Title of Regulation: 9VAC5-500. Exclusionary General Permit for Federal Operating Permit Program (Rev. H11) (repealing 9VAC5-500-10 through 9VAC5-500-240).

Statutory Authority: § 10.1-1308 of the Code of Virginia.

Public Hearing Information: No public hearings are scheduled.

Public Comment Deadline: May 23, 2012.

Effective Date: June 7, 2012.

Agency Contact: Gary E. Graham, Department of Environmental Quality, 629 East Main Street, P.O. Box 1105, Richmond, VA 23218, telephone (804) 698-4103, FAX (804) 698-4510, or email gary.graham@deq.virginia.gov.

Basis: Section 10.1-1308 of the Code of Virginia authorizes the State Air Pollution Control Board to promulgate regulations abating, controlling, and prohibiting air pollution to protect public health and welfare.

Purpose: Federal operating permit requirements mandated by Title V of the Clean Air Act and implemented in 9VAC5-80 largely apply only to sources with emissions that exceed specified levels and are thus major. To determine whether a source is major, not only are a source's actual emissions considered, but also its potential emissions. Thus, a source that has maintained actual emissions at levels below the major source threshold could still be subject to major source requirements if it has the potential to emit major amounts of air pollutants. However, such sources could legally avoid program requirements by taking federally-enforceable permit conditions that limit emissions to levels below the applicable major source threshold.

As the deadlines for complying with the Title V operating permit requirements approached, industry and state and local air pollution agencies became increasingly focused on the need to adopt and implement federally-enforceable mechanisms to limit emissions from sources that desire to limit potential emissions to below major source levels. In the case of Virginia, the board adopted a state operating permit program (9VAC5-80, Article 5) that was approved by the Environmental Protection Agency (EPA) for this purpose, but implementation of that program became problematic due to the volume of sources affected.

The EPA remained concerned that even with expedited approvals and other strategies, sources might face gaps in the ability to acquire federally-enforceable potential to emit limits due to delays in state adoption or EPA approval of programs or in their implementation. In order to ensure that such gaps did not create adverse consequences for states or for sources, on January 25, 1995, EPA issued a memo announcing a transition policy for a period extending until January 25, 1997. Under this policy, exclusionary rules and general permits could be used to create simple, streamlined means to ensure that these sources with actual emissions below 50% of major source thresholds would not be considered major sources for the transition period. EPA extended the transition period in subsequent memos, but made clear that the transition period would not be extended past the December 31, 2000, expiration date of the EPA transition policy that was given in the final transition policy memo.

On April 24, 1997, the board adopted an exclusionary general permit program (9VAC5-500, Exclusionary General Permit for Federal Operating Permit Program) to implement that EPA transition policy. By the December 31, 2000, expiration date of the EPA transition policy, all sources in Virginia that had obtained exclusionary general permits under that program had been issued state operating permits with federally enforceable emission limits and were no longer subject to applicability as major sources under the federal operating permit program. And, as of that date, 9VAC5-500 conflicted with federal and state regulatory requirements that all major sources (with respect to their potential to emit) apply for and obtain federal operating permits. The purpose of this amendment to repeal 9VAC5-500 is to resolve that conflict and remove the provisions of an unusable permit program that is no longer needed to protect the health, welfare, and safety of the public.

Rationale for Using Fast-Track Process: As of December 31, 2000, no more sources with exclusionary general permits existed and the department had the capability to issue sufficient permits with federally enforceable emission limits under the new source review permit programs or the state operating permit program to meet any affected source's need to be excluded from the federal operating permit program. Because no sources exist with exclusionary general permits under 9VAC5-500 and applicability under an exclusionary general permit will no longer protect a source from applicability under the federal operating permit programs, there is no stakeholder group that is likely to object to repeal of the regulation.

Substance: 9VAC5-500, Exclusionary General Permit for Federal Operating Permit Program, is repealed in its entirety. The repeal of this chapter does not affect the provisions of the federal operating permit program (9VAC5-80, Articles 1, 2, 3, and 4).

Issues: The primary advantage to the public is the removal of unusable and conflicting regulatory requirements, which improves the public's ability to understand and comply with regulatory requirements. There are no disadvantages to the public.

The primary advantage to the department is the removal of regulations that are no longer necessary. There are no disadvantages to the department

Department of Planning and Budget's Economic Impact Analysis:

Summary of the Proposed Amendments to Regulation. This regulation establishes procedures for facility owners to obtain authority to operate under a general permit in order to avoid the necessity of obtaining a permit required under Title V of the Clean Air Act. The Air Pollution Control Board proposes to repeal this regulation because the U.S. Environmental Protection Agency (EPA) policy under which this regulation operated has expired and the regulation is no longer applicable.

Result of Analysis. The benefits likely exceed the costs for all proposed changes.

Estimated Economic Impact. Since the regulation is no longer applicable, repealing it will have no impact beyond reducing potential confusion amongst the public.

Businesses and Entities Affected. Since the regulation is no longer applicable, repealing it will not affect businesses or other entities.

Localities Particularly Affected. The proposed repealing of this regulation will not disproportionately affect particular localities.

Projected Impact on Employment. The proposed repealing of this regulation will not affect employment.

Effects on the Use and Value of Private Property. The proposed repealing of this regulation will not affect the use and value of private property.

Small Businesses: Costs and Other Effects. The proposed repealing of this regulation will not affect small businesses.

Small Businesses: Alternative Method that Minimizes Adverse Impact. The proposed repealing of this regulation will not produce an adverse impact on small businesses.

Real Estate Development Costs. The proposed repealing of this regulation will not affect real estate development costs.

Legal Mandate. The Department of Planning and Budget (DPB) has analyzed the economic impact of this proposed regulation in accordance with § 2.2-4007.04 of the Administrative Process Act and Executive Order Number 14 (10). Section 2.2-4007.04 requires that such economic impact analyses include, but need not be limited to, the projected number of businesses or other entities to whom the regulation would apply, the identity of any localities and types of businesses or other entities particularly affected, the projected number of persons and employment positions to be affected, the projected costs to affected businesses or entities to implement or comply with the regulation, and the impact on the use and value of private property. Further, if the proposed regulation has adverse effect on small businesses, § 2.2-4007.04 requires that such economic impact analyses include (i) an identification and estimate of the number of small businesses subject to the regulation; (ii) the projected reporting, recordkeeping, and other administrative costs required for small businesses to comply with the regulation, including the type of professional skills necessary for preparing required reports and other documents; (iii) a statement of the probable effect of the regulation on affected small businesses; and (iv) a description of any less intrusive or less costly alternative methods of achieving the purpose of the regulation. The analysis presented above represents DPB's best estimate of these economic impacts.

Agency's Response to Economic Impact Analysis: The department has reviewed the economic impact analysis prepared by the Department of Planning and Budget and has no comment.

Summary:

This action repeals in its entirety 9VAC5-500 because the U.S. Environmental Protection Agency policy under which the regulation operated has expired, rendering the regulation obsolete.