[Federal Register Volume 79, Number 180 (Wednesday, September 17, 2014)]
[Proposed Rules]
[Pages 55919-55956]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2014-21830]



[[Page 55919]]

Vol. 79

Wednesday,

No. 180

September 17, 2014

Part III





Environmental Protection Agency





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40 CFR Part 52





 State Implementation Plans: Response to Petition for Rulemaking; 
Findings of Substantial Inadequacy; and SIP Calls To Amend Provisions 
Applying to Excess Emissions During Periods of Startup, Shutdown and 
Malfunction; Supplemental Proposal To Address Affirmative Defense 
Provisions in States Included in the Petition for Rulemaking and in 
Additional State; Proposed Rule

Federal Register / Vol. 79 , No. 180 / Wednesday, September 17, 2014 
/ Proposed Rules

[[Page 55920]]


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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[EPA-HQ-OAR-2012-0322; FRL-9914-41-OAR]
RIN 2060-AR68


State Implementation Plans: Response to Petition for Rulemaking; 
Findings of Substantial Inadequacy; and SIP Calls To Amend Provisions 
Applying to Excess Emissions During Periods of Startup, Shutdown and 
Malfunction; Supplemental Proposal To Address Affirmative Defense 
Provisions in States Included in the Petition for Rulemaking and in 
Additional States

AGENCY: Environmental Protection Agency (EPA).

ACTION: Supplemental notice of proposed rulemaking.

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SUMMARY: In this supplemental notice of proposed rulemaking (SNPR), the 
Environmental Protection Agency (EPA) is supplementing and revising 
what it previously proposed as its response to a petition for 
rulemaking filed by the Sierra Club (the Petition). By notice published 
on February 22, 2013, the EPA proposed its response to the Petition's 
requests concerning treatment of excess emissions in state rules by 
sources during periods of startup, shutdown or malfunction (SSM). 
Subsequent to that proposal, a federal court ruled that the Clean Air 
Act (CAA or Act) precludes authority of the EPA to create affirmative 
defense provisions applicable to private civil suits. As a result, in 
this SNPR the EPA is proposing to apply its revised interpretation of 
the CAA, but only with respect to affirmative defense provisions in 
state implementation plans (SIPs). For specific affirmative defense 
provisions identified in the Petition, we are revising the basis for 
the proposed findings of substantial inadequacy and SIP calls or 
proposing new findings of substantial inadequacy and SIP calls. For 
specific provisions that the EPA has independently identified, 
including SIP provisions in states not included in the February 2013 
proposal notice, we are proposing new findings and SIP calls.

DATES: Comments. Comments must be received on or before November 6, 
2014.
    Public Hearing. The EPA will hold a public hearing on this SNPR on 
October 7, 2014, in Washington, DC.

ADDRESSES: Submit your comments, identified by Docket ID No. EPA-HQ-
OAR-2012-0322, by one of the following methods:
     http://www.regulations.gov: Follow the online instructions 
for submitting comments.
     Email: a-and-r-docket@epa.gov.
     Fax: (202) 566-9744.
     Mail: Attention Docket ID No. EPA-HQ-OAR-2012-0322, U.S. 
Environmental Protection Agency, EPA Docket Center, Air Docket, Mail 
Code 28221T, 1200 Pennsylvania Avenue NW., Washington, DC 20460. Please 
include a total of two copies.
     Hand Delivery: U.S. Environmental Protection Agency, EPA 
Docket Center, William Jefferson Clinton West Building, Room 3334, 1301 
Constitution Avenue NW., Washington, DC 20004, Attention Docket ID No. 
EPA-HQ-OAR-2012-0322. Such deliveries are only accepted during the 
Docket's normal hours of operation, and special arrangements should be 
made for deliveries of boxed information.
    Instructions. Direct your comments to Docket ID No. EPA-HQ-OAR-
2012-0322. The EPA's policy is that all comments received will be 
included in the public docket without change and may be made available 
online at http://www.regulations.gov, including any personal 
information provided, unless the comment includes information claimed 
to be Confidential Business Information (CBI) or other information 
whose disclosure is restricted by statute. Do not submit information 
that you consider to be CBI or otherwise protected through http://www.regulations.gov or email. The http://www.regulations.gov Web site 
is an ``anonymous access'' system, which means the EPA will not know 
your identity or contact information unless you provide it in the body 
of your comment. If you send an email comment directly to the EPA 
without going through http://www.regulations.gov, your email address 
will be automatically captured and included as part of the comment that 
is placed in the public docket and made available on the Internet. If 
you submit an electronic comment, the EPA recommends that you include 
your name and other contact information in the body of your comment and 
with any CD you submit. If the EPA cannot read your comment due to 
technical difficulties and cannot contact you for clarification, the 
EPA may not be able to consider your comment. Electronic files should 
avoid the use of special characters, avoid any form of encryption and 
be free of any defects or viruses. For additional information about the 
EPA's public docket visit the EPA Docket Center homepage at http://www.epa.gov/epahome/dockets.htm. For additional instructions on 
submitting comments, go to section I.C of the SUPPLEMENTARY INFORMATION 
section of this document.
    Docket. All documents in the docket are listed in the http://www.regulations.gov index. Although listed in the index, some 
information is not publicly available, e.g., CBI or other information 
whose disclosure is restricted by statute. Certain other material, such 
as copyrighted material, will be publicly available only in hard copy. 
Publicly available docket materials are available either electronically 
at http://www.regulations.gov or in hard copy at the U.S. Environmental 
Protection Agency, EPA Docket Center, William Jefferson Clinton West 
Building, Room 3334, 1301 Constitution Ave. NW., Washington, DC. The 
Public Reading Room is open from 8:30 a.m. to 4:30 p.m., Monday through 
Friday, excluding legal holidays. The telephone number for the Public 
Reading Room is (202) 566-1744, and the telephone number for the Air 
Docket is (202) 566-1742.
    Public Hearing: A public hearing will be held on October 7, 2014, 
at the William Jefferson Clinton West Building, Room 1117B, 1301 
Constitution Avenue, Washington, DC 20460. The public hearing will 
convene at 9 a.m. (Eastern Standard Time) and continue until the 
earlier of 6 p.m. or 1 hour after the last registered speaker has 
spoken. People interested in presenting oral testimony or inquiring as 
to whether a hearing is to be held should contact Ms. Pamela Long, Air 
Quality Planning Division, Office of Air Quality Planning and Standards 
(C504-01), U.S. Environmental Protection Agency, Research Triangle 
Park, NC 27711, telephone (919) 541-0641, fax number (919) 541-5509, 
email address long.pam@epa.gov, at least 5 days in advance of the 
public hearing (see DATES). People interested in attending the public 
hearing must also call Ms. Long to verify the time, date and location 
of the hearing. The public hearing will provide interested parties the 
opportunity to present data, views or arguments concerning the proposed 
action (i.e., this SNPR specific to affirmative defense provisions in 
SIPs). The EPA will make every effort to accommodate all speakers who 
arrive and register. A lunch break is scheduled from 12:30 p.m. until 2 
p.m. Because this hearing is being held at U.S. government facilities, 
individuals planning to attend the hearing should be prepared to show 
valid picture identification to the security staff in order to gain 
access to the meeting room. Please note that the REAL ID Act, passed by 
Congress in 2005, established

[[Page 55921]]

new requirements for entering federal facilities. These requirements 
took effect July 21, 2014. If your driver's license is issued by 
Alaska, American Samoa, Arizona, Kentucky, Louisiana, Maine, 
Massachusetts, Minnesota, Montana, New York, Oklahoma or the state of 
Washington, you must present an additional form of identification to 
enter the federal building where the public hearing will be held. 
Acceptable alternative forms of identification include: Federal 
employee badges, passports, enhanced driver's licenses, and military 
identification cards. In addition, you will need to obtain a property 
pass for any personal belongings you bring with you. Upon leaving the 
building, you will be required to return this property pass to the 
security desk. No large signs will be allowed in the building, cameras 
may only be used outside of the building and demonstrations will not be 
allowed on federal property for security reasons. The EPA may ask 
clarifying questions during the oral presentations but will not respond 
to the presentations at that time. Written statements and supporting 
information submitted during the comment period will be considered with 
the same weight as oral comments and supporting information presented 
at the public hearing. Written comments on the proposed rule must be 
received by November 6, 2014. Commenters should notify Ms. Long if they 
will need specific equipment, or if there are other special needs 
related to providing comments at the hearing. The EPA will provide 
equipment for commenters to show overhead slides or make computerized 
slide presentations if we receive special requests in advance. Oral 
testimony will be limited to 5 minutes for each commenter. The EPA 
encourages commenters to provide the EPA with a copy of their oral 
testimony electronically (via email or CD) or in hard copy form. The 
hearing schedule, including lists of speakers, will be posted on the 
EPA's Web site at http://www.epa.gov/air/urbanair/sipstatus/. Verbatim 
transcripts of the hearings and written statements will be included in 
the docket for the rulemaking. The EPA will make every effort to follow 
the schedule as closely as possible on the day of the hearing; however, 
please plan for the hearing to run either ahead of schedule or behind 
schedule.

FOR FURTHER INFORMATION CONTACT: Questions concerning this SNPR should 
be addressed to Ms. Lisa Sutton, U.S. EPA, Office of Air Quality 
Planning and Standards, State and Local Programs Group (C539-01), 
Research Triangle Park, NC 27711, telephone number (919) 541-3450, 
email address: sutton.lisa@epa.gov.
    If you have questions concerning the public hearing, please contact 
Ms. Pamela Long, U.S. Environmental Protection Agency, Office of Air 
Quality Planning and Standards, Air Quality Planning Division (C504-
01), Research Triangle Park, NC 27711, telephone (919) 541-0641, fax 
number (919) 541-5509, email address: long.pam@epa.gov (preferred 
method for registering).

SUPPLEMENTARY INFORMATION: For questions related to a specific SIP, 
please contact the appropriate EPA Regional Office:

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                        Contact for regional
                      office (person, mailing
EPA Regional office      address, telephone               State
                              number)
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I..................  Alison Simcox,             Connecticut,
                      Environmental Scientist,   Massachusetts, Maine,
                      EPA Region 1, 5 Post       New Hampshire, Rhode
                      Office Square, Suite       Island and Vermont.
                      100, Boston, MA 02109-
                      3912, (617) 918-1684.
II.................  Paul Truchan, EPA Region   New Jersey, New York,
                      2, 290 Broadway, 25th      Puerto Rico and Virgin
                      Floor, New York, NY        Islands.
                      10007-1866, (212) 637-
                      3711.
III................  Amy Johansen, EPA Region   District of Columbia,
                      3, 1650 Arch Street,       Delaware, Maryland,
                      Philadelphia, PA 19103-    Pennsylvania, Virginia
                      2029, (215) 814-2156.      and West Virginia.
IV.................  Joel Huey, EPA Region 4,   Alabama, Florida,
                      Atlanta Federal Center,    Georgia, Kentucky,
                      61 Forsyth Street SW.,     Mississippi, North
                      Atlanta, GA 30303-8960,    Carolina, South
                      (404) 562-9104.            Carolina and Tennessee.
V..................  Christos Panos, Air and    Illinois, Indiana,
                      Radiation Division (AR-    Michigan, Minnesota,
                      18J), EPA Region 5, 77     Ohio and Wisconsin.
                      West Jackson Boulevard,
                      Chicago, IL 60604-3507,
                      (312) 353-8328.
VI.................  Alan Shar (6PD-L), EPA     Arkansas, Louisiana, New
                      Region 6, Fountain Place   Mexico, Oklahoma and
                      12th Floor, Suite 1200,    Texas.
                      1445 Ross Avenue,
                      Dallas, TX 75202-2733,
                      (214) 665-6691.
VII................  Lachala Kemp, EPA Region   Iowa, Kansas, Missouri
                      7, Air Planning and        and Nebraska.
                      Development Branch,
                      11201 Renner Boulevard,
                      Lenexa, KS 66219, (913)
                      551-7214. Alternate
                      contact is Ward Burns,
                      (913) 551-7960.
VIII...............  Adam Clark, Air Quality    Colorado, Montana, North
                      Planning Unit (8P-AR)      Dakota, South Dakota,
                      Air Program, Office of     Utah and Wyoming.
                      Partnership and
                      Regulatory Assistance,
                      EPA Region 8, 1595
                      Wynkoop Street, Denver,
                      CO 80202-1129, (303) 312-
                      7104.
IX.................  Lisa Tharp, EPA Region 9,  Arizona, California,
                      Air Division, 75           Hawaii, Nevada and the
                      Hawthorne Street (AIR-     Pacific Islands.
                      8), San Francisco, CA
                      94105, (415) 947-4142.
X..................  Donna Deneen,              Alaska, Idaho, Oregon
                      Environmental Engineer,    and Washington.
                      Office of Air, Waste and
                      Toxics (AWT-107), EPA
                      Region 10, 1200 Sixth
                      Avenue, Suite 900,
                      Seattle, WA 98101, (206)
                      553-6706.
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I. General Information

A. Does this action apply to me?

    Entities potentially affected by this rule include states, U.S. 
territories, local authorities and eligible tribes that are currently 
administering, or may in the future administer, EPA-approved 
implementation plans (``air agencies'').\1\

[[Page 55922]]

The EPA's action on the Petition is potentially of interest to all such 
entities because the EPA is evaluating issues related to basic CAA 
requirements for SIPs. Through this rulemaking, the EPA is both 
clarifying and applying its interpretation of the CAA with respect to 
SIP provisions applicable to excess emissions during SSM events in 
general. In addition, in the final action based on this supplemental 
proposal, the EPA may find specific SIP provisions in states identified 
either in the Petition or by the EPA independently to be substantially 
inadequate to meet CAA requirements, pursuant to CAA section 110(k)(5), 
and thus those states will potentially be affected by this rulemaking 
directly.\2\ For example, if a state's existing SIP includes an 
affirmative defense provision that would purport to alter the 
jurisdiction of the federal courts to assess monetary penalties for 
violations of CAA requirements, then the EPA may determine that the SIP 
provision is substantially inadequate because the provision is 
inconsistent with fundamental requirements of the CAA. This rule may 
also be of interest to the public and to owners and operators of 
industrial facilities that are subject to emission limits in SIPs, 
because it may require changes to state rules applicable to excess 
emissions. When finalized, this action will embody the EPA's updated 
SSM Policy for all SIP provisions relevant to excess emissions during 
SSM events.
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    \1\ The EPA respects the unique relationship between the U.S. 
government and tribal authorities and acknowledges that tribal 
concerns are not interchangeable with state concerns. Under the CAA 
and the EPA regulations, a tribe may, but is not required to, apply 
for eligibility to have a tribal implementation plan (TIP). For 
convenience, we refer to ``air agencies'' in this rulemaking 
collectively when meaning to refer in general to states, the 
District of Columbia, U.S. territories, local air permitting 
authorities and eligible tribes that are currently administering, or 
may in the future administer, EPA-approved implementation plans. The 
EPA notes that the petition under evaluation does not identify any 
specific provisions related to tribal implementation plans. We 
therefore refer to ``state'' or ``states'' rather than ``air 
agency'' or ``air agencies'' when meaning to refer to one, some or 
all of the 39 states identified in the Petition or other states 
identified by the EPA in this SNPR. We also use ``state'' or 
``states'' rather than ``air agency'' or ``air agencies'' when 
quoting or paraphrasing the CAA or other document that uses that 
term even when the original referenced passage may have 
applicability to tribes as well.
    \2\ The specific SIPs that include affirmative defense 
provisions identified by the EPA independently are listed under 
section II.B of this SNPR (see table). Furthermore, in comments 
received on the February 2013 proposal notice, a commenter brought 
to the EPA's attention one affirmative defense provision in a SIP, 
that of Texas. In the rulemaking docket, the comment letter may be 
found at EPA-HQ-OAR-2012-0322-0621.
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B. Where can I get a copy of this document and other related 
information?

    In addition to being available in the docket, an electronic copy of 
this SNPR will be available on the World Wide Web. Following signature 
by the EPA Assistant Administrator, a copy of this SNPR will be posted 
on the EPA's Web site, under ``State Implementation Plans to Address 
Emissions During Startup, Shutdown and Malfunction,'' at http://www.epa.gov/air/urbanair/sipstatus. In addition to this notice, other 
relevant documents are located in the docket, including a copy of the 
Petition and a copy of the February 2013 proposal notice.

C. What should I consider as I prepare my comments?

    1. Submitting CBI. Do not submit this information to the EPA 
through http://www.regulations.gov or email. Clearly mark the part or 
all of the information that you claim to be CBI. For CBI information in 
a CD that you mail to the EPA, mark the outside of the CD as CBI and 
then identify electronically within the CD the specific information 
that is claimed as CBI. In addition to one complete version of the 
comment that includes information claimed as CBI, a copy of the comment 
that does not contain the information claimed as CBI must be submitted 
for inclusion in the public docket. Information so marked will not be 
disclosed except in accordance with procedures set forth in 40 CFR part 
2. Send or deliver information identified as CBI only to the following 
address: Roberto Morales, OAQPS Document Control Officer (C404-02), 
U.S. EPA, Research Triangle Park, NC 27711, Attention Docket ID No. 
EPA-HQ-OAR-2012-0322.
    2. Tips for preparing your comments. When submitting comments, 
remember to:
     Identify the rulemaking by docket number and other 
identifying information (subject heading, Federal Register date and 
page number).
     Follow directions--The agency may ask you to respond to 
specific questions or organize comments by referencing a Code of 
Federal Regulations (CFR) part or section number.
     Explain why you agree or disagree; suggest alternatives 
and substitute language for your requested changes.
     Describe any assumptions and provide any technical 
information and/or data that you used.
     If you estimate potential costs or burdens, explain how 
you arrived at your estimate in sufficient detail to allow for it to be 
reproduced.
     Provide specific examples to illustrate your concerns, and 
suggest alternatives.
     Explain your views as clearly as possible, avoiding the 
use of profanity or personal threats.
     Make sure to submit your comments by the comment period 
deadline identified.

D. How is the preamble organized?

    The information presented in this preamble is organized as follows:

I. General Information
    A. Does this action apply to me?
    B. Where can I get a copy of this document and other related 
information?
    C. What should I consider as I prepare my comments?
    D. How is the preamble organized?
    E. What is the meaning of key terms used in this notice?
II. Overview of This SNPR
    A. How does this notice supplement or revise the EPA's already 
proposed rulemaking to respond to the Petition?
    B. To which air agencies does this SNPR apply and why?
    C. What is the EPA proposing for any state that receives a 
finding of substantial inadequacy and a SIP call?
    D. What are potential impacts on affected states and sources?
III. Background for This SNPR
    A. What did the Petitioner request?
    B. What did the EPA previously propose in this rulemaking with 
respect to affirmative defense provisions in SIPs?
    C. What events necessitated this SNPR?
IV. What is the EPA proposing through this SNPR in response to the 
Petitioner's request for rescission of the EPA policy on affirmative 
defense provisions?
    A. Petitioner's Request
    B. The EPA's Proposed Revised Response
V. Revised SSM Policy on Affirmative Defense Provisions in SIPs
VI. Legal Authority, Process and Timing for SIP Calls
VII. What is the EPA proposing through this SNPR for each of the 
specific affirmative defense provisions identified in the Petition 
or identified independently by the EPA?
    A. Overview of the EPA's Evaluation of Specific Affirmative 
Defense SIP Provisions
    B. Affected States in EPA Region III
    1. District of Columbia
    2. Virginia
    3. West Virginia
    C. Affected States in EPA Region IV
    1. Georgia
    2. Mississippi
    3. South Carolina
    D. Affected States in EPA Region V
    1. Illinois
    2. Indiana
    3. Michigan
    E. Affected States and Local Jurisdictions in EPA Region VI
    1. Arkansas
    2. New Mexico
    3. New Mexico: Albuquerque-Bernalillo County
    4. Texas
    F. Affected State in EPA Region VIII: Colorado
    1. Petitioner's Analysis
    2. The EPA's Prior Proposal
    3. The EPA's Revised Proposal
    G. Affected States and Local Jurisdictions in EPA Region IX
    1. Arizona
    2. Arizona: Maricopa County
    3. California: Eastern Kern Air Pollution Control District
    4. California: Imperial County Air Pollution Control District
    5. California: San Joaquin Valley Air Pollution Control District

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    H. Affected States and Local Jurisdictions in EPA Region X
    1. Alaska
    2. Washington
    3. Washington: Energy Facility Site Evaluation Council
    4. Washington: Southwest Clean Air Agency
VIII. Statutory and Executive Order Reviews
    A. Executive Order 12866: Regulatory Planning and Review and 
Executive Order 13563: Improving Regulation and Regulatory Review
    B. Paperwork Reduction Act
    C. Regulatory Flexibility Act
    D. Unfunded Mandates Reform Act
    E. Executive Order 13132--Federalism
    F. Executive Order 13175--Consultation and Coordination with 
Indian Tribal Governments
    G. Executive Order 13045--Protection of Children from 
Environmental Health Risks and Safety Risks
    H. Executive Order 13211--Actions Concerning Regulations That 
Significantly Affect Energy Supply, Distribution or Use
    I. National Technology Transfer and Advancement Act
    J. Executive Order 12898--Federal Actions To Address 
Environmental Justice in Minority Populations and Low-Income 
Populations
    K. Determination Under Section 307(d)
    L. Judicial Review
IX. Statutory Authority

E. What is the meaning of key terms used in this notice?

    For the purpose of this notice, the following definitions apply 
unless the context indicates otherwise:
    The terms Act or CAA or the statute mean or refer to the Clean Air 
Act.
    The term affirmative defense means, in the context of an 
enforcement proceeding, a response or defense put forward by a 
defendant, regarding which the defendant has the burden of proof, and 
the merits of which are independently and objectively evaluated in a 
judicial or administrative proceeding. The term affirmative defense 
provision means more specifically a state law provision in a SIP that 
specifies particular criteria or preconditions that, if met, would 
purport to preclude a court from imposing monetary penalties or other 
forms of relief for violations of SIP requirements in accordance with 
CAA section 113 or CAA section 304.
    The term Agency means or refers to the EPA. When not capitalized, 
this term refers to an agency in general and not specifically to the 
EPA.
    The terms air agency and air agencies mean or refer to states, the 
District of Columbia, U.S. territories, local air permitting 
authorities with delegated authority from the state, and tribal 
authorities with appropriate CAA jurisdiction.
    The term automatic exemption means a generally applicable provision 
in a SIP that would provide that if certain conditions existed during a 
period of excess emissions, then those exceedances would not be 
considered violations of the applicable emission limitations.
    The term director's discretion provision means, in general, a 
regulatory provision that authorizes a state regulatory official 
unilaterally to grant exemptions or variances from applicable emission 
limitations or control measures, or to excuse noncompliance with 
applicable emission limitations or control measures, which would be 
binding on EPA and the public, in spite of SIP provisions that would 
otherwise render such conduct by the source a violation.
    The term EPA refers to the United States Environmental Protection 
Agency.
    The term excess emissions means the emissions of air pollutants 
from a source that exceed any applicable SIP emission limitations.
    The term malfunction means a sudden and unavoidable breakdown of 
process or control equipment.
    The term NAAQS means national ambient air quality standard or 
standards. These are the national primary and secondary ambient air 
quality standards that the EPA establishes under CAA section 109 for 
criteria pollutants for purposes of protecting public health and 
welfare.
    The term Petition refers to the petition for rulemaking titled, 
``Petition to Find Inadequate and Correct Several State Implementation 
Plans under Section 110 of the Clean Air Act Due to Startup, Shutdown, 
Malfunction, and/or Maintenance Provisions,'' filed by the Sierra Club 
with the EPA Administrator on June 30, 2011.
    The term Petitioner refers to the Sierra Club.
    The term shutdown means, generally, the cessation of operation of a 
source for any reason.
    The term SIP means or refers to a State Implementation Plan. 
Generally, the SIP is the collection of state statutes and regulations 
approved by the EPA pursuant to CAA section 110 that together provide 
for implementation, maintenance and enforcement of a national ambient 
air quality standard (or any revision thereof) promulgated under 
section 109 for any air pollutant in each air quality control region 
(or portion thereof) within a state. In some parts of this notice, 
statements about SIPs in general would also apply to tribal 
implementation plans in general even though not explicitly noted.
    The term SNPR means or refers to this supplemental notice of 
proposed rulemaking.
    The term SSM refers to startup, shutdown or malfunction at a 
source. It does not include periods of maintenance at such a source. An 
SSM event is a period of startup, shutdown or malfunction during which 
there are exceedances of the applicable emission limitations and thus 
excess emissions.
    The term SSM Policy refers to the cumulative guidance that the EPA 
has issued concerning its interpretation of CAA requirements with 
respect to treatment of excess emissions during periods of startup, 
shutdown and malfunction at a source. The most comprehensive statement 
of the EPA's SSM Policy prior to this proposed rulemaking is embodied 
in a 1999 guidance document discussed in more detail in this proposal. 
This specific guidance document is referred to as the 1999 SSM 
Guidance. When finalized, this action will embody the EPA's updated SSM 
Policy for all SIP provisions relevant to excess emissions during SSM 
events.
    The term startup means, generally, the setting in operation of a 
source for any reason.

II. Overview of This SNPR

A. How does this notice supplement or revise the EPA's already proposed 
rulemaking to respond to the Petition?

    By notice published on February 22, 2013 (78 FR 12459), we proposed 
to take action on a petition for rulemaking that the Sierra Club (the 
Petitioner) filed with the EPA Administrator on June 30, 2011 (the 
Petition). In that February 2013 proposal notice, we described and 
proposed the EPA's response to each of the Petition's three 
interrelated requests concerning the treatment of excess emissions from 
sources during periods of SSM in provisions in SIPs. Among other 
requests, the Petitioner requested that the EPA rescind its SSM Policy 
element interpreting the CAA to allow SIPs to include affirmative 
defense provisions for violations due to excess emissions during any 
type of SSM events because the Petitioner contended there is no legal 
basis for such provisions in SIPs.
    In this SNPR, we are supplementing and revising what we earlier 
proposed as our response to the Petitioner's requests, but only to the 
extent the requests narrowly concern affirmative defense provisions in 
SIPs. We are not revising or seeking further comment on any other 
aspects of the February 2013 proposed action.

[[Page 55924]]

    First, based on reexamination of statutory requirements in light of 
a recent court decision, we are revising our interpretation of the CAA 
concerning the issue of affirmative defense provisions in SIPs. 
Accordingly we propose to grant the Petitioner's overarching request 
that the EPA rescind its SSM Policy element that interpreted the CAA to 
allow affirmative defense provisions in SIPs. Our proposal to grant the 
Petition and to rescind our SSM Policy with respect to allowing 
affirmative defenses in SIPs is a revision of the position we 
previously proposed in the February 2013 proposal notice (i.e., to 
grant in part and to deny in part the Petition on this request). The 
basis for our proposed revision of the SSM Policy with respect to 
affirmative defense provisions in SIPs and our revised response to the 
Petition on this issue is provided in more detail in section IV of this 
SNPR.
    Second, we propose to grant the Petitioner's request that the EPA 
apply a revised interpretation to, and effectuate the removal of, 
specific existing affirmative defense provisions in SIPs identified by 
the Petitioner as inconsistent with the CAA. Accordingly, we propose to 
grant the Petition with respect to specific existing affirmative 
defense provisions in the SIPs of 13 states. For all 13 of these 
states, we have already proposed SIP calls for one or more SIP 
provisions in our February 2013 proposal notice, but note that we did 
not at that time propose SIP calls for all affirmative defense 
provisions in those states because some of the provisions appeared to 
comply with our policy at the time of the proposal. What we are 
proposing in this SNPR is to grant the Petition with respect to all of 
the identified affirmative defenses in these states.
    Third, in addition to the specific affirmative defense provisions 
identified by the Petitioner, the EPA has independently identified 
other affirmative defense provisions in SIPs and is proposing in this 
SNPR to take action with respect to these SIP provisions as well. The 
newly identified affirmative defense provisions are found in six 
states' SIPs. For two of the states whose SIPs include newly identified 
affirmative defense provisions, California and Texas, we did not 
propose a SIP call in the February 2013 proposal notice, as those 
states were not identified in the Petition. For the other four states 
(New Mexico, South Carolina, Washington and West Virginia), we did 
propose a SIP call in the February 2013 proposal notice for one or more 
SIP provisions, but at that time we did not propose a SIP call for all 
affirmative defense provisions identified in the Petition or for any 
affirmative defense provisions that were not identified in the 
Petition. The EPA is now including these six states' affirmative 
defense provisions in order to provide comprehensive guidance to all 
states concerning affirmative defense provisions in SIPs and to avoid 
confusion that may arise due to recent court decisions relevant to such 
provisions under the CAA. Section VII of this SNPR presents the EPA's 
analysis of each of the affirmative defense SIP provisions at issue.
    Fourth, for each of the states where the EPA proposes to grant the 
Petition concerning specific affirmative defense provisions or to take 
action on such provisions that EPA has independently identified, the 
Agency also proposes to find that the existing SIP provision at issue 
is substantially inadequate to meet CAA requirements and thus under CAA 
authority proposes to issue a ``SIP call'' with respect to that SIP 
provision. For those states for which the EPA promulgates a final 
finding of substantial inadequacy and a SIP call, the EPA has in the 
February 2013 notice proposed a schedule allowing the states 18 months 
within which to submit a corrective SIP revision. In section II.C of 
this SNPR, the EPA accordingly proposes that this schedule apply to all 
SIP provisions identified as substantially inadequate in this 
supplemental proposal.
    What EPA proposes in this SNPR supersedes the February 2013 
proposal only insofar as the SNPR supplements or revises the February 
2013 proposal notice with respect to the issues related to affirmative 
defense provisions in SIPs. After evaluation of public comment on this 
SNPR, the EPA intends to complete its action on the Petition in one 
final action, addressing together the issues discussed in the February 
2013 proposal notice and in this SNPR.
    This action provides the EPA an opportunity to invite public 
comment on our SSM Policy specific to affirmative defenses. In this 
SNPR, the EPA is supplementing and revising its proposed responses to 
the issues in the Petition only to the extent they concern affirmative 
defenses in SIPs, and the EPA solicits comment on its proposed 
responses. We note that an opportunity to comment on the EPA's proposed 
responses to other issues raised in the Petition was provided earlier, 
in the comment period initiated by our February 2013 proposal notice. 
Therefore, comments received on this SNPR will be considered germane 
only to the extent they pertain specifically to the subject of 
affirmative defenses in SIPs. The EPA does not intend to consider any 
further comments related to other aspects of the prior proposal, as 
those other aspects are not being reopened in this supplemental 
proposal. Moreover, because the EPA's interpretation of the CAA with 
respect to the legal basis for affirmative defense provisions in SIPs 
has changed, the EPA does not intend to respond to comments previously 
submitted on the February 2013 proposal notice to the extent they apply 
to issues related to affirmative defense provisions in SIPs generally, 
or to issues related to specific affirmative defense provisions 
identified by the Petitioner, as those comments will be moot if the EPA 
finalizes its action as discussed in this SNPR.
    Through our proposed rulemaking action, which includes the February 
2013 proposal notice and this SNPR, the EPA is clarifying, restating 
and revising its SSM Policy. When finalized, this action will embody 
the EPA's updated SSM Policy for all SIP provisions relevant to excess 
emissions during SSM events. The final action will also clarify for the 
affected states how they can resolve the identified deficiencies in 
their SIPs, as well as provide all air agencies guidance on SSM issues 
as they further develop their SIPs in the future.

B. To which air agencies does this SNPR apply and why?

    In general, the EPA's action on the Petition in this rulemaking may 
be of interest to all air agencies because the EPA is significantly 
clarifying, restating and revising its longstanding SSM Policy with 
respect to what the CAA requires concerning SIP provisions relevant to 
excess emissions during periods of startup, shutdown and malfunction. 
For example, the EPA is proposing in this SNPR to grant the 
Petitioner's request that the EPA rescind its interpretation of the CAA 
that would allow affirmative defense provisions in SIPs.
    More specifically, this SNPR is directly relevant to the states for 
which we are now proposing SIP calls on the basis that those SIP 
provisions are inconsistent with CAA requirements because they include 
affirmative defenses. The EPA is proposing SIP calls with respect to 
affirmative defense SIP provisions in each of the 17 states (for 
provisions applicable in 23 statewide and local jurisdictions \3\ and

[[Page 55925]]

no tribal areas) that show either ``Grant'' or ``SIP call'' as the 
proposed action under table 1, ``List of States With Affirmative 
Defense SIP Provisions for Which the EPA Proposes to Grant the Petition 
or to Address Such Provisions Identified by the EPA.''
---------------------------------------------------------------------------

    \3\ The state has the primary responsibility to implement SIP 
obligations, pursuant to CAA section 107(a). However, as CAA section 
110(a)(2)(E) allows, a state may authorize and rely on a local or 
regional government, agency or instrumentality to carry out the SIP 
or a portion of the SIP within its jurisdiction. As a result, some 
of the SIP provisions at issue in this rulemaking apply to specific 
portions of a state. Thus, in certain states, submission of a 
corrective SIP revision may involve rulemaking in more than one 
jurisdiction.

   Table 1--List of States With SIP Affirmative Defense Provisions for
     Which the EPA Proposes To Grant the Petition or To Address Such
                    Provisions Identified by the EPA
------------------------------------------------------------------------
                                  Proposed action \a\ with respect to
                                    affirmative defenses applicable
                             -------------------------------------------
 EPA region       State                              . . . for startup,
                                    . . . for         shutdown or other
                                  malfunctions?            modes?
------------------------------------------------------------------------
III........  District of      Grant...............  Not applicable.
              Columbia.
             Virginia.......  Grant...............  Not applicable.
             West Virginia..  SIP call (new)......  Not applicable.
IV.........  Georgia........  Grant...............  Grant.
             Mississippi....  Grant...............  Grant.
             South Carolina.  SIP call (new)......  Not applicable.
V..........  Illinois.......  Grant...............  Not applicable.
             Indiana........  Grant...............  Not applicable.
             Michigan.......  Not applicable......  Grant.
VI.........  Arkansas.......  Grant...............  Not applicable.
             New Mexico.....  Grant (for state)     Grant (for state)
                               and SIP call (new     and SIP call (new
                               for Albuquerque-      for Albuquerque-
                               Bernalillo County).   Bernalillo County).
             Texas..........  SIP call (new)......  Not applicable.
VIII.......  Colorado.......  Grant (change from    Grant.
                               February 2013
                               proposal to Deny).
IX.........  Arizona........  Grant (for state and  Grant (for state and
                               for Maricopa          for Maricopa
                               County; change from   County).
                               February 2013
                               proposal to Deny).
             California.....  SIP call (new for     Not applicable.
                               Eastern Kern APCD,
                               new for Imperial
                               County APCD and new
                               for San Joaquin
                               Valley APCD).
X..........  Alaska.........  Grant...............  Grant.
             Washington.....  Grant (for state)     Grant (for state)
                               and SIP call (new     and SIP call (new
                               for Energy Facility   for Energy Facility
                               Site Evaluation       Site Evaluation
                               Council and new for   Council and new for
                               Southwest Clean Air   Southwest Clean Air
                               Agency).              Agency).
------------------------------------------------------------------------
\a\ The proposed action under the SNPR is the same action as proposed in
  February 2013 unless noted in this table to be either new or a change.
  The entry ``SIP call'' indicates that the affirmative defense
  provision was identified by the EPA independently and was not included
  in the Petition.

    For each state for which the proposed action in this SNPR is either 
``Grant'' or ``SIP call,'' the EPA proposes to find that specific 
affirmative defense provisions in the state's SIP are substantially 
inadequate to meet CAA requirements for the reason that these 
provisions are inconsistent with the CAA.
    For each state for which the proposed action on the Petition is 
either ``Grant'' or ``SIP call,'' the EPA is further proposing in this 
SNPR to call for a SIP revision as necessary to remove the identified 
affirmative defense provisions from the SIP at issue. The EPA's revised 
proposal under this SNPR concerning affirmative defense provisions in 
specific states' SIPs is summarized in section VII of this SNPR.
    The SIP calls proposed in this SNPR apply only to those specific 
provisions, and the scope of each of the SIP calls would be limited to 
those provisions. This SNPR proposes SIP calls specific to affirmative 
defense provisions in 17 states. The 17 states include two states for 
which we are newly proposing SIP calls: California and Texas. For the 
remaining 15 states, we already proposed SIP calls in the February 2013 
proposal notice for one or more SSM-related provisions, although in 
this SNPR we are in some cases proposing SIP calls for additional 
affirmative defense provisions and in some cases proposing SIP calls on 
a basis that has changed from that of our earlier proposal.
    For Jefferson County, Kentucky, the affirmative defense provisions 
for which we proposed in February 2013 to grant the Petition were 
subsequently removed from the SIP.\4\ Thus, under this SNPR we are 
proposing instead to deny the Petition, and we are no longer proposing 
a SIP call with respect to affirmative defense provisions for this area 
because the revision has already been made by the state and approved 
into the SIP by the EPA. Note, however, that we already proposed a SIP 
call for Kentucky, for other provisions (i.e., provisions not 
concerning affirmative defenses in Jefferson County), and this SNPR 
does not change what we proposed in the February 2013 proposal notice 
for the other Kentucky SIP provisions.
---------------------------------------------------------------------------

    \4\ See, Approval and Promulgation of Implementation Plans; 
Kentucky; Approval of Revisions to the Jefferson County Portion of 
the Kentucky SIP; Emissions During Startups, Shutdowns, and 
Malfunctions, 79 FR 33101 (June 10, 2014).
---------------------------------------------------------------------------

C. What is the EPA proposing for any state that receives a finding of 
substantial inadequacy and a SIP call?

    If the EPA finalizes a finding of substantial inadequacy and issues 
a SIP call for any state, the EPA's final action will establish a 
deadline by which the state must make a SIP submission to rectify the 
deficiency. Pursuant to CAA section 110(k)(5), the EPA has authority to 
set a SIP submission deadline that does not exceed 18 months from the 
date the Agency notifies the state of the inadequacy. The EPA intends 
to disseminate notice of any final findings of substantial inadequacy 
and the issuance of any SIP call promptly after the Administrator signs 
the final notice.
    The EPA has already proposed to provide the full 18-month period

[[Page 55926]]

permissible by statute to give states sufficient time to make 
appropriate SIP revisions following their own SIP development process. 
Such a schedule will allow for the necessary SIP development process to 
correct the deficiencies yet still achieve the necessary SIP 
improvements as expeditiously as practicable.
    Accordingly, the EPA is proposing to establish the due date for the 
state to respond to the SIP call to be 18 months after the date on 
which the Administrator signs the notice and disseminates it to the 
states. If, for example, the EPA's final findings are signed and 
disseminated in May 2015, then the SIP submission deadline for each of 
the states subject to the final SIP call would fall 18 months later, in 
November 2016. Thereafter, the EPA will review the adequacy of that new 
SIP submission in accordance with the CAA requirements of sections 
110(a), 110(k), 110(l) and 193, including the EPA's interpretation of 
the CAA reflected in the SSM Policy as clarified and updated through 
this rulemaking, in notice-and-comment rulemaking on the individual SIP 
submissions.

D. What are potential impacts on affected states and sources?

    The EPA's February 2013 proposal notice included an explanation of 
the potential impacts on states and sources of the SIP calls proposed 
in that notice. That explanation is repeated here, with additions to 
encompass and highlight the potential impacts of the proposed further 
revision of the SSM Policy to disallow affirmative defense provisions 
for malfunctions, the proposed revisions to the earlier-proposed SIP 
calls and the additional SIP calls proposed in this notice. The 
issuance of a SIP call would require an affected state to take one or 
more actions to revise its SIP. These actions are described below, 
followed by a description of how those actions by the state may, in 
turn, affect sources. The states that would receive a SIP call will in 
general have options as to exactly how to revise their SIPs. In 
response to a SIP call, a state retains broad discretion concerning how 
to revise its SIP, so long as that revision is consistent with the 
requirements of the CAA. The EPA's interpretation of those requirements 
will be embodied in the revised SSM Policy, which will be stated in the 
Federal Register notice for the final action in this rulemaking.
    If the final SIP call identifies an automatic exemption provision 
in a SIP as contrary to the CAA, that provision would have to be 
removed entirely. An affected source could no longer depend on the 
automatic exemption to avoid all liability for excess emissions. If the 
final SIP call identifies an affirmative defense provision in a SIP as 
contrary to the CAA, that provision would have to be removed entirely. 
An affected source could no longer depend on the affirmative defense to 
shield it from monetary penalties assessed by a court for excess 
emissions; however, even in the absence of such affirmative defense 
provision in the SIP, a court may nevertheless decide not to assess 
monetary penalties in light of the effort by the source to avoid and/or 
minimize the excess emissions. Some other provisions, for example a 
problematic enforcement discretion provision, could be either removed 
entirely from the SIP or retained if revised appropriately in 
accordance with the EPA's interpretation of the CAA as described in the 
EPA's SSM Policy restatement in the Federal Register notice for the 
final rulemaking. The EPA notes that if a state removes a SIP-called 
provision that pertains to the exercise of enforcement discretion 
rather than amending the provision to remove any implication that the 
provision limits EPA or citizen suits, this removal would not bar the 
ability of the state to apply discretion in its own enforcement program 
but rather would make the exercise of such discretion case-by-case in 
nature.
    In addition, affected states may choose to consider reassessing 
particular emission limitations, for example to determine whether those 
limits can be revised such that well-managed emissions during planned 
operations such as startup and shutdown would not exceed the revised 
emission limitation, while still protecting air quality. Such a 
revision of an emission limitation may need to be submitted as a SIP 
revision for EPA approval if the existing limit to be changed is 
already included in the SIP or if the existing SIP relies on the 
particular existing emission limit to meet a CAA requirement. In such 
instances, the EPA would review the SIP revision for consistency with 
all applicable CAA requirements. A state that chooses to revise 
particular emission limitations, in addition to removing the aspect of 
the existing provision that is inconsistent with CAA requirements, 
could include those revisions in the same SIP submission that addresses 
the SSM provisions identified in the SIP call, or it could submit them 
separately.
    The implications for a regulated source in a given state, in terms 
of decisions it may make to change its equipment or practices in order 
to operate with emissions that comply with the revised SIP, will depend 
on the nature and frequency of the source's SSM events and how the 
state has chosen to revise the SIP to address excess emissions during 
SSM events. The EPA recognizes that after all the responsive SIP 
revisions are in place and are being implemented by the states, some 
sources may be required by the state to, or may have strong business 
reasons to, modify their physical equipment or operating practices. 
These changes could be aimed at improving the effectiveness of the 
emission control systems when operating as designed during startup and 
shutdown, increasing the durability of components to reduce the 
occurrence of malfunctions, and/or improving monitoring systems to 
detect and manage malfunctions promptly. If a state merely removes an 
exemption, affirmative defense provision, or impermissible enforcement 
discretion provision, an affected source may need to, or may rationally 
choose to, make changes of these types to better control emissions so 
as to comply with existing emission limits continuously and thereby 
reduce the risk of enforcement action. If the state establishes 
alternative emission limits for startup and shutdown operation, the 
source will need to meet these limits, but the required changes by the 
source, if any, could be less extensive and cost less.
    Because of the diversity of the SIP provisions identified in our 
February 2013 proposal notice and in this supplemental proposal, the 
diversity of potentially affected sources, the unknown nature of the 
states' responses to the SIP calls, and the fact that because of 
existing automatic exemptions many instances of excess emissions have 
not routinely been reported to air agencies or the EPA, the EPA is 
unable to estimate the number, nature and overall cost of the changes 
that emission sources may ultimately make as an indirect result of the 
proposed SIP calls. To date, the EPA's review of the public comments 
received on the February 2013 proposal indicates that the information 
in those public comments is insufficient to allow the EPA to make such 
estimates.
    This supplemental proposal concerns only affirmative defense 
provisions. The EPA's longstanding interpretation of the CAA as 
reflected in the existing SSM Policy does not allow a SIP to contain a 
director's discretion provision for excess emissions during SSM events 
including malfunctions, an automatic exemption for excess emissions 
during SSM events including malfunctions, or an enforcement discretion 
provision that purports to restrict citizen suits or federal personnel. 
The EPA is not

[[Page 55927]]

proposing to change those longstanding aspects of the SSM Policy. In 
our February 2013 proposal notice, we proposed to interpret the CAA to 
disallow affirmative defense provisions applicable to startup and 
shutdown, and in this SNPR we are proposing to interpret the CAA to 
further disallow affirmative defense provisions applicable to 
malfunctions. However, a state that receives a SIP call that includes a 
requirement to remove an affirmative defense for excess emissions would 
retain its ability to apply discretion in its enforcement program. Such 
enforcement discretion could be exercised case-by-case, or the SIP may 
include a provision that directs state personnel in the exercise of 
enforcement discretion. The criteria in an enforcement discretion 
provision could resemble the criteria previously recommended by the EPA 
for an affirmative defense provision for malfunctions. The enforcement 
discretion provision cannot apply to anyone other than state personnel. 
For example, the enforcement decisions of state personnel cannot define 
what is or is not a violation and cannot purport to limit or bar the 
exercise of enforcement discretion by the EPA or other parties pursuant 
to the citizen suit provision. An affected state could include an 
appropriate enforcement discretion provision in the same SIP submission 
that addresses the SSM provisions identified in the SIP call, or it 
could submit it separately.
    Similar to the dependent nature of the potential impacts of our 
proposals in the aggregate as described above, the implications of the 
specific change being proposed in this notice--to disallow affirmative 
defense provisions for malfunctions--for a regulated source in a given 
state, in terms of whether and how the source would potentially have 
incentives to change its equipment or practices, will depend on the 
nature and frequency of the source's malfunction events and on how the 
state has chosen to revise the SIP to address excess emissions during 
malfunction events. After responsive SIP revisions are in place and are 
being implemented by the states, some sources may have strong 
incentives to take steps to increase the durability of components and 
monitoring systems to detect and manage malfunctions promptly, as a 
court may take such steps into consideration when determining a remedy 
should there be an enforcement action against excess emissions that 
have occurred during a malfunction. For the same reasons as cited 
above, the EPA is unable to estimate the number, nature and overall 
cost of the changes that emission sources may ultimately make as an 
indirect result of the revised and additional SIP calls proposed in 
this SNPR.
    The EPA Regional Offices will work with states to help them 
understand their options and the potential consequences for sources as 
the states prepare their SIP revisions in response to the SIP calls.
    The EPA believes that among the impacts on states and their 
residents of the SIP calls proposed in the February 2013 proposal 
notice and in this SNPR will be reduced aggregate emissions from 
industrial sources and improved air quality. For the same reasons that 
we are unable to estimate the number, nature and overall cost of the 
changes that sources may ultimately make as an indirect result of the 
proposed SIP calls, we are unable to estimate the total emission 
reduction that will be achieved for any particular pollutant or how 
those reductions will be distributed across the affected states and 
communities. The EPA believes that it is obligated and authorized to 
issue the proposed SIP calls to remove affirmative defense provisions 
even though the EPA is unable to estimate the number, nature, cost and 
resulting emission reductions that will indirectly result from the 
removal of such provisions from the affected SIPs.

III. Background for This SNPR

A. What did the Petitioner request?

    The Petitioner submitted the Petition to the EPA on June 30, 2011. 
In the Petition, the Petitioner requested that the EPA address various 
types of alleged deficiencies in the Agency's SSM Policy. The SSM 
Policy provides EPA guidance to states with respect to SIP provisions 
that apply to excess emissions from sources that occur during SSM 
events. As described in the February 2013 proposal notice, the 
Petitioner included three interrelated overarching requests concerning 
the treatment in SIPs of excess emissions from sources during SSM 
events. In addition, the Petitioner requested that the EPA evaluate 
specifically identified existing provisions in the SIPs of 39 states 
that the Petitioner alleged are inconsistent with CAA requirements and 
with the EPA's interpretations of the CAA in the SSM Policy. The 
Petitioner identified the specific provisions and explained the basis 
for its belief that the provisions in question violate one or more 
requirements of the CAA.
    First, the Petitioner argued that any SIP provision providing an 
affirmative defense for monetary penalties for excess emissions 
applicable in judicial proceedings is contrary to the CAA. The 
Petitioner based its overarching arguments concerning the legality of 
affirmative defense provisions in SIPs upon the explicit statutory 
provisions of CAA sections 113 and 304. Thus, the Petitioner advocated 
that the EPA should rescind its interpretation of the CAA expressed in 
the SSM Policy that allows appropriately drawn affirmative defense 
provisions in SIPs. The Petitioner made no distinction between 
affirmative defenses for excess emissions related to malfunction and 
affirmative defenses for excess emissions related to startup or 
shutdown. See section IV of our February 2013 proposal notice for the 
EPA's proposed response at that time concerning the issue of 
affirmative defense provisions in SIPs. As explained in section III.B 
of this SNPR, the EPA did make such distinction in its proposed 
response in the February 2013 proposal notice, then reasoning that 
affirmative defense provisions were appropriate for violations due to 
malfunction events. The issue of affirmative defense provisions in SIPs 
is the focus of this SNPR, and the EPA is herein proposing to revise 
its prior proposed action on this issue.
    Second, the Petitioner argued that many existing SIPs contain 
impermissible provisions,\5\ including automatic exemptions from 
applicable emission limitations during SSM events, director's 
discretion provisions that provide discretionary exemptions from 
applicable emission limitations during SSM events, enforcement 
discretion provisions that appear to bar enforcement by the EPA or 
citizens for such excess emissions, and inappropriate affirmative 
defense provisions that are not consistent with the CAA or the 
recommendations in the EPA's SSM Policy. The Petitioner identified 
specific provisions in SIPs of 39 states that it considered 
inconsistent with the CAA and explained the basis for its objections to 
the provisions. Among the alleged deficient provisions were many that 
function as affirmative defense provisions, regardless of whether that 
specific term is used in the state law or regulation at issue and 
regardless of whether the EPA

[[Page 55928]]

previously explicitly evaluated the provision as an affirmative defense 
as described in the 1999 SSM Guidance. See section V and section IX of 
our February 2013 proposal notice for the EPA's prior proposed 
responses concerning the various alleged SIP deficiencies; only issues 
related to affirmative defense provisions are addressed in this SNPR, 
and the EPA is proposing to revise its prior proposed action only with 
respect to specific affirmative defense SIP provisions.
---------------------------------------------------------------------------

    \5\ The term ``impermissible provision'' as used throughout this 
SNPR is generally intended to refer to a SIP provision that the EPA 
believes to be inconsistent with requirements of the CAA. As 
described later in this SNPR (see section VII.A), the EPA is 
proposing to find a SIP ``substantially inadequate'' to meet CAA 
requirements where the EPA determines that a specific SIP provision 
is impermissible under the CAA.
---------------------------------------------------------------------------

    Third, the Petitioner argued that the EPA should not rely on 
interpretive letters from states to resolve any ambiguity, or perceived 
ambiguity, in state regulatory provisions in SIP submissions. The 
Petitioner reasoned that all regulatory provisions should be clear and 
unambiguous on their face and that any reliance on interpretive letters 
to alleviate facial ambiguity in SIP provisions can lead to later 
problems with compliance and enforcement. Extrapolating from several 
instances in which the basis for the original approval of a SIP 
provision related to excess emissions during SSM events was arguably 
not clear, the Petitioner contended that the EPA should never use 
interpretive letters to resolve such ambiguities. See section VI of our 
February 2013 proposal notice for the EPA's proposed response 
concerning the issue of interpretive letters; that issue is not further 
addressed in this SNPR and the EPA is seeking no additional comment on 
this issue.
    Among the fundamental concerns raised by the Petitioner was the 
claim that the EPA's SSM Policy is inconsistent with statutory 
requirements because the Agency interprets the CAA to authorize states 
to create SIP provisions that provide an affirmative defense for 
qualifying sources to assert in the event of violations for excess 
emissions that occur during SSM events. Even though the EPA interpreted 
the CAA to allow narrowly drawn affirmative provisions in SIPs that are 
consistent with recommended criteria intended to assure that states 
include appropriate limitations and conditions for affirmative 
defenses, the Petitioner objected to any such provisions. The 
Petitioner argued that any affirmative defense that purports to 
eliminate or alter the jurisdiction of federal courts to assess 
monetary penalties or any other form of relief for violations of SIP 
emission limits is contrary to the requirements of the CAA. In other 
words, no matter how narrowly drawn and no matter what the limitations 
or conditions for the affirmative defense may be, the Petitioner argued 
that no such affirmative defenses are consistent with CAA requirements 
for SIP provisions.
    In addition, the Petitioner identified specific existing provisions 
in the SIPs of 14 states that were structured or characterized as 
affirmative defenses, regardless of whether the provisions in question 
were consistent with the EPA's SSM Policy as explained in the 1999 SSM 
Guidance. The Petitioner contended that none of these identified 
provisions are consistent with CAA requirements because they improperly 
purport to shield sources from liability for violations of SIP emission 
limitations through various mechanisms. The Petitioner argued that such 
provisions are therefore inconsistent with sections 113 and 304 and the 
fundamental enforcement structure of the CAA created by Congress. Even 
if the provisions were not otherwise contrary to CAA requirements, the 
Petitioner argued, each of the identified affirmative defense 
provisions is also inconsistent in one or more ways with the EPA's own 
interpretation of the CAA provided in the 1999 SSM Guidance. For 
example, some of the identified provisions do not apply only to 
monetary penalties and purport to bar injunctive relief as well, some 
of the provisions do not require sources to qualify for an affirmative 
defense through criteria comparable to those recommended by the EPA, 
and some of the provisions appear to make state personnel the 
unilateral final arbiters of whether a source qualified for an 
affirmative defense rather than requiring that this be determined by a 
trier of fact in a judicial enforcement proceeding, thereby purporting 
to preclude enforcement by the EPA under section 113 or by others 
pursuant to the citizen suit authority of section 304.

B. What did the EPA previously propose in this rulemaking with respect 
to affirmative defense provisions in SIPs?

    The EPA published its proposed response to the Petition on February 
22, 2013. In that proposal, the EPA explained the claims asserted by 
the Petitioner, articulated its evaluation of those claims, and 
proposed to take actions with respect to each of the overarching and 
specific claims. The proposal addressed a number of interrelated issues 
concerning the proper treatment of excess emissions during SSM events 
in SIP provisions. A key component of the proposal, however, was the 
EPA's evaluation of the Petitioner's claims concerning affirmative 
defense provisions in SIPs.
    With respect to the Petitioner's overarching claim that the EPA's 
interpretation of the CAA in the SSM Policy permitting states to have 
affirmative defenses in SIP provisions is in error, the EPA proposed to 
deny in part and to grant in part. The EPA proposed to deny the 
Petitioner's claim with respect to affirmative defenses applicable to 
malfunction events, on the theory that the CAA allows such provisions 
so long as they are sufficiently narrowly drawn. The EPA reasoned that 
such provisions are appropriate for violations due to genuine 
malfunction events, in order to resolve the inherent tension between 
the fact that the CAA requires that SIP emission limitations must apply 
continuously and the fact that even properly designed, maintained and 
operated sources may sometimes have difficulty meeting emission 
limitations for reasons beyond their control. By contrast, the EPA 
proposed to grant the Petitioner's claim with respect to affirmative 
defenses applicable to planned events such as startup and shutdown. 
This was a change from the EPA's interpretation of the CAA in the 1999 
SSM Guidance, in which the EPA previously recommended that states could 
elect to create such affirmative defense provisions for startup and 
shutdown events, so long as the provisions were narrowly drawn and 
consistent with the recommended criteria to assure that they meet CAA 
requirements. The EPA's evaluation of the Petition and the statutory 
basis for affirmative defense provisions caused the Agency to 
reconsider the appropriateness of affirmative defense provisions 
applicable during startup and shutdown, which are ordinary modes of 
operation that are generally predictable and within the control of the 
source. As explained in more detail in the February 2013 proposal 
notice, the EPA's evaluation in light of then recent case law indicated 
that providing affirmative defenses applicable during planned events 
such as startup and shutdown was not consistent with the EPA's 
interpretation of the CAA to support such provisions for malfunctions 
and was tantamount to allowing sources to be shielded from monetary 
penalties for violations due to conduct that is predictable and within 
their control.\6\
---------------------------------------------------------------------------

    \6\ Some commenters on the February 2013 proposal notice focused 
great attention on whether startup and shutdown are modes of 
``normal'' source operation. The EPA assumes that every source is 
designed, maintained and operated with the expectation it will at 
least occasionally start up and shut down, and thus these modes of 
source operation are ``normal'' in the sense that they are to be 
expected. The EPA used this term in the ordinary sense of the word 
to distinguish between such predictable modes of source operation 
and genuine ``malfunctions,'' which are by definition supposed to be 
unpredictable and unforeseen events and which could not have been 
precluded by proper source design, maintenance and operation.

---------------------------------------------------------------------------

[[Page 55929]]

    With respect to the specific affirmative defense provisions 
identified by the Petitioner as deficient, the EPA evaluated each of 
the provisions to determine whether they were consistent with the EPA's 
interpretation of the CAA concerning such provisions at the time. This 
evaluation included examination of the specific provisions in light of 
the EPA's interpretations of the CAA and recommendations in the 1999 
SSM Guidance, as updated in the February 2013 proposal notice (e.g., 
the revision to the EPA's guidance concerning affirmative defenses for 
single sources with the potential to cause exceedances of the NAAQS). 
As a result, the EPA proposed to deny the Petition with respect to the 
claims concerning affirmative defense provisions to the extent 
applicable to malfunction events in three jurisdictions: (i) Arizona; 
(ii) Maricopa County, Arizona; and (iii) Colorado. The EPA proposed to 
deny the Petition with respect to these affirmative defense provisions 
to the extent applicable to malfunction events because at that time the 
EPA believed them to be consistent with the CAA and EPA guidance in the 
1999 SSM Policy. The EPA proposed to grant the Petition with respect to 
the claims concerning affirmative defense provisions in the following 
jurisdictions: (i) Alaska; (ii) Arizona (affirmative defense for 
startup and shutdown only); (iii) Maricopa County, Arizona (affirmative 
defense for startup and shutdown only); (iv) Arkansas; (v) Colorado 
(affirmative defense for startup and shutdown only); (vi) District of 
Columbia; (vii) Illinois; (viii) Indiana; (ix) Jefferson County, 
Kentucky; \7\ (x) Michigan; (xi) Mississippi; (xii) New Mexico; (xiii) 
Virginia; and (xiv) Washington. The EPA's evaluation of the specific 
provisions in these states identified a variety of deficiencies as 
explained in more detail in section IX of the February 2013 proposal 
notice. In general, the EPA considered these provisions deficient 
because they extended not only to monetary penalties but also to 
injunctive relief, because they had insufficient criteria to assure 
that they were sufficiently narrowly drawn, because they extended to 
events that were not malfunctions, or because of some combination of 
these concerns.
---------------------------------------------------------------------------

    \7\ The EPA notes that the state of Kentucky has now revised the 
SIP provisions applicable to Jefferson County (Louisville) and 
eliminated the SIP inadequacies identified in the February 2013 
proposal notice. The EPA has already approved the necessary SIP 
revisions. See 79 FR 33101 (June 10, 2014). Accordingly, the EPA's 
final action on the Petition will not need to include a finding of 
substantial inadequacy and SIP call for Jefferson County, Kentucky. 
The recently approved revision did not create an affirmative defense 
provision, so there is no need to readdress this issue in this 
jurisdiction.
---------------------------------------------------------------------------

C. What events necessitated this SNPR?

    Subsequent to EPA's issuance of the February 2013 proposal, a 
federal court ruled that CAA sections 113 and 304 preclude EPA 
authority to create affirmative defense provisions in the Agency's own 
regulations imposing emission limits on sources, because such 
provisions purport to alter the jurisdiction of federal courts to 
assess liability and impose penalties for violations of those limits in 
private civil enforcement cases. The U.S. Court of Appeals for the 
District of Columbia Circuit issued that decision in NRDC v. EPA on 
April 18, 2014.\8\ The EPA believes that the reasoning of the court in 
that decision indicates that the states, like the EPA, have no 
authority in SIP provisions to alter the jurisdiction of federal courts 
to assess penalties for violations of CAA requirements through 
affirmative defense provisions. If states lack authority under the CAA 
to alter the jurisdiction of the federal courts through affirmative 
defense provisions in SIPs, then the EPA lacks authority to approve any 
such provision in a SIP.
---------------------------------------------------------------------------

    \8\ See NRDC v. EPA, 749 F.3d 1055 (D.C. Cir. 2014).
---------------------------------------------------------------------------

    The court's decision in NRDC v. EPA \9\ pertained to a challenge to 
the EPA's National Emission Standards for Hazardous Air Pollutants 
(NESHAP) regulations issued pursuant to CAA section 112 to regulate 
hazardous air pollutants from sources that manufacture Portland 
cement.\10\ In addition to imposing specific emission limitations for 
the relevant pollutants from the affected sources, the EPA also created 
an affirmative defense that sources could assert in judicial 
enforcement proceedings for violations due to excess emissions that 
occur during qualifying malfunction events. The affirmative defense 
provision in the Portland cement NESHAP required the source to prove, 
by a preponderance of the evidence in an enforcement proceeding, that 
the source met specific criteria concerning the nature of the event and 
the source's conduct before, during and after the event. The EPA notes 
that these specific criteria required to establish the affirmative 
defense in the Portland cement NESHAP are functionally the same as the 
criteria that the EPA previously recommended to states for SIP 
provisions in the 1999 SSM Guidance and that the EPA explicitly 
repeated these same recommended criteria to states in the February 2013 
proposal notice. In addition, the EPA provided sample regulatory text 
in the February 2013 proposal notice drawn from a comparable NESHAP 
that the EPA recently promulgated for another source category, to 
illustrate how states might elect to word appropriate affirmative 
defense provisions in SIPs.\11\ In other words, the affirmative defense 
provision at issue in the NRDC v. EPA case was essentially equivalent 
to the type of provision, both conceptually and in terms of specific 
regulatory language, which the EPA would previously have considered 
consistent with CAA requirements for affirmative defense provisions for 
malfunction events in SIPs.
---------------------------------------------------------------------------

    \9\ Id.
    \10\ The NESHAP promulgated after the 1990 CAA Amendments are 
also referred to as ``maximum achievable control technology'' or 
``MACT'' standards.
    \11\ See February 2013 proposal notice, 78 FR 12459 at 12478-80.
---------------------------------------------------------------------------

    The EPA believes that the opinion of the court in NRDC v. EPA has 
significant impacts on the Agency's SSM Policy and on the positions 
that the EPA took in the February 2013 proposal notice with respect to 
issues related to affirmative defenses. Section IV of the February 2013 
proposal notice describes in detail the EPA's prior evaluation of the 
Petition with respect to the overarching issue of affirmative defense 
provisions in SIPs. In general, the EPA proposed: (i) To deny the 
request to rescind the SSM Policy with respect to interpreting the CAA 
to allow states to elect to include appropriately tailored affirmative 
defense provisions for violations due to excess emissions during 
periods of malfunction; and (ii) to grant the request to rescind the 
SSM Policy with respect to affirmative defense provisions for 
violations due to excess emissions during periods of startup and 
shutdown. Consistent with this interpretation of the CAA, the EPA 
previously proposed to revise its SSM Policy to clarify that states 
could elect to create affirmative defenses in SIP provisions only for 
malfunction events, and so long as such provisions were narrowly drawn, 
as recommended in the EPA's guidance. Even these more narrowly defined 
affirmative defense provisions are no longer consistent with CAA 
requirements under the reasoning adopted by the court in NRDC v. EPA.
    In addition, section IX of the February 2013 proposal notice 
provided the EPA's evaluation of each of the specific

[[Page 55930]]

SIP provisions identified by the Petitioner and proposed to take action 
on them, in accordance with EPA's interpretation of the CAA for such 
provisions at that time. These SIP provisions included affirmative 
defense provisions of various types, including some that the Agency had 
previously approved as consistent with its interpretation of the CAA in 
the 1999 SSM Guidance. The EPA evaluated these provisions on a case-by-
case basis and proposed either to grant or to deny the Petition with 
respect to each provision, consistent with the EPA's then current 
interpretation of the CAA for such provisions.
    The recent decision by the U.S. Court of Appeals for the District 
of Columbia Circuit in NRDC v. EPA has called into question the legal 
basis for affirmative defense provisions applicable to violations of 
CAA requirements. The reasoning used by that court, as logically 
extended to SIP provisions, indicates that neither states nor the EPA 
have authority to alter either the rights of other parties to seek 
relief or the jurisdiction of the federal courts to impose relief for 
violations of CAA requirements in SIPs, including the courts' power to 
restrain violations, to require compliance, and to assess monetary 
penalties for any violations in accordance with factors provided in CAA 
section 113(e)(1).
    The EPA acknowledges that its SSM Policy since the 1999 SSM 
Guidance has interpreted the CAA in such a way that states could in 
effect alter the jurisdiction of federal courts to assess monetary 
penalties under certain conditions through creation of affirmative 
defenses. In other words, even though Congress explicitly empowered 
federal courts to assess monetary penalties for a CAA violation, an 
affirmative defense could, contrary to the statute, limit the ability 
of a court to do so. The EPA believes that the court's decision in NRDC 
v. EPA compels the Agency to reevaluate its interpretation of the CAA 
and its proposed action on the Petition concerning affirmative defense 
provisions in SIPs. As a result, in this SNPR we are revising what we 
previously proposed as our response to the Petition, but only to the 
extent relevant to the issue of affirmative defense provisions in SIPs. 
In section III.C of this SNPR, the EPA explains in detail why the 
court's interpretation of relevant CAA provisions indicates that states 
do not have authority to create, and thus the EPA does not have 
authority to approve, SIP provisions that include an affirmative 
defense that would operate to alter the jurisdiction of federal courts 
to assess penalties or other forms of relief authorized in sections 113 
and 304. In section VII of this SNPR, the EPA explains how the decision 
affects the February 2013 proposal with respect to specific provisions 
in the SIPs of particular states. In section VII of this SNPR, the EPA 
also includes affirmative defense provisions found in six states' SIPs 
that the Agency has identified independently, and the EPA explains why 
each of these additional provisions fails to meet CAA requirements and 
thus necessitates a finding of substantial inadequacy and a SIP call as 
well. The EPA is including the additional provisions to assure that it 
provides comprehensive guidance with respect to this issue to all 
states and to alleviate confusion that may arise as a result of recent 
regulatory actions and litigation concerning affirmative defense 
provisions.

IV. What is the EPA proposing through this SNPR in response to the 
petitioner's request for rescission of the EPA policy on affirmative 
defense provisions?

A. Petitioner's Request

    The February 2013 proposal notice explained in detail the 
Petitioner's claims with respect to affirmative defense provisions in 
SIPs, but it is helpful to repeat the full argument here in order to 
explain the reasons for the EPA's revised proposal in this SNPR. 
Understanding those specific claims in light of the court's decision in 
the NRDC v. EPA decision serves to illustrate the need for the EPA to 
reexamine the statutory basis for any affirmative defense in SIP 
provisions, not merely those provisions limited to malfunction events 
or to those for malfunction events that are sufficiently narrowly drawn 
to be consistent with the EPA's prior interpretation of the CAA in the 
1999 SSM Guidance.
    The Petitioner's first request was for the EPA to rescind its SSM 
Policy element interpreting the CAA to allow affirmative defense 
provisions in SIPs for excess emissions during SSM events.\12\ The 
Petitioner also asked the EPA: (i) To find that SIPs containing an 
affirmative defense to monetary penalties for excess emissions during 
SSM events are substantially inadequate because they do not comply with 
the CAA; and (ii) to issue a SIP call pursuant to CAA section 110(k)(5) 
to require each such state to revise its SIP.\13\ Alternatively, if the 
EPA denies these two related requests, the Petitioner requested the 
EPA: (i) To require states with SIPs that contain such affirmative 
defense provisions to revise them so that they are consistent with the 
EPA's 1999 SSM Guidance for excess emissions during SSM events; and 
(ii) to issue a SIP call pursuant to CAA section 110(k)(5) to states 
with provisions inconsistent with the EPA's interpretation of the 
CAA.\14\ The EPA interpreted this latter request to refer to the 
specific SIP provisions that the Petitioner identified in a separate 
section of the Petition, titled, ``Analysis of Individual States' SSM 
Provisions,'' including specific existing affirmative defense 
provisions.
---------------------------------------------------------------------------

    \12\ Petition at 11.
    \13\ Id.
    \14\ Petition at 12.
---------------------------------------------------------------------------

    The Petitioner requested that the EPA rescind its SSM Policy 
element interpreting the CAA to allow SIPs to include affirmative 
defenses for violations due to excess emissions during any type of SSM 
events because the Petitioner contended there is no legal basis for the 
policy. Specifically, the Petitioner cited to two statutory grounds, 
CAA sections 113(b) and (e), related to the type of judicial relief 
available in an enforcement proceeding and to the factors relevant to 
the scope and availability of such relief, that the Petitioner claimed 
would bar the approval of any type of affirmative defense provision in 
SIPs.
    In the Petitioner's view, the CAA ``unambiguously grants 
jurisdiction to the district courts to determine penalties that should 
be assessed in an enforcement action involving the violation of an 
emissions limit.'' \15\ The Petitioner first argued that in any 
judicial enforcement action in the district court, CAA section 113(b) 
provides that ``such court shall have jurisdiction to restrain such 
violation, to require compliance, to assess such penalty, . . . and to 
award any other appropriate relief.'' In addition, the Petitioner cited 
the provisions of CAA section 304(a), which specifically pertain to 
citizen suit enforcement and which reiterate that the federal courts 
have jurisdiction to assess monetary penalties for violations as well 
as to impose other remedies.\16\ The Petitioner reasoned that the EPA's 
SSM Policy is therefore fundamentally inconsistent with the CAA because 
it purports to remove the discretion and authority of the federal 
courts to assess monetary penalties for violations if a source is 
shielded from monetary penalties under an affirmative defense provision 
in the approved SIP.\17\ The Petitioner

[[Page 55931]]

concluded that the EPA's interpretation of the CAA in the SSM Policy 
element allowing any affirmative defenses is impermissible ``because 
the inclusion of an affirmative defense provision in a SIP limits the 
courts' discretion--granted by Congress--to assess penalties for Clean 
Air Act violations.'' \18\
---------------------------------------------------------------------------

    \15\ Petition at 10.
    \16\ Petition at 11.
    \17\ Id.
    \18\ Id.
---------------------------------------------------------------------------

    Second, in reliance on CAA section 113(e)(1), the Petitioner argued 
that in a judicial enforcement action in a district court, the statute 
explicitly specifies a list of factors that the court is to consider in 
assessing penalties.\19\ That section provides that either the 
Administrator or the court:
---------------------------------------------------------------------------

    \19\ Id.

    . . . shall take into consideration (in addition to such other 
factors as justice may require) the size of the business, the 
economic impact of the penalty on the business, the violator's full 
compliance history and good faith efforts to comply, the duration of 
the violation as established by any credible evidence (including 
evidence other than the applicable test method), payment by the 
violator of penalties previously assessed for the same violation, 
the economic benefit of noncompliance, and the seriousness of the 
---------------------------------------------------------------------------
violation.

    The Petitioner argued that the EPA's SSM Policy authorizes states 
to create affirmative defense provisions with criteria for monetary 
penalties that are inconsistent with the factors that the statute 
specifies and that the statute explicitly directs courts to weigh in 
any judicial enforcement action. In particular, the Petitioner 
enumerated those factors that it alleges the EPA's SSM Policy totally 
omits: (i) The size of the business; (ii) the economic impact of the 
penalty on the business; (iii) the violator's full compliance history; 
(iv) the economic benefit of noncompliance; and (v) the seriousness of 
the violation. By specifying particular factors for courts to consider, 
the Petitioner reasoned, Congress has already definitively spoken to 
the question of what factors are germane in assessing monetary 
penalties under the CAA for violations. The Petitioner concluded that 
the EPA has no authority to allow a state to include an affirmative 
defense provision in a SIP with different criteria to be considered in 
awarding monetary penalties because ``[p]reventing the district courts 
from considering these statutory factors is not a permissible 
interpretation of the Clean Air Act.'' \20\ The Petitioner drew no 
distinction between affirmative defenses for unplanned events such as 
malfunctions and planned events such as startup and shutdown.
---------------------------------------------------------------------------

    \20\ Id.
---------------------------------------------------------------------------

B. The EPA's Proposed Revised Response

    As a preliminary matter, the EPA acknowledges that its 
interpretation of the CAA in its SSM Policy, since issuance of the 1999 
SSM Guidance, has been that states may elect to have narrowly drawn 
affirmative defense provisions in SIPs, so long as they meet certain 
requirements (e.g., that they only apply to monetary penalties and not 
to injunctive relief). The EPA's longstanding guidance has also 
provided very specific recommendations to states concerning how to 
develop affirmative defense provisions that would be consistent with 
CAA requirements (e.g., such provisions should require sources to prove 
in an enforcement proceeding that the violations are not so repetitive 
as to indicate that the source is improperly designed, maintained or 
operated). The EPA further acknowledges that it has previously approved 
affirmative defense provisions in SIPs or, when appropriate, 
promulgated affirmative defenses in federal implementation plans 
(FIPs). Indeed, the EPA's approval of affirmative defense provisions in 
SIPs or promulgation of such provisions in FIPs has been upheld by 
courts in several decisions.\21\
---------------------------------------------------------------------------

    \21\ See Luminant Generation Co. v. EPA, 714 F.3d 841 (5th Cir. 
2012) (upholding the EPA's approval of an affirmative defense 
applicable during malfunctions in a SIP submission as a permissible 
interpretation of the statute under Chevron step 2 analysis), cert. 
denied, 134 S.Ct. 387 (2013); Mont. Sulphur & Chemical Co. v. EPA, 
666 F.3d 1174, 1191-93 (9th Cir. 2012) (upholding the EPA's creation 
of an affirmative defense applicable during malfunctions in a FIP); 
Ariz. Public Service Co. v. EPA, 562 F.3d 1116, 1130 (9th Cir. 2009) 
(upholding the EPA's creation of an affirmative defense applicable 
during malfunctions in a FIP).
---------------------------------------------------------------------------

    Most significantly, the EPA's November 2010 approval of an 
affirmative defense applicable to ``unplanned events'' (i.e., 
malfunctions) and disapproval of an affirmative defense applicable to 
``planned events'' (e.g., planned startup and shutdown) in a Texas SIP 
submission were challenged by numerous parties. In 2012, the U.S. Court 
of Appeals for the 5th Circuit upheld EPA's actions, including both the 
Agency's approval and disapproval of the affirmative defense provisions 
applicable to the respective types of events.\22\ In that litigation, 
the EPA defended its approval and disapproval actions, including the 
filing of an opposition to a petition for certiorari filed by industry 
challengers concerning the disapproval of the affirmative defense for 
planned events. Throughout the litigation over the Texas SIP revision, 
the EPA reiterated what was at the time its view that appropriately 
drawn affirmative defense provisions applicable to malfunctions can be 
consistent with CAA requirements for SIPs. In particular, the EPA 
argued in that litigation that sections 113 and 304 do not preclude 
appropriately drawn affirmative defense provisions for malfunctions in 
SIPs. The 5th Circuit applied the two-step Chevron analysis to the 
EPA's interpretation of section 113 in connection with both the 
approval of the affirmative defense provision applicable to ``unplanned 
events'' and the disapproval of the affirmative defense provision 
applicable to ``planned events.'' With respect to both the approval and 
disapproval, the court held that the Agency's interpretation of the CAA 
at that time was a ``permissible interpretation of section [113], 
warranting deference.'' \23\ Subsequent events have caused EPA to 
reevaluate this interpretation of the CAA requirements.
---------------------------------------------------------------------------

    \22\ Luminant Generation Co. v. EPA, 714 F.3d 841 (5th Cir. 
2012), cert. denied, 134 S.Ct. 387 (2013).
    \23\ See Luminant Generation Co. v. EPA, 714 F.3d 841, at 851 
and 856 (5th Cir. 2012).
---------------------------------------------------------------------------

    The EPA has carefully evaluated the more recent April 2014 decision 
of the U.S. Court of Appeals for the District of Columbia Circuit in 
NRDC v. EPA in which the court came to a contrary conclusion with 
respect to the legal basis for an affirmative defense provision in the 
Agency's own regulations.\24\ In light of this more recent decision, 
the EPA believes that its prior interpretation of the CAA with respect 
to the approvability of affirmative defense provisions in SIPs is no 
longer the best reading of the statute. The EPA has authority to revise 
its prior interpretation of the CAA when further consideration 
indicates to the Agency that its prior interpretation of the statute is 
incorrect.\25\ In order to explain more fully why the EPA believes that 
the court's decision in NRDC v. EPA requires the Agency to change its 
SSM Policy and to revise its February 2013 proposal notice with respect 
to affirmative defense provisions in SIPs, the EPA will first explain 
why it believes that the reasoning of the court's decision is more 
broadly applicable and will then explain why it believes that the 
specific reasons given by the court for rejecting the EPA's prior 
interpretation of the CAA would apply with equal weight to SIP 
provisions.
---------------------------------------------------------------------------

    \24\ See NRDC v. EPA, 749 F.3d 1055 (D.C. Cir. 2014).
    \25\ See, e.g., White Stallion Energy Center, LLC v. EPA, 748 
F.3d 1222, 1235 (D.C. Cir. 2014) (citing Nat'l Cable & Telecomms. 
Ass'n v. Brand X Internet Servs., 545 U.S. 967 (2005) and FCC v. Fox 
Television Stations, Inc., 556 U.S. 502 (2009)).

---------------------------------------------------------------------------

[[Page 55932]]

    The EPA believes that the reasoning of the court's decision in NRDC 
v. EPA applies more broadly than to the specific facts of the case for 
several reasons. First, the EPA notes that the court's decision did not 
turn upon the specific provisions of CAA section 112. Although the 
court only evaluated the legal validity of an affirmative defense 
provision created by the EPA in conjunction with specific standards 
applicable to manufacturers of Portland cement, the court based its 
decision upon the provisions of sections 113 and 304 that pertain to 
enforcement of CAA requirements more broadly, including to SIPs. 
Sections 113 and 304 pertain to administrative and judicial enforcement 
generally and are in no way limited to enforcement of emission 
limitations promulgated by the EPA under section 112. Thus, the EPA 
does not think that the mere fact that the court only addressed the 
legality of an affirmative defense provision in this particular context 
means that the court's interpretation of sections 113 and 304 does not 
also apply more broadly. To the contrary, the EPA sees no reason why 
the logic of the court concerning sections 113 and 304 would not apply 
to SIP provisions as well.
    Second, the EPA notes that footnote 2 in the opinion does not 
signify that the court intended to take any position with respect to 
the application of its interpretation of the CAA to SIP provisions, let 
alone to suggest that its interpretation would not apply more broadly. 
The court was clearly cognizant that a similar legal issue had arisen 
in litigation in the U.S. Court of Appeals for the 5th Circuit 
concerning the Texas SIP and merely acknowledged that fact and clearly 
stated in this footnote: ``[W]e do not here confront the question 
whether an affirmative defense may be appropriate in a State 
Implementation Plan.'' \26\ Given that the case before the court did 
not pertain to SIP provisions and thus the legal validity of 
affirmative defense provisions in a SIP did not need to be decided, the 
EPA believes that footnote 2 simply reflects the court's desire to be 
clear that it was only addressing the question of whether sections 113 
and 304 preclude any EPA authority to create an affirmative defense 
applicable to private civil suits in its own regulations. However, the 
EPA believes that the logic of the court's decision in NRDC v. EPA 
regarding the import of sections 113 and 304 does extend to SIP 
provisions. In the remainder of this section of the SNPR, we explain in 
greater detail why we now think the D.C. Circuit's reading of the 
statute is the correct one.
---------------------------------------------------------------------------

    \26\ See NRDC v. EPA, 749 F.3d 1055, 1063 (D.C. Cir. 2014).
---------------------------------------------------------------------------

    Finally, the EPA notes that the fact that the court only addressed 
the legality of affirmative defense provisions in the context of 
citizen suit enforcement--which by definition is judicial rather than 
administrative enforcement--does not affect the relevance of the 
court's reasoning with respect to the legal basis for affirmative 
defenses in SIP provisions. Under the CAA, a state has the initial 
responsibility to develop and submit SIP submissions to meet various 
requirements (e.g., to impose reasonably available control measures on 
sources in nonattainment areas). The EPA's evaluation and approval of 
the state's SIP submission in turn makes the contents of the submission 
federally enforceable parts of the SIP. Pursuant to sections 113 and 
304, the state, the EPA and citizens then have the ability to seek to 
bring enforcement actions for violations of the requirements of the SIP 
in federal court. Thus, the court's logic in NRDC v. EPA would also 
apply to the provisions of the state's SIP, and the jurisdiction of a 
court to impose penalties or other forms of relief for violations of 
SIP requirements under the CAA cannot be altered by an affirmative 
defense in a state's SIP provision in the same way that it cannot be 
altered by such a provision in an EPA regulation.
    Just as the court's decision is not limited in ways that would 
preclude it from applying to SIP provisions, the EPA also believes that 
the logic of the decision would apply with equal weight to affirmative 
defense provisions in SIPs for a number of reasons. Most significantly, 
the court rejected a series of arguments that the EPA made to support 
its legal authority under the CAA to create an affirmative defense in 
the Portland cement NESHAP. The EPA made the same or comparable 
arguments to support its interpretation of the CAA to provide authority 
for states to elect to create, and for the EPA to approve, affirmative 
defense provisions in SIPs applicable in judicial enforcement cases. 
The EPA has carefully evaluated the reasoning of the court in the NRDC 
v. EPA decision and now believes that its prior interpretation of the 
CAA with respect to affirmative defense provisions in the SSM Policy, 
as first stated in the 1999 SSM Guidance and as updated in the February 
2013 proposal notice, was incorrect and would not withstand judicial 
review in light of the NRDC v. EPA decision. Evaluation of the key 
points of the court's reasoning in the decision indicates that the 
court's interpretation of the relevant statutory provisions applies 
equally to SIP provisions.
    First, the NRDC v. EPA court examined the litigants' key argument 
that the EPA has no authority to alter the jurisdiction of courts to 
assess monetary penalties or to alter the factors that courts must 
consider when assessing the amount of such penalties. The litigants 
argued that the EPA's creation of an affirmative defense had the effect 
of altering or eliminating the jurisdiction of the federal courts to 
impose penalties in a citizen suit enforcement proceeding. The NRDC v. 
EPA court evaluated the litigants' argument with a straightforward 
reading of CAA section 304(a) concerning the rights of ``any person'' 
to bring an enforcement action and the jurisdiction of federal courts 
to assess liability and penalties in such an action and of CAA section 
113(e)(1) concerning the factors that courts must consider when 
assessing civil penalties. Citing recent U.S. Supreme Court precedent, 
the court reasoned that section 304(a) creates a private right of 
action and that the courts alone are vested with authority to determine 
the scope of remedies in judicial enforcement, rather than the 
administrative agency. The NRDC v. EPA court treated this issue as a 
question that it could answer with a Chevron step 1 plain reading of 
the statute and evidently saw no ambiguity concerning whether the EPA 
has authority to alter the rights of litigants to seek monetary 
penalties for violations or to alter the jurisdiction of the federal 
courts to assess such penalties. In retrospect and in light of the 
court's decision, the EPA believes that this is the correct reading of 
CAA sections 113 and 304 with respect to this question in the SIP 
context as well. Thus, these statutory provisions functionally bar 
affirmative defense provisions in SIPs that would have the effect of 
altering the rights of litigants or the authority of the courts in the 
event of enforcement for violations of SIP requirements.
    Second, the NRDC v. EPA court evaluated the EPA's argument that an 
affirmative defense ``fleshes out the statutory requirement that 
penalties be applied only when `appropriate.' '' \27\ The EPA had 
argued that CAA section 304(a) provides federal district courts with 
jurisdiction to ``apply any appropriate civil penalties'' and that such 
penalties would only be ``appropriate'' if the regulation being 
enforced specifically provided for such penalties in the first place. 
In other words, the EPA argued, if the regulation

[[Page 55933]]

contained an affirmative defense that precluded monetary penalties 
under certain circumstances, then it would not be ``appropriate'' for a 
court to assess the penalties in those circumstances. The NRDC v. EPA 
court disagreed with this argument, stating unequivocally that under 
the CAA ``deciding whether penalties are `appropriate' is a job for the 
courts, not EPA.'' \28\ To the extent that a defendant in an 
enforcement case has a basis for arguing that monetary penalties should 
be reduced, the court stated that CAA section 113(e)(1) already 
provides courts with factors that may be taken into consideration. The 
court emphasized that in judicial enforcement, the court decides 
whether or not to accept a defendant's arguments concerning the 
assessment of penalties, not the EPA. In the February 2013 proposal 
notice, the EPA relied on this same argument to support its position 
that affirmative defense provisions in SIPs would not contradict CAA 
sections 113 and 304 and to justify its proposed denial of the Petition 
with respect to affirmative defenses applicable to malfunctions 
events.\29\ Given that the court has rejected this interpretation of 
the CAA for the EPA's own regulations, the EPA believes that the same 
principle applies to states that seek to alter the ability of federal 
courts to assess penalties for violations of CAA requirements in SIP 
provisions. If states have no authority to alter the jurisdiction of 
federal courts to impose remedies for violations explicitly provided 
for in the CAA, then this affects the EPA's authority to approve any 
such SIP provisions as consistent with the requirements of the CAA. 
Pursuant to its authority and responsibility under sections 110(k), 
110(l) and 193, the EPA can only approve SIP provisions that comply 
with the applicable substantive requirements of the CAA. Approving an 
affirmative defense provision into a SIP that would purport to 
contravene the jurisdiction of federal courts to determine liability 
and to impose remedies in accordance with sections 113 and 304 would 
thus be inappropriate.
---------------------------------------------------------------------------

    \27\ See NRDC v. EPA, 749 F.3d 1055, 1063 (D.C. Cir. 2014).
    \28\ See NRDC v. EPA, 749 F.3d 1055, 1062 (D.C. Cir. 2014).
    \29\ See February 2013 proposal notice, 78 FR 12459 at 12472 
(middle column).
---------------------------------------------------------------------------

    Third, the NRDC v. EPA court scrutinized the EPA's argument that it 
has authority under CAA section 301 to create an affirmative defense 
through the general authority of the EPA Administrator ``to prescribe 
such regulations as are necessary to carry out his functions under'' 
the CAA.\30\ In the February 2013 proposal notice, the EPA did not make 
this particular argument because it was not proposing EPA regulations 
to implement the CAA, rather it was proposing action on a petition for 
rulemaking that entails evaluating the EPA's guidance to states in the 
SSM Policy concerning whether specific types of SIP provisions are 
consistent with CAA requirements. Nevertheless, the EPA notes, the 
court rejected the notion that the EPA has any authority to promulgate 
regulations that would alter or eliminate the jurisdiction of federal 
courts to assess penalties when Congress has already directly spoken to 
that issue. As the court expressed it, ``EPA cannot rely on its gap-
filling authority to supplement the Clean Air Act's provisions when 
Congress has not left the agency a gap to fill.'' The EPA believes that 
the court's reasoning would extend to situations where the EPA is 
required to determine whether or not an affirmative defense provision 
is consistent with CAA requirements. Following this reasoning, the EPA 
would not have authority, through rulemaking on a state's SIP 
submission or otherwise, to approve an affirmative defense provision 
applicable in a judicial enforcement action, because to do so would be 
inconsistent with the statutory allocation of jurisdiction to the 
federal courts. In other words, just as the EPA's authority to 
promulgate regulations to implement the CAA does not encompass the 
authority to overwrite statutory provisions, the EPA likewise lacks 
authority to issue guidance to states concerning SIP provisions in the 
SSM Policy, or to approve a SIP submission that contains such SIP 
provisions, in a way that would likewise overwrite statutory provisions 
where Congress has spoken directly.
---------------------------------------------------------------------------

    \30\ See NRDC v. EPA, 749 F.3d 1055, 1063 (D.C. Cir. 2014).
---------------------------------------------------------------------------

    Fourth, the NRDC v. EPA court weighed the EPA's argument that CAA 
section 304 does not ``expressly deny'' EPA authority to create 
affirmative defenses and thus the EPA is not precluded from doing 
so.\31\ Because the statute is silent with respect to whether or not 
such provisions are permissible, the EPA inferred that the EPA had 
authority to create them as a component of the Portland cement NESHAP. 
In the February 2013 proposal notice, the EPA used a comparable 
argument that sections 110(a), 113(b) and 113(e) of the CAA do not 
expressly forbid affirmative defense provisions in SIPs, both to 
support its position that states could elect to have affirmative 
defense provisions for malfunctions in SIPs and in support of its 
proposed denial of the Petition on this point.\32\ In response to this 
particular argument, the NRDC v. EPA court rejected the suggestion that 
a court should ``presume a delegation of power absent an express 
withholding of such power'' as inconsistent with the principles of 
statutory interpretation under Chevron. The court thus expressly 
rejected the argument that affirmative defense provisions are 
consistent with the CAA by virtue of the fact that Congress has not 
explicitly forbidden them, especially in the face of conflicting 
provisions such as those in sections 113(b) and 304(a) giving 
jurisdiction to federal courts to assess penalties for violations of 
CAA requirements. The EPA now believes that this same reasoning applies 
to affirmative defense provisions in SIPs.
---------------------------------------------------------------------------

    \31\ Id.
    \32\ See February 2013 proposal notice, 78 FR 12459 at 12470 
(middle column); 12470 (right column); 12472 (right column).
---------------------------------------------------------------------------

    Finally, the NRDC v. EPA court evaluated the EPA's argument that 
affirmative defense provisions are ``necessary to account for the 
tension between requirements that emission limitations be `continuous' 
and the practical reality that control technology can fail 
unavoidably.'' \33\ This tension is an important point that the EPA has 
long noted as a basis for its interpretation of the CAA to allow 
affirmative defense provisions, not only in its own regulations such as 
the Portland cement NESHAP, but also in the SSM Policy providing 
guidance to states for SIP provisions. In the February 2013 proposal 
notice, the EPA used this same argument and the same case law support 
to justify its position that states could elect to have affirmative 
defense provisions for malfunctions in SIPs and for its proposed denial 
of the Petition on this point.\34\ The NRDC v. EPA court agreed that 
this would be a ``good argument'' for a source to make in an 
enforcement proceeding but made clear that this ``tension'' does not 
give the EPA legal authority to create an affirmative defense.\35\ The 
court thus

[[Page 55934]]

summarily rejected the EPA's argument that the need to ``balance'' the 
objectives of the CAA and to resolve the ``tension'' in the CAA 
authorizes creation of affirmative defenses that purport to alter or 
eliminate the jurisdiction of the courts to assess monetary penalties 
or other forms of relief. Given the result in the NRDC v. EPA decision, 
the EPA believes that this argument can no longer be a basis for the 
EPA's approval of affirmative defense provisions in SIPs that would 
apply in judicial enforcement actions. The net result would be that 
sources can continue to make this practical argument in the context of 
judicial enforcement proceedings and that this consideration would 
remain relevant in that forum, but without intercession by states or 
the EPA concerning whether the source should be liable for penalties in 
any specific circumstance through an affirmative defense provision in 
the SIP. In accordance with CAA section 113(e), sources retain the 
ability to seek lower monetary penalties through the statutory factors 
provided for consideration in administrative or judicial enforcement 
proceedings. In this context, for example, a violating source could 
argue that factors such as good-faith efforts to comply should reduce 
or eliminate otherwise applicable monetary penalties in a particular 
situation.
---------------------------------------------------------------------------

    \33\ See NRDC v. EPA, 749 F.3d 1055, 1063 (D.C. Cir. 2014).
    \34\ See February 2013 proposal notice, 78 FR 12459 at 12470 
(left column); 12472 (right column); 12487 (left column).
    \35\ The EPA interprets the court's opinion to mean that a 
defendant in an enforcement proceeding might want to make this 
argument as part of its efforts to seek lower penalties, consistent 
with the factors listed in CAA section 113(e). The court's reference 
to the EPA's making such an argument relates back to the court's 
earlier suggestion that the EPA could seek to participate as an 
intervenor or an amicus in a citizen suit enforcement matter if it 
wants to take a position on what monetary penalties are 
``appropriate'' for a given violation.
---------------------------------------------------------------------------

    In light of the court's decision in NRDC v. EPA, the EPA believes 
it necessary to revise its SSM Policy and its February 2013 proposed 
response to the Petition with respect to the issues related to 
affirmative defense provisions in SIPs. Given the court's reasoning 
that sections 113 and 304 preclude the EPA from having authority to 
create an affirmative defense applicable in private civil suits in 
federal regulations because such a provision would impinge upon 
jurisdiction explicitly provided by Congress to the courts, the EPA 
believes that its past guidance to states in the SSM Policy is flawed. 
If the EPA has no authority to create affirmative defenses because it 
cannot alter the jurisdiction of the courts to assess penalties in 
enforcement proceedings for violations of CAA requirements, then it 
follows that states likewise cannot alter the jurisdiction of the 
federal courts in SIP provisions and the EPA cannot approve any SIP 
provision that purports to do so. The EPA emphasizes that the same 
logic applies to any SIP provision that purports to eliminate, restrict 
or otherwise alter the jurisdiction of federal courts to impose any of 
the expressly listed forms of relief in section 113(b), not merely 
those applicable to monetary penalties.\36\ Pursuant to the 
requirements of sections 110(k), 110(l) and 193, the EPA has both the 
authority and the responsibility to evaluate SIP submissions to assure 
that they meet the requirements of the CAA. Pursuant to section 
110(k)(5), the EPA has authority and discretion to take action to 
require states to revise previously approved SIP provisions if they do 
not meet CAA requirements.
---------------------------------------------------------------------------

    \36\ The EPA notes that CAA section 113(b) expressly gives 
federal courts jurisdiction ``to restrain such violation, to require 
compliance, to assess such civil penalty, to collect any fees owed 
the United States under this chapter (other than subchapter II of 
this chapter) and any noncompliance assessment and nonpayment 
penalty owed under section 7420 of this title, and to award any 
other appropriate relief.'' Similarly, CAA section 304 expressly 
provides that in the context of a citizen suit enforcement case, 
federal courts have jurisdiction ``to enforce such an emission 
standard or limitation, or such an order . . . and to apply any 
appropriate civil penalties.'' In the latter section, the term 
``emission standard or limitation'' is defined broadly in section 
304(f).
---------------------------------------------------------------------------

    For the foregoing reasons, in this SNPR the EPA is proposing to 
grant the Petition with respect to the Petitioner's request that the 
EPA rescind its SSM Policy element interpreting the CAA to allow 
affirmative defense provisions in SIPs for excess emissions during SSM 
events. Unlike the EPA's view at the time of the February 2013 proposal 
notice, the EPA now sees no valid basis for interpreting the CAA to 
permit affirmative defense provisions in SIPs for violations due to 
excess emissions during any type of event, whether that event is a 
malfunction totally beyond the control of the source or a planned event 
within the control of the sources such as a startup or shutdown.

V. Revised SSM Policy on Affirmative Defense Provisions in SIPs

    In the February 2013 proposal notice, the EPA evaluated the issues 
raised by the Petitioner concerning the treatment of excess emissions 
during SSM events in SIP provisions. As part of responding to the 
Petition, the EPA proposed to clarify, reiterate and revise its 
longstanding SSM Policy. In this SNPR, the EPA is now proposing to 
revise further its interpretation of the CAA with respect to 
affirmative defense provisions applicable to excess emissions during 
SSM events.
    Based upon a reevaluation of the CAA with respect to SIP 
provisions, and upon careful consideration of the implications of the 
court's decision in NRDC v. EPA, the EPA is proposing to revise its SSM 
Policy concerning the issue of affirmative defense provisions. In 
particular, the EPA is proposing to reverse its prior recommendations 
to states on this issue provided in the 1999 SSM Guidance. In that 
guidance, the EPA had interpreted the CAA to permit states to elect to 
create narrowly drawn affirmative defense provisions in SIPs, both for 
malfunction events and for startup and shutdown events, so long as the 
provisions were consistent with the criteria recommended by the Agency. 
In the February 2013 proposal notice, the EPA had already proposed to 
revise this interpretation of the CAA to permit states to develop 
affirmative defense provisions only for malfunction events and not for 
startup and shutdown events. The decision of the court in NRDC v. EPA 
indicates that the EPA needs to revise the SSM Policy yet further.
    At this juncture, the EPA believes that the reasoning of the U.S. 
Court of Appeals for the District of Columbia Circuit in NRDC v. EPA 
logically extends to affirmative defense provisions created by states 
in SIPs, as well as to such provisions created by the EPA in its own 
regulations. Given that sections 113 and 304 functionally bar any 
affirmative defense that purports to alter or to eliminate the 
jurisdiction of federal courts to assess penalties for violations of 
CAA requirements or to impose the other remedies listed in section 
113(b), this principle applies to SIP provisions as well. Although the 
NRDC v. EPA decision focused on the jurisdiction of the federal courts 
to assess civil penalties for violations of EPA regulations promulgated 
under section 112, because that was what was specifically at issue in 
the case before it, the EPA sees no reason why the same logic would not 
apply to any SIP provision that purported to alter or eliminate the 
jurisdiction of the federal courts to exercise their authority in the 
event of violations as provided in CAA section 113(b), including the 
authority to restrain violations, to require compliance, to assess 
civil penalties, to collect any fees and to award any other appropriate 
relief. In other words, affirmative defense provisions in SIPs that 
purport to alter or eliminate the broad authority of federal courts to 
award any of these types of relief in the event of an enforcement 
action, whether pursuant to section 113 or section 304, are likewise 
contrary to the enforcement structure of the CAA. Accordingly, the EPA 
proposes to revise its SSM Policy to interpret the CAA to preclude 
affirmative defense provisions in SIPs. When finalized, this rulemaking 
will embody the EPA's revised SSM Policy, and it will provide the most 
up-to-date and comprehensive EPA guidance on

[[Page 55935]]

the subject of the proper treatment of excess emissions from sources 
during SSM events in SIP provisions.

VI. Legal Authority, Process and Timing for SIP Calls

    In section VIII of the February 2013 proposal notice, the EPA 
explained in detail its statutory authority under CAA section 110(k)(5) 
to issue a SIP call to states to address SIP deficiencies, the process 
for making such a SIP call and the timing for such a SIP call. In this 
SNPR, the EPA is not revising its interpretations of the CAA with 
respect to those issues and thus is not seeking comment on these 
topics. The EPA is revising one aspect of the February 2013 proposal 
notice with respect to the basis for the proposed SIP calls for 
affirmative defense provisions. In the February 2013 proposal notice, 
the EPA explained its basis for concluding that different types of 
deficient SIP provisions identified in the Petition are substantially 
inadequate to comply with requirements of the CAA and thus warrant a 
SIP call for a state to revise or to eliminate the impermissible 
provision. With respect to affirmative defense provisions, the EPA 
articulated its evaluation of why inadequate affirmative defense 
provisions applicable to malfunction events, or any affirmative defense 
provisions applicable to planned events like startup and shutdown, 
would be inconsistent with fundamental legal requirements of CAA 
sections 110(a) and 302(k) and the enforcement structure provided in 
CAA sections 113 and 304.\37\ The rationale provided by the EPA in the 
February 2013 proposal notice was obviously based upon the Agency's 
interpretation of the relevant requirements of the CAA at the time of 
that proposal.
---------------------------------------------------------------------------

    \37\ See February 2013 proposal notice, FR 12459 at 12487-88.
---------------------------------------------------------------------------

    In light of the decision of the U.S. Court of Appeals for the 
District of Columbia Circuit in NRDC v. EPA, however, the EPA has 
reevaluated whether any form of affirmative defense provision is 
consistent with CAA requirements for SIP provisions. The court 
concluded that the EPA has no authority to alter the rights of 
litigants to seek monetary penalties for violations of CAA requirements 
and no authority to alter the broad jurisdiction of federal courts to 
assess such penalties for such violations under CAA sections 113 and 
304. The EPA believes that the logic of the court's decision extends to 
the jurisdiction of the federal courts to impose other remedies 
expressly provided for in sections 113 and 304 as well. These sections 
of the CAA are thus among the fundamental requirements with which SIPs 
must comply in order to be consistent with the enforcement structure 
created by Congress in the CAA.
    The EPA notes that the NRDC v. EPA court did not condition its 
decision on considerations such as whether the use of the affirmative 
defense provision in the Portland cement NESHAP would have a 
demonstrated causal connection to a given environmental impact (or 
undermine a specific enforcement action); the court decided the 
question based solely on the fundamental legal requirements of the CAA, 
which apply equally to SIPs. The court viewed the statutory 
requirements for enforcement of violations as a legal bar to the EPA's 
creating an affirmative defense. The EPA believes that this decision 
supports the EPA's view that an affirmative defense provision in a SIP 
that would operate to interfere with the rights of litigants to seek 
penalties for violations of the SIP or other statutory forms of relief, 
or to interfere with the jurisdiction of courts to assess penalties or 
other relief for such violations, is a substantial inadequacy because 
such provision would violate fundamental legal requirements of the CAA. 
This potential for interference with the intended enforcement structure 
of the CAA is sufficient to establish that such an affirmative defense 
provision is substantially inadequate to meet CAA requirements, and 
there is no need to demonstrate that the use of the affirmative defense 
would be causally connected to any particular impact (e.g., a specific 
violation of a NAAQS at a particular monitor on a particular day, or 
the undermining of effective enforcement for a particular violation by 
a particular source). By specifying that parties have the right to seek 
relief for violations and that courts have jurisdiction to impose 
relief for such violations, the EPA believes, Congress has already made 
the determination that SIP provisions have to be consistent with the 
requirements of CAA sections 113 and 304 without regard to impact on 
other CAA requirements such as demonstrating attainment. Accordingly, 
the EPA has the authority and the responsibility to assure that SIP 
provisions meet the requirements of CAA sections 113 and 304 and do not 
undermine the enforcement structure for SIPs that was created in the 
CAA.

VII. What is the EPA proposing through this SNPR for each of the 
specific affirmative defense provisions identified in the Petition or 
identified independently by the EPA?

A. Overview of the EPA's Evaluation of Specific Affirmative Defense SIP 
Provisions

    In addition to its overarching request that the EPA revise its 
interpretation of the CAA in the SSM Policy with respect to any form of 
affirmative defense provisions in SIPs, the Petitioner identified 
specific existing affirmative defense provisions that the Petitioner 
contended are not consistent with the EPA's own interpretation of the 
CAA as expressed in the 1999 SSM Guidance. In general, the provisions 
identified by the Petitioner are structured as affirmative defense 
provisions, regardless of whether they use the term ``affirmative 
defense'' and regardless of whether the EPA ever specifically evaluated 
the provisions with respect to the recommendations for such provisions 
in the 1999 SSM Guidance. While not agreeing with the EPA's guidance 
for affirmative defense provisions, the Petitioner expressed concern 
that all of the identified provisions fail to address some or all of 
the criteria for affirmative defense provisions that the EPA 
recommended in the 1999 SSM Guidance.
    In the February 2013 proposal notice, the EPA explained that it was 
reviewing each identified affirmative defense provision on the merits. 
At that time, the EPA was operating under the belief that its 
interpretation of the CAA with respect to affirmative defense 
provisions in SIPs was correct. Accordingly, the EPA evaluated each of 
the provisions for consistency with the EPA's interpretation of the CAA 
as set forth in the 1999 SSM Guidance and as it was revising its 
interpretation in the February 2013 proposal notice. The February 2013 
proposal notice thus contained the EPA's proposal to grant or to deny 
the Petition based on the EPA's evaluation as to whether the provision 
at issue provides adequate criteria to provide only a narrow 
affirmative defense for violations due to malfunctions for sources 
under certain circumstances consistent with the overarching CAA 
objectives, such as attaining and maintaining the NAAQS. In addition, 
the EPA proposed to grant the Petition with respect to any identified 
provision that creates an affirmative defense applicable during planned 
startup and shutdown events, because such provisions are not consistent 
with the requirements of the CAA.

[[Page 55936]]

    Now, however, the EPA is reevaluating each of the specific 
affirmative defense provisions identified by the Petitioner for 
consistency with the CAA in light of the court's decision in NRDC v. 
EPA. As explained in section III.C of this SNPR, the EPA is revising 
its interpretation of the CAA concerning the legal basis for 
affirmative defense provisions. Given that the reasoning of the court 
applies equally to SIP provisions, the EPA is proposing to grant the 
Petition with respect to each of these provisions. Thus, the EPA is 
proposing to find that these provisions are substantially inadequate 
because they are not consistent with fundamental legal requirements of 
the CAA and the EPA is proposing to issue a SIP call to each affected 
state for these specific provisions.
    In addition to provisions identified by the Petitioner, the EPA is 
independently identifying other specific existing problematic 
affirmative defense provisions in SIPs. As a result, the EPA is newly 
including one or more affirmative defense provisions in the SIPs of the 
following four states: (1) New Mexico (Albuquerque-Bernalillo County); 
(2) Texas; (3) California (Eastern Kern Air Pollution Control District, 
Imperial County Air Pollution Control District and San Joaquin Valley 
Air Pollution Control District); and (4) Washington (Energy Facility 
Site Evaluation Council and Southwest Clean Air Agency). The EPA is 
including these additional affirmative defense provisions in this SNPR 
in order to provide comprehensive guidance to all states concerning 
such provisions in SIPs and to avoid confusion that may arise due to 
recent Agency administrative actions, litigation and resulting court 
decisions relevant to such provisions under the CAA. In particular, the 
EPA is concerned that its explicit approval of affirmative defense 
provisions in the SIPs of other states as being consistent with the 
requirements of the CAA as reflected in the 1999 SSM Guidance warrants 
affirmative action by the Agency to ask those states to revise their 
SIPs. Accordingly, the EPA is proposing to make a finding of 
substantial inadequacy for these additional affirmative defense 
provisions because they are not consistent with fundamental legal 
requirements of the CAA and the EPA is proposing to issue a SIP call 
with respect to each affected state for these specific provisions as 
well.

B. Affected States in EPA Region III

1. District of Columbia
a. Petitioner's Analysis
    The Petitioner objected to five provisions in the District of 
Columbia (DC) SIP as being inconsistent with the CAA and the EPA's SSM 
Policy.\38\ Among the other alleged SIP deficiencies, the Petitioner 
objected to the provision in the DC SIP that provides an affirmative 
defense for violations of visible emission limitations during 
``unavoidable malfunction'' (D.C. Mun. Regs. tit. 20 Sec.  606.4). The 
Petitioner objected to this provision because the elements of the 
defense are not laid out clearly in the SIP, because the term 
``affirmative defense'' is not defined in the SIP, and finally, the 
Petitioner argues, because affirmative defense provisions for any 
excess emissions are wholly inconsistent with the CAA and should be 
removed from the SIP. The Petitioner's overarching claim was that CAA 
section 113 is a bar to affirmative defense provisions because EPA does 
not have authority to alter the jurisdiction of the courts to assess 
penalties or the factors that Congress directed the courts to consider.
---------------------------------------------------------------------------

    \38\ Petition at 29-30.
---------------------------------------------------------------------------

b. The EPA's Prior Proposal
    In the February 2013 proposal notice, the EPA proposed to grant the 
Petition with respect to D.C. Mun. Regs. tit. 20 Sec.  606.4 because it 
is not a permissible affirmative defense provision consistent with the 
requirements of the CAA and the EPA's recommendations in the EPA's SSM 
Policy. The EPA previously stated its belief that, by purporting to 
create a bar to enforcement that applies not only to monetary penalties 
but also to injunctive relief, this provision is inconsistent with the 
requirements of CAA sections 113 and 304. By not including sufficient 
criteria to assure that sources seeking to raise the affirmative 
defense have in fact been properly designed, maintained and operated, 
and to assure that sources have taken all appropriate steps to minimize 
excess emissions, the provision also fails to be sufficiently narrowly 
drawn to justify shielding from monetary penalties for violations. 
Thus, the EPA previously reasoned that this provision is not 
appropriate as an affirmative defense provision because it is 
inconsistent with fundamental requirements of the CAA.
c. The EPA's Revised Proposal
    In this SNPR, the EPA is proposing to revise the basis for the 
finding of substantial inadequacy and the SIP call for D.C. Mun. Regs. 
tit. 20 Sec.  606.4. The EPA is proposing to revise its interpretation 
of the CAA with respect to affirmative defense provisions in SIPs. 
Previously the EPA assessed whether the provision met certain 
requirements, such as being limited to monetary penalties rather than 
injunctive relief and containing sufficiently robust criteria to assure 
that the defense applied only in appropriately narrow circumstances. 
Now, the Agency must evaluate such provisions to determine whether they 
are constructed in a way that would purport to preclude federal court 
jurisdiction under section 113 to assess civil penalties or other forms 
of relief for violations of SIP emission limits, to prevent courts from 
considering the statutory factors for the assessment of civil penalties 
under section 113 or to interfere with the rights of litigants to 
pursue enforcement consistent with their rights under the citizen suit 
provision of section 304. The EPA interprets the provision of D.C. Mun. 
Regs. tit. 20 Sec.  606.4 to create an impermissible affirmative 
defense for violations of visible emission limitations during 
``unavoidable malfunction'' events. The provision operates to limit the 
jurisdiction of the federal court in an enforcement action and to 
preclude both liability and any form of judicial relief contemplated in 
CAA sections 113 and 304. Thus, the EPA believes that this provision 
interferes with the intended enforcement structure of the CAA, through 
which parties may seek to bring enforcement actions for violations of 
SIP emission limits and courts may exercise their jurisdiction to 
determine what, if any, relief is appropriate.
    For this reason, the EPA is proposing to find D.C. Mun. Regs. tit. 
20 Sec.  606.4 substantially inadequate to meet CAA requirements and 
the EPA is thus proposing to issue a SIP call with respect to this 
provision. The EPA notes that in this SNPR it is only addressing this 
provision with respect to its deficiency as an affirmative defense 
provision and is not revising its February 2013 proposal with respect 
to the proposed action on the other four provisions in the DC SIP that 
are at issue in the Petition.
2. Virginia
a. Petitioner's Analysis
    The Petitioner objected to a generally applicable provision in the 
Virginia SIP that allows for discretionary exemptions during periods of 
malfunction (9 Va.

[[Page 55937]]

Admin. Code Sec.  5-20-180(G)).\39\ The Petitioner objected to this 
provision on multiple grounds, including: (i) That it provides an 
exemption from the otherwise applicable SIP emission limitations; (ii) 
that it provides a discretionary exemption for excess emissions during 
malfunction because the provision gives the state the authority to 
determine whether a violation ``shall be judged to have taken place''; 
and (iii) that if intended as an affirmative defense provision it fails 
to meet EPA's interpretation of the CAA with respect to such provisions 
for several reasons.
---------------------------------------------------------------------------

    \39\ Petition at 70-71.
---------------------------------------------------------------------------

b. The EPA's Prior Proposal
    In the February 2013 proposal notice, the EPA proposed to grant the 
Petition with respect to 9 Va. Admin. Code Sec.  5-20-180(G). The EPA 
explained that the provision at issue is deficient for several reasons, 
including the fact that it is not sufficient as an affirmative defense 
provision to meet CAA requirements. With respect to the deficiency of 
the provision as an affirmative defense, the EPA noted that even if it 
were to consider 9 Va. Admin. Code Sec.  5-20-180(G) as providing for 
an affirmative defense rather than an automatic or discretionary 
exemption, the provision is not a permissible affirmative defense 
provision consistent with the requirements of the CAA as interpreted in 
the EPA's recommendations in the EPA's SSM Policy. The EPA previously 
stated its belief that, by purporting to create a bar to enforcement 
that applies not only to monetary penalties but also to injunctive 
relief, this provision is inconsistent with the requirements of CAA 
sections 113 and 304. The EPA also argued that by not including 
sufficient criteria to assure that sources seeking to raise the 
affirmative defense have in fact been properly designed, maintained and 
operated, and to assure that sources have taken all appropriate steps 
to minimize excess emissions, the provision fails to be sufficiently 
narrowly drawn to justify shielding from monetary penalties for 
violations. Thus, the EPA previously proposed to find that this 
provision is not appropriate as an affirmative defense provision 
because it is inconsistent with fundamental requirements of the CAA.
c. The EPA's Revised Proposal
    In this SNPR, the EPA is proposing to revise the basis for the 
finding of substantial inadequacy and the SIP call for 9 Va. Admin. 
Code Sec.  5-20-180(G). The EPA is proposing to revise its 
interpretation of the CAA with respect to affirmative defense 
provisions in SIPs. Previously the EPA assessed whether such provisions 
met certain requirements, such as being limited to monetary penalties 
rather than injunctive relief and containing sufficiently robust 
criteria to assure that the defense applied only in appropriately 
narrow circumstances. Now, the Agency must evaluate such provisions to 
determine whether they are constructed in a way that would purport to 
preclude federal court jurisdiction under section 113 to assess civil 
penalties or other forms of relief for violations of SIP emission 
limits, to prevent courts from considering the statutory factors for 
the assessment of civil penalties under section 113 or to interfere 
with the rights of litigants to pursue enforcement consistent with 
their rights under the citizen suit provision of section 304. The EPA 
interprets the provision of 9 Va. Admin. Code Sec.  5-20-180(G) to 
create an impermissible affirmative defense for violations of SIP 
emission limits. The provision would operate to limit the jurisdiction 
of the federal court in an enforcement action and to preclude both 
liability and any form of judicial relief contemplated in CAA sections 
113 and 304. Thus, the EPA believes that this provision interferes with 
the intended enforcement structure of the CAA, through which parties 
may seek to bring enforcement actions for violations of SIP emission 
limits and courts may exercise their jurisdiction to determine what, if 
any, relief is appropriate.
    For these reasons, the EPA is proposing to find 9 Va. Admin. Code 
Sec.  5-20-180(G) substantially inadequate to meet CAA requirements and 
the EPA is thus proposing to issue a SIP call with respect to this 
provision. The EPA notes that in this SNPR it is only addressing this 
provision with respect to its deficiency as an affirmative defense 
provision and is not revising its February 2013 proposal notice with 
respect to the other separate bases for the finding of substantial 
inadequacy of this provision.
3. West Virginia
a. The EPA's Evaluation
    In addition to evaluating specific affirmative defense provisions 
identified by the Petitioner, the EPA is also evaluating other 
affirmative defense provisions that may be affected by the Agency's 
revision of its interpretation of CAA requirements for such provisions 
in SIPs. As part of its review, the EPA has identified one affirmative 
defense provision in the SIP for the state of West Virginia in W.Va. 
Code Section 45-2-9.4. This provision provides an affirmative defense 
available to sources for excess emissions that occur during 
malfunctions. The EPA notes that it has already proposed to make a 
finding of substantial inadequacy and to issue a SIP call for another 
related provision in W.Va. Code Section 45-2-9.1 for separate reasons 
not relevant here and the EPA is not reopening its February 2013 
proposal notice with respect to the latter SIP provision.
    In light of the court's decision in NRDC v. EPA, the EPA is 
proposing to revise its SSM Policy concerning the issue of affirmative 
defense provisions. In particular, the EPA is proposing to reverse its 
prior recommendations to states on this issue provided in the 1999 SSM 
Guidance. In that guidance, the EPA had interpreted the CAA to permit 
states to elect to create narrowly drawn affirmative defense provisions 
in SIPs, both for malfunction events and for startup and shutdown 
events, so long as the provisions were consistent with the criteria 
recommended by the Agency. In the February 2013 proposal notice, the 
EPA had already proposed to revise this interpretation of the CAA to 
permit states to develop affirmative defense provisions only for 
malfunction events and not for startup and shutdown events. The 
decision of the court in NRDC v. EPA indicates that the EPA needs to 
revise the SSM Policy yet further.
    As discussed in sections IV and V of this SNPR, the EPA is 
proposing to revise its interpretation of the CAA with respect to 
affirmative defense provisions in SIPs. The affirmative defense in 
W.Va. Code Section 45-2-9.4 provides that if a source establishes 
certain factual criteria ``to the satisfaction of'' a state official, 
then the occurrence of a malfunction is an ``affirmative defense.'' The 
EPA notes that the affirmative defense for malfunctions in W.Va. Code 
Section 45-2-9.4 was not consistent with the EPA's prior interpretation 
of the CAA and with its recommendations for such provisions in the 1999 
SSM Guidance. Regardless of that fact, the EPA believes that this 
provision impermissibly purports to alter or eliminate the jurisdiction 
of federal courts to assess penalties or to impose other forms of 
relief for violations of SIP emission limits. Under this provision, if 
the source is able to establish that it met each of the specified 
criteria to the satisfaction of the state official, then the provision 
purports to bar any relief for those violations. Accordingly, the EPA 
believes that this affirmative defense provision is inconsistent with 
the fundamental enforcement structure of the CAA and the EPA thus 
believes that

[[Page 55938]]

the provision is not consistent with CAA requirements for SIP 
provisions.
b. The EPA's Proposal
    In this SNPR, the EPA is proposing to make a finding of substantial 
inadequacy and to issue a SIP call for the affirmative defense 
provision applicable to excess emissions that occur during malfunctions 
in W.Va. Code Section 45-2-9.4. The EPA is proposing to revise its 
interpretation of the CAA with respect to affirmative defense 
provisions in SIPs. Previously the EPA assessed whether such provisions 
met certain requirements, such as being limited to monetary penalties 
rather than injunctive relief and containing sufficiently robust 
criteria to assure that the defense applied only in appropriately 
narrow circumstances. Now, the Agency must evaluate such provisions to 
determine whether they are constructed in a way that would purport to 
preclude federal court jurisdiction under section 113 to assess civil 
penalties or other forms of relief for violations of SIP emission 
limits, to prevent courts from considering the statutory factors for 
the assessment of civil penalties under section 113 or to interfere 
with the rights of litigants to pursue enforcement consistent with 
their rights under the citizen suit provision of section 304.
    The EPA interprets W.Va. Code Section 45-2-9.4 to provide an 
affirmative defense that operates to limit the jurisdiction of the 
federal court in an enforcement action and to limit the authority of 
the court to impose monetary penalties or to impose other forms of 
relief as contemplated in CAA sections 113 and 304. Thus, the EPA 
believes that this provision interferes with the intended enforcement 
structure of the CAA, through which parties may seek to bring 
enforcement actions for violations of SIP emission limits and courts 
may exercise their jurisdiction to determine what, if any, relief is 
appropriate.
    For these reasons, the EPA is proposing to find W.Va. Code Section 
45-2-9.4 substantially inadequate to meet CAA requirements and thus the 
EPA is proposing to issue a SIP call with respect to this provision. 
The EPA notes that in this SNPR it is only addressing this provision 
with respect to its deficiency as an affirmative defense provision and 
is not revising its February 2013 proposal with respect to the proposed 
action on the other provisions in the West Virginia SIP that are at 
issue in the Petition.

C. Affected States in EPA Region IV

1. Georgia
a. Petitioner's Analysis
    The Petitioner objected to a provision in the Georgia SIP that 
provides for exemptions for excess emissions during startup, shutdown 
or malfunctions under certain circumstances (Ga. Comp. R. & Regs. 391-
3-1-.02(2)(a)(7)).\40\ The Petitioner objected to this provision on 
multiple grounds, including: (i) That it provides an exemption from the 
otherwise applicable SIP emission limitations by providing that the 
excess emissions ``shall be allowed'' subject to certain conditions; 
(ii) that although the provision provides some ``substantive 
criteria,'' the provision does not meet the criteria the EPA recommends 
for an affirmative defense provision consistent with the requirements 
of the CAA in the EPA's 1999 SSM Guidance; and (iii) that the provision 
is not a permissible ``enforcement discretion'' provision applicable 
only to state personnel, because it ``is susceptible to interpretation 
as an enforcement exemption, precluding EPA and citizen enforcement as 
well as state enforcement.''
---------------------------------------------------------------------------

    \40\ Petition at 32.
---------------------------------------------------------------------------

b. The EPA's Prior Proposal
    In the February 2013 proposal notice, the EPA proposed to grant the 
Petition with respect to Ga. Comp. R. & Regs. 391-3-1-.02(2)(a)(7). The 
EPA explained that the provision at issue is deficient for several 
reasons, including the fact that it is not sufficient as an affirmative 
defense provision to meet CAA requirements. With respect to the 
deficiency of the provision as an affirmative defense, the EPA noted 
that Ga. Comp. R. & Regs. 391-3-1-.02(2)(a)(7) is not a permissible 
affirmative defense provision consistent with the requirements of the 
CAA as interpreted in the EPA's recommendations in the EPA's SSM 
Policy. By purporting to create a bar to enforcement that applies not 
only to monetary penalties but also to injunctive relief, the EPA 
reasoned that this provision is inconsistent with the requirements of 
CAA sections 113 and 304. The EPA also argued that by not including 
sufficient criteria to assure that sources seeking to raise the 
affirmative defense have in fact been properly designed, maintained and 
operated, and to assure that sources have taken all appropriate steps 
to minimize excess emissions, the provision also fails to be 
sufficiently narrowly drawn to justify shielding from monetary 
penalties for violations. Moreover, the EPA previously reasoned that 
Ga. Comp. R. & Regs. 391-3-1-.02(2)(a)(7) was deficient because it 
applies not only to malfunctions but also to startup and shutdown 
events, contrary to the EPA's interpretation of the CAA set forth in 
the February 2013 proposal notice. Thus, the EPA previously proposed to 
find that Ga. Comp. R. & Regs. 391-3-1-.02(2)(a)(7) is not appropriate 
as an affirmative defense provision because it is inconsistent with 
fundamental requirements of the CAA.
c. The EPA's Revised Proposal
    In this SNPR, the EPA is proposing to revise the basis for the 
finding of substantial inadequacy and the SIP call for Ga. Comp. R. & 
Regs. 391-3-1-.02(2)(a)(7). The EPA is proposing to revise its 
interpretation of the CAA with respect to affirmative defense 
provisions in SIPs. Previously the EPA assessed whether such provisions 
met certain requirements, such as being limited to monetary penalties 
rather than injunctive relief and containing sufficiently robust 
criteria to assure that the defense applied only in appropriately 
narrow circumstances. Now, the Agency must evaluate such provisions to 
determine whether they are constructed in a way that would purport to 
preclude federal court jurisdiction under section 113 to assess civil 
penalties or other forms of relief for violations of SIP emission 
limits, to prevent courts from considering the statutory factors for 
the assessment of civil penalties under section 113 or to interfere 
with the rights of litigants to pursue enforcement consistent with 
their rights under the citizen suit provision of section 304. The EPA 
interprets the provision of Ga. Comp. R. & Regs. 391-3-1-.02(2)(a)(7) 
to create an impermissible affirmative defense for violations of SIP 
emission limits. The provision operates to limit the jurisdiction of 
the federal court in an enforcement action and to preclude both 
liability and any form of judicial relief contemplated in CAA sections 
113 and 304. Thus, the EPA believes that this provision interferes with 
the intended enforcement structure of the CAA, through which parties 
may seek to bring enforcement actions for violations of SIP emission 
limits and courts may exercise their jurisdiction to determine what, if 
any, relief is appropriate.
    For these reasons, the EPA is proposing to find Ga. Comp. R. & 
Regs. 391-3-1-.02(2)(a)(7) substantially inadequate to meet CAA 
requirements and the EPA is thus proposing to issue a SIP call with 
respect to this provision.

[[Page 55939]]

The EPA notes that in this SNPR it is only addressing this provision 
with respect to its deficiency as an affirmative defense provision and 
is not revising its February 2013 proposal with respect to the other 
separate bases for the finding of substantial inadequacy of this 
provision.
2. Mississippi
a. Petitioner's Analysis
    The Petitioner objected to three provisions in the Mississippi SIP 
as being inconsistent with the CAA and the EPA's SSM Policy.\41\ Among 
the other alleged SIP deficiencies, the Petitioner objected to two 
generally applicable provisions in the Mississippi SIP that allow for 
affirmative defenses for violations of otherwise applicable SIP 
emission limitations during periods of upset, i.e., malfunctions (11-1-
2 Miss. Code R. Sec.  10.1) and unavoidable maintenance (11-1-2 Miss. 
Code R. Sec.  10.3).\42\ First, the Petitioner objected to both of 
these provisions based on its assertion that the CAA allows no 
affirmative defense provisions in SIPs. Second, the Petitioner asserted 
that even if affirmative defense provisions were permissible under the 
CAA, the affirmative defenses in these provisions ``fall far short of 
the EPA policy.'' Specifically, the Petitioner argued that the EPA's 
guidance for affirmative defenses recommends that they ``are not 
appropriate where a single source or a small group of sources has the 
potential to cause an exceedance of the NAAQS or PSD increments,'' \43\ 
and Mississippi's provisions do not contain a restriction to address 
this point. Further, the Petitioner argued that the affirmative 
defenses in Mississippi's SIP are not limited to actions seeking civil 
penalties and that they fail to meet other criteria ``that EPA requires 
for acceptable defense provisions.'' \44\ Finally, the Petitioner 
argued that the CAA and the EPA's SSM Policy interpreting it do not 
allow affirmative defenses for excess emissions during maintenance 
events under any circumstances.
---------------------------------------------------------------------------

    \41\ Petition at 29-30.
    \42\ Petition at 47-49.
    \43\ Petition at 48.
    \44\ Petition at 47-48.
---------------------------------------------------------------------------

b. The EPA's Prior Proposal
    In the February 2013 proposal notice, the EPA proposed to grant the 
Petition with respect to 11-1-2 Miss. Code R. Sec.  10.1 and 11-1-2 
Miss. Code R. Sec.  10.3 because they are deficient affirmative defense 
provisions. By purporting to create a bar to enforcement that applies 
not only to monetary penalties but also to injunctive relief, the EPA 
reasoned that these provisions are inconsistent with the requirements 
of CAA sections 113 and 304. The EPA also argued that by not including 
sufficient criteria to assure that sources seeking to raise these 
affirmative defenses have in fact been properly designed, maintained 
and operated, and to assure that sources have taken all appropriate 
steps to minimize excess emissions, the provision also fails to be 
sufficiently narrowly drawn to justify shielding from monetary 
penalties for violations during malfunctions. With respect to the 
comparable affirmative defense for maintenance in 11-1-2 Miss. Code R. 
Sec.  10.3, the EPA reiterated its long held position that no 
affirmative defense is appropriate for violations that occur during 
maintenance because maintenance is a normal mode of source operation 
during which the source should be expected to comply with the 
applicable emission limitations. Thus, the EPA previously proposed to 
find that 11-1-2 Miss. Code R. Sec.  10.1 and 11-1-2 Miss. Code R. 
Sec.  10.3 are not appropriate as affirmative defense provisions 
because they are inconsistent with fundamental requirements of the CAA.
c. The EPA's Revised Proposal
    In this SNPR, the EPA is proposing to revise the basis for the 
finding of substantial inadequacy and the SIP call for 11-1-2 Miss. 
Code R. Sec.  10.1 and 11-1-2 Miss. Code R. Sec.  10.3. The EPA is 
proposing to revise its interpretation of the CAA with respect to 
affirmative defense provisions in SIPs. Previously the EPA assessed 
whether the provision met certain requirements, such as being limited 
to monetary penalties rather than injunctive relief and containing 
sufficiently robust criteria to assure that the defense applied only in 
appropriately narrow circumstances. Now, the Agency must evaluate such 
provisions to determine whether they are constructed in a way that 
would purport to preclude federal court jurisdiction under section 113 
to assess civil penalties or other forms of relief for violations of 
SIP emission limits, to prevent courts from considering the statutory 
factors for the assessment of civil penalties under section 113 or to 
interfere with the rights of litigants to pursue enforcement consistent 
with their rights under the citizen suit provision of section 304. The 
EPA interprets the provisions of 11-1-2 Miss. Code R. Sec.  10.1 and 
11-1-2 Miss. Code R. Sec.  10.3 to create an impermissible affirmative 
defenses for violations of SIP emission limits. These provisions 
operate to limit the jurisdiction of the federal court in an 
enforcement action and to preclude both liability and any form of 
judicial relief contemplated in CAA sections 113 and 304. Thus, the EPA 
believes that these provisions interfere with the intended enforcement 
structure of the CAA, through which parties may seek to bring 
enforcement actions for violations of SIP emission limits and courts 
may exercise their jurisdiction to determine what, if any, relief is 
appropriate.
    For these reasons, the EPA is proposing to find 11-1-2 Miss. Code 
R. Sec.  10.1 and 11-1-2 Miss. Code R. Sec.  10.3 provisions 
substantially inadequate to meet CAA requirements and the EPA is thus 
proposing to issue a SIP call with respect to these provisions. The EPA 
notes that in this SNPR it is only addressing 11-1-2 Miss. Code R. 
Sec.  10.1 and 11-1-2 Miss. Code R. Sec.  10.3 with respect to the 
deficiency as affirmative defense provisions and is not revising its 
February 2013 proposal with respect to another SIP provision, 11-1-2 
Miss. Code R. Sec.  10.2, for which the EPA has proposed to make a 
finding of substantial inadequacy and to issue a SIP call on different 
grounds.
3. South Carolina
a. The EPA's Evaluation
    In addition to evaluating specific affirmative defense provisions 
identified by the Petitioner, the EPA is also evaluating other 
affirmative defense provisions that may be affected by the Agency's 
revision of its interpretation of CAA requirements for such provisions 
in SIPs. As part of its review, the EPA has identified one affirmative 
defense provision in the SIP for the state of South Carolina in S.C. 
Code Ann. Regs. 62.1, Section II(G)(6). This provision provides that 
permits for certain sources may contain an affirmative defense for 
excess emissions that occur during emergencies. The permits at issue 
embody federally enforceable emission limits that assure the sources 
will remain below the threshold for major stationary sources subject to 
the permitting requirements of title V of the CAA. By accepting these 
emission limits in permits as authorized by this provision of the 
state's SIP, these sources are treated as minor sources rather than 
major sources for regulatory purposes.
    In light of the court's decision in NRDC v. EPA, the EPA is 
proposing to revise its SSM Policy concerning the issue of affirmative 
defense provisions. In particular, the EPA is proposing to reverse its 
prior recommendations to states on this issue provided in the 1999 SSM 
Guidance. In that guidance, the

[[Page 55940]]

EPA had interpreted the CAA to permit states to elect to create 
narrowly drawn affirmative defense provisions in SIPs, both for 
malfunction events and for startup and shutdown events, so long as the 
provisions were consistent with the criteria recommended by the Agency. 
In the February 2013 proposal notice, the EPA had already proposed to 
revise this interpretation of the CAA to permit states to develop 
affirmative defense provisions only for malfunction events and not for 
startup and shutdown events. The decision of the court in NRDC v. EPA 
indicates that the EPA needs to revise the SSM Policy yet further.
    As discussed in sections IV and V of this SNPR, the EPA is 
proposing to revise its interpretation of the CAA with respect to 
affirmative defense provisions in SIPs. The affirmative defense in S.C. 
Code Ann. Regs. 62.1, Section II(G)(6) provides that if a source meets 
certain factual criteria, then the occurrence of an emergency is an 
``affirmative defense'' for any technology-based emission limitation 
violations that occur during the emergency. The affirmative defense is 
not limited to monetary penalties and appears to bar any form of relief 
if the source meets the criteria for the defense. The EPA notes that 
the affirmative defense for emergencies in S.C. Code Ann. Regs. 62.1, 
Section II(G)(6) was not consistent with the EPA's prior interpretation 
of the CAA and with its recommendations for such provisions in the 1999 
SSM Guidance. Regardless of that fact, the EPA believes that this 
provision impermissibly purports to alter or eliminate the jurisdiction 
of federal courts to assess penalties or to impose other forms of 
relief for violations of federally enforceable SIP or permit emission 
limits. Under this provision, if the source is able to establish that 
it met each of the specified criteria, then the provision purports to 
bar any relief for those violations. Accordingly, the EPA believes that 
this affirmative defense provision is inconsistent with the fundamental 
enforcement structure of the CAA and the EPA thus believes that the 
provision is not consistent with CAA requirements for SIP provisions.
b. The EPA's Proposal
    In this SNPR, the EPA is proposing to make a finding of substantial 
inadequacy and to issue a SIP call for the affirmative defense 
provisions applicable to excess emissions that occur during emergencies 
in S.C. Code Ann. Regs. 62.1, Section II(G)(6). The EPA is proposing to 
revise its interpretation of the CAA with respect to affirmative 
defense provisions in SIPs. Previously the EPA assessed whether such 
provisions met certain requirements, such as being limited to monetary 
penalties rather than injunctive relief and containing sufficiently 
robust criteria to assure that the defense applied only in 
appropriately narrow circumstances. Now, the Agency must evaluate such 
provisions to determine whether they are constructed in a way that 
would purport to preclude federal court jurisdiction under section 113 
to assess civil penalties or other forms of relief for violations of 
SIP emission limits, to prevent courts from considering the statutory 
factors for the assessment of civil penalties under section 113 or to 
interfere with the rights of litigants to pursue enforcement consistent 
with their rights under the citizen suit provision of section 304.
    The EPA interprets S.C. Code Ann. Regs. 62.1, Section II(G)(6) to 
provide an affirmative defense that operates to limit the jurisdiction 
of the federal court in an enforcement action and to limit the 
authority of the court to impose monetary penalties or to impose other 
forms of relief as contemplated in CAA sections 113 and 304. Thus, the 
EPA believes that this provision interferes with the intended 
enforcement structure of the CAA, through which parties may seek to 
bring enforcement actions for violations of SIP emission limits and 
courts may exercise their jurisdiction to determine what, if any, 
relief is appropriate.
    For these reasons, the EPA is proposing to find S.C. Code Ann. 
Regs. 62.1, Section II(G)(6) substantially inadequate to meet CAA 
requirements and the EPA is thus proposing to issue a SIP call with 
respect to this provision. The EPA notes that in this SNPR it is only 
addressing this provision with respect to its deficiency as an 
affirmative defense provision and is not revising its February 2013 
proposal with respect to the proposed action on the other provisions in 
the South Carolina SIP that are at issue in the Petition.

D. Affected States in EPA Region V

1. Illinois
a. Petitioner's Analysis
    The Petitioner objected to three generally applicable provisions in 
the Illinois SIP (Ill. Admin. Code tit. 35 Sec.  201.261, Ill. Admin. 
Code tit. 35 Sec.  201.262 and Ill. Admin. Code tit. 35 Sec.  201.265) 
which the Petitioner argued have the effect of providing discretionary 
exemptions from otherwise applicable SIP emission limitations.\45\ The 
Petitioner objected to these provisions on multiple grounds, including: 
(i) that the provisions invite sources to request, during the 
permitting process, advance permission to continue to operate during a 
malfunction or breakdown and to request advance permission to 
``violate'' otherwise applicable emission limitations during startup; 
(ii) that the provisions state that, once granted, the advance 
permission to violate the emission limitations ``shall be a prima facie 
defense to an enforcement action''; and (iii) that the term ` ``prima 
facie defense' is ambiguous in its operation.'' The Petitioner argued 
that the latter provision is not clear regarding whether the defense is 
to be evaluated ``in a judicial or administrative proceeding or whether 
the Agency determines its availability.'' Allowing defenses to be 
raised in these undefined contexts, the Petitioner argued, is 
``inconsistent with the enforcement structure of the Clean Air Act.'' 
The Petitioner asserted that ``if . . . the `prima facie defense' is 
anything short of the `affirmative defense,' '' as contemplated in the 
1999 SSM Guidance, then ``it clearly has the potential to interfere 
with EPA and citizen enforcement.''
---------------------------------------------------------------------------

    \45\ Petition at 33-36.
---------------------------------------------------------------------------

b. The EPA's Prior Proposal
    In the February 2013 proposal notice, the EPA proposed to grant the 
Petition with respect to Ill. Admin. Code tit. 35 Sec.  201.261, Ill. 
Admin. Code tit. 35 Sec.  201.262 and Ill. Admin. Code tit. 35 Sec.  
201.265. The EPA proposed to grant the Petition for these provisions 
even though the state has asserted that the effect of these provisions 
together only provides sources with a prima facie defense in an 
enforcement proceeding. Even if interpreted to provide an affirmative 
defense rather than an automatic or discretionary exemption, however, 
the EPA previously noted that the provisions do not provide a 
permissible affirmative defense provision consistent with the 
requirements of the CAA as interpreted in the EPA's recommendations in 
the EPA's SSM Policy.
    In the February 2013 proposal notice, the EPA enumerated various 
ways in which the provisions were not consistent with the EPA's 
recommendations in the EPA's SSM Policy interpreting the CAA: (i) It is 
not clear that the defense applies only to monetary penalties, which is 
inconsistent with the requirements of CAA sections 113 and 304; (ii) 
the defense applies to violations that occurred during startup periods, 
which

[[Page 55941]]

is inconsistent with CAA sections 113 and 304; (iii) the provisions 
shift the burden of proof to the enforcing party; and (iv) the 
provisions do not include sufficient criteria to assure that sources 
seeking to raise the affirmative defense have in fact been properly 
designed, maintained and operated, and to assure that sources have 
taken all appropriate steps to minimize excess emissions. Accordingly, 
even if Ill. Admin. Code tit. 35 Sec.  201.261, Ill. Admin. Code tit. 
35 Sec.  201.262 and Ill. Admin. Code tit. 35 Sec.  201.265 are 
together interpreted to provide a prima facie defense to enforcement 
rather than to provide exemptions, the EPA already proposed to find 
that these provisions are substantially inadequate to meet CAA 
requirements and thus proposed to issue a SIP call with respect to 
these provisions.
c. The EPA's Revised Proposal
    In this SNPR, the EPA is proposing to revise the basis for the 
finding of substantial inadequacy and the SIP call for Ill. Admin. Code 
tit. 35 Sec.  201.261, Ill. Admin. Code tit. 35 Sec.  201.262 and Ill. 
Admin. Code tit. 35 Sec.  201.265. The EPA is proposing to revise its 
interpretation of the CAA with respect to affirmative defense 
provisions in SIPs. Previously the EPA assessed whether such provisions 
met certain requirements, such as being limited to monetary penalties 
rather than injunctive relief and containing sufficiently robust 
criteria to assure that the defense applied only in appropriately 
narrow circumstances. Now, the Agency must evaluate such provisions to 
determine whether they are constructed in a way that would purport to 
preclude federal court jurisdiction under section 113 to assess civil 
penalties or other forms of relief for violations of SIP emission 
limits, to prevent courts from considering the statutory factors for 
the assessment of civil penalties under section 113 or to interfere 
with the rights of litigants to pursue enforcement consistent with 
their rights under the citizen suit provision of section 304. To the 
extent that Ill. Admin. Code tit. 35 Sec.  201.261, Ill. Admin. Code 
tit. 35 Sec.  201.262 and Ill. Admin. Code tit. 35 Sec.  201.265 
together do provide only a defense as characterized by the state rather 
than an exemption, the EPA believes that they create an impermissible 
affirmative defense for violations of SIP emission limits. These 
provisions would operate together to limit the jurisdiction of the 
federal court in an enforcement action and to preclude both liability 
and any form of judicial relief contemplated in CAA sections 113 and 
304. Thus, the EPA believes that these provisions interfere with the 
intended enforcement structure of the CAA, through which parties may 
seek to bring enforcement actions for violations of SIP emission limits 
and courts may exercise their jurisdiction to determine what, if any, 
relief is appropriate.
    For these reasons, the EPA is proposing to find Ill. Admin. Code 
tit. 35 Sec.  201.261, Ill. Admin. Code tit. 35 Sec.  201.262 and Ill. 
Admin. Code tit. 35 Sec.  201.265 substantially inadequate to meet CAA 
requirements and the EPA is thus proposing to issue a SIP call with 
respect to these provisions. The EPA notes that in this SNPR it is only 
addressing these provisions with respect to their deficiency as an 
affirmative defense and is not revising its February 2013 proposal 
notice with respect to the other separate bases for the finding of 
substantial inadequacy for these provisions.
2. Indiana
a. Petitioner's Analysis
    The Petitioner objected to a generally applicable provision in the 
Indiana SIP that allows for discretionary exemptions during 
malfunctions (326 Ind. Admin. Code 1-6-4(a)).\46\ The Petitioner 
objected to this provision on multiple grounds, including: (i) That it 
provides an exemption from the otherwise applicable SIP emission 
limitations; (ii) that it is ambiguous because it provides that excess 
emissions during malfunction periods ``shall not be considered a 
violation'' if the source demonstrates that a number of conditions are 
met, but it does not specify to whom or in what forum such 
demonstration must be made; (iii) that if the foregoing demonstration 
need only be made to the satisfaction of the state, then this would 
give a state official the sole authority to determine that the excess 
emissions were not a violation and could thus be read to preclude 
enforcement by the EPA or citizens; and (iv) that if the demonstration 
is to be made in an enforcement context, then the provision could be 
interpreted as providing an affirmative defense, but one that is 
inconsistent with the requirements of the CAA as interpreted in the 
EPA's SSM Policy.
---------------------------------------------------------------------------

    \46\ Petition at 36-37.
---------------------------------------------------------------------------

b. The EPA's Prior Proposal
    In the February 2013 proposal notice, the EPA proposed to grant the 
Petition with respect to 326 Ind. Admin. Code 1-6-4(a). The EPA noted 
at that time that even if it were to interpret 326 Ind. Admin. Code 1-
6-4(a) to be an affirmative defense applicable in an enforcement 
context, then the provision is not consistent with the EPA's 
recommendations for such affirmative defenses in the EPA's SSM Policy 
interpreting the CAA. By purporting to create a bar to enforcement that 
applies not just to monetary penalties but also to injunctive relief, 
and by including criteria inconsistent with those recommended by the 
EPA for affirmative defense provisions, this provision is inconsistent 
with the requirements of CAA sections 113 and 304. For these reasons, 
the EPA previously proposed to find that 326 Ind. Admin. Code 1-6-4(a) 
is substantially inadequate to meet CAA requirements and proposed to 
issue a SIP call with respect to this provision.
c. The EPA's Revised Proposal
    In this SNPR, the EPA is proposing to revise the basis for the 
finding of substantial inadequacy and the SIP call for 326 Ind. Admin. 
Code 1-6-4(a). The EPA is proposing to revise its interpretation of the 
CAA with respect to affirmative defense provisions in SIPs. Previously 
the EPA assessed whether such provisions met certain requirements, such 
as being limited to monetary penalties rather than injunctive relief 
and containing sufficiently robust criteria to assure that the defense 
applied only in appropriately narrow circumstances. Now, the Agency 
must evaluate such provisions to determine whether they are constructed 
in a way that would purport to preclude federal court jurisdiction 
under section 113 to assess civil penalties or other forms of relief 
for violations of SIP emission limits, to prevent courts from 
considering the statutory factors for the assessment of civil penalties 
under section 113 or to interfere with the rights of litigants to 
pursue enforcement consistent with their rights under the citizen suit 
provision of section 304.
    To the extent that 326 Ind. Admin. Code 1-6-4(a) provides only a 
defense rather than an exemption, the EPA believes that it creates an 
impermissible affirmative defense for violations of SIP emission 
limits. The provision would operate to limit the jurisdiction of the 
federal court in an enforcement action and to preclude both liability 
and any form of judicial relief contemplated in CAA sections 113 and 
304. Thus, the EPA believes that this provision interferes with the 
intended enforcement structure of the CAA, through which parties may 
seek to bring enforcement actions for violations of SIP emission limits 
and courts may exercise

[[Page 55942]]

their jurisdiction to determine what, if any, relief is appropriate.
    For these reasons, the EPA is proposing to find 326 Ind. Admin. 
Code 1-6-4(a) substantially inadequate to meet CAA requirements and the 
EPA is thus proposing to issue a SIP call with respect to this 
provision. The EPA notes that in this SNPR it is only addressing this 
provision with respect to its deficiency as an affirmative defense and 
is not revising its February 2013 proposal notice with respect to the 
other separate bases for the finding of substantial inadequacy for the 
provision.
3. Michigan
a. Petitioner's Analysis
    The Petitioner objected to a generally applicable provision in 
Michigan's SIP that provides for an affirmative defense to monetary 
penalties for violations of otherwise applicable SIP emission 
limitations during periods of startup and shutdown (Mich. Admin. Code 
r. 336.1916).\47\ The Petitioner objected to this provision on multiple 
grounds, including: (i) That one of the criteria in the affirmative 
defense provision, Mich. Admin. Code r. 336.1916, makes the defense 
available to a single source or small group of sources as long as such 
source did not ``cause[] an exceedance of the national ambient air 
quality standards or any applicable prevention of significant 
deterioration increment'' thereby applying to sources with the 
``potential'' to cause violations of the NAAQS contrary to the 
recommendations of EPA's 1999 SSM Guidance; and (ii) that the 
affirmative defense provision is available for violations of ``an 
applicable emission limitation,'' which Petitioner argued could be 
construed by a court to include ``limits derived from federally 
promulgated technology based standards, such as NSPSs and NESHAPs,'' 
contrary to EPA's interpretation of the CAA in the 1999 SSM Guidance to 
preclude SIP-based affirmative defenses for violations of these federal 
technology-based standards.
---------------------------------------------------------------------------

    \47\ Petition at 44-46.
---------------------------------------------------------------------------

b. The EPA's Prior Proposal
    In the February 2013 proposal notice, the EPA proposed to grant the 
Petition with respect to Mich. Admin. Code r. 336.1916, which provides 
for an affirmative defense to violations of applicable emission 
limitations during startup and shutdown events. The EPA noted at that 
time that an affirmative defense for excess emissions that occur during 
planned events such as startup and shutdown was contrary to the EPA's 
then current interpretation of the CAA to allow such affirmative 
defenses only for events beyond the control of the source, i.e., during 
malfunctions. In the February 2013 proposal notice, the EPA proposed to 
revise its SSM Policy to reflect this interpretation of the CAA, and to 
update the recommendations it previously made concerning affirmative 
defense provisions applicable to startup and shutdown events in the 
1999 SSM Guidance. For this reason, the EPA previously proposed to find 
that Mich. Admin. Code r. 336.1916 is substantially inadequate to meet 
CAA requirements and proposed to issue a SIP call with respect to this 
provision.
c. The EPA's Revised Proposal
    In this SNPR, the EPA is proposing to revise the basis for the 
finding of substantial inadequacy and the SIP call for Mich. Admin. 
Code r. 336.1916. The EPA is proposing to revise its interpretation of 
the CAA with respect to affirmative defense provisions in SIPs. 
Previously the EPA assessed whether such provisions met certain 
requirements, such as being limited to monetary penalties rather than 
injunctive relief and containing sufficiently robust criteria to assure 
that the defense applied only in appropriately narrow circumstances. 
Now, the Agency must evaluate such provisions to determine whether they 
are constructed in a way that would purport to preclude federal court 
jurisdiction under section 113 to assess civil penalties or other forms 
of relief for violations of SIP emission limits, to prevent courts from 
considering the statutory factors for the assessment of civil penalties 
under section 113 or to interfere with the rights of litigants to 
pursue enforcement consistent with their rights under the citizen suit 
provision of section 304.
    The EPA interprets Mich. Admin. Code r. 336.1916 to provide an 
affirmative defense that operates to limit the jurisdiction of the 
federal court in an enforcement action and to preclude both liability 
and any form of judicial relief contemplated in CAA sections 113 and 
304. The fact that this affirmative defense applies during planned and 
predictable events exacerbates this problem, but even if the provision 
were applicable only to genuine malfunction events it is not a 
permissible SIP provision. Thus, the EPA believes that this provision 
interferes with the intended enforcement structure of the CAA, through 
which parties may seek to bring enforcement actions for violations of 
SIP emission limits and courts may exercise their jurisdiction to 
determine what, if any, relief is appropriate.
    For these reasons, the EPA is proposing to find Mich. Admin. Code 
r. 336.1916 substantially inadequate to meet CAA requirements and the 
EPA is thus proposing to issue a SIP call with respect to this 
provision.

E. Affected States and Local Jurisdictions in EPA Region VI

1. Arkansas
a. Petitioner's Analysis
    The Petitioner objected to two provisions in the Arkansas SIP as 
inconsistent with the CAA and the EPA's SSM Policy.\48\ One of these 
provisions, Reg. 19.602, provides an ``affirmative defense'' applicable 
to violations by sources in certain circumstances. The Petitioner 
objected to Reg. 19.602 because it provides a ``complete affirmative 
defense'' for excess emissions that occur during emergency conditions. 
The Petitioner argued that this provision, which the state may have 
modeled after the EPA's title V regulations, is impermissible because 
its application is not clearly limited to operating permits.
---------------------------------------------------------------------------

    \48\ Petition at 24. The Petitioner cites to 014-01-1 Ark. Code 
R. Sec. Sec.  19.1004(H) and 19.602. The EPA interprets these 
citations as references to Reg. 19.1004(H) and Reg. 19.602 of the 
Arkansas Pollution Control & Ecology Commission (APC&EC), Regulation 
No. 19--Regulations of the Arkansas Plan of Implementation for Air 
Pollution Control, as approved by the EPA on Apr. 12, 2007 (72 FR 
18394). For ease of description, we refer herein to Reg. 19.602.
---------------------------------------------------------------------------

b. The EPA's Prior Proposal
    In the February 2013 proposal notice, the EPA proposed to grant the 
Petition with respect to Reg. 19.602. The EPA explained its view that 
Reg. 19.602 is an impermissible affirmative defense provision because 
it does not explicitly limit the defense to monetary penalties, it 
establishes criteria that are inconsistent with those recommended in 
the EPA's SSM Policy, and it can be read to create different or 
additional defenses from those that are provided in underlying federal 
technology-based emission limitations. As a consequence, the EPA 
reasoned that Reg. 19.602 is inconsistent with the requirements for SIP 
provisions in CAA sections 110(a)(2)(A), 110(a)(2)(C) and 302(k). For 
these reasons, the EPA previously proposed to find that Reg. 19.602 is 
substantially inadequate to meet CAA requirements and proposed to issue 
a SIP call with respect to this provision.
c. The EPA's Revised Proposal
    In this SNPR, the EPA is proposing to revise the basis for the 
finding of

[[Page 55943]]

substantial inadequacy and the SIP call for Reg. 19.602. The EPA is 
proposing to revise its interpretation of the CAA with respect to 
affirmative defense provisions in SIPs. Previously the EPA assessed 
whether such provisions met certain requirements, such as being limited 
to monetary penalties rather than injunctive relief and containing 
sufficiently robust criteria to assure that the defense applied only in 
appropriately narrow circumstances. Now, the Agency must evaluate such 
provisions to determine whether they are constructed in a way that 
would purport to preclude federal court jurisdiction under section 113 
to assess civil penalties or other forms of relief for violations of 
SIP emission limits, to prevent courts from considering the statutory 
factors for the assessment of civil penalties under section 113 or to 
interfere with the rights of litigants to pursue enforcement consistent 
with their rights under the citizen suit provision of section 304.
    The EPA interprets Reg. 19.602 to provide an affirmative defense 
that operates to limit the jurisdiction of the federal court in an 
enforcement action and to preclude both liability and any form of 
judicial relief contemplated in CAA sections 113 and 304. Thus, the EPA 
believes that this provision interferes with the intended enforcement 
structure of the CAA, through which parties may seek to bring 
enforcement actions for violations of SIP emission limits and courts 
may exercise their jurisdiction to determine what, if any, relief is 
appropriate.
    For these reasons, the EPA is proposing to find Reg. 19.602 
substantially inadequate to meet CAA requirements and the EPA is thus 
proposing to issue a SIP call with respect to this provision. The EPA 
notes that in this SNPR it is only addressing this provision with 
respect to its deficiency as an affirmative defense provision and is 
not revising its February 2013 proposal with respect to the proposed 
action on the other provision in the Arkansas SIP that is at issue in 
the Petition.
2. New Mexico
a. Petitioner's Analysis
    The Petitioner objected to three provisions in the New Mexico SIP 
that provide affirmative defenses for excess emissions that occur 
during malfunctions (20.2.7.111 NMAC), during startup and shutdown 
(20.2.7.112 NMAC), and during emergencies (20.2.7.113 NMAC).\49\ The 
Petitioner objected to the inclusion of these provisions in the SIP 
based on its view that affirmative defense provisions are always 
inconsistent with CAA requirements. The Petitioner also argued that 
each of these affirmative defenses is generally available to all 
sources, which is in contravention of the EPA's recommendation in the 
SSM Policy that affirmative defenses should not be available to ``a 
single source or groups of sources that has the potential to cause an 
exceedance of the NAAQS.'' Finally, the Petitioner argued that the 
affirmative defense provision applicable to emergency events is 
impermissible because it was modeled after the EPA's title V 
regulations, which are not meant to apply to SIP provisions.
---------------------------------------------------------------------------

    \49\ Petition at 54-57. The EPA interprets the Petitioner's 
reference to N.M. Code R. Sec.  20.2.7.111, N.M. Code R. Sec.  
20.2.7.112 and N.M. Code R. Sec.  20.2.7.113 as citations to 
20.2.7.111 NMAC, 20.2.7.112 NMAC and 20.2.7.113 NMAC, as approved by 
the EPA on Sept. 14, 2009 (74 FR 46910) (hereinafter referred to as 
20.2.7.111 NMAC, 20.2.7.112 NMAC and 20.2.7.113 NMAC).
---------------------------------------------------------------------------

b. The EPA's Prior Proposal
    In the February 2013 proposal notice, the EPA proposed to grant the 
Petition with respect to 20.2.7.112 NMAC, which includes an affirmative 
defense applicable during startup and shutdown events that is contrary 
to the EPA's interpretation of the CAA. The EPA noted at that time that 
an affirmative defense for excess emissions that occur during planned 
events such as startup and shutdown was contrary to the EPA's current 
interpretation of the CAA to allow such affirmative defenses only for 
events beyond the control of the source, i.e., during malfunctions. In 
the February 2013 proposal notice, the EPA proposed to revise its SSM 
Policy to reflect this interpretation of the CAA, and to update the 
recommendations it previously made concerning affirmative defense 
provisions applicable to startup and shutdown events in the 1999 SSM 
Guidance. The EPA also proposed to grant the Petition with respect to 
20.2.7.111 NMAC, which includes an affirmative defense applicable 
during malfunction events. The EPA previously reasoned that this 
provision is inconsistent with the CAA because it neither limits the 
defense to only those sources that do not have the potential to cause 
exceedances of the NAAQS or PSD increments nor requires sources to make 
an ``after the fact'' showing that no such exceedances actually 
occurred as an element of the affirmative defense. Finally, the EPA 
proposed to grant the Petition with respect to 20.2.7.113 NMAC. The EPA 
previously stated its belief that this provision is an impermissible 
affirmative defense because it does not explicitly limit the defense to 
monetary penalties, it establishes criteria that are inconsistent with 
those in the EPA's SSM Policy, and it can be read to create different 
or additional defenses from those that are provided in underlying 
federal technology-based emission limitations. Thus, the EPA previously 
proposed to find that all three of these provisions are inconsistent 
with CAA sections 110(a)(2)(A), 110(a)(2)(C) and 302(k), and with 
respect to CAA sections 113 and 304.
c. The EPA's Revised Proposal
    In this SNPR, the EPA is proposing to revise the basis for the 
finding of substantial inadequacy and the SIP call for the affirmative 
defense provisions applicable to excess emissions that occur during 
malfunctions (20.2.7.111 NMAC), during startup and shutdown (20.2.7.112 
NMAC), and during emergencies 20.2.7.113 NMAC). The EPA is proposing to 
revise its interpretation of the CAA with respect to affirmative 
defense provisions in SIPs. Previously the EPA assessed whether such 
provisions met certain requirements, such as being limited to monetary 
penalties rather than injunctive relief and containing sufficiently 
robust criteria to assure that the defense applied only in 
appropriately narrow circumstances. Now, the Agency must evaluate such 
provisions to determine whether they are constructed in a way that 
would purport to preclude federal court jurisdiction under section 113 
to assess civil penalties or other forms of relief for violations of 
SIP emission limits, to prevent courts from considering the statutory 
factors for the assessment of civil penalties under section 113 or to 
interfere with the rights of litigants to pursue enforcement consistent 
with their rights under the citizen suit provision of section 304.
    The EPA interprets 20.2.7.111 NMAC and 20.2.7.112 NMAC to provide 
affirmative defenses that operate to limit the jurisdiction of the 
federal court in an enforcement action and to limit the authority of 
the court to impose monetary penalties as contemplated in CAA sections 
113 and 304. As to 20.2.7.113 NMAC, the EPA interprets this provision 
to operate to limit the jurisdiction of the federal court in an 
enforcement action and to limit the authority of the court to impose 
any form of relief contemplated in CAA sections 113 and 304. Thus, the 
EPA believes that each of these provisions interferes with the intended 
enforcement structure of the CAA, through which parties may seek to 
bring enforcement actions for violations of SIP

[[Page 55944]]

emission limits and courts may exercise their jurisdiction to determine 
what, if any, relief is appropriate.
    For these reasons, the EPA is proposing to find 20.2.7.111 NMAC, 
20.2.7.112 NMAC and 20.2.7.113 NMAC substantially inadequate to meet 
CAA requirements and the EPA is thus proposing to issue a SIP call with 
respect to these provisions.
3. New Mexico: Albuquerque-Bernalillo County
a. The EPA's Evaluation
    In addition to evaluating specific affirmative defense provisions 
identified by the Petitioner, the EPA is also evaluating other 
affirmative defense provisions that may be affected by the Agency's 
revision of its interpretation of CAA requirements for such provisions 
in SIPs. As part of its review, the EPA has identified three 
affirmative defense provisions in the SIP for the state of New Mexico 
that apply in the Albuquerque-Bernalillo County area. These provisions 
provide affirmative defenses available to sources for excess emissions 
that occur during malfunctions (20.11.49.16.A NMAC), during startup and 
shutdown (20.11.49.16.B NMAC) and during emergencies (20.11.49.16.C 
NMAC). The EPA acknowledges that it explicitly approved these 
affirmative defense provisions in 2010, after ascertaining that they 
were consistent with the Agency's interpretation of the CAA and its 
recommendations for such provisions in the 1999 SSM Guidance, 
applicable at that point in time.\50\
---------------------------------------------------------------------------

    \50\ See, ``Approval and Promulgation of Implementation Plans; 
Albuquerque-Bernalillo County, NM; Excess Emissions,'' 75 FR 5698 
(Feb. 4, 2010).
---------------------------------------------------------------------------

    In light of the court's decision in NRDC v. EPA, the EPA is 
proposing to revise its SSM Policy concerning the issue of affirmative 
defense provisions. In particular, the EPA is proposing to reverse its 
prior recommendations to states on this issue provided in the 1999 SSM 
Guidance. In that guidance, the EPA had interpreted the CAA to permit 
states to elect to create narrowly drawn affirmative defense provisions 
in SIPs, both for malfunction events and for startup and shutdown 
events, so long as the provisions were consistent with the criteria 
recommended by the Agency. In the February 2013 proposal notice, the 
EPA had already proposed to revise this interpretation of the CAA to 
permit states to develop affirmative defense provisions only for 
malfunction events and not for startup and shutdown events. The 
decision of the court in NRDC v. EPA indicates that the EPA needs to 
revise the SSM Policy yet further.
    As discussed in sections IV and V of this SNPR, the EPA is 
proposing to revise its interpretation of the CAA with respect to 
affirmative defense provisions in SIPs. Although the EPA previously 
determined that 20.11.49.16.A NMAC, 20.11.49.16.B NMAC and 
20.11.49.16.C NMAC were consistent with CAA requirements, the Agency 
now believes that these provisions impermissibly purport to alter or 
eliminate the jurisdiction of federal courts to assess penalties for 
violations of SIP emission limits. In the case of the affirmative 
defenses applicable to malfunctions and to startup and shutdown, the 
provisions set forth the elements of an affirmative defense to be 
asserted by sources in the event of violations during such events. In 
the case of the affirmative defense applicable to emergencies, the 
provision sets forth the elements of an affirmative defense to be 
asserted in the event of violations during emergencies. For each of 
these affirmative defense provisions, if the source is able to 
establish that it met each of the specified criteria to a trier of fact 
in an enforcement proceeding, then the provision purports to bar any 
civil penalties for those violations (and in the case of the 
affirmative defense for emergencies could be construed to bar other 
forms of relief as well). Accordingly, the EPA believes that each of 
these affirmative defense provisions is inconsistent with the 
fundamental enforcement structure of the CAA and the EPA thus believes 
that these provisions are not consistent with CAA requirements for SIP 
provisions.
b. The EPA's Proposal
    In this SNPR, the EPA is proposing to make a finding of substantial 
inadequacy and to issue a SIP call for the affirmative defense 
provisions applicable to excess emissions that occur during 
malfunctions (20.11.49.16.A NMAC), during startup and shutdown 
(20.11.49.16.B NMAC) and during emergencies (20.11.49.16.C NMAC). The 
EPA is proposing to revise its interpretation of the CAA with respect 
to affirmative defense provisions in SIPs. Previously the EPA assessed 
whether such provisions met certain requirements, such as being limited 
to monetary penalties rather than injunctive relief and containing 
sufficiently robust criteria to assure that the defense applied only in 
appropriately narrow circumstances. Now, the Agency must evaluate such 
provisions to determine whether they are constructed in a way that 
would purport to preclude federal court jurisdiction under section 113 
to assess civil penalties or other forms of relief for violations of 
SIP emission limits, to prevent courts from considering the statutory 
factors for the assessment of civil penalties under section 113 or to 
interfere with the rights of litigants to pursue enforcement consistent 
with their rights under the citizen suit provision of section 304.
    The EPA interprets 20.11.49.16.A NMAC and 20.11.49.16.B NMAC to 
provide affirmative defenses that operate to limit the jurisdiction of 
the federal court in an enforcement action and to limit the authority 
of the court to impose monetary penalties as contemplated in CAA 
sections 113 and 304. As to 20.11.49.16.C NMAC, the EPA interprets this 
provision to operate to limit the jurisdiction of the federal court in 
an enforcement action and to limit the authority of the court to impose 
any form of relief contemplated in CAA sections 113 and 304. Thus, the 
EPA believes that each of these provisions interferes with the intended 
enforcement structure of the CAA, through which parties may seek to 
bring enforcement actions for violations of SIP emission limits and 
courts may exercise their jurisdiction to determine what, if any, 
relief is appropriate.
    For these reasons, the EPA is proposing to find 20.11.49.16.A NMAC, 
20.11.49.16.B NMAC and 20.11.49.16.C NMAC substantially inadequate to 
meet CAA requirements and the EPA is thus proposing to issue a SIP call 
with respect to these provisions. The EPA notes that removal of 
20.11.49.16.A NMAC, 20.11.49.16.B NMAC and 20.11.49.16.C NMAC from the 
SIP will render 20.11.49.16.D NMAC, 20.11.49.16.E, 20.11.49.15.B (15) 
(concerning reporting by a source of intent to assert an affirmative 
defense for a violation), a portion of 20.11.49.6 NMAC (concerning the 
objective of establishing affirmative defense provisions) and 
20.11.49.18 NMAC (concerning actions where a determination has been 
made under 20.11.49.16.E NMAC) superfluous and no longer operative, and 
the EPA thus recommends that these provisions be removed as well.
4. Texas
a. The EPA's Evaluation
    In addition to evaluating specific affirmative defense provisions 
identified by the Petitioner, the EPA is also evaluating other 
affirmative defense provisions that may be affected by the Agency's 
revision of its interpretation of CAA requirements for such provisions 
in SIPs. As part of its review, the EPA

[[Page 55945]]

has identified four affirmative defense provisions in the SIP for the 
state of Texas. These provisions provide affirmative defenses available 
to sources for excess emissions that occur during upsets (30 TAC 
101.222(b)), unplanned events (30 TAC 101.222(c)), upsets with respect 
to opacity limits (30 TAC 101.222(d)) and unplanned events with respect 
to opacity limits (30 TAC 101.222(e)).\51\ The EPA acknowledges that it 
explicitly approved these affirmative defense provisions in 2010, after 
ascertaining that they were consistent with the Agency's interpretation 
of the CAA and its recommendations for such provisions in the 1999 SSM 
Guidance, applicable at that point in time. Moreover, the EPA defended 
its approval of these specific provisions (as well as its disapproval 
of related provisions relevant to affirmative defenses for planned 
events) in litigation in the U.S. Court of Appeals for the 5th Circuit.
---------------------------------------------------------------------------

    \51\ The EPA notes that ``upsets'' and ``unplanned events'' in 
these provisions are what are more commonly referred to as 
malfunctions, as confirmed by the state at the time the EPA approved 
these provisions as part of the SIP. See, ``Approval and 
Promulgation of Implementation Plans; Texas; Excess Emissions During 
Startup, Shutdown, Maintenance, and Malfunction,'' 75 FR 68989 (Nov. 
10, 2010).
---------------------------------------------------------------------------

    In light of the court's decision in NRDC v. EPA, the EPA is 
proposing to revise its SSM Policy concerning the issue of affirmative 
defense provisions. In particular, the EPA is proposing to reverse its 
prior recommendations to states on this issue provided in the 1999 SSM 
Guidance. In that guidance, the EPA had interpreted the CAA to permit 
states to elect to create narrowly drawn affirmative defense provisions 
in SIPs, both for malfunction events and for startup and shutdown 
events, so long as the provisions were consistent with the criteria 
recommended by the Agency. In the February 2013 proposal notice, the 
EPA had already proposed to revise this interpretation of the CAA to 
permit states to develop affirmative defense provisions only for 
malfunction events and not for startup and shutdown events. The 
decision of the court in NRDC v. EPA indicates that the EPA needs to 
revise the SSM Policy yet further.
    As discussed in sections IV and V of this SNPR, the EPA is 
proposing to revise its interpretation of the CAA with respect to 
affirmative defense provisions in SIPs. Although the EPA previously 
determined that 30 TAC 101.222(b), 30 TAC 101.222(c), 30 TAC 101.222(d) 
and 30 TAC 101.222(e) were consistent with CAA requirements, the Agency 
now believes that these provisions impermissibly purport to alter or 
eliminate the jurisdiction of federal courts to assess penalties for 
violations of SIP emission limits. For all of these affirmative 
defenses applicable to upsets and unplanned events, the provisions set 
forth the elements of an affirmative defense to be asserted by sources 
in the event of violations during such events. For each of these 
affirmative defense provisions, if the source is able to establish that 
it met each of the specified criteria to a trier of fact in an 
enforcement proceeding, then the provision purports to bar any civil 
penalties for those violations. Accordingly, the EPA believes that each 
of these affirmative defense provisions is inconsistent with the 
fundamental enforcement structure of the CAA and the EPA thus believes 
that these provisions are not consistent with CAA requirements for SIP 
provisions.
b. The EPA's Proposal
    In this SNPR, the EPA is proposing to make a finding of substantial 
inadequacy and to issue a SIP call for the affirmative defense 
provisions applicable to excess emissions that occur during upsets (30 
TAC 101.222(b)), unplanned events (30 TAC 101.222(c)), upsets with 
respect to opacity limits (30 TAC 101.222(d)), and unplanned events 
with respect to opacity limits (30 TAC 101.222(e)). The EPA is 
proposing to revise its interpretation of the CAA with respect to 
affirmative defense provisions in SIPs. Previously the EPA assessed 
whether such provisions met certain requirements, such as being limited 
to monetary penalties rather than injunctive relief and containing 
sufficiently robust criteria to assure that the defense applied only in 
appropriately narrow circumstances. Now, the Agency must evaluate such 
provisions to determine whether they are constructed in a way that 
would purport to preclude federal court jurisdiction under section 113 
to assess civil penalties or other forms of relief for violations of 
SIP emission limits, to prevent courts from considering the statutory 
factors for the assessment of civil penalties under section 113 or to 
interfere with the rights of litigants to pursue enforcement consistent 
with their rights under the citizen suit provision of section 304.
    The EPA interprets 30 TAC 101.222(b), 30 TAC 101.222(c), 30 TAC 
101.222(d), and 30 TAC 101.222(e) to provide affirmative defenses that 
operate to limit the jurisdiction of the federal court in an 
enforcement action and to limit the authority of the court to impose 
monetary penalties as contemplated in CAA sections 113 and 304. Thus, 
the EPA believes that each of these provisions interferes with the 
intended enforcement structure of the CAA, through which parties may 
seek to bring enforcement actions for violations of SIP emission limits 
and courts may exercise their jurisdiction to determine what, if any, 
relief is appropriate. The EPA appreciates the efforts previously 
undertaken by the state to amend its SIP to make it consistent with the 
CAA, as interpreted in the Agency's 1999 SSM Guidance, but the EPA must 
now revise its SSM Policy with respect to affirmative defense 
provisions in SIPs.
    For these reasons, the EPA is proposing to find 30 TAC 101.222(b), 
30 TAC 101.222(c), 30 TAC 101.222(d) and 30 TAC 101.222(e) 
substantially inadequate to meet CAA requirements and the EPA is thus 
proposing to issue a SIP call with respect to these provisions. The EPA 
notes that removal of these four provisions from the SIP will render 
cross-references to these provisions in 30 TAC 101.221(e) (as it 
applies to 30 TAC 101.222(b)-(e)), 30 TAC 101.222(f) and 30 TAC 
101.222(g) superfluous and no longer operative, and the EPA thus 
recommends that these provisions be removed as well.

F. Affected State in EPA Region VIII: Colorado

1. Petitioner's Analysis
    The Petitioner objected to two affirmative defense provisions in 
the Colorado SIP that provide for affirmative defenses to qualifying 
sources during malfunctions (5 Colo. Code Regs Sec.  1001-2(II.E)) and 
during periods of startup and shutdown (5 Colo. Code Regs Sec.  1001-
2(II.J)).\52\ The Petitioner acknowledged that this state has correctly 
revised its SIP in important ways in order to be consistent with CAA 
requirements, as interpreted in the EPA's SSM Policy, including 
providing affirmative defense provisions that are limited to monetary 
penalties, that do not apply in actions to enforce federal standards 
such as NSPS or NESHAP approved into the SIP, and that meet ``almost 
word for word'' the recommendations of the 1999 SSM Guidance. 
Nevertheless, the Petitioner had two concerns with these SIP 
provisions.
---------------------------------------------------------------------------

    \52\ Petition at 25-27.
---------------------------------------------------------------------------

    First, the Petitioner objected to both of these provisions based on 
its assertion that the CAA allows no affirmative defense provisions in 
SIPs. Second, the Petitioner asserted that even if affirmative defense 
provisions were permissible under the CAA, the state

[[Page 55946]]

had properly followed EPA guidance in the affirmative defense provision 
applicable to startup and shutdown events but failed to do so in the 
affirmative defense provision applicable to malfunctions. Specifically, 
the Petitioner argued that the EPA's own guidance for affirmative 
defenses recommended that they ``are not appropriate where a single 
source or a small group of sources has the potential to cause an 
exceedance of the NAAQS or PSD increments.'' \53\ Instead, the state's 
affirmative defense for malfunction events is potentially available to 
any source, if it can establish that the excess emissions during the 
event did not result in exceedances of ambient air quality standards 
that could be attributed to the source.\54\ The Petitioner objected to 
this as not merely inconsistent with the EPA's 1999 SSM Guidance but 
also as an approach ``that does not have the same deterrent effect'' on 
sources and that would not have the same effects on sources to assure 
that they comply at all times in order to avoid violations. As a 
practical matter, the Petitioner also argued that including this 
element to the affirmative defense could ``mire enforcement proceedings 
in the question of whether or not the NAAQS or PSD increments were 
exceeded as a matter of fact.''
---------------------------------------------------------------------------

    \53\ Id. at 25.
    \54\ See, 5 Colo. Code Regs Sec.  1001-2(II.E.1.j).
---------------------------------------------------------------------------

2. The EPA's Prior Proposal
    In the February 2013 proposal notice, the EPA proposed to grant the 
Petition with respect to 5 Colo. Code Regs Sec.  1001-2(II.J) because 
it provides an affirmative defense for violations due to excess 
emissions applicable during startup and shutdown events, contrary to 
the EPA's interpretation of the CAA. The EPA noted at that time that an 
affirmative defense for excess emissions that occur during planned 
events such as startup and shutdown was contrary to the EPA's then 
current interpretation of the CAA to allow such affirmative defenses 
only for events beyond the control of the source, i.e., during 
malfunctions. In the February 2013 proposal notice, the EPA proposed to 
revise its SSM Policy to reflect this interpretation of the CAA, and to 
update the recommendations it previously made concerning affirmative 
defense provisions applicable to startup and shutdown events in the 
1999 SSM Guidance. For these reasons, the EPA previously proposed to 
find that 5 Colo. Code Regs Sec.  1001-2(II.J) is substantially 
inadequate to meet CAA requirements and proposed to issue a SIP call 
with respect to this provision.
    The EPA previously proposed to deny the Petition with respect to 5 
Colo. Code Regs Sec.  1001-2(II.E), because this provision includes an 
affirmative defense applicable to malfunction events that is consistent 
with the requirements of the CAA, as interpreted by the EPA in the SSM 
Policy. In particular, the EPA proposed to deny the Petition with 
respect to the claim that this provision is inconsistent with the CAA 
because it is available to sources or groups of sources that might have 
the potential to cause an exceedance of the NAAQS or PSD increments. 
The EPA reasoned that an acceptable alternative approach is to require 
the source to establish, as an element of the affirmative defense, that 
the excess emissions in question did not cause such impacts. The EPA 
noted in the February 2013 proposal notice that it was updating its 
previous guidance recommendations to states for SIPs in the SSM Policy 
in order to indicate that in lieu of restricting the application of an 
affirmative defense provision only to sources without the potential to 
cause NAAQS violations, the state could elect to require a source to 
prove that the excess emissions did not cause an exceedance of the 
NAAQS or PSD increments as an element of the defense instead. 
Accordingly, the EPA previously proposed to find that 5 Colo. Code Regs 
Sec.  1001-2(II.E) is consistent with CAA requirements and declined to 
make a finding of substantial inadequacy with respect to this 
provision.
3. The EPA's Revised Proposal
    In this SNPR, the EPA is proposing to revise the basis for the 
finding of substantial inadequacy and the SIP call for the affirmative 
defense provisions applicable to excess emissions that occur during 
startup and shutdown in 5 Colo. Code Regs Sec.  1001-2(II.J). The EPA 
is also reversing its prior denial of the Petition with respect to the 
affirmative defense provision applicable to malfunctions in 5 Colo. 
Code Regs Sec.  1001-2(II.E) and is proposing to find that provision 
substantially inadequate and to issue a SIP call for that provision as 
well. The EPA is proposing to revise its interpretation of the CAA with 
respect to affirmative defense provisions in SIPs. Previously the EPA 
assessed whether such provisions met certain requirements, such as 
being limited to monetary penalties rather than injunctive relief and 
containing sufficiently robust criteria to assure that the defense 
applied only in appropriately narrow circumstances. Now, the Agency 
must evaluate such provisions to determine whether they are constructed 
in a way that would purport to preclude federal court jurisdiction 
under section 113 to assess civil penalties or other forms of relief 
for violations of SIP emission limits, to prevent courts from 
considering the statutory factors for the assessment of civil penalties 
under section 113 or to interfere with the rights of litigants to 
pursue enforcement consistent with their rights under the citizen suit 
provision of section 304.
    The EPA interprets 5 Colo. Code Regs Sec.  1001-2(II.J) and 5 Colo. 
Code Regs Sec.  1001-2(II.E) to provide affirmative defenses that 
operate to limit the jurisdiction of the federal court in an 
enforcement action to assess monetary penalties under certain 
circumstances as contemplated in CAA sections 113 and 304. Thus, the 
EPA believes that these provisions interfere with the intended 
enforcement structure of the CAA, through which parties may seek to 
bring enforcement actions for violations of SIP emission limits and 
courts may exercise their jurisdiction to determine what, if any, 
relief is appropriate.
    For these reasons, the EPA is proposing to find 5 Colo. Code Regs 
Sec.  1001-2(II.J) and 5 Colo. Code Regs Sec.  1001-2(II.E) 
substantially inadequate to meet CAA requirements and the EPA is thus 
proposing to issue a SIP call with respect to these provisions.

G. Affected States and Local Jurisdictions in EPA Region IX

1. Arizona
    a. Petitioner's Analysis
    The Petitioner objected to two provisions in the Arizona Department 
of Environmental Quality's (ADEQ) Rule R18-2-310, which provide 
affirmative defenses for excess emissions during malfunctions (AAC 
Section R18-2-310(B)) and for excess emissions during startup or 
shutdown (AAC Section R18-2- 310(C)).\55\ First, the Petitioner 
asserted that all affirmative defenses for excess emissions are 
inconsistent with the CAA and should be removed from the Arizona SIP.
---------------------------------------------------------------------------

    \55\ Petition at 20-22.
---------------------------------------------------------------------------

    Additionally, quoting from the EPA's recommendation in the SSM 
Policy that such affirmative defenses should not be available to ``a 
single source or small group of sources [that] has the potential to 
cause an exceedance of the NAAQS or PSD increments,'' the Petitioner 
contended that ``sources with the power to cause an exceedance should 
be strictly controlled at all times, not just when they actually cause 
an

[[Page 55947]]

exceedance.'' \56\ Although acknowledging that R18-2-310 contains some 
limitations to address this issue, the Petitioner argued that the 
limitations in the SIP provision do not reduce the incentive for such 
sources to emit at levels close to those that would violate a NAAQS or 
PSD increment in the way that entirely disallowing affirmative defenses 
for these types of sources would. Accordingly, the Petitioner requested 
that the EPA require Arizona either to remove R18-2-310(B) and (C) from 
the SIP entirely or to revise the rule so that affirmative defenses 
``are not available to a single source or one of a small group of 
sources who have the potential to cause an exceedance of the NAAQS.''
---------------------------------------------------------------------------

    \56\ Petition at 20.
---------------------------------------------------------------------------

    Second, the Petitioner asserted that the provision applicable to 
startup and shutdown periods (R18-2-310(C)) does not include an 
explicit requirement for a source seeking to establish an affirmative 
defense to prove that ``the excess emissions were not part of a 
recurring pattern indicative of inadequate design, operation, or 
maintenance.'' The Petitioner provided a table specifically comparing 
the provisions in R18-2-310(C) against the EPA's recommended criteria 
for affirmative defense provisions in the 1999 SSM Guidance to show 
that R18-2-310(C) does not contain a specific provision to address this 
recommended criterion and stated that the SIP provision should be 
revised to require such a demonstration.
    b. The EPA's Prior Proposal
    In the February 2013 proposal notice, the EPA proposed to deny the 
Petition with respect to the arguments concerning ADEQ's affirmative 
defense provisions for malfunctions in R18-2-310(B) because this 
provision is consistent with the requirements of the CAA, as 
interpreted by the EPA in the SSM Policy. In particular, the EPA 
proposed to deny the Petition with respect to the claim that this 
provision is inconsistent with the CAA because it is available to 
sources or groups of sources that might have the potential to cause an 
exceedance of the NAAQS or PSD increments. The EPA reasoned that an 
acceptable alternative approach is to require the source to establish, 
as an element of the affirmative defense, that the excess emissions in 
question did not cause such impacts. The EPA noted in the February 2013 
proposal notice that it was updating its previous guidance 
recommendations to states for SIPs in the SSM Policy in order to 
indicate that in lieu of restricting the application of an affirmative 
defense provision only to sources without the potential to cause NAAQS 
violations, the state could elect to require a source to prove that the 
excess emissions did not cause a violation of the NAAQS as an element 
of the defense instead. Accordingly, the EPA previously proposed to 
find that R18-2-310(B) is consistent with CAA requirements and declined 
to make a finding of substantial inadequacy with respect to this 
provision.
    With respect to the arguments concerning ADEQ's affirmative defense 
provisions for startup and shutdown periods in R18-2- 310(C), the EPA 
proposed to grant the Petition because it provides an affirmative 
defense for violations due to excess emissions applicable during 
startup and shutdown events, contrary to the EPA's current 
interpretation of the CAA. The EPA noted at that time that an 
affirmative defense for excess emissions that occur during planned 
events such as startup and shutdown was contrary to the EPA's then 
current interpretation of the CAA to allow such affirmative defenses 
only for events beyond the control of the source, i.e., during 
malfunctions. In the February 2013 proposal notice, the EPA proposed to 
revise its SSM Policy to reflect this interpretation of the CAA, and to 
update the recommendations it previously made concerning affirmative 
defense provisions applicable to startup and shutdown events in the 
1999 SSM Guidance. For these reasons, the EPA previously proposed to 
find that R18-2-310(C) is substantially inadequate to meet CAA 
requirements and proposed to issue a SIP call with respect to this 
provision.
    c. The EPA's Revised Proposal
    In this SNPR, the EPA is reversing its prior proposed denial of the 
Petition with respect to the affirmative defense provision applicable 
to malfunctions in R18-2-310(B) and is proposing to find that provision 
substantially inadequate and to issue a SIP call for that provision. 
The EPA is also revising the prior basis for the finding of substantial 
inadequacy and the SIP call for the affirmative defense provisions 
applicable to excess emissions that occur during startup and shutdown 
in R18-2-310(C). The EPA is proposing to revise its interpretation of 
the CAA with respect to affirmative defense provisions in SIPs. 
Previously the EPA assessed whether such provisions met certain 
requirements, such as being limited to monetary penalties rather than 
injunctive relief and containing sufficiently robust criteria to assure 
that the defense applied only in appropriately narrow circumstances. 
Now, the Agency must evaluate such provisions to determine whether they 
are constructed in a way that would purport to preclude federal court 
jurisdiction under section 113 to assess civil penalties or other forms 
of relief for violations of SIP emission limits, to prevent courts from 
considering the statutory factors for the assessment of civil penalties 
under section 113 or to interfere with the rights of litigants to 
pursue enforcement consistent with their rights under the citizen suit 
provision of section 304.
    The EPA interprets R18-2-310(B) and R18-2-310(C) to provide 
affirmative defenses that operate to limit the jurisdiction of the 
federal court in an enforcement action to assess monetary penalties 
under certain circumstances as contemplated in CAA sections 113 and 
304. Thus, the EPA believes that these provisions interfere with the 
intended enforcement structure of the CAA, through which parties may 
seek to bring enforcement actions for violations of SIP emission limits 
and courts may exercise their jurisdiction to determine what, if any, 
relief is appropriate.
    For these reasons, the EPA is proposing to find R18-2-310(B) and 
R18-2-310(C) substantially inadequate to meet CAA requirements and the 
EPA is thus proposing to issue a SIP call with respect to these 
provisions.
2. Arizona: Maricopa County
a. Petitioner's Analysis
    The Petitioner objected to two provisions in the Maricopa County 
Air Pollution Control Regulations that provide affirmative defenses for 
excess emissions during malfunctions (Maricopa County Air Pollution 
Control Regulation 3, Rule 140, Sec.  401) and for excess emissions 
during startup or shutdown (Maricopa County Air Pollution Control 
Regulation 3, Rule 140, Sec.  402).\57\ These provisions in Maricopa 
County Air Quality Department (MCAQD) Rule 140 are similar to the 
affirmative defense provisions in ADEQ R18-2-310.\58\
---------------------------------------------------------------------------

    \57\ Petition at 23.
    \58\ Petition at 20-22.
---------------------------------------------------------------------------

    First, the Petitioner asserted that the affirmative defense 
provisions in Rule 140 are problematic for the same reasons identified 
in the Petition with respect to ADEQ R18-2-310. Specifically, the 
Petitioner argued that affirmative defenses should not be allowed in 
any SIP and, alternatively, that to the extent affirmative defenses are 
permissible, the provisions in Rule 140 addressing exceedances of the 
ambient standards are ``inappropriately permissive and do not comply 
with EPA guidance.'' \59\ Accordingly, the

[[Page 55948]]

Petitioner requested that the EPA require Arizona and/or MCAQD either 
to remove these provisions from the SIP entirely or to revise them so 
that they are not available to a single source or small group of 
sources that has the potential to cause a NAAQS exceedance. Second, the 
Petitioner asserted that the provisions for startup and shutdown in 
Rule 140 do not include an explicit requirement for a source seeking to 
establish an affirmative defense to prove that ``the excess emissions 
in question were not part of a recurring pattern indicative of 
inadequate design, operation, or maintenance.'' The Petitioner argued 
that Rule 140 should be revised to require such a demonstration.
---------------------------------------------------------------------------

    \59\ Id.
---------------------------------------------------------------------------

b. The EPA's Prior Proposal
    In the February 2013 proposal notice, the EPA proposed to deny the 
Petition with respect to the arguments concerning MCAQD's affirmative 
defense provisions for malfunctions in Regulation 3, Rule 140, Sec.  
401 because this provision is consistent with the requirements of the 
CAA, as interpreted by the EPA in the SSM Policy. In particular, the 
EPA proposed to deny the Petition with respect to the claim that this 
provision is inconsistent with the CAA because it is available to 
sources or groups of sources that might have the potential to cause an 
exceedance of the NAAQS or PSD increments. The EPA reasoned that an 
acceptable alternative approach is to require the source to establish, 
as an element of the affirmative defense, that the excess emissions in 
question did not cause such impacts. The EPA noted in the February 2013 
proposal notice that it was updating its previous guidance 
recommendations to states for SIPs in the SSM Policy in order to 
indicate that in lieu of restricting the application of an affirmative 
defense provision only to sources without the potential to cause NAAQS 
violations, the state could elect to require a source to prove that the 
excess emissions did not cause a violation of the NAAQS as an element 
of the defense instead. Accordingly, the EPA previously proposed to 
find that Regulation 3, Rule 140, Sec.  401 is consistent with CAA 
requirements and declined to make a finding of substantial inadequacy 
with respect to this provision.
    With respect to the arguments concerning ADEQ's affirmative defense 
provisions for startup and shutdown periods in Regulation 3, Rule 140, 
Sec.  402, the EPA previously proposed to grant the Petition because it 
provides an affirmative defense for violations due to excess emissions 
applicable during startup and shutdown events, contrary to the EPA's 
interpretation of the CAA. The EPA noted at that time that an 
affirmative defense for excess emissions that occur during planned 
events such as startup and shutdown was contrary to the EPA's then 
current interpretation of the CAA to allow such affirmative defenses 
only for events beyond the control of the source, i.e., during 
malfunctions. In the February 2013 proposal notice, the EPA proposed to 
revise its SSM Policy to reflect this interpretation of the CAA, and to 
update the recommendations it previously made concerning affirmative 
defense provisions applicable to startup and shutdown events in the 
1999 SSM Guidance. For these reasons, the EPA previously proposed to 
find that Maricopa County Air Pollution Control Regulation 3, Rule 140, 
Sec.  402 is substantially inadequate to meet CAA requirements and 
proposed to issue a SIP call with respect to this provision.
c. The EPA's Revised Proposal
    In this SNPR, the EPA is reversing its prior proposed denial of the 
Petition with respect to the affirmative defense provision applicable 
to malfunctions in Regulation 3, Rule 140, Sec.  401 and is proposing 
to find that provision substantially inadequate and to issue a SIP call 
for that provision. The EPA is also revising the prior basis for the 
finding of substantial inadequacy and the SIP call for the affirmative 
defense provisions applicable to excess emissions that occur during 
startup and shutdown in Regulation 3, Rule 140, Sec.  402. The EPA is 
proposing to revise its interpretation of the CAA with respect to 
affirmative defense provisions in SIPs. Previously the EPA assessed 
whether such provisions met certain requirements, such as being limited 
to monetary penalties rather than injunctive relief and containing 
sufficiently robust criteria to assure that the defense applied only in 
appropriately narrow circumstances. Now, the Agency must evaluate such 
provisions to determine whether they are constructed in a way that 
would purport to preclude federal court jurisdiction under section 113 
to assess civil penalties or other forms of relief for violations of 
SIP emission limits, to prevent courts from considering the statutory 
factors for the assessment of civil penalties under section 113 or to 
interfere with the rights of litigants to pursue enforcement consistent 
with their rights under the citizen suit provision of section 304.
    The EPA interprets Regulation 3, Rule 140, Sec.  401 and Regulation 
3, Rule 140, Sec.  402 to provide affirmative defenses that operate to 
limit the jurisdiction of the federal court in an enforcement action to 
assess monetary penalties under certain circumstances as contemplated 
in CAA sections 113 and 304. Thus, the EPA believes that these 
provisions interfere with the intended enforcement structure of the 
CAA, through which parties may seek to bring enforcement actions for 
violations of SIP emission limits and courts may exercise their 
jurisdiction to determine what, if any, relief is appropriate.
    For these reasons, the EPA is proposing to find Regulation 3, Rule 
140, Sec.  401 and Regulation 3, Rule 140, Sec.  402 substantially 
inadequate to meet CAA requirements and the EPA is thus proposing to 
issue a SIP call with respect to these provisions.
3. California: Eastern Kern Air Pollution Control District
a. The EPA's Evaluation
    In addition to evaluating specific affirmative defense provisions 
identified by the Petitioner, the EPA is also evaluating other 
affirmative defense provisions that may be affected by the Agency's 
revision of its interpretation of CAA requirements for such provisions 
in SIPs. As part of its review, the EPA has identified an affirmative 
defense provision in the SIP for the state of California applicable in 
the Eastern Kern Air Pollution Control District (APCD). The affirmative 
defense is included in Kern County ``Rule 111 Equipment Breakdown.'' 
This SIP provision provides an affirmative defense available to sources 
for excess emissions that occur during a breakdown condition (i.e., 
malfunction).
    In light of the court's decision in NRDC v. EPA, the EPA is 
proposing to revise its SSM Policy concerning the issue of affirmative 
defense provisions. In particular, the EPA is proposing to reverse its 
prior recommendations to states on this issue provided in the 1999 SSM 
Guidance. In that guidance, the EPA had interpreted the CAA to permit 
states to elect to create narrowly drawn affirmative defense provisions 
in SIPs, both for malfunction events and for startup and shutdown 
events, so long as the provisions were consistent with the criteria 
recommended by the Agency. In the February 2013 proposal notice, the 
EPA had already proposed to revise this interpretation of the CAA to 
permit states to develop affirmative defense provisions only for 
malfunction events and not for startup and shutdown events. The 
decision of the court in NRDC v. EPA indicates that the EPA needs to 
revise the SSM Policy yet further.

[[Page 55949]]

    As discussed in sections IV and V of this SNPR, the EPA is 
proposing to revise its interpretation of the CAA with respect to 
affirmative defense provisions in SIPs. Kern County Rule 111 includes 
the elements of an affirmative defense to be asserted by sources in the 
event of violations during breakdown conditions. The provision defines 
``breakdown conditions'' as any unforeseeable failure or malfunction of 
air pollution control equipment or monitoring equipment. If the source 
is able to establish that it met each of the specified criteria to an 
``air pollution control officer'' (i.e., an official of the state or 
the Eastern Kern APCD), then the provision purports to bar any 
enforcement action and thus any form of remedy for the violations that 
occur during the malfunction. Accordingly, the EPA believes that the 
affirmative defense provision created by Kern County Rule 111 is 
inconsistent with the fundamental enforcement structure of the CAA and 
the EPA thus believes that the provision is not consistent with CAA 
requirements for SIP provisions.
b. The EPA's Proposal
    In this SNPR, the EPA is proposing to make a finding of substantial 
inadequacy and to issue a SIP call for Kern County Rule 111 Equipment 
Breakdown in the California SIP applicable in the Eastern Kern 
APCD.\60\ The EPA is proposing to revise its interpretation of the CAA 
with respect to affirmative defense provisions in SIPs. Previously the 
EPA assessed whether such provisions met certain requirements, such as 
being limited to monetary penalties rather than injunctive relief and 
containing sufficiently robust criteria to assure that the defense 
applied only in appropriately narrow circumstances. The EPA notes that 
Kern County Rule 111 did not meet the Agency's prior interpretation of 
the CAA with regard to affirmative defense provisions in SIPs. 
Regardless of that fact, however, the Agency must now evaluate such 
provisions to determine whether they are constructed in a way that 
would purport to preclude federal court jurisdiction under section 113 
to assess civil penalties or other forms of relief for violations of 
SIP emission limits, to prevent courts from considering the statutory 
factors for the assessment of civil penalties under section 113 or to 
interfere with the rights of litigants to pursue enforcement consistent 
with their rights under the citizen suit provision of section 304.
---------------------------------------------------------------------------

    \60\ The EPA is proposing in this SNPR to make a finding of 
substantial inadequacy and to issue a SIP call for Kern County Rule 
111 Equipment Breakdown in the California SIP as it applies in each 
the Eastern Kern APCD and the San Joaquin Valley APCD.
---------------------------------------------------------------------------

    The EPA interprets Kern County ``Rule 111 Equipment Breakdown'' to 
provide an affirmative defense that operates to limit the jurisdiction 
of the federal court in an enforcement action and to limit the 
authority of the court to impose monetary penalties as contemplated in 
CAA sections 113 and 304. The provision provides that if a violating 
source meets certain criteria set forth in Rule 111, then ``no 
enforcement action may be taken.'' By proscribing any enforcement by 
any party if the source meets certain criteria, Rule 111 creates an 
affirmative defense that would preclude enforcement for excess 
emissions that would otherwise constitute a violation of the applicable 
SIP emission limitations. Thus, the EPA believes that this provision 
interferes with the intended enforcement structure of the CAA, through 
which parties may seek to bring enforcement actions for violations of 
SIP emission limits and courts may exercise their jurisdiction to 
determine what, if any, relief is appropriate.
    For these reasons, the EPA is proposing to find Kern County ``Rule 
111 Equipment Breakdown'' substantially inadequate to meet CAA 
requirements and the EPA is thus proposing to issue a SIP call with 
respect to this provision.
4. California: Imperial County Air Pollution Control District
a. The EPA's Evaluation
    In addition to evaluating specific affirmative defense provisions 
identified by the Petitioner, the EPA is also evaluating other 
affirmative defense provisions that may be affected by the Agency's 
revision of its interpretation of CAA requirements for such provisions 
in SIPs. As part of its review, the EPA has identified an affirmative 
defense provision in the SIP for the state of California applicable in 
the Imperial Valley APCD. The affirmative defense is included in 
Imperial County ``Rule 111 Equipment Breakdown.'' This SIP provision 
provides an affirmative defense available to sources for excess 
emissions that occur during a breakdown condition (i.e., malfunction).
    In light of the court's decision in NRDC v. EPA, the EPA is 
proposing to revise its SSM Policy concerning the issue of affirmative 
defense provisions. In particular, the EPA is proposing to reverse its 
prior recommendations to states on this issue provided in the 1999 SSM 
Guidance. In that guidance, the EPA had interpreted the CAA to permit 
states to elect to create narrowly drawn affirmative defense provisions 
in SIPs, both for malfunction events and for startup and shutdown 
events, so long as the provisions were consistent with the criteria 
recommended by the Agency. In the February 2013 proposal notice, the 
EPA had already proposed to revise this interpretation of the CAA to 
permit states to develop affirmative defense provisions only for 
malfunction events and not for startup and shutdown events. The 
decision of the court in NRDC v. EPA indicates that the EPA needs to 
revise the SSM Policy yet further.
    As discussed in sections IV and V of this SNPR, the EPA is 
proposing to revise its interpretation of the CAA with respect to 
affirmative defense provisions in SIPs. Imperial County Rule 111 
includes the elements of an affirmative defense to be asserted by 
sources in the event of violations during breakdown conditions. The 
provision defines ``breakdown conditions'' as any unforeseeable failure 
or malfunction of air pollution control equipment or monitoring 
equipment. If the source is able to establish that it met each of the 
specified criteria to an ``air pollution control officer'' (i.e., an 
official of the state or the Imperial Valley APCD), then the provision 
purports to bar any enforcement action and thus any form of remedy for 
the violations that occur during the malfunction. Accordingly, the EPA 
believes that the affirmative defense provision created by Imperial 
County Rule 111 is inconsistent with the fundamental enforcement 
structure of the CAA and the EPA thus believes that the provision is 
not consistent with CAA requirements for SIP provisions.
b. The EPA's Proposal
    In this SNPR, the EPA is proposing to make a finding of substantial 
inadequacy and to issue a SIP call for Imperial County ``Rule 111 
Equipment Breakdown'' in the California SIP applicable in the Imperial 
Valley APCD. The EPA is proposing to revise its interpretation of the 
CAA with respect to affirmative defense provisions in SIPs. Previously 
the EPA assessed whether such provisions met certain requirements, such 
as being limited to monetary penalties rather than injunctive relief 
and containing sufficiently robust criteria to assure that the defense 
applied only in appropriately narrow circumstances. The EPA notes that 
Imperial County Rule 111 did not meet the Agency's prior interpretation 
of the CAA with regard to affirmative defense provisions in SIPs. 
Regardless of that fact, however, the Agency must now evaluate such

[[Page 55950]]

provisions to determine whether they are constructed in a way that 
would purport to preclude federal court jurisdiction under section 113 
to assess civil penalties or other forms of relief for violations of 
SIP emission limits, to prevent courts from considering the statutory 
factors for the assessment of civil penalties under section 113 or to 
interfere with the rights of litigants to pursue enforcement consistent 
with their rights under the citizen suit provision of section 304.
    The EPA interprets Imperial County ``Rule 111 Equipment Breakdown'' 
to provide an affirmative defense that operates to limit the 
jurisdiction of the federal court in an enforcement action and to limit 
the authority of the court to impose monetary penalties as contemplated 
in CAA sections 113 and 304. The provision provides that if a violating 
source meets certain criteria set forth in Rule 111, then ``no 
enforcement action may be taken.'' By proscribing any enforcement by 
any party if the source meets certain criteria, Rule 111 creates an 
affirmative defense that would preclude enforcement for excess 
emissions that would otherwise constitute a violation of the applicable 
SIP emission limitations. Thus, the EPA believes that this provision 
interferes with the intended enforcement structure of the CAA, through 
which parties may seek to bring enforcement actions for violations of 
SIP emission limits and courts may exercise their jurisdiction to 
determine what, if any, relief is appropriate.
    For these reasons, the EPA is proposing to find Imperial County 
``Rule 111 Equipment Breakdown'' substantially inadequate to meet CAA 
requirements and the EPA is thus proposing to issue a SIP call with 
respect to this provision.
5. California: San Joaquin Valley Air Pollution Control District
a. The EPA's Evaluation
    In addition to evaluating specific affirmative defense provisions 
identified by the Petitioner, the EPA is also evaluating other 
affirmative defense provisions that may be affected by the Agency's 
revision of its interpretation of CAA requirements for such provisions 
in SIPs. As part of its review, the EPA has identified affirmative 
defense provisions in the SIP for the state of California applicable in 
the San Joaquin Valley APCD. The affirmative defenses are included in: 
(i) Fresno County ``Rule 110 Equipment Breakdown''; (ii) Kern County 
``Rule 111 Equipment Breakdown''; (iii) Kings County ``Rule 111 
Equipment Breakdown''; (iv) Madera County ``Rule 113 Equipment 
Breakdown''; (v) Stanislaus County ``Rule 110 Equipment Breakdown''; 
and (vi) Tulare County ``Rule 111 Equipment Breakdown.'' \61\ Each of 
these SIP provisions provides an affirmative defense available to 
sources for excess emissions that occur during a breakdown condition 
(i.e., malfunction).
---------------------------------------------------------------------------

    \61\ The EPA notes that comparable provisions appear in the 
California SIP for the San Joaquin Valley APCD in Merced County (in 
``Rule 109 Equipment Breakdown'') and in San Joaquin County (in 
``Rule 110 Equipment Breakdown''). However, the EPA interprets these 
provisions to be enforcement discretion provisions, applicable only 
to the state or air district personnel. In each of these counties, 
the applicable rules provide that if the source meets certain 
criteria, then ``the Air Pollution Control Officer may elect to take 
no enforcement action.'' The EPA believes that these provisions 
unequivocally apply only to the exercise of enforcement discretion 
by the state or air district personnel and are not operative in the 
event of enforcement by the EPA or others under the authority of the 
citizen suit provision of CAA section 304. For this reason, the EPA 
is not proposing to make a finding of substantial inadequacy and a 
SIP call for these comparable provisions in Merced County Rule 109 
and San Joaquin County Rule 110. If the state of California 
disagrees with this interpretation, the EPA anticipates that the 
state will inform the Agency of that fact though comment on this 
SNPR.
---------------------------------------------------------------------------

    In light of the court's decision in NRDC v. EPA, the EPA is 
proposing to revise its SSM Policy concerning the issue of affirmative 
defense provisions. In particular, the EPA is proposing to reverse its 
prior recommendations to states on this issue provided in the 1999 SSM 
Guidance. In that guidance, the EPA had interpreted the CAA to permit 
states to elect to create narrowly drawn affirmative defense provisions 
in SIPs, both for malfunction events and for startup and shutdown 
events, so long as the provisions were consistent with the criteria 
recommended by the Agency. In the February 2013 proposal notice, the 
EPA had already proposed to revise this interpretation of the CAA to 
permit states to develop affirmative defense provisions only for 
malfunction events and not for startup and shutdown events. The 
decision of the court in NRDC v. EPA indicates that the EPA needs to 
revise the SSM Policy yet further.
    As discussed in sections IV and V of this SNPR, the EPA is 
proposing to revise its interpretation of the CAA with respect to 
affirmative defense provisions in SIPs. Fresno County Rule 110, Kern 
County Rule 111, Kings County Rule 111, Madera County Rule 113, 
Stanislaus County Rule 110 and Tulare County Rule 111 include the 
elements of an affirmative defense to be asserted by sources in the 
event of violations during breakdown conditions. Each of these 
provisions defines ``breakdown conditions'' in comparable ways as any 
unforeseeable failure or malfunction of air pollution control equipment 
or monitoring equipment. If the source is able to establish that it met 
each of the specified criteria to a ``Control Officer'' (i.e., an 
official of the state or the San Joaquin Valley APCD), then the 
provision purports to bar any enforcement action and thus any form of 
remedy for the violations that occur during the malfunction. 
Accordingly, the EPA believes that each of the affirmative defense 
provisions created by Fresno County Rule 110, Kern County Rule 111, 
Kings County Rule 111, Madera County Rule 113, Stanislaus County Rule 
110 and Tulare County Rule 111 is inconsistent with the fundamental 
enforcement structure of the CAA and the EPA thus believes that these 
provisions are not consistent with CAA requirements for SIP provisions.
b. The EPA's Proposal
    In this SNPR, the EPA is proposing to make a finding of substantial 
inadequacy and to issue a SIP call for six provisions in the California 
SIP applicable in the San Joaquin Valley APCD: (i) Fresno County ``Rule 
110 Equipment Breakdown''; (ii) Kern County ``Rule 111 Equipment 
Breakdown''; (iii) Kings County ``Rule 111 Equipment Breakdown''; (iv) 
Madera County ``Rule 113 Equipment Breakdown''; (v) Stanislaus County 
``Rule 110 Equipment Breakdown''; and (vi) Tulare County ``Rule 111 
Equipment Breakdown.'' \62\ The EPA is proposing to revise its 
interpretation of the CAA with respect to affirmative defense 
provisions in SIPs. Previously the EPA assessed whether such provisions 
met certain requirements, such as being limited to monetary penalties 
rather than injunctive relief and containing sufficiently robust 
criteria to assure that the defense applied only in appropriately 
narrow circumstances. The EPA notes that Fresno County Rule 110, Kern 
County Rule 111, Kings County Rule 111, Madera County Rule 113, 
Stanislaus County Rule 110 and Tulare County Rule 111 did not meet the 
Agency's prior interpretation of the CAA with regard to affirmative 
defense provisions in SIPs. Regardless of that fact, however, the 
Agency must now evaluate such provisions to determine whether they are 
constructed in a way that would purport to preclude federal court 
jurisdiction under section 113 to

[[Page 55951]]

assess civil penalties or other forms of relief for violations of SIP 
emission limits, to prevent courts from considering the statutory 
factors for the assessment of civil penalties under section 113 or to 
interfere with the rights of litigants to pursue enforcement consistent 
with their rights under the citizen suit provision of section 304.
---------------------------------------------------------------------------

    \62\ The EPA is proposing in this SNPR to make a finding of 
substantial inadequacy and to issue a SIP call for Kern County Rule 
111 Equipment Breakdown in the California SIP as it applies in each 
the Eastern Kern APCD and the San Joaquin Valley APCD.
---------------------------------------------------------------------------

    The EPA interprets Fresno County Rule 110, Kern County Rule 111, 
Kings County Rule 111, Madera County Rule 113, Stanislaus County Rule 
110 and Tulare County Rule 111 to provide affirmative defenses that 
operate to limit the jurisdiction of the federal court in an 
enforcement action and to limit the authority of the court to impose 
monetary penalties as contemplated in CAA sections 113 and 304. These 
provisions provide that if a violating source meets certain criteria 
set forth in each of the Rules, then ``no enforcement action may be 
taken.'' By proscribing any enforcement by any party if the source 
meets certain criteria, each of these provisions creates an affirmative 
defense that would preclude enforcement for excess emissions that would 
otherwise constitute a violation of the applicable SIP emission 
limitations. Thus, the EPA believes that these provisions interfere 
with the intended enforcement structure of the CAA, through which 
parties may seek to bring enforcement actions for violations of SIP 
emission limits and courts may exercise their jurisdiction to determine 
what, if any, relief is appropriate.
    For these reasons, the EPA is proposing to find Fresno County 
``Rule 110 Equipment Breakdown,'' Kern County ``Rule 111 Equipment 
Breakdown,'' Kings County ``Rule 111 Equipment Breakdown,'' Madera 
County ``Rule 113 Equipment Breakdown,'' Stanislaus County ``Rule 110 
Equipment Breakdown'' and Tulare County ``Rule 111 Equipment 
Breakdown'' substantially inadequate to meet CAA requirements and the 
EPA is thus proposing to issue a SIP call with respect to these 
provisions.

H. Affected States and Local Jurisdictions in EPA Region X

1. Alaska
a. Petitioner's Analysis
    The Petitioner objected to a provision in the Alaska SIP that 
provides an excuse for ``unavoidable'' excess emissions that occur 
during SSM events, including startup, shutdown, scheduled maintenance 
and ``upsets'' (Alaska Admin. Code tit. 18 Sec.  50.240).\63\ The 
provision provides: ``Excess emissions determined to be unavoidable 
under this section will be excused and are not subject to penalty. This 
section does not limit the department's power to enjoin the emission or 
require corrective action.'' The Petitioner argued that this provision 
excuses excess emissions in violation of the CAA and the EPA's SSM 
Policy, which require all such emissions to be treated as violations of 
the applicable SIP emission limitations. The Petitioner further argued 
that it is unclear whether the provision could be interpreted to bar 
enforcement actions brought by the EPA or citizens, because it is 
drafted as if the state were the sole enforcement authority. Finally, 
the Petitioner pointed out, the provision is worded as if it were an 
affirmative defense, but it uses criteria for enforcement discretion. 
Finally, the Petitioner pointed out, the provision is worded as if it 
were an affirmative defense, but it uses criteria more relevant for 
enforcement discretion. In other words, the Petitioner argued that the 
provision is inconsistent with the EPA's recommendations for 
affirmative defense provisions in SIPs in the 1999 SSM Guidance.
---------------------------------------------------------------------------

    \63\ Petition at 18-20.
---------------------------------------------------------------------------

b. The EPA's Prior Proposal
    In the February 2013 proposal notice, the EPA proposed to grant the 
Petition with respect to Alaska Admin. Code tit. 18 Sec.  50.240. To 
the extent that this provision is intended to be an affirmative 
defense, the EPA believed it to be deficient to meet the requirements 
of the CAA for such provisions. The provision applies to excess 
emissions during startup, shutdown and maintenance events, contrary to 
the EPA's then current interpretation of the CAA to allow such 
affirmative defenses only for malfunctions. The EPA noted at that time 
that an affirmative defense for excess emissions that occur during 
planned events such as startup and shutdown was contrary to the EPA's 
then current interpretation of the CAA to allow such affirmative 
defenses only for events beyond the control of the source, i.e., during 
malfunctions. In the February 2013 proposal notice, the EPA proposed to 
revise its SSM Policy to reflect this interpretation of the CAA, and to 
update the recommendations it previously made concerning affirmative 
defense provisions applicable to startup and shutdown events in the 
1999 SSM Guidance. Additionally, the EPA previously reasoned that the 
section of Alaska Admin. Code tit. 18 Sec.  50.240 applying to 
``upsets'' is inadequate because the criteria referenced are not 
sufficiently similar to those recommended in the EPA's SSM Policy for 
affirmative defense provisions applicable to malfunctions. Thus, the 
EPA previously considered Alaska Admin. Code tit. 18 Sec.  50.240 to be 
inconsistent with the fundamental requirements of the CAA and thus 
proposed to find the provision substantially inadequate to meet CAA 
requirements and to issue a SIP call with respect to the provision.
c. The EPA's Revised Proposal
    In this SNPR, the EPA is revising the prior basis for the finding 
of substantial inadequacy and the SIP call for the affirmative defense 
provisions applicable to excess emissions that occur during startup, 
shutdown and upsets in Alaska Admin. Code tit. 18 Sec.  50.240. The EPA 
is proposing to revise its interpretation of the CAA with respect to 
affirmative defense provisions in SIPs. Previously the EPA assessed 
whether such provisions met certain requirements, such as being limited 
to monetary penalties rather than injunctive relief and containing 
sufficiently robust criteria to assure that the defense applied only in 
appropriately narrow circumstances. Now, the Agency must evaluate such 
provisions to determine whether they are constructed in a way that 
would purport to preclude federal court jurisdiction under section 113 
to assess civil penalties or other forms of relief for violations of 
SIP emission limits, to prevent courts from considering the statutory 
factors for the assessment of civil penalties under section 113 or to 
interfere with the rights of litigants to pursue enforcement consistent 
with their rights under the citizen suit provision of section 304.
    The EPA interprets Alaska Admin. Code tit. 18 Sec.  50.240 to 
provide affirmative defenses that operate to limit the jurisdiction of 
the federal court in an enforcement action to assess monetary penalties 
or impose injunctive relief under certain circumstances as contemplated 
in CAA sections 113 and 304. Thus, the EPA believes that this provision 
interferes with the intended enforcement structure of the CAA, through 
which parties may seek to bring enforcement actions for violations of 
SIP emission limits and courts may exercise their jurisdiction to 
determine what, if any, relief is appropriate.
    For these reasons, the EPA is proposing to find Alaska Admin. Code 
tit. 18 Sec.  50.240 substantially inadequate to meet CAA requirements 
and the EPA is thus proposing to issue a SIP call with respect to this 
provision. The EPA notes that in this SNPR it is only addressing this 
provision with respect to its deficiency as an affirmative defense 
provision and is not revising its

[[Page 55952]]

February 2013 proposal notice with respect to the other separate bases 
for the finding of substantial inadequacy of this provision.
2. Washington
a. Petitioner's Analysis
    The Petitioner objected to a provision in the Washington SIP that 
provides an excuse for ``unavoidable'' excess emissions that occur 
during certain SSM events, including startup, shutdown, scheduled 
maintenance and ``upsets'' (Wash. Admin. Code Sec.  173-400-107).\64\ 
The provision provides that ``[e]xcess emissions determined to be 
unavoidable under the procedures and criteria under this section shall 
be excused and are not subject to penalty.'' The Petitioner argued that 
this provision excuses excess emissions, in violation of the CAA and 
the EPA's SSM Policy, which require all such emissions to be treated as 
violations of the applicable SIP emission limitations. The Petitioner 
further argued that it is unclear whether the provision could be 
interpreted to bar enforcement actions brought by the EPA or citizens, 
because it is drafted as if the state were the sole enforcement 
authority. Finally, the Petitioner pointed out, the provision is worded 
as if it were an affirmative defense, but it uses criteria more 
relevant for enforcement discretion.
---------------------------------------------------------------------------

    \64\ Petition at 71-72.
---------------------------------------------------------------------------

b. The EPA's Prior Proposal
    In the February 2013 proposal notice, the EPA proposed to grant the 
Petition with respect to Wash. Admin. Code Sec.  173-400-107. The 
provision applies to startup, shutdown and maintenance events, contrary 
to the EPA's then current interpretation of the CAA to allow such 
affirmative defenses only for malfunctions. The EPA noted at that time 
that an affirmative defense for excess emissions that occur during 
planned events such as startup, shutdown and maintenance was contrary 
to the EPA's then current interpretation of the CAA to allow such 
affirmative defenses only for events beyond the control of the source, 
i.e., during malfunctions. In the February 2013 proposal notice, the 
EPA proposed to revise its SSM Policy to reflect this interpretation of 
the CAA, and to update the recommendations it previously made 
concerning affirmative defense provisions applicable to startup and 
shutdown events in the 1999 SSM Guidance.\65\ Furthermore, the EPA 
previously reasoned that the section of Wash. Admin. Code Sec.  173-
400-107 applying to ``upsets'' is inadequate because the criteria 
referenced are not sufficiently similar to those recommended in the 
EPA's SSM Policy for affirmative defense provisions applicable to 
malfunctions. Moreover, the provision appears to bar the EPA and 
citizens from seeking penalties and injunctive relief. Thus, the EPA 
previously considered Wash. Admin. Code Sec.  173-400-107 to be 
inconsistent with the fundamental requirements of the CAA and the EPA 
thus proposed to find the provision substantially inadequate to meet 
CAA requirements and proposed to issue a SIP call with respect to the 
provision.
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    \65\ The EPA notes that its SSM Policy guidance has always 
stated that affirmative defense provisions in SIPs are not 
appropriate for excess emissions that occur during maintenance 
activities. The 1999 SSM Guidance only made recommendations with 
respect to affirmative defense provisions applicable to malfunctions 
and to startup and shutdown. The 1983 SSM Guidance recommended that 
``scheduled maintenance is a predictable event which can be 
scheduled at the discretion of the operator'' and therefore 
recommended even against the exercise of enforcement discretion for 
violations during maintenance except under limited circumstances. 
See 1983 SSM Guidance at Attachment, Page 3.
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c. The EPA's Revised Proposal
    In this SNPR, the EPA is revising the prior basis for the proposed 
finding of substantial inadequacy and the proposed SIP call for the 
affirmative defense provisions applicable to excess emissions that 
occur during startup, shutdown, maintenance and upsets in Wash. Admin. 
Code Sec.  173-400-107. The EPA is proposing to revise its 
interpretation of the CAA with respect to affirmative defense 
provisions in SIPs. Previously the EPA assessed whether such provisions 
met certain requirements, such as being limited to monetary penalties 
rather than injunctive relief and containing sufficiently robust 
criteria to assure that the defense applied only in appropriately 
narrow circumstances. Now, the Agency must evaluate such provisions to 
determine whether they are constructed in a way that would purport to 
preclude federal court jurisdiction under section 113 to assess civil 
penalties or other forms of relief for violations of SIP emission 
limits, to prevent courts from considering the statutory factors for 
the assessment of civil penalties under section 113 or to interfere 
with the rights of litigants to pursue enforcement consistent with 
their rights under the citizen suit provision of section 304.
    The EPA interprets Wash. Admin. Code Sec.  173-400-107 to provide 
affirmative defenses that operate to limit the jurisdiction of the 
federal court in an enforcement action to assess monetary penalties or 
impose injunctive relief under certain circumstances as contemplated in 
CAA sections 113 and 304. Thus, the EPA believes that this provision 
interferes with the intended enforcement structure of the CAA, through 
which parties may seek to bring enforcement actions for violations of 
SIP emission limits and courts may exercise their jurisdiction to 
determine what, if any, relief is appropriate.
    For these reasons, the EPA is proposing to find Wash. Admin. Code 
Sec.  173-400-107 substantially inadequate to meet CAA requirements and 
the EPA is thus proposing to issue a SIP call with respect to this 
provision. The EPA notes that in this SNPR it is only addressing this 
provision with respect to its deficiency as an affirmative defense 
provision and is not revising its February 2013 proposal notice with 
respect to the other separate bases for the finding of substantial 
inadequacy of this provision.
3. Washington: Energy Facility Site Evaluation Council
a. The EPA's Evaluation
    In addition to evaluating specific affirmative defense provisions 
identified by the Petitioner, the EPA is also evaluating other 
affirmative defense provisions that may be affected by the Agency's 
revision of its interpretation of CAA requirements for such provisions 
in SIPs. As part of its review, the EPA has identified affirmative 
defense provisions in the SIP for the state of Washington that relate 
to the Energy Facility Site Evaluation Council (EFSEC).\66\ The EFSEC 
portion of the SIP includes Wash. Admin. Code Sec.  463-39-005, which 
adopts by reference Wash. Admin. Code Sec.  173-400-107, thereby 
incorporating the affirmative defenses applicable to startup, shutdown, 
scheduled maintenance and ``upsets'' for which, as explained earlier in 
this SNPR, the EPA has proposed to find Wash. Admin. Code Sec.  173-
400-107 substantially inadequate to meet CAA requirements.
---------------------------------------------------------------------------

    \66\ This is the state agency that reviews and authorizes the 
construction and operation of major energy facilities in Washington 
for all media in lieu of any other individual state or local agency 
permits. Thus these affirmative defense provisions can become 
embodied in the authorizations for such sources.
---------------------------------------------------------------------------

    In light of the court's decision in NRDC v. EPA, the EPA is 
proposing to revise its SSM Policy concerning the issue of affirmative 
defense provisions. In particular, the EPA is proposing to reverse its 
prior recommendations to states on this issue provided in the 1999 SSM 
Guidance. In that guidance, the EPA had interpreted the CAA to permit

[[Page 55953]]

states to elect to create narrowly drawn affirmative defense provisions 
in SIPs, both for malfunction events and for startup and shutdown 
events, so long as the provisions were consistent with the criteria 
recommended by the Agency. In the February 2013 proposal notice, the 
EPA had already proposed to revise this interpretation of the CAA to 
permit states to develop affirmative defense provisions only for 
malfunction events and not for startup and shutdown events. The 
decision of the court in NRDC v. EPA indicates that the EPA needs to 
revise the SSM Policy yet further.
    As discussed in sections IV and V of this SNPR, the EPA is 
proposing to revise its interpretation of the CAA with respect to 
affirmative defense provisions in SIPs. Wash. Admin. Code Sec.  463-39-
005 incorporates by reference the elements of an affirmative defense to 
be asserted by sources in the event of violations during startup, 
shutdown, scheduled maintenance and upsets. The provision provides 
criteria for each type of event. If the source is able to establish 
that it met each of the specified criteria, then the provision purports 
to bar any enforcement action and thus any form of remedy for the 
violations that occur during such events. The provision explicitly 
states that if the criteria are met, then the violations ``shall be 
excused and not subject to penalty.'' Accordingly, the EPA believes 
that the affirmative defenses created by Wash. Admin. Code Sec.  463-
39-005 through its incorporation by reference of Wash. Admin. Code 
Sec.  173-400-107 are inconsistent with the fundamental enforcement 
structure of the CAA and the EPA thus believes that the Wash. Admin. 
Code Sec.  463-39-005 provision is not consistent with CAA requirements 
for SIP provisions.
b. The EPA's Proposal
    In this SNPR, the EPA is proposing to make a finding of substantial 
inadequacy and to issue a SIP call for Wash. Admin. Code Sec.  463-39-
005's incorporation by reference of Wash. Admin. Code Sec.  173-400-107 
in the Washington SIP with respect to the EFSEC. The EPA is proposing 
to revise its interpretation of the CAA with respect to affirmative 
defense provisions in SIPs. Previously the EPA assessed whether such 
provisions met certain requirements, such as being limited to monetary 
penalties rather than injunctive relief and containing sufficiently 
robust criteria to assure that the defense applied only in 
appropriately narrow circumstances. The EPA notes that the affirmative 
defenses created in Wash. Admin. Code Sec.  463-39-005 through its 
incorporation by reference of Wash. Admin. Code Sec.  173-400-107 did 
not meet the Agency's prior interpretation of the CAA with regard to 
affirmative defense provisions in SIPs. Regardless of that fact, 
however, the Agency must now evaluate such provisions to determine 
whether they are constructed in a way that would purport to preclude 
federal court jurisdiction under section 113 to assess civil penalties 
or other forms of relief for violations of SIP emission limits, to 
prevent courts from considering the statutory factors for the 
assessment of civil penalties under section 113 or to interfere with 
the rights of litigants to pursue enforcement consistent with their 
rights under the citizen suit provision of section 304.
    The EPA interprets Wash. Admin. Code Sec.  463-39-005's 
incorporation by reference of Wash. Admin. Code Sec.  173-400-107 to 
provide affirmative defenses that would operate to limit the 
jurisdiction of the federal court in an enforcement action and to limit 
the authority of the court to impose monetary penalties as contemplated 
in CAA sections 113 and 304. The provision provides that if a violating 
source meets certain criteria incorporated by reference from Wash. 
Admin. Code Sec.  173-400-107, then the excess emissions are ``excused 
and not subject to penalty.'' By proscribing any enforcement by any 
party if the source meets certain criteria, Wash. Admin. Code Sec.  
463-39-005 creates affirmative defenses that would preclude enforcement 
for excess emissions that would otherwise constitute a violation of the 
applicable SIP emission limitations. Thus, the EPA believes that this 
provision interferes with the intended enforcement structure of the 
CAA, through which parties may seek to bring enforcement actions for 
violations of SIP emission limits and courts may exercise their 
jurisdiction to determine what, if any, relief is appropriate.
    For these reasons, the EPA is proposing to find Wash. Admin. Code 
Sec.  463-39-005's incorporation by reference of Wash. Admin. Code 
Sec.  173-400-107 substantially inadequate to meet CAA requirements and 
the EPA is thus proposing to issue a SIP call with respect to this 
provision.
4. Washington: Southwest Clean Air Agency
a. The EPA's Evaluation
    In addition to evaluating specific affirmative defense provisions 
identified by the Petitioner, the EPA is also evaluating other 
affirmative defense provisions that may be affected by the Agency's 
revision of its interpretation of CAA requirements for such provisions 
in SIPs. As part of its review, the EPA has identified affirmative 
defense provisions in the SIP for the state of Washington applicable in 
the portion of the state regulated by the Southwest Clean Air Agency 
(SWCAA).\67\ The affirmative defenses are included in the SIP in SWAPCA 
``400-107 Excess Emissions.'' This SIP provision provides an 
affirmative defense available to sources for excess emissions that 
occur during startup and shutdown, maintenance and upsets (i.e., 
malfunctions). It is identical to Wash. Admin. Code Sec.  173-400-107 
in all respects except that SWAPCA 400-107(3) contains a more stringent 
requirement for the reporting of excess emissions.
---------------------------------------------------------------------------

    \67\ The EPA notes that the SWCAA was formerly named, and in 
some places in the SIP still appears, as the ``Southwest Air 
Pollution Control Authority'' or ``SWAPCA.'' The EPA anticipates 
that the name will be updated in the SIP in due course as the state 
revises the SIP.
---------------------------------------------------------------------------

    In light of the court's decision in NRDC v. EPA, the EPA is 
proposing to revise its SSM Policy concerning the issue of affirmative 
defense provisions. In particular, the EPA is proposing to reverse its 
prior recommendations to states on this issue provided in the 1999 SSM 
Guidance. In that guidance, the EPA had interpreted the CAA to permit 
states to elect to create narrowly drawn affirmative defense provisions 
in SIPs, both for malfunction events and for startup and shutdown 
events, so long as the provisions were consistent with the criteria 
recommended by the Agency. In the February 2013 proposal notice, the 
EPA had already proposed to revise this interpretation of the CAA to 
permit states to develop affirmative defense provisions only for 
malfunction events and not for startup and shutdown events. The 
decision of the court in NRDC v. EPA indicates that the EPA needs to 
revise the SSM Policy yet further.
    As discussed in sections IV and V of this SNPR, the EPA is 
proposing to revise its interpretation of the CAA with respect to 
affirmative defense provisions in SIPs. SWAPCA 400-107 Excess Emissions 
includes the elements of an affirmative defense to be asserted by 
sources in the event of violations during startup and shutdown, 
maintenance and upsets. The provision provides criteria for each type 
of event. If the source is able to establish that it met each of the 
specified criteria to ``the Authority or the decision-making entity'' 
(i.e., officials of the state or the SWCAA), then the provision 
purports to bar any enforcement action and thus any form of

[[Page 55954]]

remedy for the violations that occur during such events. The provision 
explicitly states that if the criteria are met, then the violations 
``shall be excused and not subject to penalty.'' Accordingly, the EPA 
believes that the affirmative defenses created by SWAPCA 400-107 are 
inconsistent with the fundamental enforcement structure of the CAA and 
the EPA thus believes that the provision is not consistent with CAA 
requirements for SIP provisions.
b. The EPA's Proposal
    In this SNPR, the EPA is proposing to make a finding of substantial 
inadequacy and to issue a SIP call for SWAPCA ``400-107 Excess 
Emissions'' in the Washington SIP applicable in the area regulated by 
SWCAA. The EPA is proposing to revise its interpretation of the CAA 
with respect to affirmative defense provisions in SIPs. Previously the 
EPA assessed whether such provisions met certain requirements, such as 
being limited to monetary penalties rather than injunctive relief and 
containing sufficiently robust criteria to assure that the defense 
applied only in appropriately narrow circumstances. The EPA notes that 
SWAPCA 400-107 Excess Emissions did not meet the Agency's prior 
interpretation of the CAA with regard to affirmative defense provisions 
in SIPs. Regardless of that fact, however, the Agency must now evaluate 
such provisions to determine whether they are constructed in a way that 
would purport to preclude federal court jurisdiction under section 113 
to assess civil penalties or other forms of relief for violations of 
SIP emission limits, to prevent courts from considering the statutory 
factors for the assessment of civil penalties under section 113 or to 
interfere with the rights of litigants to pursue enforcement consistent 
with their rights under the citizen suit provision of section 304.
    The EPA interprets SWAPCA ``400-107 Excess Emissions'' to provide 
affirmative defenses that operate to limit the jurisdiction of the 
federal court in an enforcement action and to limit the authority of 
the court to impose monetary penalties as contemplated in CAA sections 
113 and 304. The provision provides that if a violating source meets 
certain criteria set forth in SWAPCA 400-107, then the excess emissions 
are ``excused and not subject to penalty.'' By proscribing any 
enforcement by any party if the source meets certain criteria, SWAPCA 
400-107 creates affirmative defenses that would preclude enforcement 
for excess emissions that would otherwise constitute a violation of the 
applicable SIP emission limitations. Thus, the EPA believes that this 
provision interferes with the intended enforcement structure of the 
CAA, through which parties may seek to bring enforcement actions for 
violations of SIP emission limits and courts may exercise their 
jurisdiction to determine what, if any, relief is appropriate.
    For these reasons, the EPA is proposing to find SWAPCA ``400-107 
Excess Emissions'' substantially inadequate to meet CAA requirements 
and the EPA is thus proposing to issue a SIP call with respect to this 
provision.

VIII. Statutory and Executive Order Reviews

A. Executive Order 12866: Regulatory Planning and Review and Executive 
Order 13563: Improving Regulation and Regulatory Review

    Under Executive Order 12866 (58 FR 51735, October 4, 1993), this 
action is a ``significant regulatory action'' because it raises novel 
legal or policy issues. Accordingly, the EPA submitted this action to 
the Office of Management and Budget (OMB) for review under Executive 
Orders 12866 and 13563 (76 FR 3821, January 21, 2011) and any changes 
made in response to OMB recommendations have been documented in the 
docket for this action.

B. Paperwork Reduction Act

    This action does not impose any new information collection burden. 
The EPA's SPNR, in response to the Petition, merely states the EPA's 
current interpretation of the statutory requirements of the CAA and 
does not require states to collect any additional information. To the 
extent that the EPA proposes to issue a SIP call to a state under CAA 
section 110(k)(5), the EPA is only proposing an action that requires 
the state to revise its SIP to comply with existing requirements of the 
CAA.

C. Regulatory Flexibility Act

    The Regulatory Flexibility Act (RFA) generally requires an agency 
to prepare a regulatory flexibility analysis of any rule subject to 
notice-and-comment rulemaking requirements under the Administrative 
Procedure Act or any other statute unless the agency certifies that the 
rule will not have a significant economic impact on a substantial 
number of small entities.\68\
---------------------------------------------------------------------------

    \68\ Small entities include small businesses, small 
organizations and small governmental jurisdictions. For purposes of 
assessing the impacts of this notice on small entities, small entity 
is defined as: (1) A small business that is a small industrial 
entity as defined in the U.S. Small Business Administration (SBA) 
size standards (see 13 CFR 121.201); (2) a small governmental 
jurisdiction that is a government of a city, county, town, school 
district or special district with a population of less than 50,000; 
or (3) a small organization that is any not-for-profit enterprise 
that is independently owned and operated and is not dominant in its 
field.
---------------------------------------------------------------------------

    After considering the economic impacts of this SNPR on small 
entities, I certify that this action will not have a significant 
economic impact on a substantial number of small entities. Courts have 
interpreted the RFA to require a regulatory flexibility analysis only 
when small entities will be subject to the requirements of the rule. 
See, e.g., Michigan v. EPA, 213 F.3d 663 (D.C. Cir. 2000); Mid-Tex 
Elec. Co-op, Inc. v. FERC, 773 F.2d 327 (D.C. Cir. 1985). This proposed 
rule will not impose any requirements on small entities. Instead, the 
proposed action merely states the EPA's current interpretation of the 
statutory requirements of the CAA. To the extent that the EPA proposes 
to issue a SIP call to a state under CAA section 110(k)(5), the EPA is 
only proposing an action that requires the state to revise its SIP to 
comply with existing requirements of the CAA. The EPA's action, 
therefore, would leave to states the choice of how to revise the SIP 
provision in question to make it consistent with CAA requirements and 
determining, among other things, which of the several lawful approaches 
to the treatment of excess emissions during SSM events will be applied 
to particular sources. We continue to be interested in the potential 
impacts of the proposed rule on small entities and welcome comments on 
issues related to such impacts.

D. Unfunded Mandates Reform Act

    This rule does not contain a federal mandate that may result in 
expenditures of $100 million or more for state, local and tribal 
governments, in the aggregate, or the private sector in any one year. 
The action may impose a duty on certain state governments to meet their 
existing obligations to revise their SIPs to comply with CAA 
requirements. The direct costs of this action on states would be those 
associated with preparation and submission of a SIP revision by those 
states for which the EPA issues a SIP call. Examples of such costs 
could include development of a state rule, conducting notice and public 
hearing and other costs incurred in connection with a SIP submission. 
These aggregate costs would be far less than the $100-million threshold 
in any one year. Thus, this rule is not subject to the requirements of 
sections 202 or 205 of UMRA.
    This rule is also not subject to the requirements of section 203 of 
UMRA

[[Page 55955]]

because it contains no regulatory requirements that might significantly 
or uniquely affect small governments. The regulatory requirements of 
this action would apply to the states for which the EPA issues a SIP 
call. To the extent that such states allow local air districts or 
planning organizations to implement portions of the state's obligation 
under the CAA, the regulatory requirements of this action would not 
significantly or uniquely affect small governments because those 
governments have already undertaken the obligation to comply with the 
CAA.

E. Executive Order 13132--Federalism

    This action does not have federalism implications. It will not have 
substantial direct effects on the states, on the relationship between 
the national government and the states, or on the distribution of power 
and responsibilities among the various levels of government, as 
specified in Executive Order 13132, because it will simply maintain the 
relationship and the distribution of power between the EPA and the 
states as established by the CAA. The proposed SIP calls are required 
by the CAA because the EPA is proposing to find that the current SIPs 
of the affected states are substantially inadequate to meet fundamental 
CAA requirements. In addition, the effects on the states will not be 
substantial because where a SIP call is finalized for a state, the SIP 
call will require the affected state to submit only those revisions 
necessary to address the SIP deficiencies and applicable CAA 
requirements. While this action may impose direct effects on the 
states, the expenditures would not be substantial because they would be 
far less than $25 million in the aggregate in any one year. Thus, 
Executive Order 13132 does not apply to this action.
    In the spirit of Executive Order 13132, and consistent with the 
EPA's policy to promote communications between the EPA and state and 
local governments, the EPA specifically solicits comment on this SNPR 
from state and local officials.

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

    This action does not have tribal implications, as specified in 
Executive Order 13175 (65 FR 67249, November 9, 2000). In this action, 
the EPA is not addressing any tribal implementation plans. This action 
is limited to states. Thus, Executive Order 13175 does not apply to 
this action. However, the EPA invites comment on this SNPR from tribal 
officials.

G. Executive Order 13045--Protection of Children From Environmental 
Health Risks and Safety Risks

    The EPA interprets EO 13045 (62 FR 19885, April 23, 1997) as 
applying only to those regulatory actions that concern health or safety 
risks, such that the analysis required under section 5-501 of the EO 
has the potential to influence the regulation. This action is not 
subject to EO 13045 because it merely prescribes the EPA's action for 
states regarding their obligations for SIPs under the CAA.

H. Executive Order 13211--Actions Concerning Regulations That 
Significantly Affect Energy Supply, Distribution or Use

    This action is not a ``significant energy action'' as defined in 
Executive Order 13211 (66 FR 28355 (May 22, 2001)), because it is not 
likely to have a significant adverse effect on the supply, distribution 
or use of energy. This action merely prescribes the EPA's action for 
states regarding their obligations for SIPs under the CAA.

I. National Technology Transfer and Advancement Act

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

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

    Executive Order 12898 (59 FR 7629, Feb. 16, 1994) establishes 
federal executive policy on environmental justice. Its main provision 
directs federal agencies, to the greatest extent practicable and 
permitted by law, to make environmental justice part of their mission 
by identifying and addressing, as appropriate, disproportionately high 
and adverse human health or environmental effects of their programs, 
policies and activities on minority populations and low-income 
populations in the U.S.
    The EPA has determined that this SNPR will not have 
disproportionately high and adverse human health or environmental 
effects on minority or low-income populations because it increases the 
level of environmental protection for all affected populations without 
having any disproportionately high and adverse human health or 
environmental effects on any population, including any minority or low-
income population. The rule is intended to ensure that all communities 
and populations across the affected states, including minority, low-
income and indigenous populations overburdened by pollution, receive 
the full human health and environmental protection provided by the CAA. 
This proposed action concerns states' obligations regarding the 
treatment they give, in rules included in their SIPs under the CAA, to 
excess emissions during startup, shutdown and malfunctions. This SNPR 
would require 17 states to bring their treatment of these emissions 
into line with CAA requirements, which would lead to sources' having 
greater incentives to control emissions during such events.

K. Determination Under Section 307(d)

    Pursuant to CAA section 307(d)(1)(V), the Administrator determines 
that this action is subject to the provisions of section 307(d). 
Section 307(d) establishes procedural requirements specific to 
rulemaking under the CAA. Section 307(d)(1)(V) provides that the 
provisions of section 307(d) apply to ``such other actions as the 
Administrator may determine.''

L. Judicial Review

    Section 307(b)(1) of the CAA indicates which Federal Courts of 
Appeal have venue for petitions of review of final agency actions by 
the EPA under the CAA. This section provides, in part, that petitions 
for review must be filed in the U.S. Court of Appeals for the District 
of Columbia Circuit (i) when the agency action consists of ``nationally 
applicable regulations promulgated, or final actions taken, by the 
Administrator'' or (ii) when such action is locally or regionally 
applicable, if ``such action is based on a determination of nationwide 
scope or effect and if in taking such action the Administrator finds 
and publishes that such action is based on such a determination.''
    This rule responding to the Petition is ``nationally applicable'' 
within the meaning of section 307(b)(1). First, the

[[Page 55956]]

rulemaking addresses a Petition that raises issues that are applicable 
in all states and territories in the U.S. For example, the Petitioner 
requested that the EPA revise its SSM Policy with respect to whether 
affirmative defense provisions in SIPs are consistent with CAA 
requirements. The EPA's response is relevant for all states nationwide. 
Second, the rulemaking will address a Petition that raises issues 
relevant to specific existing SIP provisions in states across the U.S. 
that are located in each of the 10 EPA Regions, 10 different federal 
circuits and multiple time zones. Third, the rulemaking addresses a 
common core of knowledge and analysis involved in formulating the 
decision and a common interpretation of the requirements of the CAA 
being applied to SIPs in states across the country. Fourth, the 
rulemaking, by addressing issues relevant to appropriate SIP provisions 
in one state, may have precedential impacts upon the SIPs of other 
states nationwide. Courts have found similar rulemaking actions to be 
of nationwide scope and effect.\69\
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    \69\ See, e.g., State of Texas, et al. v. EPA, 2011 U.S. App. 
LEXIS 5654 (5th Cir. 2011) (finding SIP call to 13 states to be of 
nationwide scope and effect and thus transferring the case to the 
U.S. Court of Appeals for the D.C. Circuit in accordance with CAA 
section 307(b)(1)).
---------------------------------------------------------------------------

    This determination is appropriate because in the 1977 CAA 
Amendments that revised CAA section 307(b)(1), Congress noted that the 
Administrator's determination that an action is of ``nationwide scope 
or effect'' would be appropriate for any action that has ``scope or 
effect beyond a single judicial circuit.'' H.R. Rep. No. 95-294 at 323-
324, reprinted in 1977 U.S.C.C.A.N. 1402-03. Here, the scope and effect 
of this rulemaking extends to numerous judicial circuits because the 
action on the Petition extends to states throughout the country. In 
these circumstances, section 307(b)(1) and its legislative history 
authorize the Administrator to find the rule to be of ``nationwide 
scope or effect'' and thus to indicate the venue for challenges to be 
in the D.C. Circuit. Thus, any petitions for review must be filed in 
the U.S. Court of Appeals for the District of Columbia Circuit. 
Accordingly, the EPA is proposing to determine that this will be a 
rulemaking of nationwide scope or effect.
    In addition, pursuant to CAA section 307(d)(1)(V), the EPA is 
determining that this rulemaking action will be subject to the 
requirements of section 307(d), which establish procedural requirements 
specific to rulemaking under the CAA.

IX. Statutory Authority

    The statutory authority for this action is provided by CAA section 
101 et seq. (42 U.S.C. 7401 et seq.).

List of Subjects in 40 CFR Part 52

    Environmental protection, Affirmative defense, Air pollution 
control, Carbon dioxide, Carbon dioxide equivalents, Carbon monoxide, 
Excess emissions, Greenhouse gases, Hydrofluorocarbons, Incorporation 
by reference, Intergovernmental relations, Lead, Methane, Nitrogen 
dioxide, Nitrous oxide, Ozone, Particulate matter, Perfluorocarbons, 
Reporting and recordkeeping requirements, Startup, shutdown and 
malfunction, State implementation plan, Sulfur hexafluoride, Sulfur 
oxides, Volatile organic compounds.

    Dated: September 5, 2014.
Janet G. McCabe,
Acting Assistant Administrator.
[FR Doc. 2014-21830 Filed 9-16-14; 8:45 am]
BILLING CODE 6560-50-P