Ms. Mary Nichols Assistant Administrator Office of Air and Radiation United States Environmental Protection Agency 401 M Street, SW Washington, D.C. 20460 Dear Ms. Nichols: The purpose of this letter is to provide our recommendations concerning actions the United States Environmental Protection Agency (U.S. EPA) should take to ease the impact of implementing the federal air toxics program in California. We in California have been working with the U.S. EPA in helping to develop the federal air toxics program pursuant to the mandates identified in the federal Clean Air Act Amendments of 1990. We understand and appreciate the effort your staff is making in meeting these mandates and are committed to continue to assist the U.S. EPA in developing this program. As you know, the Air Resources Board (ARB) and local air pollution control and air quality management districts (local districts) in California have been implementing air toxics programs since the early 1980s. These programs have significantly reduced air toxic emissions in California. Although the approach we have taken may differ with the approach the U.S. EPA prescribes under section 112, we believe that our program will, in most cases, offer more health protection than would be achieved if we were to simply implement the federally- required program. However, we are concerned that the complexity and prescriptive requirements of the federal air toxics program may jeopardize our ability to implement an effective and practical state air toxics program. Consequently, we are providing the following seven recommendations for your consideration. A favorable response to these recommendations would greatly assist us in our efforts to efficiently implement the federal air toxics program. Ms. Mary Nichols Page Two Recommendation 1 - Amend Part 63, Subpart E, entitled Approval of State Programs and Delegation of Federal Authorities, to provide for a more comprehensive program approval that includes the provisions of a federal audit to ensure adequate state performance. Currently, Part 63, Subpart E, contains a provision that allows for approval of a state air toxics program provided the state commits to incorporate conditions into Title V operating permits that are no less stringent than otherwise applicable federal standards. Unfortunately, the conditions the U.S. EPA imposes upon this program approval option make it of little value to California. Specifically, compared to the applicable federal standard, the state's permits must incorporate conditions that: (1) express levels of control for each emission point that are no less stringent; (2) express compliance and enforcement measures for each emission point that are no less stringent; (3) express the levels of control and compliance and enforcement measures in the same form and the same units of measure; and (4) adopt federally-approved monitoring and testing procedures. In addition, the use of this option applies only to emission standards promulgated pursuant to section 112(d), section 112(f), and section 112(h), and only to sources required to obtain Title V operating permits. These conditions severely restrict our ability to use this program approval option. Therefore, we recommend that amendments be proposed to Part 63, Subpart E, which would greatly expand the scope of this program approval. This could be done by minimizing the conditions specified for approval, expanding applicability to other section 112 requirements such as section 112(g), and expanding the scope to include non-Title V sources. To provide assurance that the states are meeting the commitment to be no less stringent, the U.S. EPA should establish an auditing program in lieu of a permit-by-permit review. We maintain the integrity of California's air quality programs through this kind of audit function and it has served us well. We recommend you adopt this approach in lieu of your current approach. This approach could greatly simplify California's efforts to implement the federal air toxics program, eliminate dual regulations, reduce the regulatory burden on California businesses, and ensure that we have reduced the public's exposure to toxic air pollutants. Recommendation 2 - Substantially reduce the recordkeeping and reporting requirements in the promulgation of MACT emission standards. Each MACT standard contains substantial recordkeeping and reporting requirements in order to demonstrate that the source will be in compliance with the MACT standards. Certainly, some of these requirements are necessary to ensure that the source is in compliance. Ms. Mary Nichols Page Three However, the U.S. EPA is imposing many administrative requirements associated with recordkeeping, reporting, and compliance test methods which will make it impossible for alternative state rules or programs to be approved. Therefore, we recommend that the U.S. EPA significantly reduce the amount of recordkeeping and reporting required and provide substantial flexibility to states in developing alternative requirements that would still assure compliance. Protection of public health should be the linchpin of our toxics programs. Alternative state administrative requirements should receive U.S. EPA's deference. Recommendation 3 - Provide clear policy guidance that the U.S. EPA should place a strong emphasis on approving state rules which achieve equivalent public health benefits. We understand that the U.S. EPA has a mandate to ensure that state rules are no less stringent. However, the U.S. EPA is being overly prescriptive in the criteria it uses to approve alternative state rules. For example, we have now been seeking federal approval for our perchloroethylene dry cleaning rule for over one year. Our dry cleaning rule clearly will result in greater emission reductions than the federal MACT standard for dry cleaners. However, we have not yet submitted a formal request for approval because we have not reached a satisfactory agreement on several administrative issues associated with recordkeeping, reporting, and alternative equipment and test methods. Thus, what should have been a quick and straightforward approval has required substantial resources from both our agencies and taken a great deal of time. Recommendation 4 -In drafting MACT standards, recognize and specify alternatives that are federally enforceable. The U.S. EPA should take a more flexible approach in developing MACT standards that recognizes alternative approaches as federally enforceable. For example, the U.S. EPA should specify as acceptable alternatives those standards which are expressed in a different form than the federal standard based on input from states with knowledge and experience regarding particular source categories. This approach could greatly simplify and expedite the process for obtaining federal approval for state rules. Recommendation 5 - Establish a mechanism within the MACT standards that allows states a reasonable time to seek section 112(l) authority to substitute a state rule. The U. S. EPA has already promulgated a number of MACT standards. In almost all cases, the ARB or the local districts have standards that address the same sources. Since the MACT standard becomes effective upon promulgation, the affected sources are placed in the undesirable position of complying with dual regulations. We recommend that you include a mechanism within the MACT standards that would allow for a stay of implementation Ms. Mary Nichols Page Four pending submittal and decision on a request for authority to implement a substitute rule. Such a provision would reduce the liability and burden upon affected sources and facilitate the integration of state and federal air toxic programs. Recommendation 6 - Amend Part 63, Subpart E, entitled Approval of State Programs and Delegation of Federal Authorities, to revise the provision that all required monitoring or testing must be reported at least every six months (section 63.93(b)(4)(iv)). The provision to report monitoring or testing results every six months was added between proposal and promulgation of the Part 63, Subpart E, rule. This provision is unnecessary because the monitoring and testing frequency is specified in the individual MACT standards. As a result, it adds another condition that the states must meet to obtain authority to implement a rule that substitutes for a section 112 rule. We are experiencing difficulty with this provision in our efforts to obtain approval for our state dry cleaning emissions standard. Elimination of the provision to report every six months would remove one obstacle to obtaining state authority. Recommendation 7 - Continue to ensure that state and local agencies have adequate input into development of both the technical and policy positions. We appreciate the substantial efforts that the U.S. EPA staff have made to involve state and local agency representatives in their regulatory development process. We also appreciate the many forums you have provided state and local agencies to explore issues and provide input. However, we do find ourselves in situations where we are asked to provide input on key technical or policy positions within a timeframe that is unrealistic. Your direction to agency staff to continue to seek input and provide adequate review time will help ensure that we are able to provide the best information possible. These recommendations, by necessity, generally represent a broad policy perspective and serve as a framework for continuing dialogue on implementation of the federal air toxics program. However, I believe that your support of these recommendations will greatly assist us in beginning to address the myriad of technical and policy issues that have been and will continue to be raised. We owe it to California's citizens and businesses to guarantee that their environmental protection is done in the most efficient manner. Ms. Mary Nichols Page Five Thank you for the opportunity to comment. Should you have any questions or need further assistance, please contact me at (916) 322-5840. Sincerely, John D. Dunlap, III Chairman cc: Ms. Felicia Marcus Regional Administrator United States Environmental Protection Agency Region IX 75 Hawthorne Street San Francisco, California 94105