This is a draft final document prepared by a subgroup composed of members of the National and Regional Strategies Workgroup and the Base Programs Analyses and Policies Workgroup as part of the Federal Advisory Committee Act (FACA) Subcommittee process. It is not an EPA document. This document is subject to further discussion at the October FACA Subcommittee meeting.

Control Strategies

Date:	October 2, 1997

Status:	Draft #5 since Presidential Directive

Please refer to Draft #5 of the Control Strategy Issue Paper, dated June 23, 1997, for background, including definitions, working assumptions, pre-Presidential Directive key questions and options, and a summary of National control measures.

Contacts:	Dan Johnson, representing NRSWG @ (360) 407-6872, fax (360) 407-6802

Jean Vernet, representing BPAPWG @ (202) 586-4755, fax (202) 586-2062

Issue Statement (revised based on Presidential Directive):

The purpose of this postscript to the control strategy issue paper is to offer recommendations on control strategy issues that remain unresolved after the Presidential Directive. In particular, the Presidential Directive appears to offer little or no guidance to EPA in the following three areas:

•	the initial round of control strategies for areas that are not covered by regional transport strategies or that will need additional local controls to attain the new standards.

•	the role, if any, for federal backstops.

•	consequences of EPA's failure to implement national measures, lack of timely implementation of such measures, or inadequate emission reductions resulting from such measures.

Key Questions

Question 1. To what degree should the initial round of control strategies offer states flexibility to tailor control strategies to an area's air quality needs?

Question 2. How can a state assure EPA, the public, and stakeholders that an area's control strategy will achieve timely and certain attainment of air quality standards?

Question 3. How should the situation be handled where national measures are not implemented, or are not timely? What is the consequence to the regulatory agency (e.g. sanctions)?

Framework for Control Strategies

Introduction: The success or failure of any plan to attain healthful levels of air quality is based on emission reductions that result from successful air pollution control strategies. Though the nature of the strategies may differ (e.g., command and control, voluntary, market based), the Issue Group feels that control strategies should:

•	result in timely and certain attainment of air quality standards;

•	be developed in an environment of flexibility so that the strategy can be tailored to address an area's air quality needs most efficiently; and

•	provide for the ability to assess the effectiveness of the strategy on an ongoing basis.

These goals are consistent with the "Content Related Principles" upon which all issue papers are to be based. To help achieve these goals, we propose an alternate route for SIP development and implementation that provides flexibility, ensures attainment in a timely manner, and builds in a formal assessment of the effectiveness of applied control strategies.

Summary: Under the proposed alternative, states or local air management agencies would have seven years from the date of designation to attain the standard or to demonstrate that the measures will achieve attainment by the statutory deadline. This demonstration would be conducted using methodologies and performance targets developed by the state, written into the SIP, and subject to EPA's review and approval. Should it be determined that the alternative plan is falling short of its targeted reductions for any reason, specific contingency measures sufficient to ensure attainment within the statutory deadline would be automatically triggered. These contingency measures would also be part of the SIP.

Timeline: The following table compares control strategy implementation requirements implied by the Presidential Directive, and the requirements in transitional areas, to the "alternative" requirements. Dates are offered as examples only. The time between key milestones would apply for both ozone and PM irrespective of the date the initial nonattainment designation occurs.

Year Current Requirements Transitional Requirements Alternative Requirements 2000 Nonattainment designation 8 hr Ozone SIPs due; areas classified "Transitional" Nonattainment designation 2001

2002

2003 Attainment SIPs due Alternative SIPs due including:

- progress assessment methods

- contingency measure backstops 2004 Local strategies implemented EPA approval of control and contingency measures 2005

2006

2007 Assess attainment based on regional and local measures Progress assessment using agreed methodologies 2008 Implement backstop measures if required; full EPA SIP approval 2009

2010 Attainment date

Attainment date (?) Attainment date 2011

2012 Maximum attainment date

Maximum attainment date Maximum attainment date

This timeline assumes states are allowed 10 years from designation (plus two possible one year extensions) to attain the standard. In fact, the Act requires attainment to be achieved "…as expeditiously as practicable, but no later than 5 years from the date such area was designated nonattainment,…except that [EPA] may extend the attainment date…for a period no greater than 10 years." It appears that EPA has interpreted the Presidential Directive in such a way that this exception clause is automatically invoked, allowing states up to 10 years to attain. If the 5 year extension was not provided, the attainment date would be year 5. Given the three year average form of the new standards, compliance would have to be determined based on data from years 3, 4 and 5 (years which would not have fully benefited from attainment plan control measures).

Contingency Measure Backstops: Contingency measures that serve as backstops in the event the core SIP attainment plan proves deficient are critical to the success of this alternative framework. The framework envisions the development by EPA, in partnership with the states, of non-binding model regulations for all significant source categories, regulations that when implemented would result in emission reductions in all but those few areas where the most stringent rules are already being implemented. Model regulations could be applied by a given state with modifications that are appropriate in light of the circumstances in that state. States would be required to adopt sufficient "backstop" regulations as part of this contingency plan that, when coupled with those measures from the core SIP for which EPA has quantified and approved emission reduction credit, will ensure attainment by the applicable attainment date.

Key Features of Alternative Framework: The key features of this proposed alternative are:

•	states and local air management agencies are offered the opportunity to prepare an attainment plan using any mix of innovative and non-traditional measures (e.g., economic incentives and voluntary approaches) and traditional measures such as command and control;

•	the plan must meet all RFP requirements, and must show attainment no later than the statutory deadline; the demonstration of attainment should be "streamlined" similar to that contemplated by the Presidential directive for transitional areas;

•	the plan must also include specific rate-of-progress targets and deadlines, and specific methods to be used to assess or measure success in meeting those targets, and to predict the plan's future success;

•	finally, the plan must include a set of specific contingency measures which would be triggered automatically should the rate-of-progress targets not be met; contingency measures which must be, at a minimum, 1) designed to insure timely attainment of the NAAQS, and 2) quantified consistent with EPA issued guidance regarding the projected emission reduction potential of such measures.

Thus the rate-of-progress assessment and the methods for assessing success would become part of the SIP, as would the commitment to use contingency measures to redress any shortfall(s) of the alternative plan. This should assure attainment of the standard in a timely manner.

Conclusion: This alternative provides state and local air management agencies with the flexibility to respond to local conditions in the most efficient manner. It also provides the public with a higher guarantee of attainment of the NAAQS by the statutory deadline, through the use of the rate-of-progress assessment built into the process. Finally, the backstop or contingency requirements offer a further guarantee that attainment will be achieved in a timely manner.

Evaluation and Recommendations

(Environmental community representatives are currently considering the degree to which they can express their support of this general framework and the recommendations.)

Question 1. To what degree should the initial round of control strategies offer states flexibility to tailor control strategies to an area's air quality needs?

Option 1: No discretion: All prescriptive and national measures that are clearly identified and required by the Clean Air Act continue to be adopted and implemented according to statutory direction and deadlines. Similar to the approach provided for areas where EPA has determined regional strategies are sufficient to bring the areas into attainment with air quality standards, EPA identifies and requires additional prescribed measures adequate to meet an area's air quality objectives.

Pros

•	Emission reductions are predictable, assuring expeditious progress toward attainment

•	Federal oversight is simplified; failure by the state to plan or implement is easy to recognize

•	Prescriptive measures coupled with specific deadlines could assure timely environmental progress

Cons

•	Lacking the ability to choose control strategies fails to provide for flexible response methods

•	Potentially affected interests are not afforded the opportunity to participate in control strategy development

•	Clean Air Act amendments would be required before EPA could prescribe specific measures

Option 2: Limited discretion: All prescriptive and national measures that are clearly identified and required by the Clean Air Act continue to be adopted and implemented according to statutory direction and deadlines. Selection of those additional control measures (including innovative and nontraditional strategies) needed to meet an area's air quality objectives is left to the discretion of the air quality planning authority.

Pros

•	With respect to the prescribed measures required in the control strategy, emission reductions are predictable, assuring some expeditious progress toward attainment

•	With respect to the prescribed measures required in the control strategy, Federal oversight is simplified; failure by the state to plan or implement prescribed measures is easy to recognize

•	Potentially affected interests afforded some opportunity to participate in some parts of control strategy development

•	Provides a limited opportunity to evaluate non-traditional approaches, and potentially selecting these approaches to the extent they are cost-effective

Cons

•	States are provided only limited opportunity to choose control strategies, and thus to provide for flexible response methods

•	Potentially affected interests are afforded only limited opportunity to participate in control strategy development

•	Clean Air Act amendments would be required before EPA could prescribe specific measures

•	Federal oversight complicated to the extent non-traditional approaches are used by the state in the control strategy

Option 3: Most discretion (RECOMMENDED): National measures that are clearly identified and required by the Clean Air Act continue to be adopted and implemented according to statutory direction and deadlines. An air quality authority has the discretion to adopt those additional control strategies (including innovative and nontraditional strategies) needed to meet an area's air quality objectives. Note: this recommendation is only valid when coupled with the Backstops option from Question 2.

Pros

•	Discretion provides states with the best opportunity to accommodate flexible response methods by emission sources

•	Potentially affected interests are afforded the opportunity to participate in control strategy development

•	Allows for the evaluation and selection of the most cost-effective measures (including both traditional and non-traditional measures)

Cons

•	States which lack authority to exceed minimum federal requirements may be unable to plan control strategies on a timely basis

•	Federal oversight complicated to the extent non-traditional approaches are used by the state in the control strategy

Question 2. How can a state assure EPA, the public, and stakeholders that an area's control strategy will achieve timely and certain attainment of air quality standards?

Option 1: Status quo: The state relies on the current SIP approval process combined with air quality monitoring to determine attainment of the standard. Under the SIP approval process, EPA determines the approvability of a SIP and then subjects its determinations on component parts of the SIP to public review through notice-and- comment federal rule-making.

Pros

•	EPA oversight of state planning process could result in early recognition and timely action on deficient plans

•	Potentially affected interests will be engaged in the planning process, including the technical assumptions, emission estimates, and modeling, which may result in the use of best available, scientifically-based information

•	RFP, and RFP contingency measures provide progress towards attainment

Cons

•	RFP alone without a classification/bump up scheme may compromise timely attainment;

•	Continues to focus debate on the science underlying the choice of control strategy options, which often results in delayed implementation and untimely environmental progress

Option 2: Backstops (RECOMMENDED): Initially, the air quality planning agency has discretion to develop and implement a control strategy designed to meet air quality objectives. Only when the strategy fails to show reasonable further progress prior to the attainment date, do pre-adopted contingency measures sufficient to bring the area into attainment "kick in." Note: this recommendation is only valid when coupled with the Most Discretion option from Question 1.

Pros

•	Provides more assurance of timely attainment

•	Provides incentive for implementation of effective alternative control measures (including non-traditional approaches) to avoid having to implement backstop measures

•	Implementation of backstops would be pre-planned and based on specific deadlines

•	Deficiencies in the attainment plan would be remedied automatically, without the need for additional Federal oversight

Cons

•	May not provide sufficient time for non-traditional approaches to succeed before backstops are automatically triggered

•	As contemplated, backstops do not provide for flexible response methods

•	States would be required to adopt more control measures within the same SIP planning timeframes

•	Some areas, having already implemented stringent control measures on all their significant sources, would not realize emission reductions from many, or any, of the backstop measures

Question 3. How should the situation be handled where national measures are not implemented, or are not timely? What is the consequence to the regulatory agency (e.g. sanctions)?

Q3) A. For national measures which EPA fails to develop on schedule:

Option 1 (FAVORED): Credit is given from the target date, regardless of actual implementation date.

Option 2: Credit is given from the actual implementation date: RFP requirements are reduced by the difference in reductions for one RFP period. (Attainment dates and requirements remain unchanged.)

Option 3: Credit is given from the actual implementation date, with a grace period to allow for substitute measures to meet RFP requirements. (Attainment dates and requirements remain unchanged.)

Option 4: Credit is given from the actual implementation date. Discretionary measures must be substituted by the target date to make up the difference in emission reductions to meet RFP requirements.

Q3) B. For national measures which are not implemented:

Option 1: Difference in emission reductions made up by discretionary measures; RFP requirements are reduced by the difference for one RFP period. (Attainment dates and requirements remain unchanged.)

Option 2: Differences in emission reductions made up by discretionary measures; a grace period is allowed for implementation of these discretionary measures. A reassessment of overall reduction requirements (such as a mid-course correction) may be conducted.

Option 3: Discretionary measures must be substituted by the original target date.

Option 4 (FAVORED BY MOST): USEPA is responsible for substituting measures sufficient to achieve equal reductions.

Q3) C. What should be the consequences to the regulatory agency?

Option 1 (FAVORED BY MOST): Sanctions are waived for states for USEPA's failure to implement a national rule for which credit has been allowed.

Option 2: A grace period is allowed within which substitute measures must be adopted and implemented. If substitute measures are not adopted by the end of the grace period, appropriate sanctions will be applied.

Option 3: Substitute measures must be adopted and implemented by the target date. If they are not implemented, appropriate sanctions will be applied.