California State Nonroad Engine Pollution Control Standards; Commercial Harbor Craft Regulations; Notice of Decision, 77521-77528 [2011-31916]

Download as PDF Federal Register / Vol. 76, No. 239 / Tuesday, December 13, 2011 / Notices srobinson on DSK4SPTVN1PROD with NOTICES necessary approvals, exemptions, or orders from the U.S. Coast Guard.43 CARB also points out that many vessels already use shore power while docked, presumably in compliance with U.S. Coast Guard regulations. As above, PMSA’s comment here is again outside the scope of EPA’s section 209(e)(2) evaluation of California’s authorization request. EPA does not review the general appropriateness of California’s regulations; nor does EPA’s review permit analysis of whether California’s regulations conflict with areas of Federal law under the purview of other agencies. This PMSA comment does not make any attempt to show that California’s regulations are in conflict with any of the criteria in section 209(e)(2). It therefore cannot be the basis for any denial of California’s request for authorization under section 209(e)(2). Third, PMSA comments that California’s At-Berth Regulation’s ‘‘retrofit requirements’’ are preempted under section 209(e) of the Clean Air Act. This is another issue that PMSA first presented to CARB during the California rulemaking. At that time, CARB disagreed.44 CARB again pointed out that its At-Berth Regulation does not require vessel operators to retrofit or modify their engines. CARB further pointed out that despite section 209(e)’s preemption, section 209(e)(2) allows California to seek authorization to adopt and enforce its nonroad engine regulations, which it intended to do and has now done. PMSA’s comments compare this situation to the one addressed by the Supreme Court in United States v. Locke, 529 U.S. 89 (2000). However, in this case, unlike in the case of Locke, the statute in question, the Clean Air Act, explicitly permits California to promulgate its own standards applicable to emissions from marine vessels as long as EPA does not make any of the findings required under section 209(e)(2) to deny authorization. Also, as part of this third general comment, PMSA raises two additional issues. First, PMSA raises the issue that EPA’s authorization would allow other states to adopt the At-Berth Regulation, and that it is difficult to envision how other states would do so. PMSA is correct that other states may adopt and enforce California standards, if such states meet the requirements of section 209(e)(2)(B) of the Act. While PMSA notes that there may be difficulties with 43 At-Berth Regulation section (b)(2), section 93118.3(b)(2), title 17, chapter 1, subchapter 7.5, California Code of Regulations, EPA–HQ–OAR– 2011–0548–0012. 44 CARB FSOR at 20. VerDate Mar<15>2010 16:25 Dec 12, 2011 Jkt 226001 other states’ adoption of the At-Berth Regulation—and PMSA has not made it clear that there would be—PMSA makes no attempt to explain how this difficulty in any way effects California’s ability to receive authorization under section 209(e)(2)(A). Second, PMSA presents its opposition to California’s At-Berth Regulation on the basis that ocean-going vessel emissions are an issue of broad concern and should be addressed internationally through the International Maritime Organization. This comment relates to the broad policy considerations affecting California’s regulation of vessels, but it does not address any of the criteria in section 209(e)(2). It is therefore not within the scope of EPA’s review under that section. As EPA has stated on numerous occasions, sections 209(b) and 209(e) of the Clean Air Act limits our authority to deny California requests for waivers and authorizations to the three criteria listed therein. As a result, EPA has consistently refrained from denying California’s requests based on any other criteria.45 In instances where the U.S. Court of Appeals has reviewed EPA decisions declining to deny waiver requests based on criteria not found in section 209(b), the Court has upheld and agreed with EPA’s determination.46 None of the above-described issues PMSA raises is among—or fits within the confines of—the criteria listed under sections 209(e).47 Therefore, in considering California’s At-Berth Regulation, EPA cannot deny California’s request for authorization based on these comments. E. Authorization Determination for California’s At-Berth Regulation After a review of the information submitted by CARB and PMSA, EPA finds that those opposing California’s request have not met the burden of demonstrating that authorization for California’s At-Berth Regulation should be denied based on any of the three statutory criteria of section 209(e)(2). For this reason, EPA finds that an authorization for California’s At-Berth Regulation should be granted. III. Decision The Administrator has delegated the authority to grant California section 45 See, e.g., 74 FR 32744, 32783 (July 8, 2009). Motor and Equipment Manufacturers Ass’n v. Nichols, 142 F.3d 449, 462–63, 466–67 (DC Cir.1998), Motor and Equipment Manufacturers Ass’n v. EPA, 627 F.2d 1095, 1111, 1114–20 (DC Cir. 1979). 47 PMSA may raise these issues in a direct challenge to California’s regulations in other forums, but these issues are not relevant to EPA’s limited review under section 209(e). 46 See PO 00000 Frm 00052 Fmt 4703 Sfmt 4703 77521 209(e) authorizations to the Assistant Administrator for Air and Radiation. After evaluating California’s At-Berth Regulation, CARB’s submissions, and the public comments from PMSA, EPA is granting an authorization to California for its At-Berth Regulation. My decision will affect not only persons in California, but also entities outside the State who must comply with California’s requirements. For this reason, I determine and find that this is a final action of national applicability for purposes of section 307(b)(1) of the Act. Pursuant to section 307(b)(1) of the Act, judicial review of this final action may be sought only in the United States Court of Appeals for the District of Columbia Circuit. Petitions for review must be filed by February 13, 2012. Judicial review of this final action may not be obtained in subsequent enforcement proceedings, pursuant to section 307(b)(2) of the Act. IV. Statutory and Executive Order Reviews As with past authorization and waiver decisions, this action is not a rule as defined by Executive Order 12866. Therefore, it is exempt from review by the Office of Management and Budget as required for rules and regulations by Executive Order 12866. In addition, this action is not a rule as defined in the Regulatory Flexibility Act, 5 U.S.C. 601(2). Therefore, EPA has not prepared a supporting regulatory flexibility analysis addressing the impact of this action on small business entities. Further, the Congressional Review Act, 5 U.S.C. 801, et seq., as added by the Small Business Regulatory Enforcement Fairness Act of 1996, does not apply because this action is not a rule for purposes of 5 U.S.C. 804(3). Dated: November 28, 2011. Gina McCarthy, Assistant Administrator, Office of Air and Radiation. [FR Doc. 2011–31909 Filed 12–12–11; 8:45 am] BILLING CODE 6560–50–P ENVIRONMENTAL PROTECTION AGENCY [FRL–9503–5] California State Nonroad Engine Pollution Control Standards; Commercial Harbor Craft Regulations; Notice of Decision Environmental Protection Agency (EPA). ACTION: Notice of Decision. AGENCY: E:\FR\FM\13DEN1.SGM 13DEN1 77522 Federal Register / Vol. 76, No. 239 / Tuesday, December 13, 2011 / Notices EPA has granted the California Air Resources Board (CARB) its request for an authorization to adopt and enforce regulations for the control of emissions of particulate matter and oxides of nitrogen from new and in-use diesel-fueled engines on commercial harbor craft. DATES: Petitions for review must be filed by February 13, 2012. ADDRESSES: EPA has established a docket for this action under Docket ID EPA–HQ–OAR–2011–0549. All documents relied upon in making this decision, including those submitted to EPA by CARB, are contained in the public docket. Publicly available docket materials are available either electronically through www.regulations.gov or in hard copy at the Air and Radiation Docket in the EPA Headquarters Library, EPA West Building, Room 3334, located at 1301 Constitution Avenue NW., Washington, DC. The Public Reading Room is open to the public on all federal government working days from 8:30 a.m. to 4:30 p.m.; generally, it is open Monday through Friday, excluding holidays. The telephone number for the Reading Room is (202) 566–1744. The Air and Radiation Docket and Information Center’s Web site is https://www.epa.gov/ oar/docket.html. The electronic mail (email) address for the Air and Radiation Docket is: a-and-r-Docket@ epa.gov, the telephone number is (202) 566–1742, and the fax number is (202) 566–9744. An electronic version of the public docket is available through the federal government’s electronic public docket and comment system. You may access EPA dockets at https:// www.regulations.gov. After opening the www.regulations.gov Web site, enter EPA–HQ–OAR–2011–0549 in the ‘‘Enter Keyword or ID’’ fill-in box to view documents in the record. Although a part of the official docket, the public docket does not include Confidential Business Information (‘‘CBI’’) or other information whose disclosure is restricted by statute. EPA’s Office of Transportation and Air Quality (‘‘OTAQ’’) maintains a Web page that contains general information on its review of California waiver requests. Included on that page are links to prior waiver Federal Register notices, some of which are cited in today’s notice. The page can be accessed at https://www.epa.gov/otaq/cafr.htm. FOR FURTHER INFORMATION CONTACT: Kristien G. Knapp, Attorney-Advisor, Compliance Division, Office of Transportation and Air Quality, U.S. Environmental Protection Agency, 1200 Pennsylvania Avenue (6405J) NW., srobinson on DSK4SPTVN1PROD with NOTICES SUMMARY: VerDate Mar<15>2010 16:25 Dec 12, 2011 Jkt 226001 Washington, DC 20460. Telephone: (202) 343–9949. Fax: (202) 343–2800. Email: knapp.kristien@epa.gov. SUPPLEMENTARY INFORMATION: I. Background A. California’s Commercial Harbor Craft Regulations In a letter dated April 12, 2010, CARB submitted to EPA its request pursuant to section 209(e) of the Clean Air Act (‘‘CAA’’ or ‘‘the Act’’), regarding its regulations to enforce emission standards for new and in-use commercial harbor craft operated within California waters and twenty-four nautical miles of the California baseline (‘‘commercial harbor craft regulations’’).1 The CARB Board approved the commercial harbor craft regulations at its November 15, 2007 hearing (by Resolution 07–47).2 After making modifications, as directed by the Board, CARB’s Executive Officer formally adopted the rulemaking in Executive Order R–08–007 on September 2, 2008.3 CARB’s commercial harbor craft regulations became operative under California state law on November 19, 2008.4 The regulations are codified in title 13, California Code of Regulations (CCR), section 2229.5 and title 17, CCR section 93118.5.5 California’s commercial harbor craft regulations establish emission standards, requirements related to the control of emissions, and enforcement provisions. The requirements are applicable to diesel propulsion and auxiliary engines on new and in-use commercial harbor crafts, with some exceptions.6 Commercial harbor craft include a variety of different types of vessels, including ferries, excursion vessels, tugboats, towboats, and commercial and charter fishing boats. Approximately eighty percent of commercial harbor craft engines operating in California are previously unregulated diesel engines, accounting for approximately 3.3 tons per day (tpd) of diesel particulate matter (PM) and 73 tpd of oxides of nitrogen (NOX). California’s commercial harbor craft regulations aim to reduce these emissions so that California can meet 1 Letter from James Goldstene to Lisa P. Jackson, EPA–HQ–OAR–2011–0549–0001. 2 CARB, Resolution 07–47, EPA–HQ–OAR–2011– 0549–0027. 3 CARB, Executive Order R–08–007, EPA–HQ– OAR–2011–0549–0030. 4 See CARB, Approval Notice, EPA–HQ–OAR– 2011–0549–0035. 5 See CARB, Final Regulation Order, EPA–HQ– OAR–2011–0549–0034. 6 See CARB, Authorization Support Document, p. 5, EPA–HQ–OAR–2011–0549–0002 (hereinafter ‘‘CARB Support Document’’). PO 00000 Frm 00053 Fmt 4703 Sfmt 4703 the 2014 National Ambient Air Quality Standards (NAAQS) deadline for PM2.5 in the South Coast Air Basin. The commercial harbor craft regulations apply separately to new and in-use engines used on harbor craft.7 For new harbor craft, each propulsion and auxiliary diesel engine on the vessel is required to be certified to the most stringent federal new marine engine emission standards for that engine’s power rating and displacement in effect at the time of sale, lease, rent, or acquisition.8 The regulation imposes additional requirements for larger new ferries (with the capacity to transport seventy-five or more passengers), either by using best available control technology (‘‘BACT’’),9 or by using a federal Tier 4 certified propulsion engine. For in-use harbor craft, new or in-use diesel engines may not be sold, offered for sale, leased, rented, or acquired unless the diesel propulsion or auxiliary engines are certified to at least the federal Tier 2 or Tier 3 marine emission standards for new engines of the same power rating and displacement.10 In-use emission requirements are imposed on Tier 0 and Tier 1 marine engines in ferries, excursion vessels, tugboats, towboats, push boats, and multipurpose harbor craft. Those harbor craft are required to meet emission limits equal to or cleaner than the federal new marine engine certification standards in effect for the year that in-use engine compliance is required. California’s commercial harbor craft regulations also impose requirements related to monitoring, reporting and recordkeeping of compliance on owners and operators of new and in-use harbor craft.11 Subject to CARB approval, harbor craft owners and operators may opt to meet requirements by implementing alternative emission control strategies. B. Clean Air Act Nonroad Engine and Vehicle Authorizations Section 209(e)(1) of the Act permanently preempts any State, or political subdivision thereof, from adopting or attempting to enforce any standard or other requirement relating to the control of emissions for certain new nonroad engines or vehicles. Section 209(e)(2) of the Act requires the Administrator to grant California authorization to enforce its own 7 CARB Support Document, pp. 2–6. Support Document at 2. 9 BACT is the diesel emission control strategy (DECS) determined by CARB to be the greatest feasible reduction of NOX or PM. 10 CARB Support Document at 3. 11 CARB Support Document at 5. 8 CARB E:\FR\FM\13DEN1.SGM 13DEN1 Federal Register / Vol. 76, No. 239 / Tuesday, December 13, 2011 / Notices srobinson on DSK4SPTVN1PROD with NOTICES standards for new nonroad engines or vehicles that are not listed under section 209(e)(1), subject to certain restrictions. On July 20, 1994, EPA promulgated a rule that sets forth, among other things, the criteria, as found in section 209(e)(2), which EPA must consider before granting any California authorization request for new nonroad engine or vehicle emission standards. On October 8, 2008, the regulations promulgated in that rule were moved to 40 CFR part 1074, and modified slightly.12 As stated in the preamble to the section 209(e) rule, EPA has historically interpreted the section 209(e)(2)(iii) ‘‘consistency’’ inquiry to require, at minimum, that California standards and enforcement procedures be consistent with section 209(a), section 209(e)(1), and section 209(b)(1)(C) (as EPA has interpreted that subsection in the context of section 209(b) motor vehicle waivers).13 In order to be consistent with section 209(a), California’s nonroad standards and enforcement procedures must not apply to new motor vehicles or new motor vehicle engines. To be consistent with section 209(e)(1), California’s nonroad standards and enforcement procedures must not attempt to regulate engine categories that are permanently preempted from state regulation. To determine consistency with section 209(b)(1)(C), EPA typically reviews nonroad authorization requests under the same ‘‘consistency’’ criteria that are applied to motor vehicle waiver requests. Pursuant to section 209(b)(1)(C), the Administrator shall not grant California a motor vehicle waiver if she finds that California ‘‘standards and accompanying enforcement procedures are not consistent with 12 The applicable regulations, now in 40 CFR part 1074, subpart B, § 1074.105, provide: (a) The Administrator will grant the authorization if California determines that its standards will be, in the aggregate, at least as protective of public health and welfare as otherwise applicable federal standards. (b) The authorization will not be granted if the Administrator finds that any of the following are true: (1) California’s determination is arbitrary and capricious. (2) California does not need such standards to meet compelling and extraordinary conditions. (3) The California standards and accompanying enforcement procedures are not consistent with section 209 of the Act. (c) In considering any request from California to authorize the state to adopt or enforce standards or other requirements relating to the control of emissions from new nonroad spark-ignition engines smaller than 50 horsepower, the Administrator will give appropriate consideration to safety factors (including the potential increased risk of burn or fire) associated with compliance with the California standard. 13 See 59 FR 36969 (July 20, 1994). VerDate Mar<15>2010 16:25 Dec 12, 2011 Jkt 226001 section 202(a)’’ of the Act. Previous decisions granting waivers and authorizations have noted that state standards and enforcement procedures are inconsistent with section 202(a) if: (1) There is inadequate lead time to permit the development of the necessary technology giving appropriate consideration to the cost of compliance within that time, or (2) the federal and state testing procedures impose inconsistent certification requirements. C. Burden of Proof In Motor and Equip. Mfrs Assoc. v. EPA, 627 F.2d 1095 (D.C. Cir. 1979) (‘‘MEMA I’’), the U.S. Court of Appeals stated that the Administrator’s role in a section 209 proceeding is to: consider all evidence that passes the threshold test of materiality and * * * thereafter assess such material evidence against a standard of proof to determine whether the parties favoring a denial of the waiver have shown that the factual circumstances exist in which Congress intended a denial of the waiver.14 The court in MEMA I considered the standards of proof under section 209 for the two findings related to granting a waiver for an ‘‘accompanying enforcement procedure’’ (as opposed to the standards themselves): (1) Protectiveness in the aggregate and (2) consistency with section 202(a) findings. The court instructed that ‘‘the standard of proof must take account of the nature of the risk of error involved in any given decision, and it therefore varies with the finding involved. We need not decide how this standard operates in every waiver decision.’’ 15 The court upheld the Administrator’s position that, to deny a waiver, there must be ‘‘clear and compelling evidence’’ to show that proposed procedures undermine the protectiveness of California’s standards.16 The court noted that this standard of proof also accords with the congressional intent to provide California with the broadest possible discretion in setting regulations it finds protective of the public health and welfare.17 With respect to the consistency finding, the court did not articulate a standard of proof applicable to all proceedings, but found that the opponents of the waiver were unable to meet their burden of proof even if the standard were a mere preponderance of the evidence. Although MEMA I did not explicitly consider the standards of proof under section 209 concerning a waiver request for ‘‘standards,’’ as compared to accompanying enforcement procedures, there is nothing in the opinion to suggest that the court’s analysis would not apply with equal force to such determinations. EPA’s past waiver decisions have consistently made clear that: ‘‘[E]ven in the two areas concededly reserved for Federal judgment by this legislation—the existence of ‘compelling and extraordinary’ conditions and whether the standards are technologically feasible—Congress intended that the standards of EPA review of the State decision to be a narrow one.’’ 18 Opponents of the waiver bear the burden of showing that the criteria for a denial of California’s waiver request have been met. As found in MEMA I, this obligation rests firmly with opponents of the waiver in a section 209 proceeding: [t]he language of the statute and its legislative history indicate that California’s regulations, and California’s determinations that they must comply with the statute, when presented to the Administrator are presumed to satisfy the waiver requirements and that the burden of proving otherwise is on whoever attacks them. California must present its regulations and findings at the hearing and thereafter the parties opposing the waiver request bear the burden of persuading the Administrator that the waiver request should be denied.19 The Administrator’s burden, on the other hand, is to make a reasonable evaluation of the information in the record in coming to the waiver decision. As the court in MEMA I stated: ‘‘here, too, if the Administrator ignores evidence demonstrating that the waiver should not be granted, or if he seeks to overcome that evidence with unsupported assumptions of his own, he runs the risk of having his waiver decision set aside as ‘arbitrary and capricious.’ ’’ 20 Therefore, the Administrator’s burden is to act ‘‘reasonably.’’ 21 D. EPA’s Administrative Process in Consideration of California’s Commercial Harbor Craft Regulations Upon review of CARB’s request, EPA offered an opportunity for a public hearing, and requested written comment on issues relevant to a full section 209(e) authorization analysis, by publication of a Federal Register notice on June 29, 2011.22 Specifically, we 18 See, 14 MEMA I, 627 F.2d at 1122. 15 Id. 16 Id. 17 Id. PO 00000 Frm 00054 Fmt 4703 Sfmt 4703 77523 e.g., 40 FR 21102–103 (May 28, 1975). I, 627 F.2d at 1121. 20 Id. at 1126. 21 Id. at 1126. 22 76 FR 38153 (June 29, 2011). 19 MEMA E:\FR\FM\13DEN1.SGM 13DEN1 77524 Federal Register / Vol. 76, No. 239 / Tuesday, December 13, 2011 / Notices requested comment on: (a) Whether CARB’s determination that its standards, in the aggregate, are at least as protective of public health and welfare as applicable federal standards is arbitrary and capricious, (b) whether California needs such standards to meet compelling and extraordinary conditions, and (c) whether California’s standards and accompanying enforcement procedures are consistent with section 209 of the Act. In response to EPA’s June 29, 2011 Federal Register notice, EPA received two written comments. The written comments are from the American Waterways Operators (‘‘AWO’’) 23 and K-Sea Transportation Partners L.P. (‘‘KSea’’).24 AWO initially requested a public hearing, and later withdrew that request. After the close of the comment period, EPA met with AWO to discuss comments from their members.25 AWO comments that California does not need the new standards to meet compelling and extraordinary conditions. AWO also comments that California’s standards and enforcement procedures are not consistent with the Clean Air Act section 209. Additionally, AWO expressed other concerns in their comments related to the commercial harbor craft regulation’s compliance schedules. K-Sea comments that the new regulations are not consistent with section 202(a) of the Clean Air Act. KSea also comments that California does not need the new regulations to meet compelling and extraordinary conditions. Additionally, K-Sea does not believe that CARB adequately assessed the financial impacts and compliance costs associated with implementation of California’s commercial harbor craft regulations. II. Discussion srobinson on DSK4SPTVN1PROD with NOTICES A. California’s Protectiveness Determination Section 209(e)(2)(i) of the Act instructs that EPA cannot grant an authorization if the agency finds that CARB was arbitrary and capricious in its determination that its standards are, in the aggregate, at least as protective of public health and welfare as applicable federal standards. CARB’s Board made a protectiveness determination in Resolution 07–47, finding that 23 The American Waterways Operators (‘‘AWO’’), Comments, EPA–HQ–OAR–2011–0549–0038 (hereinafter ‘‘AWO Comments’’). 24 K-Sea Transportation Partners L.P. (‘‘K-Sea’’), Comments, EPA–HQ–OAR–2011–0549–0037 (hereinafter ‘‘K-Sea Comments’’). 25 EPA, ‘‘Memorandum from Tayyaba Waqar to Docket EPA–HQ–OAR–2011–0549,’’ EPA–HQ– OAR–2011–0549–0039. VerDate Mar<15>2010 16:25 Dec 12, 2011 Jkt 226001 California’s commercial harbor craft regulation will not cause the California emission standards, in the aggregate, to be less protective of public health and welfare than applicable federal standards.26 CARB asserts that EPA has no basis to find that the CARB Board’s determination is arbitrary or capricious.27 CARB points out that most of the commercial harbor craft requirements (for new diesel engines in newly acquired harbor craft and ferry propulsion engines) are identical to the federal requirements for those engines. CARB also highlights that its requirements for new propulsion diesel engines in larger new ferries are more stringent that federal standards because they additionally require BACT technology. With respect to the commercial harbor craft regulation’s inuse requirements, CARB additionally asserts that its requirements are more stringent than applicable federal regulations because EPA does not have the authority to regulate in-use nonroad engines. No commenter expressed an opinion or presented evidence suggesting that CARB was arbitrary and capricious in making its above-noted protectiveness findings or that CARB’s requirements are not, in the aggregate, as stringent as applicable federal standards. Therefore, based on the record before us, EPA finds that opponents of the authorization have not shown that California was arbitrary and capricious in its determination that its standards are, in the aggregate, at least as protective of public health and welfare as applicable federal standards. B. Need for California Standards to Meet Compelling and Extraordinary Conditions Section 209(e)(2)(ii) of the Act instructs that EPA cannot grant an authorization if the agency finds that California ‘‘does not need such California standards to meet compelling and extraordinary conditions.’’ This criterion restricts EPA’s inquiry to whether California needs its own mobile source pollution program to meet 26 ‘‘BE IT FURTHER RESOLVED that the Board hereby determines, in accordance with section 209(e)(2) of the CAA, that to the extent the regulation approved herein affects nonroad engines as defined in CAA section 216(10) and (11), the emission standards and other requirements related to the control of emissions in the regulation approved herein are, in the aggregate, at least as protective of public health and welfare as applicable federal standards; California needs its nonroad emission standards to meet compelling and extraordinary conditions; and the standards and accompanying enforcement procedures approved herein are consistent with CAA section 209.’’ CARB Resolution 07–47, EPA–HQ–OAR– 2011–0549–0028. 27 CARB Support Document at 7–8. PO 00000 Frm 00055 Fmt 4703 Sfmt 4703 compelling and extraordinary conditions, and not whether any given standards are necessary to meet such conditions.28 As discussed above, for over forty years CARB has repeatedly demonstrated the need for its motor vehicle emissions program to address compelling and extraordinary conditions in California. In its Resolution 07–47, CARB re-affirmed its longstanding position that California continues to need its nonroad emission standards to meet its serious air pollution problems. Likewise, EPA has consistently recognized that California continues to have the same ‘‘geographical and climatic conditions that, when combined with the large numbers and high concentrations of automobiles, create serious pollution problems.’’ 29 AWO asserts that California does not need the commercial harbor craft regulations to meet compelling and extraordinary conditions. AWO focuses on California’s goal of improving upon the South Coast Air Basin’s nonattainment status by reducing NOX and PM2.5 levels. AWO states that there is no justification for CARB to adopt statewide regulations of NOX and PM2.5 in order to meet the 2014 NAAQS deadline for PM2.5 in the South Coast Air Basin. AWO reviewed CARB’s Initial Statement of Reasons (‘‘ISOR’’) and believes that the ISOR does not provide sufficient detail to explain the relationship between pollutant exceedances and commercial harbor craft emissions. Additionally, AWO believes that the data CARB used from 2006 and earlier for its analysis of commercial harbor craft’s contribution to NOX and PM2.5 levels is inaccurate and outdated in that it does not represent the most current operation of tugboats in California waters. AWO also points to CARB’s statements regarding decrease in emissions for diesel NOX and PM2.5 because of other effects and factors. Further, in comparing data for emission reductions with and without the proposed standards, AWO concludes that CARB’s emission reduction goals would be met without implementing the commercial harbor craft regulation. K-Sea also asserts that California does not need the commercial harbor craft regulation to meet compelling and extraordinary conditions. K-Sea argues that California used data from 2006 and earlier in its rulemaking, which is 28 See 74 FR 32744, 32761 (July 8, 2009); 49 FR 18887, 18889–18890 (May 3, 1984). 29 49 FR 18887, 18890 (May 3, 1984); see also 76 FR 34693 (June 14, 2011), 74 FR 32744, 32763 (July 8, 2009), and 73 FR 52042 (September 8, 2008). E:\FR\FM\13DEN1.SGM 13DEN1 srobinson on DSK4SPTVN1PROD with NOTICES Federal Register / Vol. 76, No. 239 / Tuesday, December 13, 2011 / Notices outdated and inaccurate. K-Sea bases that argument on its belief that because of the recession, which started in 2008, emissions have already been in decline. K-Sea also states that the data CARB used to assess harbor craft emissions from tugboats in coastwise service did not accurately capture their duty cycles or operations within the 24-mile zone of the California regulated waters. AWO and K-Sea have both presented arguments and information suggesting that California does not need its commercial harbor craft regulations to meet compelling and extraordinary conditions. However, as discussed above, EPA’s inquiry under the section 209(e)(2)(ii) criterion restricts EPA’s inquiry to whether California needs its own mobile source air pollution program to meet compelling and extraordinary conditions, and not whether any given standards are necessary to meet such conditions.30 Congress decided in 1977 to allow California to promulgate individual standards that are not as stringent as comparable federal standards, as long as the standards are ‘‘in the aggregate, at least as protective of public health and welfare as applicable federal standards.’’ This decision by Congress requires EPA to allow California to promulgate individual standards that are part of California’s overall approach to reducing mobile source emissions to address air pollution problems. Congress intended to provide California the ‘‘broadest possible discretion’’ in selecting the best means to protect its citizens and the public welfare and did not intend for EPA to weigh which particular regulations are most appropriate for California to implement to protect public health and welfare. Consequently, Congress provided EPA a much more limited role in considering objections raised by opponents of the waiver. Although AWO and K-Sea believe that California does not need its commercial harbor craft regulations to meet compelling and extraordinary conditions, CARB has provided evidence that it does. In the California rulemaking, CARB explained its need for the commercial harbor craft regulation.31 Regarding the comment that California’s air quality problems are limited to the South Coast Air Basin, EPA has never suggested in previous authorization or waiver proceedings that localized air quality concerns are not sufficient to receive authorization under 30 See 74 FR 32744, 32761 (July 8, 2009); 49 FR 18887, 18889–18890 (May 3, 1984). 31 CARB, Technical Support Document, EPA– HQ–OAR–2011–0549–0007, pp. I–1–I–3. VerDate Mar<15>2010 16:25 Dec 12, 2011 Jkt 226001 this criterion. However, even if EPA were to accept this comment for the sake of argument, CARB has explained that it has statewide goals and federal Clean Air Act requirements to reduce NOX and PM2.5 emissions. CARB explained that NOX and PM2.5 reductions are necessary because of the relationship between those pollutants and the federal non-attainment status in both the South Coast and San Joaquin Valley air basins: The South Coast and San Joaquin Valley air basins are the two areas in the State that exceed the annual PM2.5 standards. These areas are required by federal law to develop State Implementation Plans (SIPs) describing how they will attain the standards by 2015. The U.S. EPA further requires that all necessary emission reductions be achieved one calendar year sooner—by 2014—in recognition of the annual average form [sic] the standard. NOX emission reductions are needed because NOX leads to formation in the atmosphere of both ozone and PM2.5; diesel PM emission reductions are needed because diesel PM contributes to ambient concentrations of PM2.5. San Joaquin Valley and South Coast air basins are also in nonattainment for the federal ozone standard.* * * While all sources of NOX emissions are important, marine vessels, which include commercial harbor craft engines, are one of several key contributors to PM2.5 that will determine whether California is able to meet the 2014 deadline for PM2.5 attainment in the South Coast air basin. * * * Staff projects that the regulation would reduce in-use harbor craft diesel PM emissions about 70 percent and NOX emissions about 60 percent from the 2004 baseline by 2020. These emission reductions would occur in areas along waterways, near ports, and in those communities surrounding these areas, as well as further inland. The regulation would also reduce diesel PM and NOX emissions that contribute to exceedances throughout the State of ambient air quality standards for both PM2.5 and ozone. These reductions would assist California in its goal of achieving state and federal air quality standards. The emission reductions from the proposed regulation would result in lower ambient PM levels and reduced exposure to diesel PM. Staff estimates that approximately 310 premature deaths statewide would be avoided by year 2025 from implementation of the proposed regulation. The estimated cost benefit of the avoided premature deaths and other health benefits due to the emission reductions are estimated to range from $1.3 to $2.0 billion.32 Thus, contrary to AWO’s argument, CARB presents that it does need statewide commercial harbor craft regulations, because NOX and PM pollution problems affect the entire state. Although AWO and K-Sea claim that California’s 2006 data is outdated, 32 Id. PO 00000 Frm 00056 Fmt 4703 Sfmt 4703 77525 because emissions have decreased since 2008 due to the recession and other emission reduction strategies, they have not presented evidence proving this to be the case. EPA must rely on the record in front of us. Moreover, while both AWO and K-Sea suggest that California may have overstated the emission contributions from harbor craft, they do not show that harbor craft do not contribute to emissions that affect California’s air quality. While the level of air pollution may go to the overall benefits of the program, it is not relevant for determining the need for California’s nonroad engine program. Indeed, AWO’s comments make clear that the harbor craft regulations will result in emission reductions.33 Moreover, AWO’s argument relies on California’s other emission reduction strategies to make its case, but it is inappropriate for EPA to decide which California regulations are needed, and which are not. CARB presented that they expect the emission reductions from the commercial harbor craft regulation to benefit the entire state in meeting federal standards and reaching their statewide emission reduction goals. While AWO believes California’s state goals will be met without the commercial harbor craft regulation, they do not present evidence to support that belief, nor do they suggest that the San Joaquin or South Coast air basins would actually meet federal ozone and PM standards without the commercial harbor craft regulation. Nor would it be appropriate for EPA to decide that the other emission controls on which AWO relies are necessary but the controls on commercial harbor craft are not. Aside from the fact that all sources of pollution could argue that other sources should be regulated instead of them, EPA’s review is not intended to replace the policy decisions of California in determining the appropriate emission control strategies it will use to meet its air quality needs. Based on the above, those opposing the authorization have not met the burden of proof necessary for EPA to find that California no longer needs a separate mobile source emissions program to address compelling and extraordinary conditions in California. Therefore, EPA has determined that we cannot deny California authorization for its commercial harbor craft regulations under section 209(e)(2)(ii). 33 For example, AWO analyzed CARB’s ISOR, and found that California’s commercial harbor craft regulation would achieve ‘‘only 10 percent’’ of California’s total estimated statewide PM emission reductions and ‘‘only 6 percent’’ of California’s total estimated statewide NOX reductions. E:\FR\FM\13DEN1.SGM 13DEN1 77526 Federal Register / Vol. 76, No. 239 / Tuesday, December 13, 2011 / Notices C. Consistency With Section 209 of the Clean Air Act Section 209(e)(2)(iii) of the Act instructs that EPA cannot grant an authorization if California’s standards and enforcement procedures are not consistent with section 209. As described above, EPA has historically evaluated this criterion for consistency with sections 209(a), 209(e)(1), and 209(b)(1)(C). 1. Consistency With Section 209(a) To be consistent with section 209(a) of the Clean Air Act, California’s commercial harbor craft regulations must not apply to new motor vehicles or new motor vehicle engines. California’s commercial harbor craft regulations apply to nonroad engines, not on-highway motor vehicles or engines. CARB states that the new vessel requirements regulate new diesel engines, and apply only to nonroad engines that are neither new motor vehicles nor new motor vehicle engines. No commenter presented otherwise; therefore, EPA cannot deny California’s request on the basis that California’s commercial harbor craft regulations are not consistent with section 209(a). srobinson on DSK4SPTVN1PROD with NOTICES 2. Consistency With Section 209(e)(1) To be consistent with section 209(e)(1) of the Clean Air Act, California’s commercial harbor craft regulations must not affect new farming or construction vehicles or engines that are below 175 horsepower, or new locomotives or their engines. CARB presents that commercial harbor craft engines are not used in locomotives and are not primarily used in farm and construction equipment vehicles. No commenter presented otherwise; therefore, EPA cannot deny California’s request on the basis that California’s commercial harbor craft requirements are not consistent with section 209(e)(1). 3. Consistency With Section 209(b)(1)(C) The requirement that California’s standards be consistent with section 209(b)(1)(C) of the Clean Air Act effectively requires consistency with section 202(a) of the Act. California standards are inconsistent with section 202(a) of the Act if there is inadequate lead-time to permit the development of technology necessary to meet those requirements, giving appropriate consideration to the cost of compliance within that time. California’s accompanying enforcement procedures would also be inconsistent with section 202(a) if the federal and California test procedures were not consistent. The scope of EPA’s review of whether California’s action is consistent with VerDate Mar<15>2010 16:25 Dec 12, 2011 Jkt 226001 section 202(a) is narrow. The determination is limited to whether those opposed to the authorization or waiver have met their burden of establishing that California’s standards are technologically infeasible, or that California’s test procedures impose requirements inconsistent with the federal test procedure.34 a. Technological Feasibility Congress has stated that the consistency requirement of section 202(a) relates to technological feasibility.35 Section 202(a)(2) states, in part, that any regulation promulgated under its authority ‘‘shall take effect after such period as the Administrator finds necessary to permit the development and application of the requisite technology, giving appropriate consideration to the cost of compliance within such period.’’ Section 202(a) thus requires the Administrator to first determine whether adequate technology already exists; or if it does not, whether there is adequate time to develop and apply the technology before the standards go into effect. The latter scenario also requires the Administrator to decide whether the cost of developing and applying the technology within that time is feasible. Previous EPA waivers are in accord with this position.36 For example, a previous EPA waiver decision considered California’s standards and enforcement procedures to be consistent with section 202(a) because adequate technology existed as well as adequate lead-time to implement that technology.37 Subsequently, Congress has stated that, generally, EPA’s construction of the waiver provision has been consistent with congressional intent.38 CARB presents that the technological feasibility of most of the commercial harbor craft requirements are ‘‘clearly technologically feasible’’ because they mirror requirements that EPA has already adopted and determined were technologically feasible after considering cost of compliance when setting its Tier 2, 3, and 4 emission standards.39 Such is the case for the new vessel engine requirements, for which compliance is based on meeting applicable federal Tier 2, 3, or 4 emission standards. Larger new ferry 34 MEMA 35 H.R. I, 627, F.2d at 1126. Rep. No. 95–294, 95th Cong., 1st Sess. 301 (1977). 36 See, e.g., 49 FR 1887, 1895 (May 3, 1984); 43 FR 32182, 32183 (July 25, 1978); 41 FR 44209, 44213 (October 7, 1976). 37 41 FR 44209 (October 7, 1976). 38 H.R. Rep. No. 95–294, 95th Cong., 1st Sess. 301 (1977). 39 CARB Support Document at 9–13. PO 00000 Frm 00057 Fmt 4703 Sfmt 4703 propulsion engines must similarly meet applicable federal standards, with those that meet Tier 2 or 3 federal standards also required to be equipped with BACT. CARB states that the BACT requirement is technologically feasible because a BACT determination is made on a case-by-case assessment of technological availability for each specific ferry application. If no BACT is available for a specific ferry application, compliance with federal Tier 2 or 3 standards is all that is required. This aspect of California’s commercial harbor craft regulations is the only aspect which does not rely upon compliance with a federal standard; for this aspect, CARB contends that the cost of compliance on ferry owners and operators will largely be passed along to customers without significant economic disruption. CARB’s in-use requirements also rely on compliance with federal emission standards and includes four compliance options: (1) Engine replacement with new federal Tier 2 or 3 compliant engines, (2) demonstrating compliance with federal Tier 2 or 3 standards (e.g., rebuilding), (3) demonstrating that a vessel will not operate more than three hundred hours in a compliance year, and (4) flexibility through exemptions and compliance extensions. EPA did not receive any comments suggesting that California’s commercial harbor craft regulations are technologically infeasible. EPA did receive comments—from AWO and KSea—suggesting that CARB did not adequately address the cost of compliance within the lead-time provided. AWO asserts that California’s commercial harbor craft regulations are inconsistent with section 202(a) because there has been inadequate lead-time to permit the development and widespread commercial availability of the technology necessary to comply, and CARB has not given appropriate consideration to the cost of compliance within the lead-time provided. AWO further asserts that approximately fourfifths of the towing vessel fleet is equipped with pre-Tier 1 or Tier 1 certified engines, and current regulations only require use of an EPAapproved kit, if available; California’s commercial harbor craft regulations, on the other hand, will require these vessels to rebuild with a Tier 2 kit or completely repower. AWO also asserts that CARB does not address the cost of a retrofit versus the cost of replacement; this, AWO believes, is a failure to provide adequate lead-time, ‘‘with appropriate consideration to the cost of compliance.’’ AWO emphasizes that its E:\FR\FM\13DEN1.SGM 13DEN1 srobinson on DSK4SPTVN1PROD with NOTICES Federal Register / Vol. 76, No. 239 / Tuesday, December 13, 2011 / Notices members cannot afford these costs, particularly because ninety percent of the towing industry is comprised of small businesses. Additionally, AWO stresses that these cost concerns (e.g., vessel downtime required during drydocks, the residual value of engine replacement, cost of installation and maintenance, equipment and shipyard availability) were not given full consideration by CARB. AWO believes that many towing companies may be forced to cease operations in California. Furthermore, even though California provides funding options, AWO asserts that such funding is largely unavailable for AWO members because they do not primarily operate within California. AWO believes that the cost increases associated with the commercial harbor craft regulation will drive up the cost of waterways transportation. K-Sea also believes that CARB did not adequately assess the financial impacts and cost of compliance. K-Sea emphasizes that out of its 18 tugs, they would need to replace 13. K-Sea informs EPA that they cannot afford this, and will be forced to either make a radical capital investment to comply, or cease operating in California. K-Sea represents that they cannot obtain CARB funding because it does not operate primarily in California. K-Sea also states that they could relocate compliant vessels to California, which would merely shift pollution out of state. K-Sea believes this renders the ‘‘necessity of the regulation to be ‘arbitrary and capricious’ * * *’’ EPA’s review with regard to cost of compliance occurs within the context of its review of whether California’s commercial harbor craft regulations are consistent with section 202(a) of the Clean Air Act. As described above, EPA’s review here is narrow. That is, section 202(a) consistency calls for a limited review of technological feasibility, including analysis of the cost of new technology, if technology does not currently exist. Section 202(a) does not allow EPA to conduct a more searching review of whether the costs are outweighed by the overall benefits of the California regulations. In this case, no party has objected to CARB’s demonstration that technologies are in existence and are being used in actual operation; AWO and K-Sea only challenge the cost of compliance. EPA’s traditional review of costs considers whether the cost of compliance per engine would render the regulation cost prohibitive and thus infeasible. Here, CARB understands that there are significant costs associated with compliance, but it expects those costs to eventually be passed on to the VerDate Mar<15>2010 16:25 Dec 12, 2011 Jkt 226001 consumer, without significant impact on the industry. AWO and K-Sea, on the other hand, present that compliance with the commercial harbor craft regulations would impose unreasonable costs that could lead operators to cease operations in California. AWO and KSea did not further express that the costs associated with compliance would render compliance entirely infeasible. Notably, CARB responded to similar if not identical concerns from industry— including comments from AWO— during the California rulemaking.40 In response to comments with respect to the significant costs of compliance and impact on the industry, CARB stood by its rulemaking findings. CARB addressed the many points AWO and KSea now raise in this proceeding. Specifically, CARB stated, among other things, that it does not believe the commercial harbor craft regulation will have significant economic impacts; that the potential impacts on affected tugboat and towboat businesses will, on average, decrease a business’s return on investment by 3.6 and 0.5 percent, respectively; that engine replacement is the most expensive compliance option, but there may be other less costly options, including rebuilding, employing emission control technologies, applying for approval of alternative control of emissions plan, or applying for compliance extensions; that tugboats will be able to pass on the added compliance costs to their customers; that the regulation will not result in job losses or significant impact on tugboat businesses because they provide a necessary service that will continue to be in high demand; and that CARB has given six years of lead-time for businesses to plan for compliance in which they may apply for incentive funds or choose other less costly compliance options. In previous waiver and authorization determinations, EPA has consistently given California substantial deference on its policy judgments, including those related to the costs associated with compliance. For example, in a previous authorization determination where cost of compliance was an issue, EPA stated: ‘‘CARB’s regulations are feasible with respect to cost objectively; i.e., all fleet operators face the same cost per unit to comply. While this cost may have different impacts on fleets of varying sizes, EPA recognizes that it is up to CARB to choose who it will regulate 40 CARB, ‘‘Final Statement of Reasons for Rulemaking,’’ EPA–HQ–OAR–2011–0549–0032, pp. 57–67. PO 00000 Frm 00058 Fmt 4703 Sfmt 4703 77527 under its standards.’’ 41 Similarly here, EPA is in no position to second-guess CARB’s regulatory choices. Because the cost of compliance is not so burdensome to render compliance options out of reach, the fact that some operators may have difficulties with the cost of compliance does not render the program infeasible. Therefore, based on the record before us, EPA finds that opponents of the authorization have not met their burden of proof. Consequently, EPA cannot deny California’s authorization based on technological infeasibility. b. Consistency of Certification Procedures California’s standards and accompanying enforcement procedures would also be inconsistent with section 202(a) if the California test procedures were to impose certification requirements inconsistent with the federal certification requirements. Such inconsistency means that manufacturers would be unable to meet both the California and federal testing requirements using the same test vehicle or engine.42 CARB presents that none of the commercial harbor craft requirements pose any inconsistency as between California and federal test procedures. CARB asserts that the compliance methods for new vessel engines are EPA’s Tier 2, 3, or 4 federal marine engine test procedures. For larger new ferries, CARB also relies on federal marine engine test procedures, and asserts that the added BACT requirement is not inconsistent with federal procedures because EPA has no comparable requirement. The regulation’s in-use requirements also rely on federal marine engine test procedures. CARB further presents that the in-use requirements are not inconsistent with federal requirements because EPA does not have any comparable in-use standards and test procedures. EPA received no comments suggesting that CARB’s commercial harbor craft requirements pose a test procedure consistency problem. Therefore, based on the record, EPA cannot find that CARB’s testing procedures are inconsistent with section 202(a). Consequently, EPA cannot deny CARB’s request based on this criterion. D. Other Issues AWO requests that the compliance dates for the affected vessels be reset 41 EPA, Authorization of In-Use Emission Standards for Transport Refrigeration Unit Engines,’’ January 9, 2009, at 63. 42 See, e.g., 43 FR 32182 (July 25, 1978). E:\FR\FM\13DEN1.SGM 13DEN1 77528 Federal Register / Vol. 76, No. 239 / Tuesday, December 13, 2011 / Notices according to the date that EPA approves California’s authorization request to facilitate compliance. AWO also expressed concerns about inconsistent regulation for vessels engaged in interstate commerce. K-Sea echoed a similar concern, stating that the regulations will shift the burden of dealing with emissions to other states because companies may choose to relocate a non-CARB compliant engine to operations elsewhere. With respect to AWO’s request for a delayed compliance schedule, EPA cannot change an aspect of California’s regulation. EPA is only authorized to review California’s standards to determine compliance with section 209. It is not authorized to change California’s regulations. With respect to the AWO and K-Sea comments regarding the interstate implications of California’s commercial harbor craft regulations, that issue is also beyond the scope of EPA’s review under the three section 209(e)(2) criteria. As EPA has stated on numerous occasions, sections 209(b) and 209(e) of the Clean Air Act limit our authority to deny California requests for waivers and authorizations to the three criteria listed therein. As a result, EPA has consistently refrained from denying California’s requests for waivers and authorizations based on any other criteria.43 In instances where the U.S. Court of Appeals has reviewed EPA decisions declining to deny waiver requests based on criteria not found in section 209(b), the Court has upheld and agreed with EPA’s determination.44 Neither of these other issues AWO and K-Sea raises is among—or fits within the confines of—the criteria listed under section 209(e).45 It is clear that Congress intended that California have the ability to promulgate standards that are more stringent than those that would otherwise apply to mobile sources under federal regulations. Indeed, other states could also promulgate such standards if they are identical to California’s. Therefore, in considering California’s commercial harbor craft regulations, EPA may not deny authorization based on these issues. srobinson on DSK4SPTVN1PROD with NOTICES 43 See, e.g., 74 FR 32744, 32783 (July 8, 2009). Motor and Equipment Manufacturers Ass’n v. Nichols, 142 F.3d 449, 462–63, 466–67 (DC Cir. 1998), Motor and Equipment Manufacturers Ass’n v. EPA, 627 F.2d 1095, 1111, 1114–20 (DC Cir. 1979). 45 AWO and K-Sea may raise these issues in a direct challenge to California’s regulations in other forums, but these issues are not relevant to EPA’s limited review under section 209. 44 See VerDate Mar<15>2010 16:25 Dec 12, 2011 Jkt 226001 E. Authorization Determination for California’s Commercial Harbor Craft Regulations After a review of the information submitted by CARB and other parties to this proceeding, EPA finds that those opposing California’s request have not met the burden of demonstrating that an authorization for California’s commercial harbor craft regulations should be denied based on any of the three statutory criteria of section 209(e)(2). For this reason, EPA finds that an authorization for California’s commercial harbor craft regulations should be granted. III. Decision The Administrator has delegated the authority to grant California section 209(b) waivers of preemption and section 209(e) authorizations to the Assistant Administrator for Air and Radiation. After evaluating California’s commercial harbor craft regulations, CARB’s submissions, and the public comments from AWO and K-Sea, EPA is granting an authorization to California for its commercial harbor craft regulations. My decision will affect not only persons in California, but also entities outside the State who must comply with California’s requirements. For this reason, I determine and find that this is a final action of national applicability for purposes of section 307(b)(1) of the Act. Pursuant to section 307(b)(1) of the Act, judicial review of this final action may be sought only in the United States Court of Appeals for the District of Columbia Circuit. Petitions for review must be filed by February 13, 2012. Judicial review of this final action may not be obtained in subsequent enforcement proceedings, pursuant to section 307(b)(2) of the Act. IV. Statutory and Executive Order Reviews As with past authorization and waiver decisions, this action is not a rule as defined by Executive Order 12866. Therefore, it is exempt from review by the Office of Management and Budget as required for rules and regulations by Executive Order 12866. In addition, this action is not a rule as defined in the Regulatory Flexibility Act, 5 U.S.C. 601(2). Therefore, EPA has not prepared a supporting regulatory flexibility analysis addressing the impact of this action on small business entities. Further, the Congressional Review Act, 5 U.S.C. 801, et seq., as added by the Small Business Regulatory Enforcement Fairness Act of 1996, does PO 00000 Frm 00059 Fmt 4703 Sfmt 4703 not apply because this action is not a rule for purposes of 5 U.S.C. 804(3). Dated: December 5, 2011. Gina McCarthy, Assistant Administrator, Office of Air and Radiation. [FR Doc. 2011–31916 Filed 12–12–11; 8:45 am] BILLING CODE 6560–50–P ENVIRONMENTAL PROTECTION AGENCY [FRL–9505–6] Proposed CERCLA Administrative Cost Recovery Settlement; North Hollywood Operable Unit of the San Fernando Valley Area 1 Superfund Site Environmental Protection Agency (EPA). ACTION: Notice; request for public comment. AGENCY: In accordance with Section 122(i) of the Comprehensive Environmental Response, Compensation, and Liability Act, as amended (‘‘CERCLA’’), 42 U.S.C. 9622(i), notice is hereby given of a proposed administrative settlement for recovery of response costs concerning the North Hollywood Operable Unit of the San Fernando Valley Area 1 Superfund Site, located in the vicinity of Los Angeles, California, with the following settling parties: Pick-YourPart Auto Wrecking; Hayward Associates, LLC; and PNM Properties, LLC. The settlement requires the settling parties to pay a total of $102,161 to the North Hollywood Operable Unit Special Account within the Hazardous Substance Superfund. The settlement also includes a covenant not to sue the settling parties pursuant to Section 107(a) of CERCLA, 42 U.S.C. 9607(a). For thirty (30) days following the date of publication of this notice, the Agency will receive written comments relating to the settlement. The Agency will consider all comments received and may modify or withdraw its consent to the settlement if comments received disclose facts or considerations which indicate that the settlement is inappropriate, improper, or inadequate. The Agency’s response to any comments received will be available for public inspection at the City of Los Angeles Central Library, Science and Technology Department, 630 West 5th Street, Los Angeles, CA 90071 and at the EPA Region 9 Superfund Records Center, Mail Stop SFD–7C, 95 Hawthorne Street, Room 403, San Francisco, CA 94105. SUMMARY: E:\FR\FM\13DEN1.SGM 13DEN1

Agencies

ENVIRONMENTAL PROTECTION AGENCY

[Federal Register Volume 76, Number 239 (Tuesday, December 13, 2011)]
[Notices]
[Pages 77521-77528]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-31916]

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

ENVIRONMENTAL PROTECTION AGENCY

[FRL-9503-5]

California State Nonroad Engine Pollution Control Standards;
Commercial Harbor Craft Regulations; Notice of Decision

AGENCY: Environmental Protection Agency (EPA).

ACTION: Notice of Decision.

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

[[Page 77522]]

SUMMARY: EPA has granted the California Air Resources Board (CARB) its
request for an authorization to adopt and enforce regulations for the
control of emissions of particulate matter and oxides of nitrogen from
new and in-use diesel-fueled engines on commercial harbor craft.

DATES: Petitions for review must be filed by February 13, 2012.

ADDRESSES: EPA has established a docket for this action under Docket ID
EPA-HQ-OAR-2011-0549. All documents relied upon in making this
decision, including those submitted to EPA by CARB, are contained in
the public docket. Publicly available docket materials are available
either electronically through www.regulations.gov or in hard copy at
the Air and Radiation Docket in the EPA Headquarters Library, EPA West
Building, Room 3334, located at 1301 Constitution Avenue NW.,
Washington, DC. The Public Reading Room is open to the public on all
federal government working days from 8:30 a.m. to 4:30 p.m.; generally,
it is open Monday through Friday, excluding holidays. The telephone
number for the Reading Room is (202) 566-1744. The Air and Radiation
Docket and Information Center's Web site is https://www.epa.gov/oar/docket.html. The electronic mail (email) address for the Air and
Radiation Docket is: a-and-r-Docket@epa.gov, the telephone number is
(202) 566-1742, and the fax number is (202) 566-9744. An electronic
version of the public docket is available through the federal
government's electronic public docket and comment system. You may
access EPA dockets at https://www.regulations.gov. After opening the
www.regulations.gov Web site, enter EPA-HQ-OAR-2011-0549 in the ``Enter
Keyword or ID'' fill-in box to view documents in the record. Although a
part of the official docket, the public docket does not include
Confidential Business Information (``CBI'') or other information whose
disclosure is restricted by statute.
EPA's Office of Transportation and Air Quality (``OTAQ'') maintains
a Web page that contains general information on its review of
California waiver requests. Included on that page are links to prior
waiver Federal Register notices, some of which are cited in today's
notice. The page can be accessed at https://www.epa.gov/otaq/cafr.htm.

FOR FURTHER INFORMATION CONTACT: Kristien G. Knapp, Attorney-Advisor,
Compliance Division, Office of Transportation and Air Quality, U.S.
Environmental Protection Agency, 1200 Pennsylvania Avenue (6405J) NW.,
Washington, DC 20460. Telephone: (202) 343-9949. Fax: (202) 343-2800.
Email: knapp.kristien@epa.gov.

SUPPLEMENTARY INFORMATION:

I. Background

A. California's Commercial Harbor Craft Regulations

In a letter dated April 12, 2010, CARB submitted to EPA its request
pursuant to section 209(e) of the Clean Air Act (``CAA'' or ``the
Act''), regarding its regulations to enforce emission standards for new
and in-use commercial harbor craft operated within California waters
and twenty-four nautical miles of the California baseline (``commercial
harbor craft regulations'').\1\ The CARB Board approved the commercial
harbor craft regulations at its November 15, 2007 hearing (by
Resolution 07-47).\2\ After making modifications, as directed by the
Board, CARB's Executive Officer formally adopted the rulemaking in
Executive Order R-08-007 on September 2, 2008.\3\ CARB's commercial
harbor craft regulations became operative under California state law on
November 19, 2008.\4\ The regulations are codified in title 13,
California Code of Regulations (CCR), section 2229.5 and title 17, CCR
section 93118.5.\5\
---------------------------------------------------------------------------

\1\ Letter from James Goldstene to Lisa P. Jackson, EPA-HQ-OAR-
2011-0549-0001.
\2\ CARB, Resolution 07-47, EPA-HQ-OAR-2011-0549-0027.
\3\ CARB, Executive Order R-08-007, EPA-HQ-OAR-2011-0549-0030.
\4\ See CARB, Approval Notice, EPA-HQ-OAR-2011-0549-0035.
\5\ See CARB, Final Regulation Order, EPA-HQ-OAR-2011-0549-0034.
---------------------------------------------------------------------------

California's commercial harbor craft regulations establish emission
standards, requirements related to the control of emissions, and
enforcement provisions. The requirements are applicable to diesel
propulsion and auxiliary engines on new and in-use commercial harbor
crafts, with some exceptions.\6\ Commercial harbor craft include a
variety of different types of vessels, including ferries, excursion
vessels, tugboats, towboats, and commercial and charter fishing boats.
Approximately eighty percent of commercial harbor craft engines
operating in California are previously unregulated diesel engines,
accounting for approximately 3.3 tons per day (tpd) of diesel
particulate matter (PM) and 73 tpd of oxides of nitrogen
(NOX). California's commercial harbor craft regulations aim
to reduce these emissions so that California can meet the 2014 National
Ambient Air Quality Standards (NAAQS) deadline for PM2.5 in
the South Coast Air Basin. The commercial harbor craft regulations
apply separately to new and in-use engines used on harbor craft.\7\
---------------------------------------------------------------------------

\6\ See CARB, Authorization Support Document, p. 5, EPA-HQ-OAR-
2011-0549-0002 (hereinafter ``CARB Support Document'').
\7\ CARB Support Document, pp. 2-6.
---------------------------------------------------------------------------

For new harbor craft, each propulsion and auxiliary diesel engine
on the vessel is required to be certified to the most stringent federal
new marine engine emission standards for that engine's power rating and
displacement in effect at the time of sale, lease, rent, or
acquisition.\8\ The regulation imposes additional requirements for
larger new ferries (with the capacity to transport seventy-five or more
passengers), either by using best available control technology
(``BACT''),\9\ or by using a federal Tier 4 certified propulsion
engine.
---------------------------------------------------------------------------

\8\ CARB Support Document at 2.
\9\ BACT is the diesel emission control strategy (DECS)
determined by CARB to be the greatest feasible reduction of
NOX or PM.
---------------------------------------------------------------------------

For in-use harbor craft, new or in-use diesel engines may not be
sold, offered for sale, leased, rented, or acquired unless the diesel
propulsion or auxiliary engines are certified to at least the federal
Tier 2 or Tier 3 marine emission standards for new engines of the same
power rating and displacement.\10\ In-use emission requirements are
imposed on Tier 0 and Tier 1 marine engines in ferries, excursion
vessels, tugboats, towboats, push boats, and multipurpose harbor craft.
Those harbor craft are required to meet emission limits equal to or
cleaner than the federal new marine engine certification standards in
effect for the year that in-use engine compliance is required.
---------------------------------------------------------------------------

\10\ CARB Support Document at 3.
---------------------------------------------------------------------------

California's commercial harbor craft regulations also impose
requirements related to monitoring, reporting and recordkeeping of
compliance on owners and operators of new and in-use harbor craft.\11\
Subject to CARB approval, harbor craft owners and operators may opt to
meet requirements by implementing alternative emission control
strategies.
---------------------------------------------------------------------------

\11\ CARB Support Document at 5.
---------------------------------------------------------------------------

B. Clean Air Act Nonroad Engine and Vehicle Authorizations

Section 209(e)(1) of the Act permanently preempts any State, or
political subdivision thereof, from adopting or attempting to enforce
any standard or other requirement relating to the control of emissions
for certain new nonroad engines or vehicles. Section 209(e)(2) of the
Act requires the Administrator to grant California authorization to
enforce its own

[[Page 77523]]

standards for new nonroad engines or vehicles that are not listed under
section 209(e)(1), subject to certain restrictions. On July 20, 1994,
EPA promulgated a rule that sets forth, among other things, the
criteria, as found in section 209(e)(2), which EPA must consider before
granting any California authorization request for new nonroad engine or
vehicle emission standards. On October 8, 2008, the regulations
promulgated in that rule were moved to 40 CFR part 1074, and modified
slightly.\12\ As stated in the preamble to the section 209(e) rule, EPA
has historically interpreted the section 209(e)(2)(iii) ``consistency''
inquiry to require, at minimum, that California standards and
enforcement procedures be consistent with section 209(a), section
209(e)(1), and section 209(b)(1)(C) (as EPA has interpreted that
subsection in the context of section 209(b) motor vehicle waivers).\13\
---------------------------------------------------------------------------

\12\ The applicable regulations, now in 40 CFR part 1074,
subpart B, Sec. 1074.105, provide:
(a) The Administrator will grant the authorization if California
determines that its standards will be, in the aggregate, at least as
protective of public health and welfare as otherwise applicable
federal standards.
(b) The authorization will not be granted if the Administrator
finds that any of the following are true:
(1) California's determination is arbitrary and capricious.
(2) California does not need such standards to meet compelling
and extraordinary conditions.
(3) The California standards and accompanying enforcement
procedures are not consistent with section 209 of the Act.
(c) In considering any request from California to authorize the
state to adopt or enforce standards or other requirements relating
to the control of emissions from new nonroad spark-ignition engines
smaller than 50 horsepower, the Administrator will give appropriate
consideration to safety factors (including the potential increased
risk of burn or fire) associated with compliance with the California
standard.
\13\ See 59 FR 36969 (July 20, 1994).
---------------------------------------------------------------------------

In order to be consistent with section 209(a), California's nonroad
standards and enforcement procedures must not apply to new motor
vehicles or new motor vehicle engines. To be consistent with section
209(e)(1), California's nonroad standards and enforcement procedures
must not attempt to regulate engine categories that are permanently
preempted from state regulation. To determine consistency with section
209(b)(1)(C), EPA typically reviews nonroad authorization requests
under the same ``consistency'' criteria that are applied to motor
vehicle waiver requests. Pursuant to section 209(b)(1)(C), the
Administrator shall not grant California a motor vehicle waiver if she
finds that California ``standards and accompanying enforcement
procedures are not consistent with section 202(a)'' of the Act.
Previous decisions granting waivers and authorizations have noted that
state standards and enforcement procedures are inconsistent with
section 202(a) if: (1) There is inadequate lead time to permit the
development of the necessary technology giving appropriate
consideration to the cost of compliance within that time, or (2) the
federal and state testing procedures impose inconsistent certification
requirements.

C. Burden of Proof

In Motor and Equip. Mfrs Assoc. v. EPA, 627 F.2d 1095 (D.C. Cir.
1979) (``MEMA I''), the U.S. Court of Appeals stated that the
Administrator's role in a section 209 proceeding is to:

consider all evidence that passes the threshold test of materiality
and * * * thereafter assess such material evidence against a
standard of proof to determine whether the parties favoring a denial
of the waiver have shown that the factual circumstances exist in
which Congress intended a denial of the waiver.\14\
---------------------------------------------------------------------------

\14\ MEMA I, 627 F.2d at 1122.

The court in MEMA I considered the standards of proof under section 209
for the two findings related to granting a waiver for an ``accompanying
enforcement procedure'' (as opposed to the standards themselves): (1)
Protectiveness in the aggregate and (2) consistency with section 202(a)
findings. The court instructed that ``the standard of proof must take
account of the nature of the risk of error involved in any given
decision, and it therefore varies with the finding involved. We need
not decide how this standard operates in every waiver decision.'' \15\
---------------------------------------------------------------------------

\15\ Id.
---------------------------------------------------------------------------

The court upheld the Administrator's position that, to deny a
waiver, there must be ``clear and compelling evidence'' to show that
proposed procedures undermine the protectiveness of California's
standards.\16\ The court noted that this standard of proof also accords
with the congressional intent to provide California with the broadest
possible discretion in setting regulations it finds protective of the
public health and welfare.\17\
---------------------------------------------------------------------------

\16\ Id.
\17\ Id.
---------------------------------------------------------------------------

With respect to the consistency finding, the court did not
articulate a standard of proof applicable to all proceedings, but found
that the opponents of the waiver were unable to meet their burden of
proof even if the standard were a mere preponderance of the evidence.
Although MEMA I did not explicitly consider the standards of proof
under section 209 concerning a waiver request for ``standards,'' as
compared to accompanying enforcement procedures, there is nothing in
the opinion to suggest that the court's analysis would not apply with
equal force to such determinations. EPA's past waiver decisions have
consistently made clear that: ``[E]ven in the two areas concededly
reserved for Federal judgment by this legislation--the existence of
`compelling and extraordinary' conditions and whether the standards are
technologically feasible--Congress intended that the standards of EPA
review of the State decision to be a narrow one.'' \18\
---------------------------------------------------------------------------

\18\ See, e.g., 40 FR 21102-103 (May 28, 1975).
---------------------------------------------------------------------------

Opponents of the waiver bear the burden of showing that the
criteria for a denial of California's waiver request have been met. As
found in MEMA I, this obligation rests firmly with opponents of the
waiver in a section 209 proceeding:

[t]he language of the statute and its legislative history indicate
that California's regulations, and California's determinations that
they must comply with the statute, when presented to the
Administrator are presumed to satisfy the waiver requirements and
that the burden of proving otherwise is on whoever attacks them.
California must present its regulations and findings at the hearing
and thereafter the parties opposing the waiver request bear the
burden of persuading the Administrator that the waiver request
should be denied.\19\
---------------------------------------------------------------------------

\19\ MEMA I, 627 F.2d at 1121.

The Administrator's burden, on the other hand, is to make a reasonable
evaluation of the information in the record in coming to the waiver
decision. As the court in MEMA I stated: ``here, too, if the
Administrator ignores evidence demonstrating that the waiver should not
be granted, or if he seeks to overcome that evidence with unsupported
assumptions of his own, he runs the risk of having his waiver decision
set aside as `arbitrary and capricious.' '' \20\ Therefore, the
Administrator's burden is to act ``reasonably.'' \21\
---------------------------------------------------------------------------

\20\ Id. at 1126.
\21\ Id. at 1126.
---------------------------------------------------------------------------

D. EPA's Administrative Process in Consideration of California's
Commercial Harbor Craft Regulations

Upon review of CARB's request, EPA offered an opportunity for a
public hearing, and requested written comment on issues relevant to a
full section 209(e) authorization analysis, by publication of a Federal
Register notice on June 29, 2011.\22\ Specifically, we

[[Page 77524]]

requested comment on: (a) Whether CARB's determination that its
standards, in the aggregate, are at least as protective of public
health and welfare as applicable federal standards is arbitrary and
capricious, (b) whether California needs such standards to meet
compelling and extraordinary conditions, and (c) whether California's
standards and accompanying enforcement procedures are consistent with
section 209 of the Act.
---------------------------------------------------------------------------

\22\ 76 FR 38153 (June 29, 2011).
---------------------------------------------------------------------------

In response to EPA's June 29, 2011 Federal Register notice, EPA
received two written comments. The written comments are from the
American Waterways Operators (``AWO'') \23\ and K-Sea Transportation
Partners L.P. (``K-Sea'').\24\ AWO initially requested a public
hearing, and later withdrew that request. After the close of the
comment period, EPA met with AWO to discuss comments from their
members.\25\
---------------------------------------------------------------------------

\23\ The American Waterways Operators (``AWO''), Comments, EPA-
HQ-OAR-2011-0549-0038 (hereinafter ``AWO Comments'').
\24\ K-Sea Transportation Partners L.P. (``K-Sea''), Comments,
EPA-HQ-OAR-2011-0549-0037 (hereinafter ``K-Sea Comments'').
\25\ EPA, ``Memorandum from Tayyaba Waqar to Docket EPA-HQ-OAR-
2011-0549,'' EPA-HQ-OAR-2011-0549-0039.
---------------------------------------------------------------------------

AWO comments that California does not need the new standards to
meet compelling and extraordinary conditions. AWO also comments that
California's standards and enforcement procedures are not consistent
with the Clean Air Act section 209. Additionally, AWO expressed other
concerns in their comments related to the commercial harbor craft
regulation's compliance schedules.
K-Sea comments that the new regulations are not consistent with
section 202(a) of the Clean Air Act. K-Sea also comments that
California does not need the new regulations to meet compelling and
extraordinary conditions. Additionally, K-Sea does not believe that
CARB adequately assessed the financial impacts and compliance costs
associated with implementation of California's commercial harbor craft
regulations.

II. Discussion

A. California's Protectiveness Determination

Section 209(e)(2)(i) of the Act instructs that EPA cannot grant an
authorization if the agency finds that CARB was arbitrary and
capricious in its determination that its standards are, in the
aggregate, at least as protective of public health and welfare as
applicable federal standards. CARB's Board made a protectiveness
determination in Resolution 07-47, finding that California's commercial
harbor craft regulation will not cause the California emission
standards, in the aggregate, to be less protective of public health and
welfare than applicable federal standards.\26\ CARB asserts that EPA
has no basis to find that the CARB Board's determination is arbitrary
or capricious.\27\ CARB points out that most of the commercial harbor
craft requirements (for new diesel engines in newly acquired harbor
craft and ferry propulsion engines) are identical to the federal
requirements for those engines. CARB also highlights that its
requirements for new propulsion diesel engines in larger new ferries
are more stringent that federal standards because they additionally
require BACT technology. With respect to the commercial harbor craft
regulation's in-use requirements, CARB additionally asserts that its
requirements are more stringent than applicable federal regulations
because EPA does not have the authority to regulate in-use nonroad
engines.
---------------------------------------------------------------------------

\26\ ``BE IT FURTHER RESOLVED that the Board hereby determines,
in accordance with section 209(e)(2) of the CAA, that to the extent
the regulation approved herein affects nonroad engines as defined in
CAA section 216(10) and (11), the emission standards and other
requirements related to the control of emissions in the regulation
approved herein are, in the aggregate, at least as protective of
public health and welfare as applicable federal standards;
California needs its nonroad emission standards to meet compelling
and extraordinary conditions; and the standards and accompanying
enforcement procedures approved herein are consistent with CAA
section 209.'' CARB Resolution 07-47, EPA-HQ-OAR-2011-0549-0028.
\27\ CARB Support Document at 7-8.
---------------------------------------------------------------------------

No commenter expressed an opinion or presented evidence suggesting
that CARB was arbitrary and capricious in making its above-noted
protectiveness findings or that CARB's requirements are not, in the
aggregate, as stringent as applicable federal standards. Therefore,
based on the record before us, EPA finds that opponents of the
authorization have not shown that California was arbitrary and
capricious in its determination that its standards are, in the
aggregate, at least as protective of public health and welfare as
applicable federal standards.

B. Need for California Standards to Meet Compelling and Extraordinary
Conditions

Section 209(e)(2)(ii) of the Act instructs that EPA cannot grant an
authorization if the agency finds that California ``does not need such
California standards to meet compelling and extraordinary conditions.''
This criterion restricts EPA's inquiry to whether California needs its
own mobile source pollution program to meet compelling and
extraordinary conditions, and not whether any given standards are
necessary to meet such conditions.\28\ As discussed above, for over
forty years CARB has repeatedly demonstrated the need for its motor
vehicle emissions program to address compelling and extraordinary
conditions in California. In its Resolution 07-47, CARB re-affirmed its
longstanding position that California continues to need its nonroad
emission standards to meet its serious air pollution problems.
Likewise, EPA has consistently recognized that California continues to
have the same ``geographical and climatic conditions that, when
combined with the large numbers and high concentrations of automobiles,
create serious pollution problems.'' \29\
---------------------------------------------------------------------------

\28\ See 74 FR 32744, 32761 (July 8, 2009); 49 FR 18887, 18889-
18890 (May 3, 1984).
\29\ 49 FR 18887, 18890 (May 3, 1984); see also 76 FR 34693
(June 14, 2011), 74 FR 32744, 32763 (July 8, 2009), and 73 FR 52042
(September 8, 2008).
---------------------------------------------------------------------------

AWO asserts that California does not need the commercial harbor
craft regulations to meet compelling and extraordinary conditions. AWO
focuses on California's goal of improving upon the South Coast Air
Basin's non-attainment status by reducing NOX and
PM2.5 levels. AWO states that there is no justification for
CARB to adopt statewide regulations of NOX and
PM2.5 in order to meet the 2014 NAAQS deadline for
PM2.5 in the South Coast Air Basin. AWO reviewed CARB's
Initial Statement of Reasons (``ISOR'') and believes that the ISOR does
not provide sufficient detail to explain the relationship between
pollutant exceedances and commercial harbor craft emissions.
Additionally, AWO believes that the data CARB used from 2006 and
earlier for its analysis of commercial harbor craft's contribution to
NOX and PM2.5 levels is inaccurate and outdated
in that it does not represent the most current operation of tugboats in
California waters. AWO also points to CARB's statements regarding
decrease in emissions for diesel NOX and PM2.5
because of other effects and factors. Further, in comparing data for
emission reductions with and without the proposed standards, AWO
concludes that CARB's emission reduction goals would be met without
implementing the commercial harbor craft regulation.
K-Sea also asserts that California does not need the commercial
harbor craft regulation to meet compelling and extraordinary
conditions. K-Sea argues that California used data from 2006 and
earlier in its rulemaking, which is

[[Page 77525]]

outdated and inaccurate. K-Sea bases that argument on its belief that
because of the recession, which started in 2008, emissions have already
been in decline. K-Sea also states that the data CARB used to assess
harbor craft emissions from tugboats in coastwise service did not
accurately capture their duty cycles or operations within the 24-mile
zone of the California regulated waters.
AWO and K-Sea have both presented arguments and information
suggesting that California does not need its commercial harbor craft
regulations to meet compelling and extraordinary conditions. However,
as discussed above, EPA's inquiry under the section 209(e)(2)(ii)
criterion restricts EPA's inquiry to whether California needs its own
mobile source air pollution program to meet compelling and
extraordinary conditions, and not whether any given standards are
necessary to meet such conditions.\30\ Congress decided in 1977 to
allow California to promulgate individual standards that are not as
stringent as comparable federal standards, as long as the standards are
``in the aggregate, at least as protective of public health and welfare
as applicable federal standards.'' This decision by Congress requires
EPA to allow California to promulgate individual standards that are
part of California's overall approach to reducing mobile source
emissions to address air pollution problems. Congress intended to
provide California the ``broadest possible discretion'' in selecting
the best means to protect its citizens and the public welfare and did
not intend for EPA to weigh which particular regulations are most
appropriate for California to implement to protect public health and
welfare. Consequently, Congress provided EPA a much more limited role
in considering objections raised by opponents of the waiver.
---------------------------------------------------------------------------

\30\ See 74 FR 32744, 32761 (July 8, 2009); 49 FR 18887, 18889-
18890 (May 3, 1984).
---------------------------------------------------------------------------

Although AWO and K-Sea believe that California does not need its
commercial harbor craft regulations to meet compelling and
extraordinary conditions, CARB has provided evidence that it does. In
the California rulemaking, CARB explained its need for the commercial
harbor craft regulation.\31\ Regarding the comment that California's
air quality problems are limited to the South Coast Air Basin, EPA has
never suggested in previous authorization or waiver proceedings that
localized air quality concerns are not sufficient to receive
authorization under this criterion. However, even if EPA were to accept
this comment for the sake of argument, CARB has explained that it has
statewide goals and federal Clean Air Act requirements to reduce
NOX and PM2.5 emissions. CARB explained that
NOX and PM2.5 reductions are necessary because of
the relationship between those pollutants and the federal non-
attainment status in both the South Coast and San Joaquin Valley air
basins:
---------------------------------------------------------------------------

\31\ CARB, Technical Support Document, EPA-HQ-OAR-2011-0549-
0007, pp. I-1-I-3.

The South Coast and San Joaquin Valley air basins are the two
areas in the State that exceed the annual PM2.5
standards. These areas are required by federal law to develop State
Implementation Plans (SIPs) describing how they will attain the
standards by 2015. The U.S. EPA further requires that all necessary
emission reductions be achieved one calendar year sooner--by 2014--
in recognition of the annual average form [sic] the standard.
NOX emission reductions are needed because NOX
leads to formation in the atmosphere of both ozone and
PM2.5; diesel PM emission reductions are needed because
diesel PM contributes to ambient concentrations of PM2.5.
San Joaquin Valley and South Coast air basins are also in non-
attainment for the federal ozone standard.* * *
While all sources of NOX emissions are important,
marine vessels, which include commercial harbor craft engines, are
one of several key contributors to PM2.5 that will
determine whether California is able to meet the 2014 deadline for
PM2.5 attainment in the South Coast air basin.
* * * Staff projects that the regulation would reduce in-use
harbor craft diesel PM emissions about 70 percent and NOX
emissions about 60 percent from the 2004 baseline by 2020. These
emission reductions would occur in areas along waterways, near
ports, and in those communities surrounding these areas, as well as
further inland.
The regulation would also reduce diesel PM and NOX
emissions that contribute to exceedances throughout the State of
ambient air quality standards for both PM2.5 and ozone.
These reductions would assist California in its goal of achieving
state and federal air quality standards.
The emission reductions from the proposed regulation would
result in lower ambient PM levels and reduced exposure to diesel PM.
Staff estimates that approximately 310 premature deaths statewide
would be avoided by year 2025 from implementation of the proposed
regulation. The estimated cost benefit of the avoided premature
deaths and other health benefits due to the emission reductions are
estimated to range from $1.3 to $2.0 billion.\32\

\32\ Id.
---------------------------------------------------------------------------

Thus, contrary to AWO's argument, CARB presents that it does need
statewide commercial harbor craft regulations, because NOX
and PM pollution problems affect the entire state.
Although AWO and K-Sea claim that California's 2006 data is
outdated, because emissions have decreased since 2008 due to the
recession and other emission reduction strategies, they have not
presented evidence proving this to be the case. EPA must rely on the
record in front of us. Moreover, while both AWO and K-Sea suggest that
California may have overstated the emission contributions from harbor
craft, they do not show that harbor craft do not contribute to
emissions that affect California's air quality. While the level of air
pollution may go to the overall benefits of the program, it is not
relevant for determining the need for California's nonroad engine
program. Indeed, AWO's comments make clear that the harbor craft
regulations will result in emission reductions.\33\
---------------------------------------------------------------------------

\33\ For example, AWO analyzed CARB's ISOR, and found that
California's commercial harbor craft regulation would achieve ``only
10 percent'' of California's total estimated statewide PM emission
reductions and ``only 6 percent'' of California's total estimated
statewide NOX reductions.
---------------------------------------------------------------------------

Moreover, AWO's argument relies on California's other emission
reduction strategies to make its case, but it is inappropriate for EPA
to decide which California regulations are needed, and which are not.
CARB presented that they expect the emission reductions from the
commercial harbor craft regulation to benefit the entire state in
meeting federal standards and reaching their statewide emission
reduction goals. While AWO believes California's state goals will be
met without the commercial harbor craft regulation, they do not present
evidence to support that belief, nor do they suggest that the San
Joaquin or South Coast air basins would actually meet federal ozone and
PM standards without the commercial harbor craft regulation. Nor would
it be appropriate for EPA to decide that the other emission controls on
which AWO relies are necessary but the controls on commercial harbor
craft are not. Aside from the fact that all sources of pollution could
argue that other sources should be regulated instead of them, EPA's
review is not intended to replace the policy decisions of California in
determining the appropriate emission control strategies it will use to
meet its air quality needs.
Based on the above, those opposing the authorization have not met
the burden of proof necessary for EPA to find that California no longer
needs a separate mobile source emissions program to address compelling
and extraordinary conditions in California. Therefore, EPA has
determined that we cannot deny California authorization for its
commercial harbor craft regulations under section 209(e)(2)(ii).

[[Page 77526]]

C. Consistency With Section 209 of the Clean Air Act

Section 209(e)(2)(iii) of the Act instructs that EPA cannot grant
an authorization if California's standards and enforcement procedures
are not consistent with section 209. As described above, EPA has
historically evaluated this criterion for consistency with sections
209(a), 209(e)(1), and 209(b)(1)(C).
1. Consistency With Section 209(a)
To be consistent with section 209(a) of the Clean Air Act,
California's commercial harbor craft regulations must not apply to new
motor vehicles or new motor vehicle engines. California's commercial
harbor craft regulations apply to nonroad engines, not on-highway motor
vehicles or engines. CARB states that the new vessel requirements
regulate new diesel engines, and apply only to nonroad engines that are
neither new motor vehicles nor new motor vehicle engines. No commenter
presented otherwise; therefore, EPA cannot deny California's request on
the basis that California's commercial harbor craft regulations are not
consistent with section 209(a).
2. Consistency With Section 209(e)(1)
To be consistent with section 209(e)(1) of the Clean Air Act,
California's commercial harbor craft regulations must not affect new
farming or construction vehicles or engines that are below 175
horsepower, or new locomotives or their engines. CARB presents that
commercial harbor craft engines are not used in locomotives and are not
primarily used in farm and construction equipment vehicles. No
commenter presented otherwise; therefore, EPA cannot deny California's
request on the basis that California's commercial harbor craft
requirements are not consistent with section 209(e)(1).
3. Consistency With Section 209(b)(1)(C)
The requirement that California's standards be consistent with
section 209(b)(1)(C) of the Clean Air Act effectively requires
consistency with section 202(a) of the Act. California standards are
inconsistent with section 202(a) of the Act if there is inadequate
lead-time to permit the development of technology necessary to meet
those requirements, giving appropriate consideration to the cost of
compliance within that time. California's accompanying enforcement
procedures would also be inconsistent with section 202(a) if the
federal and California test procedures were not consistent. The scope
of EPA's review of whether California's action is consistent with
section 202(a) is narrow. The determination is limited to whether those
opposed to the authorization or waiver have met their burden of
establishing that California's standards are technologically
infeasible, or that California's test procedures impose requirements
inconsistent with the federal test procedure.\34\
---------------------------------------------------------------------------

\34\ MEMA I, 627, F.2d at 1126.
---------------------------------------------------------------------------

a. Technological Feasibility
Congress has stated that the consistency requirement of section
202(a) relates to technological feasibility.\35\ Section 202(a)(2)
states, in part, that any regulation promulgated under its authority
``shall take effect after such period as the Administrator finds
necessary to permit the development and application of the requisite
technology, giving appropriate consideration to the cost of compliance
within such period.'' Section 202(a) thus requires the Administrator to
first determine whether adequate technology already exists; or if it
does not, whether there is adequate time to develop and apply the
technology before the standards go into effect. The latter scenario
also requires the Administrator to decide whether the cost of
developing and applying the technology within that time is feasible.
Previous EPA waivers are in accord with this position.\36\ For example,
a previous EPA waiver decision considered California's standards and
enforcement procedures to be consistent with section 202(a) because
adequate technology existed as well as adequate lead-time to implement
that technology.\37\ Subsequently, Congress has stated that, generally,
EPA's construction of the waiver provision has been consistent with
congressional intent.\38\
---------------------------------------------------------------------------

\35\ H.R. Rep. No. 95-294, 95th Cong., 1st Sess. 301 (1977).
\36\ See, e.g., 49 FR 1887, 1895 (May 3, 1984); 43 FR 32182,
32183 (July 25, 1978); 41 FR 44209, 44213 (October 7, 1976).
\37\ 41 FR 44209 (October 7, 1976).
\38\ H.R. Rep. No. 95-294, 95th Cong., 1st Sess. 301 (1977).
---------------------------------------------------------------------------

CARB presents that the technological feasibility of most of the
commercial harbor craft requirements are ``clearly technologically
feasible'' because they mirror requirements that EPA has already
adopted and determined were technologically feasible after considering
cost of compliance when setting its Tier 2, 3, and 4 emission
standards.\39\ Such is the case for the new vessel engine requirements,
for which compliance is based on meeting applicable federal Tier 2, 3,
or 4 emission standards. Larger new ferry propulsion engines must
similarly meet applicable federal standards, with those that meet Tier
2 or 3 federal standards also required to be equipped with BACT. CARB
states that the BACT requirement is technologically feasible because a
BACT determination is made on a case-by-case assessment of
technological availability for each specific ferry application. If no
BACT is available for a specific ferry application, compliance with
federal Tier 2 or 3 standards is all that is required. This aspect of
California's commercial harbor craft regulations is the only aspect
which does not rely upon compliance with a federal standard; for this
aspect, CARB contends that the cost of compliance on ferry owners and
operators will largely be passed along to customers without significant
economic disruption. CARB's in-use requirements also rely on compliance
with federal emission standards and includes four compliance options:
(1) Engine replacement with new federal Tier 2 or 3 compliant engines,
(2) demonstrating compliance with federal Tier 2 or 3 standards (e.g.,
rebuilding), (3) demonstrating that a vessel will not operate more than
three hundred hours in a compliance year, and (4) flexibility through
exemptions and compliance extensions.
---------------------------------------------------------------------------

\39\ CARB Support Document at 9-13.
---------------------------------------------------------------------------

EPA did not receive any comments suggesting that California's
commercial harbor craft regulations are technologically infeasible. EPA
did receive comments--from AWO and K-Sea--suggesting that CARB did not
adequately address the cost of compliance within the lead-time
provided.
AWO asserts that California's commercial harbor craft regulations
are inconsistent with section 202(a) because there has been inadequate
lead-time to permit the development and widespread commercial
availability of the technology necessary to comply, and CARB has not
given appropriate consideration to the cost of compliance within the
lead-time provided. AWO further asserts that approximately four-fifths
of the towing vessel fleet is equipped with pre-Tier 1 or Tier 1
certified engines, and current regulations only require use of an EPA-
approved kit, if available; California's commercial harbor craft
regulations, on the other hand, will require these vessels to rebuild
with a Tier 2 kit or completely repower. AWO also asserts that CARB
does not address the cost of a retrofit versus the cost of replacement;
this, AWO believes, is a failure to provide adequate lead-time, ``with
appropriate consideration to the cost of compliance.'' AWO emphasizes
that its

[[Page 77527]]

members cannot afford these costs, particularly because ninety percent
of the towing industry is comprised of small businesses. Additionally,
AWO stresses that these cost concerns (e.g., vessel downtime required
during drydocks, the residual value of engine replacement, cost of
installation and maintenance, equipment and shipyard availability) were
not given full consideration by CARB. AWO believes that many towing
companies may be forced to cease operations in California. Furthermore,
even though California provides funding options, AWO asserts that such
funding is largely unavailable for AWO members because they do not
primarily operate within California. AWO believes that the cost
increases associated with the commercial harbor craft regulation will
drive up the cost of waterways transportation.
K-Sea also believes that CARB did not adequately assess the
financial impacts and cost of compliance. K-Sea emphasizes that out of
its 18 tugs, they would need to replace 13. K-Sea informs EPA that they
cannot afford this, and will be forced to either make a radical capital
investment to comply, or cease operating in California. K-Sea
represents that they cannot obtain CARB funding because it does not
operate primarily in California. K-Sea also states that they could
relocate compliant vessels to California, which would merely shift
pollution out of state. K-Sea believes this renders the ``necessity of
the regulation to be `arbitrary and capricious' * * *''
EPA's review with regard to cost of compliance occurs within the
context of its review of whether California's commercial harbor craft
regulations are consistent with section 202(a) of the Clean Air Act. As
described above, EPA's review here is narrow. That is, section 202(a)
consistency calls for a limited review of technological feasibility,
including analysis of the cost of new technology, if technology does
not currently exist. Section 202(a) does not allow EPA to conduct a
more searching review of whether the costs are outweighed by the
overall benefits of the California regulations. In this case, no party
has objected to CARB's demonstration that technologies are in existence
and are being used in actual operation; AWO and K-Sea only challenge
the cost of compliance. EPA's traditional review of costs considers
whether the cost of compliance per engine would render the regulation
cost prohibitive and thus infeasible. Here, CARB understands that there
are significant costs associated with compliance, but it expects those
costs to eventually be passed on to the consumer, without significant
impact on the industry. AWO and K-Sea, on the other hand, present that
compliance with the commercial harbor craft regulations would impose
unreasonable costs that could lead operators to cease operations in
California. AWO and K-Sea did not further express that the costs
associated with compliance would render compliance entirely infeasible.
Notably, CARB responded to similar if not identical concerns from
industry--including comments from AWO--during the California
rulemaking.\40\ In response to comments with respect to the significant
costs of compliance and impact on the industry, CARB stood by its
rulemaking findings. CARB addressed the many points AWO and K-Sea now
raise in this proceeding. Specifically, CARB stated, among other
things, that it does not believe the commercial harbor craft regulation
will have significant economic impacts; that the potential impacts on
affected tugboat and towboat businesses will, on average, decrease a
business's return on investment by 3.6 and 0.5 percent, respectively;
that engine replacement is the most expensive compliance option, but
there may be other less costly options, including rebuilding, employing
emission control technologies, applying for approval of alternative
control of emissions plan, or applying for compliance extensions; that
tugboats will be able to pass on the added compliance costs to their
customers; that the regulation will not result in job losses or
significant impact on tugboat businesses because they provide a
necessary service that will continue to be in high demand; and that
CARB has given six years of lead-time for businesses to plan for
compliance in which they may apply for incentive funds or choose other
less costly compliance options. In previous waiver and authorization
determinations, EPA has consistently given California substantial
deference on its policy judgments, including those related to the costs
associated with compliance. For example, in a previous authorization
determination where cost of compliance was an issue, EPA stated:
``CARB's regulations are feasible with respect to cost objectively;
i.e., all fleet operators face the same cost per unit to comply. While
this cost may have different impacts on fleets of varying sizes, EPA
recognizes that it is up to CARB to choose who it will regulate under
its standards.'' \41\ Similarly here, EPA is in no position to second-
guess CARB's regulatory choices. Because the cost of compliance is not
so burdensome to render compliance options out of reach, the fact that
some operators may have difficulties with the cost of compliance does
not render the program infeasible.
---------------------------------------------------------------------------

\40\ CARB, ``Final Statement of Reasons for Rulemaking,'' EPA-
HQ-OAR-2011-0549-0032, pp. 57-67.
\41\ EPA, Authorization of In-Use Emission Standards for
Transport Refrigeration Unit Engines,'' January 9, 2009, at 63.
---------------------------------------------------------------------------

Therefore, based on the record before us, EPA finds that opponents
of the authorization have not met their burden of proof. Consequently,
EPA cannot deny California's authorization based on technological
infeasibility.
b. Consistency of Certification Procedures
California's standards and accompanying enforcement procedures
would also be inconsistent with section 202(a) if the California test
procedures were to impose certification requirements inconsistent with
the federal certification requirements. Such inconsistency means that
manufacturers would be unable to meet both the California and federal
testing requirements using the same test vehicle or engine.\42\
---------------------------------------------------------------------------

\42\ See, e.g., 43 FR 32182 (July 25, 1978).
---------------------------------------------------------------------------

CARB presents that none of the commercial harbor craft requirements
pose any inconsistency as between California and federal test
procedures. CARB asserts that the compliance methods for new vessel
engines are EPA's Tier 2, 3, or 4 federal marine engine test
procedures. For larger new ferries, CARB also relies on federal marine
engine test procedures, and asserts that the added BACT requirement is
not inconsistent with federal procedures because EPA has no comparable
requirement. The regulation's in-use requirements also rely on federal
marine engine test procedures. CARB further presents that the in-use
requirements are not inconsistent with federal requirements because EPA
does not have any comparable in-use standards and test procedures.
EPA received no comments suggesting that CARB's commercial harbor
craft requirements pose a test procedure consistency problem.
Therefore, based on the record, EPA cannot find that CARB's testing
procedures are inconsistent with section 202(a). Consequently, EPA
cannot deny CARB's request based on this criterion.

D. Other Issues

AWO requests that the compliance dates for the affected vessels be
reset

[[Page 77528]]

according to the date that EPA approves California's authorization
request to facilitate compliance. AWO also expressed concerns about
inconsistent regulation for vessels engaged in interstate commerce. K-
Sea echoed a similar concern, stating that the regulations will shift
the burden of dealing with emissions to other states because companies
may choose to relocate a non-CARB compliant engine to operations
elsewhere. With respect to AWO's request for a delayed compliance
schedule, EPA cannot change an aspect of California's regulation. EPA
is only authorized to review California's standards to determine
compliance with section 209. It is not authorized to change
California's regulations. With respect to the AWO and K-Sea comments
regarding the interstate implications of California's commercial harbor
craft regulations, that issue is also beyond the scope of EPA's review
under the three section 209(e)(2) criteria. As EPA has stated on
numerous occasions, sections 209(b) and 209(e) of the Clean Air Act
limit our authority to deny California requests for waivers and
authorizations to the three criteria listed therein. As a result, EPA
has consistently refrained from denying California's requests for
waivers and authorizations based on any other criteria.\43\ In
instances where the U.S. Court of Appeals has reviewed EPA decisions
declining to deny waiver requests based on criteria not found in
section 209(b), the Court has upheld and agreed with EPA's
determination.\44\ Neither of these other issues AWO and K-Sea raises
is among--or fits within the confines of--the criteria listed under
section 209(e).\45\ It is clear that Congress intended that California
have the ability to promulgate standards that are more stringent than
those that would otherwise apply to mobile sources under federal
regulations. Indeed, other states could also promulgate such standards
if they are identical to California's. Therefore, in considering
California's commercial harbor craft regulations, EPA may not deny
authorization based on these issues.
---------------------------------------------------------------------------

\43\ See, e.g., 74 FR 32744, 32783 (July 8, 2009).
\44\ See Motor and Equipment Manufacturers Ass'n v. Nichols, 142
F.3d 449, 462-63, 466-67 (DC Cir. 1998), Motor and Equipment
Manufacturers Ass'n v. EPA, 627 F.2d 1095, 1111, 1114-20 (DC Cir.
1979).
\45\ AWO and K-Sea may raise these issues in a direct challenge
to California's regulations in other forums, but these issues are
not relevant to EPA's limited review under section 209.
---------------------------------------------------------------------------

E. Authorization Determination for California's Commercial Harbor Craft
Regulations

After a review of the information submitted by CARB and other
parties to this proceeding, EPA finds that those opposing California's
request have not met the burden of demonstrating that an authorization
for California's commercial harbor craft regulations should be denied
based on any of the three statutory criteria of section 209(e)(2). For
this reason, EPA finds that an authorization for California's
commercial harbor craft regulations should be granted.

III. Decision

The Administrator has delegated the authority to grant California
section 209(b) waivers of preemption and section 209(e) authorizations
to the Assistant Administrator for Air and Radiation. After evaluating
California's commercial harbor craft regulations, CARB's submissions,
and the public comments from AWO and K-Sea, EPA is granting an
authorization to California for its commercial harbor craft
regulations.
My decision will affect not only persons in California, but also
entities outside the State who must comply with California's
requirements. For this reason, I determine and find that this is a
final action of national applicability for purposes of section
307(b)(1) of the Act. Pursuant to section 307(b)(1) of the Act,
judicial review of this final action may be sought only in the United
States Court of Appeals for the District of Columbia Circuit. Petitions
for review must be filed by February 13, 2012. Judicial review of this
final action may not be obtained in subsequent enforcement proceedings,
pursuant to section 307(b)(2) of the Act.

IV. Statutory and Executive Order Reviews

As with past authorization and waiver decisions, this action is not
a rule as defined by Executive Order 12866. Therefore, it is exempt
from review by the Office of Management and Budget as required for
rules and regulations by Executive Order 12866.
In addition, this action is not a rule as defined in the Regulatory
Flexibility Act, 5 U.S.C. 601(2). Therefore, EPA has not prepared a
supporting regulatory flexibility analysis addressing the impact of
this action on small business entities.
Further, the Congressional Review Act, 5 U.S.C. 801, et seq., as
added by the Small Business Regulatory Enforcement Fairness Act of
1996, does not apply because this action is not a rule for purposes of
5 U.S.C. 804(3).

Dated: December 5, 2011.
Gina McCarthy,
Assistant Administrator, Office of Air and Radiation.
[FR Doc. 2011-31916 Filed 12-12-11; 8:45 am]
BILLING CODE 6560-50-P

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.