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3M: Hutchinson, Minnesota

3M: Letter from David Wefrig to Andrew Ronchak

3M Environmental Technology PO Box 33331
and Services St. Paul, MN 55133-3331
612 778 6442

August 7, 1996


Mr. Andrew Ronchak
Minnesota Pollution Control Agency
520 Lafayette Road
St. Paul, MN 55155

Dear Andy:

Per your request, following are 3M's comments regarding the letter from the EPA to MPCA dated August 6, 1996. Pursuant to a conversation between 3M's Vice President of Environmental Technology and Safety Services, Dr. David Sonstegard, and US EPA's Assistant Administrator, Mr. David Gardiner, 3M agreed that we would make our comments to the MPCA regarding EPA's letter.

3M is committed to the Administration's view that Project XL has three primary goals, and that the public will benefit from new management approaches that demonstrate:

1) Superior Environmental Performance (SEP),
2) Enhanced Economic Performance, and
3) Community Benefit,

Such a system should provide more flexibility, reduced costs, and improved performance for all parties.

3M firmly believes that the current Hutchinson XL permit, which has progressed through public comment, represents Superior Environmental Performance (SEP) today and will ensure it into the future. The current permit requires 3M, throughout the life of the permit, to maintain emissions below what the otherwise applicable rules would require. At our meeting last week, we also agreed that 3M would commit to even further "out performing" the otherwise applicable rules by an additional 10%. This is a significant move on our part, but one we are willing to make to help resolve the issues.

While the EPA's suggestions do address an important concern for 3M and for any company in the XL Program; that is An "understandable desire to avoid the personal risks, consistent with 3M policy and practice, of creating a potential legal violation out of actions that (before XL)were purely voluntary", we are unable to accept the suggestions put forth by the EPA, due to the following two primary issues:

(1) Requiring 3M, in effect, to participate in dual regulatory processes,
(2) Biennial review by any party.


Mr. Andrew Ronchak
Page 2

August 8, 1996


In Further Detail

Issue 1: Requiring3M, in effect, to participate in dual regulatory processes.

3M might well be required revert to command and control regulations after significant investments have been made based on performance-based standards. Using tile current EPA definition of SEP, which does not allow 3M to benefit from the decision to voluntarily install pollution control equipment at the site, 3M can envision many situations where EPA could construe the project to be a failure even though emissions are well below the baselines set in the permit and are well below what the otherwise applicable rules would require. Should any of these situations exist in the future, EPA's solution is that the permit would be renegotiated, or if the parties fail to agree, "the XL permit/FPA would be terminated and 3M Hutchinson returned promptly to operation under otherwise applicable rules." In such a situation, 3M would left with a choice of potentially accepting very limiting caps or emission limitations which could severely impact future growth at the plant (even though emissions were far below what the rules would otherwise require) or exiting the project and proceeding back into the command-and-control world of existing regulations at a time when previous environmental and financial commitments had progressed on a different path. This would mean that from a practical standpoint both performance and control requirements would simultaneously need to be met, resulting in duplication of environmental and financial commitments. That clearly is an impossible situation under which to make effective environmental and business decisions.

For the above reasons 3M can accept in the permit a requirement to undertake an evaluation against otherwise applicable regulations reduced by 10 percent but cannot agree to the evaluative baseline comparison which includes preexisting voluntary controls. 3M would however be willing to undertake such an analysis as part of a non-enforceable commitment in the FPA.

Issue 2: Biennial review by any party.

To further compound matters, the proposal further allows other parties (stakeholders) to make a finding during the assessment that SEP has not been achieved and thereby require 3M to again decide whether to accept lower limitations or exit the system. The criteria that stakeholders would use to make this determination is not explained.

The EPA also suggests that additional language is necessary in the FPA to address pollution prevention initiatives. 3M's policies, procedures and practices have demonstrated 3M's commitment to environmental improvement. The ongoing daily operation of 3M Hutchinson is driven by adherence to those 3M initiatives. The pollution prevention procedure and evaluation methods proposed in the EPA letter are difficult to rationalize considering:

a) the history of pollution prevention at 3M (3M actually coined the term over 20 years ago),


Mr. Andrew Ronchak
Page 3
August 8, 1996

b) the history of this plant in particular (a substantial reduction in the waste ratio has already been achieved),

c) the pollution prevention procedures that have already been worked out in the FPA with significant input from the stakeholder groups for 3M's Project (see attachment 2 of FPA)

As we have demonstrated the Hutchinson community, the MPCA, and the Minnesota Stakeholders accept the Environmental Performance Limits (caps) and the evaluation and pollution prevention procedures set forth in the MPCA's Project XL Permit and FPA for 3M Hutchinson.

Although not mentioned in EPA's most recent letter, 3M is still deeply concerned about the EPA's statement at the July 30th meeting that the PSD rules would still apply to a significant portion of the plant. As you know, this issue remains unresolved. Consequently we need to come to closure on this matter as well.

It may also be worthwhile making a brief comment about the other goals of Project XL maintaining a viable economy and creating community benefit. While these should not overshadow the achievement of SEP, they must at least be placed on equal footing. In briefly focusing on these goals, 3M's objective is to maintain this facility's productive capacity while convening from magnetic tape production to the production of other products - a distinct and openly recognized community benefit. 3M also believes that we will be able to demonstrate that a performance-based environmental system, as exemplified by the MPCA's Hutchinson Project XL, Permit, will greatly reduce transactional and time costs for both the MPCA and 3M and allow environmental improvements to be made in a more efficient and timely manner.

We trust these explanations adequately set forth 3M's concerns with the suggestions put forth. If you have any questions or need additional information please contact me at your convenience.

In closing, the 3M Hutchinson XL Permit, as written, is based on hours of discussion with the MPCA and is drafted to address 3M's needs in terms of clarity on the regulatory assessment and the MPCA's needs to assure that the permit contains the proper checks and balances to continued demonstration of superior environmental performance. With the exception of the amendment for an additional 10% reduction from otherwise applicable rules, the permit satisfies the superior environmental performance criteria.



David R. Wefring
Environmental Specialist

C: J. L. Bauman, 3M Hutchinson

T. D. Hooper, 3M Washington
M. A. Nash, 3M St. Paul
M. A. Santoro, 3M St. Paul
D. A. Sonstegard, 3M St. Paul
T. W. Zosel, 3M St. Paul
Permit Change 2

IV. Other Requirements.

B. Air Quality Analyses. The permittee and the MPCA shall complete the air quality analyses reports described in this section. The analyses shall be based on the state and federal regulations at the time of the analysis. The analyses shall be performed for each unit for major emissions units, but units may be grouped for smaller emission units (e.g., tanks and mixers). The permittee shall maintain records necessary to conduct the air quality 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 at or below state and federal regulatory requirements, or the ensure superior environmental performance. The air quality analyses reports shall be completed on each of the following dates: November 1, 1998; November 1, 2000.

1. Regulatory Baseline Analysis. The permittee and the MPCA shall complete an 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. The regulatory analysis shall establish the new allowable emissions baseline based on maximum production capacity.

2. Environmental Performance Analysis. The permittee and the MPCA shall complete an analysis that shall establish what 90% of the allowable emissions were for VOC and HAP, based on actual production data, on a facility-wide basis under state and federal regulations at the time of the analysis.

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