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Minnesota Pollution Control Agency (MPCA)

Letter from David Sonstegard to Peder Larson


August 13, 1996

FAX: 296-7923

Mr. Peder A. Larson
Minnesota Pollution Control Agency
520 Lafayette Rd. N.
St. Paul, MN 55155-4194

RE: Project XL

Dear Commissioner Larson:

As you well know, Project XL has proved to be both challenging and frustrating. Many hours of difficult negotiations have occurred since we proposed our XL pilot on July 10, 1995, and were awarded our project by President Clinton on November 3 of last year. However, despite even the recent difficulties, we are pleased that the results of our collaborative efforts now have the unanimous support of the groups here in Minnesota for this project. This is a major accomplishment and one of which we can all be proud.

3M greatly appreciates the efforts of both MPCA and EPA to finally bring the negotiations to a close. With some recent events (e.g., the conference call on Friday with Mr. Gardiner and staff), 3M is hopeful we can now finally resolve the two substantive policy issues which remain unresolved and MPCA can issue the 3M Hutchinson XL Permit. The remaining issues include:

1. definition of superior environmental performance and

2. the legal mechanism to approve Project XL.


Although 3M appreciates EPA's position on the definition of SEP, we respectfully disagree with them on this in principle. In our view, this is not in the spirit of what we perceived to be the purpose of Project XL - that is to let companies with demonstrated histories of excellence and leadership propose pilots to experiment with the current environmental regulatory system with hopes of creating a path to regulatory reform. 3M appreciates the comments by Mr. Gardiner in his letter of August 8 (letter attached) citing the "impressive voluntary environmental step" taken by 3M Hutchinson. 3M is proud of our accomplishments at this site. The corporation has invested more than $40 million in voluntary pollution control at this site since 1989. Doing the right thing is part of the 3M culture.

From our perspective, it is unreasonable and illogical to give 3M, or any other company for that matter, credit for such exemplary performance.

Despite our disagreement over the principle of SEP, Project XL is, in our opinion, an important program. We continue to believe the XL concept can be a meaningful path to a true performance-based environmental regulatory system. In essence, small steps toward reform are better than no steps.

To this end, we are willing to incorporate EPA's definition of SEP into the mechanics of the permit as requested by Mr. Gardiner in his letter of August 8. To accomplish this, we have added the following language in bold type into the language proposed in the Ronchak letter to Mr. Hanson dated August 8. This new language has been accepted by your staff.

Change to Section IV. Other Requirements

B. Air Quality Analysis

1. Environmental Release Limit Analysis. The permittee and the MPCA shall complete an air quality regulatory analysis to compare the pollutant limits in Section II.A.1, Tables 1 and 3 to state and federal regulatory requirements at the time of the analysis. This analysis shall establish new allowable emissions baseline on maximum production capacity on a facility-wide basis.

2. Air Quality Superior Environmental Performance Analysis. The permittee and the MPCA shall complete a VOC and HAP analysis to evaluate the environmental performance under this permit. This analysis shall compare the actual emissions in the previous year to 90% of the allowable emissions under state and federal regulations applicable during that year. This analysis is based on actual production data, on a facility-wide basis.

3. New Source Air Quality Emission Superior Environmental Performance Analysis. The permittee and MPCA shall complete a VOC and HAP analysis to evaluate the environmental performance of all new emission units which began operations after September 1, 1996. The analysis shall compare the actual emissions in the previous year from all new sources to the allowable emissions under applicable state and federal regulations during that year. This analysis will account for voluntary pollution control or pollution prevention measures incorporated after September 1, 1996, for existing and new sources.

4. Analyses Protocol and Review. The air quality analyses reports shall be completed on each of the following dates: November 1, 1998; November 1, 2000. The analyses shall be performed individually for each major emission unit. However, smaller emission units may be grouped (e.g., tanks and mixers). The permittee shall maintain records necessary to conduct these analyses. At the time each of these analyses are completed, the MPCA will decide whether it needs to amend this permit either to keep the pollutant limits in Section II.A.1, Tables 1 and 3 at or below state and federal regulatory requirements or to ensure air quality superior environmental performance.

Add new Section IV.C.8 and 9. Reports and Notifications:

IV.C.8. 3M will prepare and submit annually, to the MPCA and 3M's stakeholders, a pollution prevention report which will include information on pollution prevention goals set for the facility.

IV.C.9. 3M will add Project XL actual emissions data to its Internet homepage.

Add new Section IV.G. Stakeholder Participation:

3M will hold two meetings per year with, and will share and receive comments from 3M's stakeholders on: 1) EMS sections submitted to the MPCA; 2) pollution prevention related information; 3) the Air Quality Environmental Release Limit Analysis; and 4) the Air Quality Superior Environmental Performance Analysis.

At this point, the 3M Hutchinson permit is far from what we at 3M envisioned and proposed as a pilot. The permit will now contain EPA's definition of SEP in addition to workload and paperwork requirements that we believe equal or exceed those required under the current system. Therefore, with these final changes, 3M considers all outstanding issues that have been raised by EPA as either 1) addressed by these new commitments or 2) contemplated in the current permit and FPA that have been publicly reviewed.


The one remaining legal issue relates to the legal mechanism for approving the XL permit. 3M and MPCA's attorney have carefully considered EPA's latest proposal to issue the XL permit under the Clean Air Act Title V permitting program. Simply stated, 3M will not accept this approach. This Title V approach is a last-minute change and departure from previous EPA positions that a narrowly-defined, site-specific rulemaking is the vehicle to implement this important highly-visible program.

Project XL is a partnership between EPA, MPCA, and 3M. There are three parties involved and each must do its part to see that this project has the proper support and commitment. We are particularly disturbed by the fact that we understand that EPA intends to issue site specific rulemaking for other XL participants, but not for the Hutchinson project. Thus, our acceptance of PA's SEP principle to be incorporated into the XL permit is contingent upon EPA making a commitment to issue site-specific rulemaking for 3M Hutchinson as originally planned.

In closing, we realize that working with your staff we have created an innovative XL permit. Indeed, it may be the most innovative environmental permit ever prepared. With the additions proposed in the last couple of days, the Hutchinson XL permit is now clearly structured with sufficient checks and balances to ensure superior environmental performance as mandated by EPA. Equally important, we also believe it is structured to result in positive community benefits and hopefully economic benefits for both 3M, MPCA, and EPA.

We are about to embark on a bold experiment which has the unprecedented support of the MPCA, the PPC group, which includes Minnesota's key NGO's, and the citizens of Hutchinson. We feel strongly that this support and trust are based on 3M's long history of environmental excellence and leadership. Thus, there is no better company, in our opinion, to try such an experiment. We trust that EPA views this particular XL experiment in this light as well.

MPCA, MPCA's stakeholders, EPA, 3M's Hutchinson stakeholders and 3M staff have all spent countless hours on this project. We clearly sense that everyone involved wants this project to succeed. Consequently, we trust EPA will agree that this experiment is properly structured and that it is ready to give it a try.

I now look forward to a final decision and written confirmation by EPA on this matter by Friday, August 16.


David Sonstegard


cc: T. Hooper, 3M Washington - 01/001
M.A. Nash, 3M - 220-12E-02
M.A. Santoro, 3M - 41-01-05
A. Ronchak - MPCA - FAX: 296-7709
D.R. Wefring, 3M - 41-01-05
T.W. Zosel, 3M - 41-01-05

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