submit written comment
addressing all relevant issues pertaining to California's authorization
request. The affected parties have had in their possession the
necessary information to adequately comment on whether the Fleet
Requirements are technologically feasible as well as CARB's
protectiveness determination. Opponents have had access to the
necessary information to formulate comments in regard to the second
waiver criterion at section 209(e)(2)(A)(ii). All written comments have
been placed in the public docket. EPA was responsive to the desire
expressed by some commenters to speak directly with representatives to
EPA, including the desire to explain the economic impacts the Fleet
Requirements may have on their businesses. In response, EPA conducted
and made available an informal teleconference phone call for interested
parties in California with representatives from EPA.\182\ This Federal
Register notice provides EPA's reasoned response to all oral testimony,
written comment, and viewpoints expressed to EPA. All commenters,
including opponents of the waiver, have had ample opportunity to
comment and meet their applicable burdens of proof. Opponents of CARB's
Fleet Requirements and of its authorization request have had ample
opportunity to present their viewpoints during the course of CARB's
rulemaking and EPA's authorization proceeding. Lastly, as noted above,
CARB has engaged in several proceedings and has adopted a series of
amendments in response to concerns raised by the regulated parties,
including fleet operators.
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\181\ As explained in EPA's July 2009 GHG waiver decision, EPA
is guided by the language in the Clean Air Act and not the hearing
requirements set forth in the Administrative Procedure Act. EPA
incorporates that reasoning into today's decision. See 74 FR 32744,
32780-32782 (July 8, 2009).
\182\ EPA-HQ-OAR-2008-0691-0321.
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2. Request for EPA To Reopen the Comment Period
EPA received comment from PLF characterized as a ``Notice of New
Development and Supplemental Comment'' requesting that EPA reopen the
comment period associated with the Fleet Requirements authorization
request and to hold in abeyance any decision regarding California's
authorization request. PLF points to the recent decision issued by the
United States Court of Appeals for the District of Columbia Circuit in
Natural Resources Defense Counsel v. EPA, No. 08-1250, January 4, 2013,
(Decision) for the proposition that the court's decision and CARB's
authorization application are inextricably linked. PLF characterizes
the Decision as requiring EPA itself to adopt stringent federal
implementation standards for PM2.5 throughout the nation,
including California. Because California asserted that it ``needs''
PM2.5 nonroad diesel standards that are more stringent than
federal PM2.5 standards, and because EPA is now required to
use the ``stringent, action-forcing provisions'' of section 188-188(b)
of the Clean Air Act as a result of the Decision, PLF maintains that it
is appropriate to complete EPA's administrative proceedings on remand
(from the Decision) before EPA is able to determine the extent to which
there is a ``need'' for California to have its own PM2.5
standard based on ``compelling and extraordinary conditions'' in
California. In addition, PLF asserts that EPA's most recent revision of
the NAAQS PM2.5 primary standard, which lowers the existing
level to 12.0 micrograms per cubic meter, and the concomitant revision
to the Air Quality Index for PM2.5, provides additional
reason to question California's ``need'' for its own PM2.5
nonroad diesel standard.\183\ EPA responds to the substance of PLF's
comments above in our discussion of the second criterion for
authorization.
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\183\ Although PLF expresses the NAAQS PM2.5 primary
standard in ``micrometers,'' the correct unit of measure is
micrograms.
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As discussed above, EPA does not agree that the recent decision of
the Court of Appeals has any significant effect on the second criterion
for granting authorization. Moreover, PLF has had a full opportunity to
make its argument with regard to this new decision and its potential
effect on this authorization determination, and EPA has responded in
full to PLF's comments. We therefore believe there is no need for a
further reopening of the comment period for this proceeding; nor is
there any cause for any delay in issuing our decision with regard to
the authorization. Therefore, we deny PLF's request to reopen the
authorization comment period and to delay issuing an authorization
decision for the Fleet Requirements.
3. Claims Outside the Scope of the Clean Air Act
Airlines for America (``A4A'') has provided comment opposing EPA
authorization of California's Fleets Regulation. A4A claims that the
Fleet Requirements, as they affect airport ground equipment, are
preempted by the Federal Aviation Act and the Airline Deregulation Act.
These comments are outside the scope of EPA's scope of review of
California authorization requests under section 209(e)(2). As EPA has
stated on numerous occasions, EPA's review of California regulations
under section 209 is not a broad review of the reasonableness of the
regulations or its compatibility with all other laws. Sections 209(b)
and 209(e) of the Clean Air Act limit EPA's authority to deny
California requests for waivers and authorizations to the three
criteria listed therein. As a result, EPA has consistently refrained
from denying California's requests for waivers and authorizations based
on any other criteria.\184\ In instances where the U.S. Court of
Appeals has reviewed EPA decisions declining to deny waiver requests
based on criteria not found in section 209(b), the Court has upheld and
agreed with EPA's determination.\185\ A4A's comment raises issues of
federal preemption that are not included within the criteria listed
under sections 209(e).\186\ Therefore, in considering
[[Page 58121]]
whether to grant authorization for California's Fleet Requirements
under section 209(e), EPA cannot deny California's request for
authorization based on the issues raised by A4A.
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\184\ See, e.g., 74 FR 32744, 32783 (July 8, 2009).
\185\ See Motor and Equipment Manufacturers Ass'n v. Nichols,
142 F.3d 449, 462-63, 466-67 (D.C. Cir.1998), Motor and Equipment
Manufacturers Ass'n v. EPA, 627 F.2d 1095, 1111, 1114-20 (D.C. Cir.
1979).
\186\ A4A may raise these issues in a direct challenge to
California's regulations in other forums, but these issues are not
relevant to EPA's limited review under section 209.
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EPA also received comment suggesting that EPA and California must
certify CARB's Fleet Requirements as ``not having a significant
economic impact on a substantial number of small entities'' under the
Regulatory Flexibility Act (5 U.S.C. 601).\187\ EPA notes that CARB's
authorization request and EPA's subsequent action do not constitute a
rule as defined in the Regulatory Flexibility Act, 5 U.S.C. 601(2), and
therefore are not covered by the certification requirement in that
statute. EPA's authorization proceedings and actions under section
209(e)(2)(A) are informal adjudications. In an authorization
proceeding, EPA receives a request from one entity (CARB) that is
presenting an existing regulation established as a matter of California
law. The request is for an EPA authorization for that party, so it may
adopt and enforce the specific regulations. In deciding this request,
EPA interprets and applies the three authorization criteria established
by the Act, and under this provision is required to grant the
authorization unless EPA makes one of the three specified findings. EPA
applies the pre-existing law, section 209(e)(2)(A), and EPA's
regulation promulgated therein, to a specific request covering a
specific regulation, and applies the three statutory criteria to the
facts of the specific request.
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\187\ Delta Construction, May 12, 2010 comment at 3 (Citing 42
U.S.C. 7410(k) and 40 CFR 52.02(a)).
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The decision to grant or deny the authorization request directly
affects the legal rights of the party before EPA, California. If EPA
grants the authorization, then CARB may enforce its state regulations.
Other parties, for example, the fleet operators, may be indirectly
affected because state regulation is no longer preempted. While there
may be indirect consequences for various parties, the only decision
taken by EPA in the authorization proceeding is the decision that
permits the State of California to adopt and enforce its state
regulations. As noted above, sections 209(b) and 209(e) of the Clean
Air Act limit EPA's authority to deny California requests for waivers
and authorizations to the three criteria listed therein. As a result,
EPA has consistently refrained from denying California's requests for
waivers and authorizations based on any other criteria.\188\ Review of
California regulations under the Regulatory Flexibility Act is not
included within the criteria listed under sections 209(e). Indeed,
Congress intended EPA to provide California with substantial deference
in making its own decisions regarding the effects of its regulations.
Therefore, in considering whether to grant authorization for
California's Fleet Requirements under section 209(e), EPA is not
required to undertake a review under the Regulatory Flexibility Act and
could not deny California's request for authorization based on any such
review.
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\188\ See, e.g. 74 FR 32744, 32783 (July 8, 2009).
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4. Constitutional Claims
EPA received a number of comments suggesting that EPA should deny
authorization of the Fleet Requirements because of their potential to
impose negative economic impacts on fleets. These comments stated that
the regulations would cause emissions control equipment that fleet
operators purchased before CARB's regulations took effect to lose its
asset value, even though the equipment still has a long useful life.
The comments suggest that CARB's regulation amounts to a ``taking'' as
defined under the Fifth Amendment to the U.S. Constitution and
``appropriate sections of California Constitution and Law.'' EPA's
response to these comments is guided first by the language in section
209(e)(2)(A) that clearly sets forth the limited criteria or basis by
which we may deny an authorization request from CARB. EPA's limited
ability to deny an authorization request to the criteria found in
section 209(e)(2)(A) of the Act is consistent with case law.\189\
Therefore, in considering whether to grant authorization for
California's Fleet Requirements under section 209(e), EPA cannot deny
California's request for authorization based on constitutional
arguments outside the scope of the Clean Air Act. Moreover, such
arguments are best directed against California directly in a court of
law, not to a separate government agency with only a limited authority
to review California's regulations.
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\189\ MEMA I.
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E. Authorization Determination for California's Fleet Requirements
After a review of the information submitted by CARB and other
commenters, EPA finds that those opposing California's request have not
met the burden of demonstrating that authorization for California's
Fleet Requirements should be denied based on any of the statutory
criteria of section 209(e)(2)(A). For this reason, EPA finds that an
authorization for California's Fleet Requirements should be granted.
IV. Decision
The Administrator has delegated the authority to grant California
section 209(e) authorizations to the Assistant Administrator for Air
and Radiation. After evaluating California's Fleet Requirements, CARB's
submissions, and the public comments received, EPA is granting an
authorization to California for its Fleet Requirements.
My decision will indirectly affect not only persons in California,
but also entities outside the state who must comply with California's
requirements. For this reason, I determine and find that this is a
final action of national applicability for purposes of section
307(b)(1) of the Act. Pursuant to section 307(b)(1) of the Act,
judicial review of this final action may be sought only in the United
States Court of Appeals for the District of Columbia Circuit. Petitions
for review must be filed by November 19, 2013. Judicial review of this
final action may not be obtained in subsequent enforcement proceedings,
pursuant to section 307(b)(2) of the Act.
V. Statutory and Executive Order Reviews
As with past authorization and waiver decisions, this action is not
a rule as defined by Executive Order 12866. Therefore, it is exempt
from review by the Office of Management and Budget as required for
rules and regulations by Executive Order 12866.
In addition, this action is not a rule as defined in the Regulatory
Flexibility Act, 5 U.S.C. 601(2). Therefore, EPA has not prepared a
supporting regulatory flexibility analysis addressing the impact of
this action on small business entities.
Further, the Congressional Review Act, 5 U.S.C. 801, et seq., as
added by the Small Business Regulatory Enforcement Fairness Act of
1996, does not apply because this action is not a rule for purposes of
5 U.S.C. 804(3).
Dated: September 13, 2013.
Janet G. McCabe,
Acting Assistant Administrator, Office of Air and Radiation.
[FR Doc. 2013-22930 Filed 9-19-13; 8:45 am]
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