Conditional Approval; Contingency Measure State Implementation Plan for the 2008 Ozone Standard; San Joaquin Valley, California

SUPPLEMENTARY INFORMATION:

Throughout this document, “we,” “us,” and “our” refer to the EPA.

Table of Contents

I. Background for Proposed Action

A. The 2008 Ozone National Ambient Air Quality Standards, Designation, Classification, and Plans

B. The San Joaquin Valley Ozone Nonattainment Area

C. Previous EPA Actions Related to Contingency Measures for the 2008 Ozone NAAQS in the San Joaquin Valley

II. Contingency Measure Requirements, Guidance, and Legal Precedent

A. Statutory and Regulatory Requirements

B. Draft Revised Contingency Measure Guidance

III. Summary of SIP Submission and Evaluation for Compliance With SIP Revision Procedural Requirements

A. Summary of SIP Submission

B. Evaluation for Compliance With SIP Revision Procedural Requirements

IV. Summary of the San Joaquin Valley Ozone Contingency Measure Plan

A. One Year's Worth of Progress

B. Emissions Inventory Analysis and Contingency Measures

C. Adopted Contingency Measures

D. Commitments To Adopt Additional Contingency Measures

E. Contingency Measure Feasibility Analysis

V. EPA Evaluation

A. One Year's Worth of Progress

B. Contingency Measures

C. Commitments To Adopt Additional Contingency Measures

D. Contingency Measure Feasibility Analysis

E. Conclusion

VI. Proposed Action and Request for Public Comment

VII. Statutory and Executive Order Reviews

I. Background for Proposed Action

A. The 2008 Ozone National Ambient Air Quality Standards, Designation, Classification, and Plans

Ground-level ozone pollution is formed from the reaction of volatile organic compounds (VOC) and oxides of nitrogen (NO_X ) in the presence of sunlight. These two pollutants, referred to as ozone precursors, are emitted by many types of sources, including on-and off-road motor vehicles and engines, power plants and industrial facilities, and smaller area sources such as lawn and garden equipment, architectural coatings, and other types of consumer products.

Scientific evidence indicates that adverse public health effects occur following exposure to ozone, particularly in children and adults with lung disease. Breathing air containing ozone can reduce lung function and inflame airways, which can increase respiratory symptoms and aggravate asthma or other lung diseases.

Under section 109 of the Clean Air Act (CAA or “Act”), the EPA has established national ambient air quality standards (NAAQS or “standards”) for certain pervasive air pollutants, such as ozone. The EPA has previously promulgated NAAQS for ozone in 1979 and 1997. In 2008, the EPA revised and further strengthened the ozone NAAQS by setting the acceptable level of ozone in the ambient air at 0.075 parts per million (ppm), averaged over an 8-hour period. Although the EPA further tightened the 8-hour ozone NAAQS to 0.070 ppm in 2015, this action relates to the requirements for the 2008 ozone NAAQS.

Following promulgation of a new or revised NAAQS, the EPA is required under CAA section 107(d) to designate areas throughout the country as attaining or not attaining the NAAQS. In 2012, the EPA designated the San Joaquin Valley as nonattainment for the 2008 ozone standards and classified that area as “Extreme.”

In California, the California Air Resources Board (CARB or “State”) is the state agency responsible for the adoption and submission to the EPA of California SIP revisions, and it has broad authority to establish emissions standards and other requirements for mobile sources. Local and regional air pollution control districts in California are responsible for the regulation of stationary sources and are generally responsible for the development of regional air quality plans. In the San Joaquin Valley, the San Joaquin Valley Unified Air Pollution Control District (SJVUAPCD or “District”) is responsible for stationary source regulation, and it also develops and adopts air quality management plans to address CAA planning requirements applicable to that region. Such plans are then submitted to CARB for adoption and submittal to the EPA as revisions to the California SIP.

Under CAA section 110(k), the EPA is charged with evaluation of each SIP revision submitted by states for compliance with applicable CAA requirements and with taking action on each submission. The EPA evaluates SIP submissions and takes action to approve or disapprove them through notice-and-comment rulemaking published in the Federal Register . CAA section 110(k)(4) authorizes the EPA to conditionally approve a SIP submission based on a commitment of the State to adopt specific enforceable measures by a date certain, but no later than one year after the date of approval of the SIP submission. Where appropriate, the EPA may act on separate portions of a SIP submission in separate rulemaking actions.

Under the CAA, ozone nonattainment areas classified under subpart 2 as “Serious” or above, such as the San Joaquin Valley area for the 2008 ozone NAAQS, must include in their SIPs, among other requirements, contingency measures consistent with CAA sections 172(c)(9) and 182(c)(9). Contingency measures are additional controls or measures to be implemented in the event the area fails to make reasonable further progress (RFP), meet any applicable milestone, or attain the NAAQS by the attainment date. Additional information about the requirements for contingency measures can be found in section II of this document.

B. The San Joaquin Valley Ozone Nonattainment Area

The San Joaquin Valley nonattainment area for the 2008 ozone standards consists of San Joaquin, Stanislaus, Merced, Madera, Fresno, Tulare, and Kings counties, and the western portion of Kern County. The San Joaquin Valley nonattainment area stretches over 250 miles from north to south, averages a width of 80 miles, and encompasses over 23,000 square miles. It is partially enclosed by the Coast Mountain range to the west, the Tehachapi Mountains to the south, and the Sierra Nevada range to the east. The population of the San Joaquin Valley in 2020 was estimated to be more than 4.4 million people and is projected to increase to nearly 5 million people by 2035.

C. Previous EPA Actions Related to Contingency Measures for the 2008 Ozone NAAQS in the San Joaquin Valley

In March 2019, the EPA took final action to approve, or conditionally approve, certain SIP revisions submitted by CARB to meet CAA requirements for the 2008 ozone NAAQS in the San Joaquin Valley, California, ozone nonattainment area. Specifically, the EPA approved the base year emissions inventory, RFP demonstration, and motor vehicle emissions budgets, and we conditionally approved the contingency measure element for the 2008 ozone NAAQS. The approval was conditional because it relied on a commitment by the District to amend the District's Rule 4601 (Architectural Coatings) to include contingency provisions and a commitment by CARB to submit the amended District rule to the EPA within a year of final conditional approval of the contingency measure element for the San Joaquin Valley. We justified a conditional approval of the contingency measure element, even though the contingency measure itself would only achieve a small fraction of the recommended amount of emissions reductions for contingency measures, on two bases: (1) surplus emissions reductions anticipated from already-implemented measures in the milestone years and year after the attainment year and (2) a commitment by the State to achieve additional emissions reductions by the attainment year in the San Joaquin Valley that would reduce the chances for failure to attain the 2008 ozone NAAQS by the applicable attainment date.

Our final conditional approval of the contingency measure element was the subject of a legal challenge and, in a 2021 Ninth Circuit Court of Appeals decision in the Association of Irritated Residents v. EPA case, the Court remanded the conditional approval action back to the Agency. In so doing, the Court found that, by taking into account the emissions reductions from already-implemented measures to find that the contingency measure would suffice to meet the applicable requirement, the EPA was circumventing the Court's 2016 holding in Bahr v. EPA. The Court also held that the EPA could not avoid the need for robust contingency measures by assuming that they would not be needed.

In October 2022, in light of the Association of Irritated Residents v. EPA decision, the EPA took final action to withdraw our previous conditional approval and to partially disapprove the contingency measure element submitted to address the contingency measure requirements for the San Joaquin Valley for the 2008 ozone NAAQS. We did so because we found that, if we did not take into account the likelihood the District would need contingency measures or surplus emissions reductions from already implemented measures, then the one contingency measure that was included in the contingency measure element would have to shoulder the entire burden of achieving the recommended amount for contingency measures (if triggered). Moreover, that one contingency measure would have only achieved a small fraction of the recommended amount of emissions reductions for contingency measures.

Pursuant to section 179 of the CAA and 40 CFR 52.31, the EPA's partial disapproval of the contingency measure element triggered sanctions clocks. More specifically, as explained in our final partial disapproval action, under 40 CFR 52.31, the offset sanction in CAA section 179(b)(2) would be imposed 18 months after the effective date of the partial disapproval action (the disapproval took effect November 2, 2022), and the highway funding sanction in CAA section 179(b)(1) would be imposed six months after the offset sanction was imposed, unless the EPA determined that a subsequent SIP submission corrects the identified deficiencies before the applicable deadline. In addition, the EPA's partial disapproval of the contingency measure SIP submissions triggered an obligation on the EPA to promulgate a federal implementation plan (FIP) within two years of the November 2, 2022 effective date, pursuant to CAA section 110(c)(1), unless we approved a subsequent SIP submission that corrects the plan deficiencies before the applicable deadline.

In April 2024, in response to our final partial disapproval, the State of California adopted and submitted the 2024 SJV Ozone Contingency Measure Plan, which is the subject of this proposed action, to correct the deficiencies that the EPA identified in the previous contingency measure SIP submissions that were the basis for the EPA's October 2022 disapproval. We describe the 2024 SJV Ozone Contingency Measure Plan in more detail in sections III and IV of this document and present our evaluation of the SIP submission in section V of this document. Based on this proposed conditional approval, in the Rules and Regulations section of this issue of the Federal Register , we are issuing an interim final determination to stay the application of the offset sanction and to defer the application of the highway sanction that were triggered by the EPA's October 2022 partial disapproval.

In addition to the submission of the 2024 SJV Ozone Contingency Measure Plan, the District has adopted, and CARB has submitted, revisions to the District's architectural coatings rule ( i.e., District Rule 4601) to include a contingency measure for the 2008 ozone NAAQS (“Architectural Coatings Contingency Measure”). The EPA approved the amended architectural coatings rule in December 2022. The Architectural Coatings Contingency Measure will, if triggered, remove the rule's small container exemption ( i.e., one liter or less) for certain types of coatings. More recently, CARB adopted and submitted a contingency measure for the vehicle inspection and maintenance (“Smog Check”) program. As adopted, the “Smog Check Contingency Measure” would narrow the Smog Check inspection exemption for newer model year vehicles in certain California nonattainment areas upon a triggering event for certain NAAQS, including the 2008 ozone NAAQS for the San Joaquin Valley. The EPA recently approved the Smog Check Contingency Measure as a revision to the California SIP.

In our actions approving the Architectural Coatings Contingency Measure and the Smog Check Contingency Measure, we indicated that we were approving the contingency measures as individual contingency measures but that we were not determining in those actions whether the State had met the contingency measure SIP requirements under CAA sections 172(c)(9) and 182(c)(9) for the areas to which the contingency measures apply. Instead, we indicated that we would take into account the emissions reductions associated with the Architectural Coatings Contingency Measure and the Smog Check Contingency Measure when we take action on the contingency measure element submitted by the State to demonstrate compliance with CAA sections 172(c)(9) and 182(c)(9) for a given area. As expected, we are taking into account the emissions reductions associated with the Architectural Coatings Contingency Measure and the Smog Check Contingency Measure in this proposed action on the 2024 SJV Ozone Contingency Measure Plan, which was submitted to satisfy the contingency measure SIP requirements under CAA sections 172(c)(9) and 182(c)(9) for the 2008 ozone NAAQS for the San Joaquin Valley.

II. Contingency Measure Requirements, Guidance, and Legal Precedent

The EPA first provided its views on the CAA's requirements for ozone plans under part D, title I of the Act in the following guidance documents: (1) “State Implementation Plans; General Preamble for the Implementation of Title I of the Clean Air Act Amendments of 1990” (“General Preamble”); and (2) “State Implementation Plans; General Preamble for the Implementation of Title I of the Clean Air Act Amendments of 1990; Supplemental.” More recently, in the Implementation of the 2008 National Ambient Air Quality Standards for Ozone: State Implementation Plan Requirements, “2008 Ozone SIP Requirements Rule (SRR),” the EPA provided further interpretive guidance on the statutory SIP requirements that apply to areas designated nonattainment for the 2008 ozone NAAQS.

A. Statutory and Regulatory Requirements

Under CAA section 172(c)(9), states required to make an attainment plan SIP submission must include contingency measures to be implemented if the area fails to meet RFP (“RFP contingency measures”) or to attain the NAAQS by the applicable attainment date (“attainment contingency measures”). For ozone nonattainment areas classified Serious or above, CAA section 182(c)(9) further specifies that states must include contingency measures to be implemented if the area fails to meet any applicable milestone. An EPA determination that the state failed to meet an RFP milestone or to attain the NAAQS by the applicable attainment date is referred to as a “triggering event” because it triggers the requirement to implement the contingency measures.

Contingency measures must be fully adopted rules or control measures that are ready to be implemented upon a triggering event. In general, the EPA expects all actions needed to effect full implementation of the measures to occur within 60 days after the EPA notifies the state of a failure to meet RFP or to attain. Moreover, we generally expect the additional emissions reductions from the contingency measures to be achieved within a year of the triggering event.

The purpose of contingency measures is to continue progress in reducing emissions while a state revises its SIP to meet the missed RFP requirement or to correct the failure to attain. Neither the CAA nor the EPA's implementing regulations establish a specific level of emission reductions that implementation of contingency measures must achieve, but the EPA has traditionally recommended that contingency measures should provide for emission reductions equivalent to approximately one year of reductions needed for RFP in the nonattainment area. As part of the contingency measure SIP submission, the EPA expects states to explain the amount of anticipated emissions reductions that the contingency measures will achieve. In the “Draft: Guidance on the Preparation of State Implementation Plan Provisions that Address the Nonattainment Area Contingency Measure Requirements for Ozone and Particulate Matter (DRAFT—3/17/23—Public Review Version)” (herein referred to as the “Draft Revised Contingency Measure Guidance”) (discussed in section I.B below), the EPA recommends that, in the event that a state is unable to identify and adopt contingency measures that will provide for approximately one year's worth of emissions reductions, the state should provide a reasoned justification why the smaller amount of emissions reductions is appropriate.

To satisfy the contingency measure requirements of CAA sections 172(c)(9) and 182(c)(9), the contingency measures adopted as part of a 2008 ozone NAAQS attainment plan must consist of control measures for the area that are not otherwise required to meet other attainment plan requirements ( e.g., to meet reasonably available control measure (RACM)/reasonably available control technology (RACT) requirements). By definition, contingency measures are measures that are over and above what a state must adopt and impose to provide for RFP and to provide for attainment by the applicable attainment date.

In addition, to comply with CAA sections 172(c)(9) and 182(c)(9), contingency measures must be both conditional and prospective, i.e., measures that go into effect and achieve emission reductions in the event of a future triggering event, but not before the triggering event. In the 2016 Bahr v. EPA decision, the Ninth Circuit Court of Appeals held that CAA section 172(c)(9) does not allow the EPA to approve already-implemented control measures as contingency measures. In other words, a state must develop, adopt, and submit one or more contingency measures to be implemented upon a triggering event, regardless of the extent to which already-implemented measures would achieve surplus emission reductions beyond those necessary to meet other applicable CAA requirements.

As noted in section I.C of this document, the recent AIR decision held that, under the EPA's current guidance, the surplus emissions reductions from already-implemented measures could not be relied upon to justify the approval of a contingency measure that would achieve far less than one year's worth of RFP as sufficient to meet the contingency measure requirements of CAA sections 172(c)(9) and 182(c)(9) for the nonattainment area.

B. Draft Revised Contingency Measure Guidance

In March 2023, the EPA published a notice of availability announcing new draft guidance ( i.e., the Draft Revised Contingency Measure Guidance) addressing the contingency measure SIP requirements of CAA sections 172(c)(9) and 182(c)(9) and provided the opportunity for public comment. The principal differences between the draft revised guidance and existing guidance on contingency measures relate to the EPA's recommendations concerning the specific amount of emission reductions that implementation of contingency measures should achieve and the timing for when the emissions reductions from the contingency measures should occur. The Draft Revised Contingency Measure Guidance also provides recommended procedures for developing a demonstration, if applicable, that the area lacks sufficient feasible contingency measures to achieve the recommended amount of reductions, which builds on existing guidance that the state provide a reasoned justification for why the smaller amount of emissions reductions from contingency measures is appropriate.

Under the Draft Revised Contingency Measure Guidance, the recommended level of emissions reductions that contingency measures should achieve is one year's worth of “progress” as opposed to one year's worth of RFP (the previous recommended amount of reductions). One year's worth of “progress” is calculated by determining the average annual reductions between the base year emissions inventory and the projected attainment year emissions inventory, determining what percentage of the base year emissions inventory this amount represents, and then applying that percentage to the projected attainment year emissions inventory to determine the amount of reductions needed to ensure ongoing progress if contingency measures are triggered.

With respect to the time period within which reductions from contingency measures should occur, the EPA previously recommended that contingency measures take effect within 60 days of being triggered and that the resulting emission reductions generally occur within one year of the triggering event. Under the Draft Revised Contingency Measure Guidance, in instances where there are insufficient contingency measures available to achieve the recommended amount of emissions reductions within one year of the triggering event, the EPA recommends that contingency measures that provide reductions within up to two years of the triggering event could be appropriate to consider toward achieving the recommended amount of emissions reductions. The Draft Revised Contingency Measure Guidance does not alter the 60-day recommendation for the contingency measures to take initial effect.

If, after adequately evaluating additional control measures, the state is unable to identify contingency measures that would provide approximately one year's worth of emissions reductions, the Draft Revised Contingency Measure Guidance recommends that the state should provide a reasoned justification (referred to herein as an “infeasibility demonstration”). This reasoned justification should explain and document the state's evaluation of all existing and potential control measures relevant to the appropriate source categories and pollutants in the nonattainment area and the state's conclusions regarding whether such measures are feasible.

As explained in the Draft Revised Contingency Measure Guidance, CAA section 172(c)(9) and section 182(c)(9) do not explicitly provide for consideration of whether specific measures are feasible. However, the Agency does not read these statutory provisions to require states to adopt contingency measures that are not feasible. The statutory provisions applicable to other nonattainment area plan control measure requirements, including RACM/RACT (for ozone and PM), best available control measure (BACM)/best available control technology (BACT) (for PM), and most stringent measures (MSM) (for PM), allow air agencies to exclude certain control measures that are deemed unreasonable or infeasible (depending on the requirement). For example, the MSM provision in CAA section 188(e) requires plans to include “the most stringent measures that are included in the implementation plan of any state or are achieved in practice in any state, and can feasibly be implemented in the area.” While the contingency measures provisions do not include such caveats, the EPA does not conclude that the contingency measures provisions should be read to require plans to include infeasible measures. Thus, the EPA anticipates that a demonstrated lack of feasible measures would be a reasoned justification for adopting contingency measures that achieve less than the recommended amount of emission reductions.

III. Summary of SIP Submission and Evaluation for Compliance With SIP Revision Procedural Requirements

A. Summary of SIP Submission

On April 29, 2024, CARB submitted the 2024 SJV Ozone Contingency Measure Plan as a revision to the California SIP. The District adopted the 2024 SJV Ozone Contingency Measure Plan on April 25, 2024, and submitted it to CARB for adoption and submission to EPA as a SIP revision. The April 29, 2024 SIP submission includes the 2024 SJV Ozone Contingency Measure Plan (including appendices), as well as supporting material including the resolutions of adoption, CARB evaluation and completeness forms, and evidence of public notice and hearing.

The 2024 SJV Ozone Contingency Measure Plan includes a general discussion of contingency measures and related guidance, including the EPA's Draft Revised Contingency Measure Guidance. The Plan also contains a calculation of emissions equal to one year's worth of progress, a discussion of the two adopted contingency measures that apply to this area, namely, the contingency provisions in District Rule 4601 (referred to as the Architectural Coatings Contingency Measure) and CARB's Smog Check Contingency Measure, and an estimate of reductions from each adopted contingency measure. The submittal also includes a commitment to adopt and submit to the EPA, within one year of the EPA's final conditional approval of the 2024 SJV Ozone Contingency Measure Plan, amendments to certain District rules, to include additional contingency provisions. These rules are District Rule 4601 (Architectural Coatings) (“Architectural Coatings Rule”), Rule 4603 (Surface Coating of Metal Parts and Products, Plastic Parts and Products, and Pleasure Crafts) (“Surface Coating of Metal Parts and Products Rule”), Rule 4604, (Can and Coil Coating Operations) (“Can and Coil Coatings Rule”), Rule 4653 (Adhesives and Sealants) (“Adhesives and Sealants Rule”), and Rule 4663 (Organic Solvent Cleaning, Storage, and Disposal) (“Solvent Cleaning Rule”). We describe the specific contingency measure provisions that would be included in amendments to these rules in section IV.D of this document. The submission also includes infeasibility demonstrations to address the fact that the total reductions estimated from the two adopted contingency measures fall short of the recommended emissions reductions (equivalent to one year's worth of progress).

B. Evaluation for Compliance With SIP Revision Procedural Requirements

Under CAA sections 110(a) and 110(l), SIPs and SIP revisions must be adopted by the State, and the State must provide for reasonable public notice and hearing prior to adoption. Pursuant to 40 CFR 51.102, states must provide at least 30-days' notice of any public hearing to be held on a proposed SIP revision. States must provide the opportunity to submit written comments and allow the public the opportunity to request a public hearing within that period.

The District adopted the 2024 SJV Ozone Contingency Measure Plan on April 25, 2024, through Resolution No. 2024-4-11, following a public hearing held on the same day. Prior to adoption, the District published notice of the April 25, 2024 public hearing via an email to members of a District electronic mailing list and provided 30 days for submission of written comments. CARB subsequently adopted the 2024 SJV Ozone Continency Measure Plan as a revision to the SIP on April 26, 2024, through Executive Order S-24-003. CARB then submitted the 2024 SJV Ozone Contingency Measure Plan on April 29, 2024, as an attachment to a transmittal letter dated April 26, 2024. Copies of all of these documents can be found in the docket for this proposed rule.

Based on the materials provided in the April 29, 2024 SIP submission, we propose to find that the District and CARB have met the procedural requirements for adoption and submission of SIPs and SIP revisions under CAA sections 110(a) and 110(l), and 40 CFR 51.102.

IV. Summary of the San Joaquin Valley Ozone Contingency Measure Plan

The 2024 SJV Ozone Contingency Measure Plan includes a calculation of one year's worth of progress, an analysis of top source categories in the emissions inventory, a list of existing contingency measures and commitments to adopt and submit additional contingency measures, and a contingency measure feasibility analysis. In this section we describe each of these components of the plan.

A. One Year's Worth of Progress

Section 3 of the 2024 SJV Ozone Contingency Measure Plan contains calculations for the contingency measure reduction targets that are equivalent to one year's worth of progress. One year's worth of progress is calculated by determining the average annual reductions between the base year emissions inventory and the projected attainment year emissions inventory, determining what percentage of the base year emissions inventory this amount represents, then applying that percentage to the projected attainment year emissions inventory.

The resulting emissions reductions targets are shown in table 1.