10/1/96 DRAFT

INTERIM IMPLEMENTATION POLICY PRINCIPLES

FOR THE TRANSITION FROM OLD NATIONAL AMBIENT AIR QUALITY STANDARDS (NAAQS) TO THE NEW NAAQS

BACKGROUND

The interim implementation policy (IIP) principles that follow were presented and accepted by the Subcommittee for Development of Ozone, Particulate Matter and Regional Haze Implementation Programs at the July 30, 1996, meeting in Crystal City, Virginia. The principles were developed by the Base Programs Analyses and Policy Work Group in conjunction with an Ad Hoc Committee of the Subcommittee.

At the July 30, 1996, Subcommittee meeting, it was agreed that the Environmental Protection Agency (EPA) would begin drafting an interim implementation policy based on these principles. Additionally, it was agreed that the draft IIP would be sent to the Subcommittee when it is submitted to the Office of Management and Budget for review. The Subcommittee would then have time during the public comment period to submit any comments on the IIP to EPA. This approach is being taken since the main focus of the Subcommittee is on the development of implementation programs for ozone, particulate mater and a regional haze reduction program that will take effect if the ozone and PM NAAQS are revised, rather than on the interim period. It is EPA's intention to publish a proposed IIP in November 1996, at the same time the ozone and PM NAAQS proposals are published.

The principles were developed from the perspective of needing a policy which could be simply administered and which would gradually begin to direct efforts toward the new standard. It was recognized that a key principle for a transition policy was to minimize delay in steps toward attaining the revised standards without adding unnecessary costs or devaluing existing investments in pollution control programs. The principles include some incentives for States to begin addressing the new standard as expeditiously as possible.

ASSUMPTIONS OF IIP PRINCIPLES

Several assumptions upon which the principles are based are:

All 15 percent plans for ozone should be required to comply with existing policies since they were due in November 1993 and were to have achieved all of the reductions before the standard changed.

The 3 percent per year requirement for ozone is a good way to continue progress during the interim period while new area boundaries are being designated and new implementation strategies are being developed.

Evaluating current modeling and controls against the new standards uses work already done but recognizes the change on the horizon.

The results of the Ozone Transport Assessment Group (OTAG) effort should be a part of the transition toward the new standard.

IIP PRINCIPLES

The interim implementation policy principles that were presented and generally accepted by the Subcommittee at the July 30, 1996 meeting follow.

1. The interim implementation policy becomes effective at the time new NAAQS are promulgated and remains effective until State rules/SIP's based on the new implementation strategy are adopted, approved, and enforceable by the State and submitted to EPA.

2. No backsliding is allowed.

- All existing programs stay in place, e.g., the Ozone Transport Region.

- All requirements for new programs stay in place, e.g., 3	percent rate of progress (ROP) or other actions to meet milestones, including new programs that may be required as a result of the OTAG or other transport-related activities.

3. The goal is progress toward attainment of new NAAQS in a flexible and cost-effective manner.

- Current or required new program provides ROP or "glide path" to govern actions in the interim.

- Ozone and PM bump ups are tied to EPA decisions on promulgation of the new standards. (No bump ups would occur prior to the final decision on the standards. Consensus on this issue is based on a NAAQS promulgation date of 6/97.)

4. A nonattainment area should be allowed to take credit for effective emission reductions (equivalent or greater air quality) from sources outside the nonattainment area

Substitution Case Example

It was agreed that a nonattainment area should be able to take credit for effective (equivalent or greater air quality) emission reductions from sources outside the nonattainment area with the following conditions. The underlying assumption is that these emissions would be included in the nonattainment area's modeling inventory, and that emission reductions from such sources are impacting the nonattainment area.

Conditions

Substitutions are restricted to the Post '96, 3 percent per year requirement.

Substitutions may be made for VOC sources within 100 km of the nonattainment boundary and for nitrogen oxides (NOx) sources within 200 km of the nonattainment boundary.

The case for the substitution has to be made when the	request is made, i.e., this cannot be used to delay	achievement of the Post '96, 3 percent per year requirement.

Substitutions are restricted to intrastate unless two States reach agreement. Interstate substitutions, like intrastate substitutions, must be enforceable by the States in which the affected sources are located.

This provision is only in effect during the transition period. The final implementation strategy will address the issue for the post-transition period.

The same "ground rules" apply for these credits as apply to credits obtained within the nonattainment area boundary.

The other emissions from the county in which the substitution source or sources are located would not have to be inventoried and included in the SIP if the county was outside the nonattainment area.

5. Existing nonattainment areas and their requirements should be addressed as follows:

Nonattainment Area Requirements

A. For areas that are nonattainment under the existing standard and will be attainment under the new standard.

This category is conditional based on an official "pre- designation" determination (i.e., some determination based on air quality data showing whether the area is attaining or not attaining the new standards to be completed within 90 days of promulgation).

All existing measures must be kept in place.

Where applicable, i.e., where a 9 percent ROP plan is required for marginal to moderate areas that are still nonattainment of the current standard and existing moderate, serious, and severe areas, if an area has its 9 percent ROP plan adopted, submitted, and complete, it may defer implementation of any additional measures, including 9 percent ROP plan.

Where applicable, i.e., where a 9 percent ROP plan is required for marginal to moderate areas that are still nonattainment of the current standard and existing moderate, serious, and severe areas, if an area does not have its 9 percent ROP plan, then it will be subject to the requirements of the nonattainment-to- nonattainment category described below.

B. For areas that are attainment under the existing standard that will be nonattainment under the new standard.

The new implementation strategy will apply.

C. For areas that are nonattainment under the existing standard that will remain nonattainment under the new standard.

Once the new SIP's are adopted, approved and enforceable by the States and submitted to EPA, the new implementation strategy will apply. Until that time, the interim policy will apply.

For previous moderate or marginal areas which are still in nonattainment, the area may EITHER submit a demonstration of attainment of the new standard within 18 months from the promulgation of the new standard OR submit the 9 percent ROP plan (3 percent per year through '99) for the old standard. Nonattainment area bump ups will be deferred to the date new standards are promulgated. The area would be subject to the ROP requirements of the higher classification. Other requirements specified for these areas would be addressed through the new implementation strategy except for new source review.

For previous serious, severe and extreme areas which are still in nonattainment, the requirements under the old standard apply except as described below.

-- The ROP submissions to be made on the schedule required by the Act (with NOx-HC substitutions justifiable by showing air quality benefits based on either existing or revised standard). For areas that do not anticipate submitting plans to address a revised standard before 1999, ROP submissions should cover the period 1999-2002 as well as 1996-1999.

-- The revision of the ozone standard should not interfere with the schedule for the adoption of regional measures (whether Federal or State) resulting from the OTAG process. (Any such measures may be appropriately credited toward ROP. The air quality impact of OTAG measures that have been adopted and analyzed might be appropriately credited against some or all of an area's ROP obligations. EPA should address this issue with additional guidance).

-- Analysis of additional "local" precursor reductions that an area may need to demonstrate attainment with the revised ozone standard should be completed within 90 days of the promulgation of a revised ozone standard. The schedule for adoption of additional measures should be addressed in designing the new implementation strategy.

6. The burden of proof for equivalence of substitutions rests with the States, and substitutions are to be documented and reviewed as part of the SIP process.

7. To more effectively address the issue of transport, new implementation policies must be structured.

8. Any disincentives to (a) the early implementation of control measures and (b) additional, improved monitoring should be identified and eliminated, and incentives for such efforts should be established.

9. A comprehensive and sophisticated public education and outreach strategy to enhance public awareness and understanding of issues related to the new NAAQS should be expeditiously developed and implemented.