ENVIRONMENTAL PROTECTION AGENCY
[40 CFR Part 63]
[FRL-                ]
Hazardous Air Pollution: Proposed Regulations Governing 
Equivalent Emission Limitations by Permit
AGENCY:   Environmental Protection Agency (EPA)
ACTION:   Proposed Rule
SUMMARY:  The proposed rule would implement section 112(j)
of the Clean Air Act (as amended in 1990) ("the Act").
Section 112(j) applies to the owner or operator of a major
source of hazardous air pollutant(s) (HAP's) in a source
category for which the EPA was scheduled to, but failed to
promulgate a maximum achievable control technology (MACT)
standard under 112(d) or 112(h) of the Act.  Section 112(j)
requirements apply to major sources in a source category 
18 months after a date listed in the source category
schedule for standards.  After the effective date of a Title
V permit program in a State (but not before May 15, 1994),
each owner or operator of a major source in such a source
category would be required to submit an application for a
permit, permit revision, or permit renewal containing case-
by-case MACT emission limits that are at least as stringent
as the Federal MACT standard would have been.  The proposed
rule establishes requirements and procedures for the owners
or operators to follow in order to comply with section
112(j).  The proposed rule also contains guidance for
reviewing agencies in implementing section 112(j), to
maintain consistency in these reviews.
DATES:    Comments. Comments must be received on or before 
(Insert date 45 days after publication in the FEDERAL
REGISTER).
     Public Hearing.  If anyone contacts the EPA requesting
a public hearing by [Insert date two weeks after publication
in the FEDERAL REGISTER], a public hearing will be held on
[contact Ms. Theresa Adkins at (919) 541-5645 to get the
date] beginning at 10:00 a.m.  Persons interested in
attending the hearing should call Theresa Adkins at 
(919) 541-5645 to ensure that a hearing will be held.
     Request to Speak at Hearing.  Persons wishing to
present oral testimony must contact the EPA by [Insert date
2 weeks after proposal in the FEDERAL REGISTER).
ADDRESSES:     Comments.  Comments should be submitted (in
duplicate if possible) to: Air Docket (LE-131), Attention
Docket Number A-93-32 (see Docket section below), Room 
M1500, U.S. Environmental Protection Agency, 401 M Street,
S.W., Washington, D.C. 20460.
     Public Hearing.  If anyone contacts the EPA requesting
a public hearing, it will be held at the EPA's Office of
Administration auditorium, Research Triangle Park, North
Carolina.  Persons interested in attending the hearing or
wishing to present oral testimony should notify Theresa
Adkins, U.S. Environmental Protection Agency, Research
Triangle Park, North Carolina, 27711, telephone number (919)
541-5645.
     Docket.   Docket No. A-93-32, containing supporting
information used in developing the proposed rule is
available for public inspection and copying between 
8:30 a.m. and 3:30 p.m., Monday through Friday, at the 
EPA's Air Docket, Room M1500, U.S. Environmental Protection
Agency, 401 M Street, S.W., Washington, D.C. 20460. 
A reasonable fee may be charged for copying.
FOR FURTHER INFORMATION CONTACT:  Ms. Katherine Kaufman,
Emission Standards Division (MD-13), U.S. Environmental
Protection Agency, Research Triangle Park, North Carolina,
27711, telephone (919) 541-0102.
SUPPLEMENTARY INFORMATION:  The information presented in
this preamble is organized as follows:
I.   SUMMARY OF PROPOSED RULE
II.  BACKGROUND DISCUSSION
     A.   Clean Air Act amendments: Section 112
     B.   Clean Air Act amendments: Provisions for
          Equivalent Emission Limitation by Permit.
     C.   Implementation Principles
III. SUMMARY AND RATIONALE FOR SECTIONS 63.50 THROUGH 63.57
     OF THE PROPOSED RULE
     A.   Section 63.50- Applicability
     B.   Section 63.51- Definitions
     C.   Section 63.52- Requirements for existing sources
     D.   Section 63.53- Application content for a case-by-
          case MACT determination
     E.   Section 63.54- Preconstruction requirements for
          new sources
     F.   Section 63.55- Permit requirements for new sources
     G.   Section 63.56- Maximum achievable control
          technology (MACT) determinations for sources
          subject to case-by-case determination of
          equivalent emission limitations
     H.   Section 63.57- Requirements for case-by-case
          determination of equivalent emission limitations
          after promulgation of a subsequent MACT standard
IV.  DISCUSSION OF THE RELATIONSHIP OF THE PROPOSED
     REQUIREMENTS TO OTHER REQUIREMENTS OF THE ACT
     A.   Section 112(g) Requirements for Constructed,
          Reconstructed, and Modified Major Sources; and
          Subsequent Standards under Section 112(d) or
          Section 112(h).
     B.   Section 112(l) Delegation Process
     C.   Section 112(i)(5) Early Reductions Program

V.   ADMINISTRATIVE REQUIREMENTS
     A.   Executive Order 12291
     B.   Regulatory Flexibility Act
     C.   Paperwork Reduction Act
     The purpose of this notice is to provide the public
with the opportunity to comment on the proposed rule
implementing the requirements of section 112(j) of the Act.
This preamble is organized to serve readers needing (1) an
overview of the proposed requirements of the section 112(j)
program, and (2) a detailed discussion of the alternatives
considered in developing the proposed requirements.
     The first section provides an overview of the
requirements of the regulations being proposed today.
     The second section provides background information on
section 112(j) in the context of the 1990 amendments to the
Act.
     The third section provides a detailed discussion of the
requirements of the proposed rule and the rationale for
these requirements, including other regulatory options that
were considered.
     The fourth section of this preamble discusses the
relationship of the proposed requirements of section 112(j)
of the Act with other requirements of the Act under other
subsections of section 112.


     The fifth section of this preamble demonstrates that
the proposed rulemaking is consistent with a number of
federal administrative requirements.
     This preamble makes use of the term "State," usually
meaning the State air pollution control agency which would
be the permitting authority implementing the section 112(j)
program.  The reader should assume that use of  the word
"State" also applies, as defined in section 302(d) of the
Act, to the District of Columbia and territories of the
United States, and may also include reference to a local air
pollution control agency.  These agencies can either be the
permitting authority for the area of their jurisdiction or
assist the State or EPA in implementing the section 112(j)
program.  In some cases, the term "reviewing agency" is used
and can refer to both State agencies and to local agencies
(when the local agency directly makes the determinations or
assists the State in making the determinations).  The term
"reviewing agency" may also apply to the EPA, where the EPA
is responsible for the program.
     The proposed rule and preamble make a number of
references to three regulations which have not yet been
proposed.  The first is Subpart A to 40 CFR Part 63.  This
Subpart would provide general provisions that would apply to
all subparts of Part 63, including the proposed rule.  The
EPA expects these general provisions to be promulgated
before today's proposed rule is promulgated.  [add citation
if GP's are proposed before 112j].  The second is the rule
governing constructed, reconstructed, or modified major
sources, which EPA intends to propose in additional sections
of Subpart B to 40 CFR Part 63.  The third is the federal
operating permits program which EPA intends to promulgate as
40 CFR Part 71.  Today's proposed rule and this preamble
refer to "Part 70 or Part 71" permits.  At this time, only 
40 CFR Part 70 has been promulgated, but it is expected that
Part 71 will be promulgated before the promulgation  date of
today's proposed rule.
I.   SUMMARY OF PROPOSED RULE
     The rule proposed today would implement the
requirements of section 112(j) of the Clean Air Act, as
amended in 1990.  Section 112(j) establishes requirements
for regulation of major sources of hazardous air pollutants
in the event that EPA lags more than 18 months behind
schedule in issuing a control technology standard for an
industry.
     Section 112 requires EPA to set maximum achievable
control technology (MACT) standards for all categories of
major sources of hazardous air pollutants by November 15,
2000.  EPA is required to issue a schedule for regulating
all source categories within two, four, seven, or ten years
of enactment.  The Agency on September 24, 1992 proposed the
draft source category schedule for standards in the Federal
Register.
     Section 112(j) would be triggered if EPA has failed to
promulgate a MACT standard for a source category 18 months
after the deadline listed in the final schedule.  Under the
proposed rule, the owner or operator of each major source
with emission units in that category would have to apply for
a case-by-case (facility-specific) determination of maximum
achievable control technology.  Section 112(j) requirements 
apply in a state beginning on the effective date of a permit
program established under Title V of the Act, but not before
May 15, 1994.
     Case-by-case MACT determinations would be made by the
permitting authority.  This generally would be the state air
pollution control agency, but in some circunstances could be
EPA or a local air pollution control agency.
     Once a source category becomes subject to 112(j), the
proposed rule would require MACT for all emission units in
that source category that are:
o    part of an existing major source
o    part of a new major source
o    new emission units added to a major source
An emission unit would be considered "new" if construction
or reconstruction commenced after the section 112(e)
deadline.  The section 112(e) deadline is the scheduled date
for issuing a national MACT standard applicable to those
emission units.

     The proposed rule would require owners or operators of
new and existing sources covered by 112(j) to apply for
case-by-case determination of MACT emissions limitations by
the permitting authority.  Section 63.53 specifies the
required contents of these applications.
     Permitting authorities would determine MACT emission
limitations for emission units based on principles
established in section 63.56 and a more detailed guidance
document titled "Draft Guidelines for MACT Determinations,"
which the EPA is making available today for comment.  (The
Draft Guidelines are also available through the National
Technical Information Service, 5285 Port Royal Road,
Springfield, Virginia 22161, or at (703) 487-4650. The NTIS
document number is PB93-183283).  Comments on the Draft
Guidelines should be submitted together with comments on
today's rule.  The Draft Guidelines contain procedures for
evaluating whether a control technology is consistent with
the minimum requirements established in section 112(d) of
the Act. Because section 112(j)(5) requires that case-by-
case MACT determinations be "equivalent to the limitation
that would apply to such source if an emission standard had
been promulgated in a timely manner under subsection (d),"
EPA believes that consideration of the Guidelines is a
crucial component of the 112(j) case-by-case MACT
determination process.

     Permits for new and existing sources subject to 
section 112(j) would have to contain the elements listed in 
section 63.54(c).  (Today's proposal includes requirements
for the substantive terms of permits and the content of
permit applications because the operating permits rules do
not include similar requirements).
     Existing major sources would be required to comply with
their MACT emissions limitations by the date set by the
permitting authority, which can be no more than three years
after permit issuance.  New sources would have to comply
with their MACT limits at permit issuance.
     Under other federal or state regulations, many new
sources covered by section 112(j) will be required to obtain
approval of the design of their hazardous air pollutant
control equipment prior to construction.  Preconstruction
approval will be mandatory for (1) new sources that are
subject to forthcoming regulations implementing section
112(g) of the Act, and (2) new sources in states that
require operating permit issuance or revision prior to
construction.
     For new sources not required to undergo preconstruction
review, states may elect to provide a preconstruction MACT
determination process containing elements set out in section
63.54.  Procedures for incorporating such emission
limitations subsequently into operating permits are
described in section 63.55.  Another voluntary option for
these sources is to obtain an operating permit or permit
revision prior to construction, so long as the State's Part
70 operation permit program provides for that option.
     Finally section 63.57 of today's proposal establishes
requirements for complying with a 112(d) standard that is
promulgated subsequent to a case-by-case MACT determination
under 112(j).
     The term "emission unit" in the proposed rule
corresponds to the term "source" in section 112 of the
statute.  EPA has chosen to use "emission unit" rather than
"source" to avoid creating any misperception that the
section 112(j) rule could somehow constrain the Agency's
flexibility to define source in other rulemakings under
section 112, including national MACT standards for each
source category to be issued under subsection (d) or (h).
II.  BACKGROUND DISCUSSION
A.   Clean Air Act Amendments.  Section 112.
     The Clean Air Act amendments of 1990 
[Public Law 101-549] contain major changes to section 112 of
the Act pertaining to the control of hazardous air pollutant
(HAP) emissions.  Section 112(b) includes a HAP list that is
composed of 189 chemicals, including 172 specific chemicals
and 17 compound classes.  Section 112(c) requires
publication of a list of source categories and subcategories
of major sources emitting these HAPs, and of area sources
warranting regulation.  Section 112(d) requires promulgation
of emission standards for each listed source category or
subcategory according to a schedule set forth in 
section 112(e).
B.   Clean Air Act Amendments.  Provisions for Equivalent
     Emission Limitation by Permit.
     1.   General Requirements of Section 112(j).
     The amendments to section 112 include new 
section 112(j).  This section is entitled "Equivalent
Emission Limitation by Permit."  Subsection 112(j)(2) of the
Act provides that section 112(j) applies if EPA misses a 
deadline for promulgation of a standard under 112(d)
established in the "source category schedule for standards":
In the event that the Administrator fails to promulgate a
standard for a category or subcategory of major sources by
the date established pursuant to subsection (e)(1) and (3),
and beginning 18 months after such date (but not prior to
the effective date of a permit program under title V), the
owner or operator of any major source in such category or
subcategory shall submit a permit application...

     The owner or operator of a major source subject to the
provisions of section 112(j) is required under 
subsection 112(j)(3) to submit a complete permit application
18 months after the missed promulgation deadline:
By the date established by paragraph (2), the owner or
operator of a major source subject to this subsection shall
file an application for a permit. 
Subsection 112(j)(3) also requires that EPA must establish
requirements for permit applications, including content and
criteria for the reviewing agency to determine completeness.
In addition, subsection 112(j)(3) provides that if the
reviewing agency deems the application incomplete, or
disapproves the application, then the applicant has up to
six months to revise and resubmit the application.
     Subsection 112(j)(5) establishes a requirement for
case-by-case MACT determinations:
The permit shall be issued pursuant to title V and shall
contain emission limitations for the hazardous air
pollutants subject to regulation under this section and
emitted by the source that the Administrator (or the State)
determines, on a case-by-case basis, to be equivalent to the
limitation that would apply to such source if an emission
standard had been promulgated in a timely manner under
subsection (d).

Subsection 112(j)(5) also establishes compliance dates:
No such pollutant may be emitted in amounts exceeding an
emission limitation contained in a permit immediately for
new sources and, as expeditiously as practicable, but not
later than the date 3 years after the permit is issued for
existing sources or such other compliance date as would
apply under subsection (i).

If the applicable criteria for voluntary early reductions,
established under section 112(i)(5), are met, then this
alternative emission limit satisfies the requirements of 
section 112(j), provided that the emission reductions are
achieved by the missed promulgation date. 
     In the event that EPA promulgates a given MACT standard
for the applicable source category before the permit
application is approved, the permit must reflect the this
standard, not the case-by-case MACT determination, and the
source shall be required to comply by the date provided
under subsection (i).  In this case, the owner or operator
of an existing source has no more than 
3 years to comply, and the owner or operator of a new source
must comply immediately upon issuance of the permit.
However, under Section 112(i)(2) any new source that
commenced construction or reconstruction between proposal
and promulgation of the MACT standard may elect to comply
with the proposed standard for three years in lieu of the
promulgated MACT standard, if the promulgated MACT standard
is more stringent than the proposal.
     In the event that EPA promulgates a given MACT standard
after the permit containing case-by-case emission limits is
issued, section 112(j)(6) allows a longer compliance period:
If the Administrator promulgates a standard under subsection
(d)...after the date on which the permit has been issued,
the Administrator (or the State) shall revise such permit
upon the next renewal to reflect the standard promulgated by
the Administrator providing such source a reasonable time to
comply, but no longer than 8 years after such standard is
promulgated or 8 years after the date on which the source is
first required to comply with the emissions limitation
established by paragraph (5), whichever is earlier.

     2.   Definition of Emission Unit and Applicability of
New Source MACT
     MACT determinations must be made on a wide variety of
emitting equipment at major sources in different source
categories.  Today's proposed rule defines "emission unit"
in a way designed to allow States broad flexibility in
designing case-by-case MACT emission limitations.  This
flexibility is essential because of the variety of source
categories, diverse in size and complexity, which may be
subject to 112(j).  A narrower definition of "emission unit"
would make it difficult for States to tailor MACT
determinations to the equipment specific to a particular
source category.
     One approach the EPA considered, but rejected, would be
to require new source MACT only on those emission units that
are in and of themselves "major" at a major source - i.e. 
those emission units at a major source which themselves emit
at least 10 tons per year or more of a single HAP, or 
25 tons per year or more of a combination of HAPs.
     Prior to a missed promulgation deadline, through
section 112(g) the statute clearly requires new source MACT
only on constructed or reconstructed major sources.  Any
other equipment added to an existing major source would be a
modification (unless specifically exempted from regulation
by 112(g)), and would be subject to existing source MACT
levels of control.  However, the language of section 112(j)
is somewhat different from that of 112(g).  Section 112(j)
does not specify that new source MACT is only applicable to
new major sources.
     The EPA believes that the standards developed through
section 112(j) must anticipate and reflect the likely
requirements of section 112(d) and 112(h).  The basis for
the applicability of new source MACT selected is the 
section 112(j)(5) requirement that case-by-case MACT
standards must be:
     "emission limitations for the hazardous air
     pollutants... emitted by the source that the
     Administrator (or the State) determines, on a case-by-
     case basis, to be equivalent to the limitation that
     would apply to such source if an emission standard had
     been promulgated in a timely manner under 
     subsection (d)." 

As discussed in section I.C. (below) of this preamble, it is
the judgement of EPA that 112(j) case-by-case MACT standards
must require new source MACT to be applied to those same
sources to which a standard promulgated under section 112(d)
would apply new source MACT.  Therefore, it is necessary to 
determine what entity is considered a new source under
section 112(d) for the purpose of implementing MACT
standards.
     Section 112(a) provides that "new source" shall mean a
"stationary source the construction or reconstruction of
which is commenced after the Administrator first proposes
regulations under this section establishing an emission
standard applicable to such source."  Section 112(a)(3)
gives "stationary source" the same meaning as under section
111(a), i.e. any new "building, structure, facility, or
installation"; thus the term stationary source clearly
includes both major and area sources under 
section 112(a)(3).  Section 112(d) requires MACT standards
to be set for "sources," and "sources" can be both major and
area.  Once there is a 112(d) standard in place, any new
source will be required to meet new source MACT emission
limits, as defined by the standard.
     If, however, the language of section 112(g) is
interpreted as dispositive as to whether new or existing
source MACT must be applied to any given increase in
emissions, new sources within the definition in 112(a)(4)
would escape having to comply with new source MACT under
section 112(j).  But if a MACT standard establishes a
definition of source that would apply to a unit smaller than
a "major source," this result would conflict with the
requirement for section 112(j) case-by-case MACT
determinations to be "equivalent to the limitation that
would apply to such source..."  Yet under this reading,
although major sources adding new non-major sources could
avoid new source MACT on those new sources, if MACT is then
set under 112(d) for area sources in that category, any new
area source would have to meet new source MACT.  This would
be an anomolous result.  Therefore EPA today proposes
requiring new source MACT on all constructed or
reconstructed emission units.
     The EPA today requests comment on the desirability of
requiring or not requiring new source MACT on all new
emission units, and also specifically requests comment on
the question of whether new source MACT should be required
only on those emission units that are in and of themselves
"major" at a major source.


     3.   Subsequent Changes to a Major Source.
     The EPA believes that section 112(j) emission
limitations apply to subsequent changes made at major
sources already complying with case-by-case MACT limitations
under 112(j), where EPA has not promulgated a final standard
for the source category under section 112(d).  The EPA
intends to require, in subpart A of this Part 
(section 63.5(b)(6)), that subsequent changes to a major
source already complying with a section 112(d) or (h)
standard shall comply with established MACT emission
limitations for the source to which changes are made. 
Therefore requiring subsequent changes to sources already
meeting case-by-case MACT emission limitations under 
section 112(j) would satisfy the 112(j)(5) statutory
requirement that case-by-case MACT determinations under
112(j) be "equivalent to the limitation that would apply to
such source if an emission standard had been promulgated in
a timely manner under subsection (d)."
     The EPA requests comment on this approach, as well as
on the alternative approach of treating 112(j) as a one time
permitting requirement applicable 18 months after EPA fails
to set a relevant MACT standard, and therefore requiring
subsequent changes at major sources with 112(j) permits to
comply only with section 112(g).


C.   IMPLEMENTATION PRINCIPLES
     In designing guidance for case-by-case MACT
determinations, the EPA's thinking is guided primarily by
the need for 112(j) standards to be substantively equivalent
to 112(d) MACT standards.  Subsection 112(j)(5) requires
that a case-by-case MACT determination be "equivalent to the
limitation that would apply to such source if an emission
standard had been promulgated in a timely manner under
subsection (d)," and subsection 112(j)(6) requires eventual
compliance with subsequently promulgated 112(d) standards.
Consistency in standard-setting will smooth a major source's
eventual transition from compliance with 112(j) to
compliance with 112(d), making implementation of toxics
control easier on both States and industry.
     The EPA's other major goal in establishing 112(j)
requirements is to achieve and maintain consistency across
section 112 programs.  The EPA intends for administrative
and operational requirements under 112(j) to be consistent
with the requirements of section 112(g) rules for
construction, reconstruction, and modification of major
sources (to be proposed as sections 63.40-48 of this
subpart) and with the general provisions for section 112
(established in subpart A of this Part).  Section IV. A. of
this preamble discusses likely overlapping requirements and
major substantive differences across these programs. 

III. SUMMARY AND RATIONALE FOR SECTIONS 63.50 THROUGH 63.57
     OF THE PROPOSED RULE
     This section of the preamble is a detailed discussion
of the provisions of the proposed rule.  This discussion
outlines the rationale for the decisions that were made, and
describes other options that were considered.
A.   Section 63.50: Applicability
     1.   63.50(a). Applicability
     Paragraph 63.50(a) of the proposed rule indicates that
the intent of the rule is to implement section 112(j) of the
Act.  This paragraph indicates that 112(j) applies to the
owner or operator of a major source of HAPs after the
"effective date of a Title V program" in each State, but not
before May 15, 1994.
     (a)  Effective date of Title V.    The meaning of
"effective date of a Title V program" is indicated in the
final regulations for implementation of Title V of the Act.
Under these regulations, States are required to submit a
permit program for review by the EPA on or before 
November 15, 1993.  The EPA is required to approve or
disapprove the permit program within one year after
receiving the submittal.  The EPA's program approval date is
termed the "effective date."
     The effective date of Title V permit programs is
defined in section 502(h) of the Act, which says "The
effective date of a permit program, or partial or interim
program, approved under ... [Title V] ... shall be the date
of promulgation." This definition is incorporated into the
operating permit regulations as 40 CFR 70.4(g).
     This language refers to two types of Title V programs:
one type where the EPA "approves" the Title V program under
40 CFR Part 70 and another type where the EPA "promulgates"
a program under 40 CFR Part 71.  Programs "approved" by the
EPA under Part 70 will be developed by the State or local
area and submitted to the EPA for approval.  The language in
section 502(h) of the Act makes these programs immediately
effective upon EPA approval.  Programs "promulgated" by the
EPA under Part 71 are anticipated to be rare, and they occur
only where a State failed to submit a program, submitted a
program that EPA could not approve, or has failed to
adequately administer an approved program.  For example, the
EPA is required by section 502(d)(3) of the Act to
promulgate and administer a Title V program if, by November
1995, the EPA has not approved the State program.  The
language in section 112(j), because it refers to the
effective date of a Title V program in any State (and not by
any State), means that the program will apply to both the
EPA "approved" and "promulgated" programs.
     The Title V regulations provide for approval of
"interim" and "partial" programs in certain limited
circumstances.  The EPA believes that, because partial
programs must ensure compliance with "all requirements
established under section 112 applicable to 'major sources'
and 'new sources'," and interim programs must "substantially
meet the requirements of [Title V]," an interim or partial
program would trigger the requirements of section 112(j).
     (b)  Major Source.  Section 112(j) applies only to an
owner or operator of a major source.  Section 112(a)(1) of
the Clean Air Act defines major source as follows:
     "...any stationary source or group of stationary
     sources located within a contiguous area and under
     common control that emits or has the potential to emit
     considering controls, in the aggregate, 10 tons per
     year or more of any hazardous air pollutant or 25 tons
     per year or more of any combination of hazardous air
     pollutants..."

     The determination of whether a source is major is based
on the source's "potential to emit".  A source's potential
to emit is based on its capacity to emit hazardous air
pollutants considering federally enforceable limits on that
capacity.  If a source's potential to emit is equal to or
greater than 10 tons/yr of a single HAP, or 25 tons/yr of
any combination of HAPs, the source is a major source.   The
EPA is currently developing a rule to define a source's
potential to emit for section 112 standards.  This rule will
also provide ways for an owner or operator of a source to
establish voluntary, federally-enforceable restrictions to
limit the source's potential to emit below the major source
threshold.  If a source limits its potential to emit to
below the major source threshold it will not be subject to 

the provisions of section 112(j) as long as the source
maintains its emission status.
     The EPA specifically requests comment on how area
sources that increase their emissions enough to become major
sources after the 112(j) effective date should be treated
under 112(j).  The EPA is considering treating these sources
as existing major sources as of the date that they achieve
that major source emissions threshold, but treating any new
source within the major source as a new source for the
purposes of section 112(j).   
4.   63.50(b). Relationship to State and local requirements.
     Many State and local regulatory agencies maintain
regulatory programs that involve toxic air pollutant reviews
for stationary sources.  This paragraph clarifies that the
requirements of section 112(j) do not pre-empt any
requirements of these programs that are at least as
stringent as the proposed rule.
     5.   63.50(c)  Retention of State permit program
approval.
     Some States may not currently have specific legislative
or administrative authority sufficient to establish the
regulations required by section 112(j).  Paragraph 63.50(c)
requires that States obtain such statutory authority as a
condition of retaining their Part 70 permit program
approval.

B.   Section 63.51: Definitions
     1.   Terms Defined in the General Provisions.
     A number of terms used in the proposed rule will be
defined for all of 40 CFR Part 63 by the General Provisions,
to be contained in subpart A of this Part.  The terms which
will be defined in the General Provisions include:
     ...Administrator
     ...Effective date
     ...Hazardous air pollutant
     ...Major source
     ...Permit program
     ...Potential to emit
     ...Relevant standard
Today's rule contains a definition of "potential to emit"
that is the same as the definition in Part 70.  The EPA is
currently developing a definition of "potential to emit" to
be included in subpart A of this Part.  The EPA intends that
if subpart A of this Part is promulgated before today's rule
is promulgated, the definition included in subpart A will be
included in the final rule implementing section 112(j) of
the Act.  The EPA requests comment on the definition of
"potential to emit" for the purposes of this rule.
     2.   Terms Related to Maximum Achievable Control 
Technology
     Definitions for the following terms related to levels 

of control technology are included in 63.51 of the proposed
rule:
     ...Maximum Achievable Control Technology
     ...Control Technology
     ...Maximum Achievable Control Technology (MACT) Floor
     ...Maximum Achievable Control Technology (MACT)
Emission Limitation for Existing Sources
     ...Maximum Achievable Control Technology (MACT)
Emission Limitation for New Sources
     The basis for all of these definitions is statutory
language contained in section 112(d) of the Act.  The term
"maximum achievable control technology" appears only in
section 112(g) of the Act, and does not appear elsewhere in
section 112.  There is, however, considerable legislative
history indicating that this term refers to the level of
control required by section 112(d) emission standards.  This
term was used in this context in the House Bill, H.R. 3030.
For purposes of the definitions in the proposed rule, the
EPA assumes that "maximum achievable control technology" is
a reference to the "maximum degree of reduction in
emissions" language contained in section 112(d)(3).  The
minimum control technology requirements of section 112(d),
often referred to as the "MACT floor" are cited a number of
times in the proposed rule.  To avoid repeating these
requirements each time, the regulation includes a definition
of "MACT floor."
     3.   Terms Affecting the Extent of Coverage by Maximum
Achievable Control Technology
     The following terms are used to describe equipment
subject to a MACT determination:
     ...Emission point
     ...Emission unit
     ...New source
     An "emission point," in this regulation, is defined
narrowly to refer to any individual point of release to the
atmosphere.  However, an individual MACT determination will
often be made at once for a number of emission points.  The
term "emission unit" is used to refer to the collection of
all emission points considered when a MACT determination is
made.  
     The term "new source" refers to an emission unit for
which construction or reconstruction is commenced after the
section 112(e) scheduled deadline for a relevant standard,
or after proposal of a relevant standard under 
section 112(d) of the Act, whichever comes first.  "New
source" is defined in Clean Air Act section 112(a)(4) as
follows:
     "...a stationary source the construction or
     reconstruction of which is commenced after the
     Administrator first proposes regulations under this
     section establishing an emission standard applicable to
     such source."

Section 112(j) requires States to establish case-by-case
MACT limitations where EPA has failed to promulgate a
relevant standard,  and there may be instances where a
112(j) MACT limitation is required for a source category for
which a standard has not yet been proposed under 
section 112(d).  Since 112(j)(5) refers explicitly to case-
by-case standards for new sources, the EPA has determined
that the Act did not intend that the EPA's failure to
propose a standard implies that no sources in that source
category, no matter what the date of construction, could
ever be considered "new." The EPA has therefore selected the
112(e) scheduled deadline as the date, under a 112(j) case-
by-case MACT determination, most closely equivalent to the
112(d) proposal date for the purposes of defining "new
source," because had EPA met the schedule in setting a
standard under 112(d) the proposal could not have been any
later than the date in the schedule.  The EPA requests
comment on this determination of what sources should apply
new source MACT under 112(j).
     4.   Federally enforceable 
     The Subpart A General Provisions will include a
definition of "federally enforceable" which lists the types
of limitations and conditions that are considered federally
enforceable.  The EPA believes that, for purposes of 
Subpart B requirements, this definition should contain
additional language to ensure that the case-by-case
determinations are practically enforceable.  A more detailed
discussion of EPA's rationale for this determination is
contained in section III.E. of this preamble.  Section 63.51
includes a definition of "federally enforceable" that
incorporates these concepts.  The EPA requests comment on
this definition.
C.   Section 63.52: Requirements for existing sources
     Section 63.52 of the proposed rule requires that case-
by-case MACT determinations for existing sources be made
through the Title V permit process.  The overall process for
case-by-case MACT determinations for existing sources is
shown in Figure 1.  The owner or operator of an existing
major source must submit a permit application containing
case-by-case MACT demonstrations for all emission units in a
source category not later than 18 months after the missed
promulgation date for that source category.  The State must
then review and approve or disapprove the permit in
accordance with the procedures and principles set out in
Part 70 and in section 63.55 of this proposal, and, EPA
suggests, in accordance with the procedures and principles
set out in the case-by-case guidance.  Section 63.52(c)(1)
of the proposal implements the requirement in 
section 112(j)(4) of the Act that if a source's permit
application is incomplete or disapproved by the permitting
authority, the source has up to six months to resubmit and
meet the requirements of the permitting authority.
     For existing sources, the permitting authority at its
discretion may require compliance as expeditiously as
practicable, but within no more than three years from permit
issuance.  In addition the permitting authority may allow an
extra year, on a case by case basis, where necessary to the
installation of controls.  The EPA believes that this
approach is consistent with section 112(j)(5) which requires
that MACT standards must ensure compliance "...immediately
for new sources and, as expeditiously as practicable, but
not later than the date three years after the permit is
issued for existing sources or such other compliance date as
would apply under subsection (i)."
D.   Section 63.53: Application content for a case-by-case
MACT determination
     Section 63.53 of the proposed rule describes the
information the owner or operator is required to provide
with an application for a MACT determination.  These
information requirements are designed to identify the
emission units to be controlled and to demonstrate that the
selected control technology for those units is consistent
with or exceeds the requirements of the statute.   Further
information on the uses of this information are described in
the Draft Guidelines for MACT Determinations.
E.   Section 63.54: Preconstruction procedures for new
sources
     Section 112(j), when read together with Title V,
presents certain ambiguities which must be resolved in this
rulemaking.  Section 112(j) requires case-by-case
determinations of MACT for new as well as existing sources.
Section 112(j)(5) directs that case-by-case MACT is to be
"equivalent to the limitation that would apply to such
source if an emission standard had been promulgated in a
timely manner under subsection (d)." The timing for
application to new sources of any standard promulgated under
section 112(d) is in turn articulated in section 112(i)(1),
which prohibits the construction of a new major source or
reconstruction of an existing major source except where
there has been a determination that the construction or
reconstruction will meet the MACT standard.
     However, the timing of this determination for new
sources under section 112(j) is different than the timing
required by the statute for section 112(d) standards. 
Section 112(j) requires that the permit containing the case-
by-case determination of MACT be "reviewed and approved or
disapproved according to the provisions of section 505"
(section 112(j)(4)) and issued "pursuant to Title V,"
(section 112(j)(5)).  This conflicts with a requirement for
preconstruction review for new sources subject to only
section 112(j), because Title V does not give EPA discretion
to require applications for sources newly subject to the
title earlier than 12 months after commencing operation. 
(Section 503(c)).  Because the Part 70 permit must be issued
within 18 months of the application, it could be up to 30 

months after operation before section 112(j) requirements
would be incorporated into the Title V permit.
     As noted above, the EPA believes that sources subject
to case-by-case MACT determinations should undergo
preconstruction review.  While in some cases States may
require review under the Part 70 program to occur in the
preconstruction phase, the Act does not authorize EPA to
mandate this result.  It follows that, while Title V is
sufficiently comprehensive to handle the section 112(j)
review process for existing sources, it is not broad enough
in its mandatory coverage to implement section 112(j) for
new sources.  However, EPA believes that the preconstruction
review requirements of section 112(g) will be applicable to
many new sources subject to 112(j).  For example,
construction of all new major sources, and all new sources
constructed as part of a modification of an existing major
source, would require preconstruction review under section
112(g).  States also have the option of establishing an
accelerated voluntary administrative process for
preconstruction review of new sources subject to section
112(j), to cover those sources not subject to the
requirements of 112(g).  EPA is strongly recommending to
States that they provide these procedures.
     As an alternative to relying on the preconstruction
review procedures of section 112(g) for new major sources,
EPA considered relying on the language of section 112(i)(1)
to require preconstruction review of new sources under
112(j).  However, section 112(i)(1) requires preconstruction
review only for new major sources and therefore adds nothing
to the preconstruction review requirement applicable under
112(g). EPA solicits comment on its decision to rely on the
preconstruction review requirements of 112(g) in this
proposal.
     Section 63.54 of today's proposed rule describes an
optional preconstruction review process for new sources not
required to undergo preconstruction review under 112(g). 
States need not provide this additional preconstruction
review opportunity.  Moreover, since the preconstruction
review process set forth in Section 63.54 is optional,
States may provide for a different process.  However, an
alternative process for making these determinations would
not necessarily yield federally enforceable conditions.  The
procedures set forth in Section 63.54 contain the elements
EPA believes to be necessary for a federally enforceable
preconstruction MACT determination.  The EPA solicits
comment on these minimum procedures, and in particular
whether different criteria are appropriate.
     As discussed below, States may further enhance this
process to allow for incorporation of the MACT determination
by administrative amendment.
     The EPA believes that section 112(j) alone does not
provide the authority to impose federally enforceable
restrictions that could implement case-by-case MACT
determinations.  The EPA solicits comment on whether States
should have the option of submitting, for approval under
section 112(l), programs establishing administrative review
processes that would allow the imposition of federally
enforceable MACT determinations.  The EPA proposed a rule
under section 112(l) of the Act on May 19, 1993 (58 FR
29296).  This proposal set forth the criteria for approval
of state programs to implement the requirements of section
112.  This proposal did not specifically address approval of
state programs establishing federally enforceable
preconstruction review processes for section 112(j). 
However, such programs could be approved under section
112(l) without difficulty wherever they could be shown to be
at least as stringent as section 112(j) requirements.
     The majority of new sources subject to 112(j) will be
subject to section 112(g) preconstruction review
requirements prior to filing their permit applications under
Part 70.  The overall process for MACT determinations
contained in section 63.54 of the proposed rule is shown in
Figure 2.  For those sources not subject to preconstruction
review under 112(g), the optional review process begins with
a MACT analysis by the owner and operator.   This MACT
analysis should be consistent with the Guidelines for MACT
Determinations (hereafter referred to as the Guidelines),
including general principles described in paragraph
63.56(b).  The owner or operator provides an application for
a MACT determination to the reviewing agency (generally a
State or local agency to whom authority for implementation
of the program has been delegated).  Requirements for the
contents of this application are outlined in the Guidelines
and in section 63.53.  This application for a MACT
determination is then evaluated by the reviewing agency
according to procedures described in paragraph 63.54(b).  If
approved, the reviewing agency will issue a Notice of MACT
Approval containing certain basic elements described in
paragraph 63.54(c).  Provisions dealing with compliance with
the requirements of the the Notice of Approval are described
in paragraphs 63.54(d) through (h).
     The EPA believes that there are substantial
implementation advantages to preconstruction review for
sources subject to 112(j).  Preconstruction review provides
sources with the benefit of the State's control
determination prior to construction.  This minimizes the
possibility that initial control technology installed by a
source in anticipation of a 112(j) new source MACT
determination will need to be replaced in order to comply
with the eventual requirements of 112(j) as well as the
subsequent 112(d) MACT determination.  The EPA's past
experience in enforcing air quality regulations suggests
strongly that it would be very difficult to require
substantial changes in the design of equipment once it is in
place.  Therefore the EPA strongly urges States to establish
a preconstruction review process for sources subject to the
requirements of 112(j).  The EPA today requests comment on
the implementation consequences for 112(j) and 112(d) when
preconstruction review is not required.
     Another benefit of preconstruction review is that a
State can also require compliance earlier than permit
issuance.  If, under State law (through section 112(l)
delegation), a State wishes to enforce case-by-case MACT at
startup for new sources, then preconstructon review is the
avenue for enforcement of such a requirement.  The EPA today
specifically requests comment on the likely consequences of
the lack of such an enforcement mechanism at the federal
level.
     The EPA is, however, sensitive to the concern that
preconstruction review should not lead to unreasonable
delays.  For sources not covered by 112(g) preconstruction
requirements, section 63.54 contains streamlined
administrative procedures which should ensure that the
preconstruction review is done quickly.
     The process outlined in section 63.54 begins with a 30-
day completeness determination.  Once a complete application
is received, approval or an intent to disapprove the
application is required.  If an intent to disapprove is
issued, the owner or operator is given the opportunity to
provide further information.  

     Paragraph 63.54(b) establishes an administrative
process for reviewing a request by an owner or operator for
a MACT determination.  If the determination is to be
federally enforceable, the proposed decision to either
approve or disapprove the application is then subject to
public review.  Today's proposed rule would provide for
public review through issuance of a notice containing all
the relevant background information about the application
and 45 days for the public to comment on whether the
application should or should not be granted.  In order to
expedite approval of noncontroversial case-by-case MACT
determinations the proposed rule would allow such
determinations to be made final following the close of the
comment period if no adverse comments have been received. 
If adverse comments are received a final notice must be
published either approving or disapproving the application
and addressing the comments.
     Today's proposal requiring public review prior to
approval of case-by-case MACT determinations is consistent
with current EPA practice in other Clean Air Act programs
where federal enforceability is required.  For example, 
40 CFR 51.161 requires a 30 day public comment period for
review of an agency's proposed approval or disapproval of a
minor new source permit.  Similarly, in a 1989 rulemaking
EPA enumerated five criteria that must be met before a
State-issued operating permit can become federally
enforceable.  One of those criteria is that the permit must
be subject to public review before issuance.  This criterion
was described in the notice as being consistent with the
EPA's current practice for construction permits codified at
40 CFR 51.161.  (See 54 Fed. Reg. 27283 (June 28, 1989).
     Thus, the Agency's current practice is to require
public review of decisions required to be federally
enforceable.  As stated by the Supreme Court in Motor
Vehicle Mfrs. Ass'n v. State Farm Mut. Automobile Insurance
Co. et al, 463 U.S. 27, 43 (1983), "an agency changing its
course . . . is obligated to supply a reasoned analysis for
the change beyond that which may be required when an agency
does not act in the first instance."  In this case there is
an established practice of requiring public review as a
prerequisite to federal enforceability.  EPA proposes 
to follow that practice in this case unless a more
compelling reason is identified for either changing that
practice or deviating from it in this specific case.
     As discussed above, the EPA is proposing to require
public review as a prerequisite to federal enforceability of
case-by-case MACT determinations.  Comment is specifically
requested concerning whether public review should be a 
prerequisite to federal enforceability of case-by-case MACT
determinations,  and if it should not, what justification
there would be for deviating from established practice. 

     In Section 63.51 of the regulation, EPA has established
a definition for federally enforceable for application to
Section 112(j) MACT determinations.  This definition is
based on the five criteria for federal enforceability
established in 40 CFR Parts 51 and 52 (54 FR 27274).  Part
of the criteria for conferring federal enforceability to a
State or locally established emission limitation requires
the emission limitation to undergo some public scrutiny and
be kept in standardized files in EPA's Regional Offices.  In
addition, the emission limitation must be enforceable as a
legal and practical matter.
     In United States v. Louisiana-Pacific Corporation 
(682 F. Supp. 1122 (D. Colo. Oct. 30, 1987) and 
682 Supp. 1141 (d. Colo. March 22, 1988),) the court ruled
that permit conditions that contained blanket emission
limits (i.e. tons/yr) were not enforceable as a practicable
matter because such restrictions "...would be virtually
impossible to verify or enforce."  In order to be federally
enforceable, operational or production limitations including
limitations on quantities of raw material consumed, fuel
combusted, hours of operation, or conditions which specify
that the source must install and maintain controls that
reduce emission to a specified emission rate or level, must
be imposed on the source in addition to a blanket emission
limitation.  These operation and production limitations
should be based on the shortest practicable time period,
generally not to exceed one month.  EPA has taken the
position that requirements for a monthly limit prevents the 
enforcing agency from having to wait for long periods of
time to establish a continuing violation before initiating
enforcement action.
     To ensure federal enforceability, the owner or operator
must at a minimum be subject to monitoring, recordkeeping
and reporting requirements sufficient to document the
source's compliance with proper maintenance and operational
requirements.  Because major sources obtaining MACT
determinations will incorporate such determinations into a
Title V permit, the regulations that are the subject of this
preamble have included a requirement that the monitoring,
recordkeeping, and reporting requirements required for a
case-by-case MACT determination be consistent with the
compliance requirements contained in Part 70.  Part 70
requires monitoring, recordkeeping and reporting sufficient
to demonstrate compliance with the emission standard -- as
well as compliance with maintenance and operational
requirements.
     EPA believes that consideration of the Part 70
compliance requirements within the MACT determination
process will be much more efficient for both the source and
the reviewing agency.  If the public review process for the
MACT determination is substantially equivalent to that which
will be required for a Title V permit (under Part 70 or 
Part 71), the source would not need to undergo another
public review of the compliance requirements to assure that
the requirements are sufficient for the purposes of issuing
the Title V permit.  In addition, consideration of these
requirements will prevent a source from having to retrofit
monitoring equipment in order to obtain a Title V permit. 
States may also enhance the preconstruction process by the
addition of a formal 45-day review period and notice to
affected States, consistent with section 70.8 of this Part.
     In addition to Part 70 compliance requirements,
additional requirements may need to be considered at the
time of the MACT determination.  Section 114 of the Act
directs EPA to require enhanced monitoring and compliance
certifications for all major sources.  For the same reasons
stated for considering the Part 70 compliance requirements,
the EPA believes that these section 114 enhanced monitoring
and compliance principles should also be considered at the
time of the MACT determination, and enforced at start-up.
     The end result of the administrative review process for
new sources is a determination set forth in a document that
is termed a "Notice of MACT Approval."   Requirements for
this Notice are provided in paragraph 63.54(c) of the
proposed rule.  This Notice is required to contain the
emission limitations, notification, operating and 
maintenance, performance testing, reporting, recordkeeping,
compliance dates, and any other requirements needed to
ensure that the case-by-case MACT emission limitation will
be met.   
     The Notice of MACT Approval serves to provide the
obvious mechanism for federal enforceability of these 
conditions in the interval between initial operation of the
new source and the time the conditions are added to the 
Part 70 or Part 71 permit. 
     The EPA recognizes that there are cases for which
sources would prefer to minimize delays in the process,
particularly for operations which change relatively
frequently, and where the owner or operator is willing to
control emissions from those changes with technologies that
could be recognized as best available controls.  The EPA
requests comment on further procedures to achieve this goal.
     The EPA is especially interested in exploring
suggestions that the general permit procedures, outlined in
40 CFR 70.6(d), be available for such situations.  The
general permit may have application for section 112(j)
determinations where the permitting authority is able to
make a presumptive determination of MACT for a given type of
source.  The general permit would have to set forth the
controls required by Part 70.  Once the general permit is
issued, application of the MACT determination 
at a particular source would involve merely a determination
that the source falls within the source category covered by
the general permit.
     As discussed in the preamble to the operating permit
regulation, general permits may be issued to cover discrete
emissions units at permitted facilities.  57 Fed. Reg., at
32279.  While a general permit cannot be used to modify the
terms of an existing Title V permit, it may be issued to
cover a change at an existing plant, such as addition of a
new MACT-emitting unit, that would otherwise be eligible to
apply for a new individual permit.  In that case, the
requirements of the general permit could be incorporated
into the permit for the facility at renewal.
     The EPA solicits comment on the approach to
preconstuction review described above.  EPA specifically
solicits comment on whether 112(j) can be interpreted
torequire mandatory preconstruction review for all new
sources.
F.   Section 63.55: Incorporation of requirements for new
sources into the operating permit
     Section 63.55 describes the relationship of the MACT
review process for new sources to the operating program
requirements pursuant to Title V of the Act amendments.  The
requirements for Title V permits, contained in 
40 CFR Part 70, were published on July 21, 1992 
(57 FR 32250).  For existing sources, the approach to
establishing an administrative process for determinations
under section 112(j) of the Act is to to rely on the Title V
review process as the mechanism for establishing MACT
requirements.  For new sources, however, the EPA believes
that reliance on the Title V permit process may not be
sufficient.  First, the Title V requirements clearly do not
require a new "greenfield" plant to apply for an operating
permit until 1 year after the plant begins operation. 
Because the Title V permit must be issued within 18 months
of the application, it could be up to 30 months after
commencement of operation before section 112(j) requirements
would be incorporated into the permit.  Second, the Title V
requirements do not ensure that a MACT determination will be
conducted before construction.  While in some cases States
with Title V programs may require preconstruction reviews as
part of the operating permit process, this will not always
be the case. 
      Therefore, while for existing sources the Title V
permit process is sufficiently comprehensive to handle
section 112(j) reviews, the EPA believes, based upon the
above considerations, that when the Title V process does not
occur until after construction has begun, new sources should
be subject to preconstruction review. All new major sources
and new sources constructed as part of a modification of an
existing major source will likely be subject to
preconstruction review under section 112(g), and the
proposed rule provides a mechanism, optional with the State,
for providing a preconstruction review process yielding a
federally enforceceable determination of MACT.
     Regardless of the timing for incorporation of 112(j)
new source determinations into the operating permit, there
are certain requirements that apply.  The Title V permit
must be revised or issued according to procedures set forth
in sections 70.7 and 70.8.  In addition, the permit must
incorporate compliance provisions of section 70.6.  If,
during the EPA's review of the section 112(j) determination,
it becomes apparent that the determination is not in
compliance with the Act, then EPA must object to the
issuance or revision of that permit.  
     These requirements are obviously satisfied either when
Part 70 requires revision to an existing Title V permit
prior to construction, or when the permitting authority
otherwise requires incorporation of conditions into a 
Title V permit as a step in the section 112(j) new source
case-by-case MACT determination process.  However, even
where there is no formal incorporation of conditions into a
Title V permit prior to operation, subsequent additional
Title V review may effectively be avoided if the State's
section 112(g) or optional 112(j) process is "enhanced" to
include the important Title V procedures, thereby allowing
for later incorporation into the Title V permit by
administrative amendment.
     Section 70.7(d) of the operating permits rule defines
an "administrative amendment" to include a revision that
"[i]ncorporates into the part 70 permit the requirements
from preconstruction review permits authorized under an 
EPA-approved program, provided that such a program meets
procedural requirements substantially equivalent to those
contained in sections 70.7 and 70.8 of this Part . . . and
compliance requirements substantially equivalent to those
contained in  section 70.6 of this part."  This process of
"enhancement" of preconstruction procedures was discussed in
the preamble to the operating permits rule in the context of
existing State new source review programs (see 57 Fed. Reg.,
at 32289), but was not discussed in relation to 
section 112(j) because the procedures associated with
section 112(j) determinations had not then been articulated. 
However, the language of section 70.7(d)(v) would allow for
use of administrative amendments for an enhanced
preconstruction review process, and the EPA believes such
use is clearly within the intent of that provision.
     Enhancement of the preconstruction review process may
be partial only, incorporating some elements of the required
part 70 review or compliance provisions in the
preconstruction review process itself, with the remaining
elements occurring during the Title V process.  For instance
public review of the MACT determination that meets the
requirements of section 70.7(h) need not be repeated at the
time of incorporation into the Title V permit.  However, for
the administrative amendment procedures to be available for
determinations that have been through an enhanced process,
the public, EPA and affected States must have had the
opportunity to review all aspects of the MACT determination,
including any compliance provisions required under 
section 70.6.  Thus, public review during the
preconstruction review process would not suffice for
purposes of title V if the process did not specify the
application of compliance provisions substantially
equivalent to those in section 70.6, including monitoring,
reporting, recordkeeping, and compliance certification.
G.   Section 63.56.  MACT Determinations
     As discussed previously, sections 63.52 and 63.54
require MACT determinations, after the effective date of a
Title V permit program in a State, for all HAP-emitting
equipment that is located at a major source and is in a
source category for which the Agency has failed to
promulgate a maximum achievable control technology (MACT)
standard under sections 112(d) or 112(h) of the Clean Air
Act within 18 months after the date listed in the source
category schedule for standards.  This section of the
preamble discusses the EPA's proposed procedures for making
these MACT determinations.  These procedures include
technical review procedures needed to establish a MACT
emission limitation and a corresponding MACT control
technology.  In the proposed rule, the overall process for
MACT determinations is outlined in section 63.56.  In
addition to the proposed rule, EPA is making available today
a draft document entitled Draft Guidelines for MACT
Determinations under 112(j) (EPA-450/3-92-007). This
document will contain more details on both technical and
administrative procedures.
     The primary emphasis in the MACT guidelines is on the
procedures for case-by-case MACT determinations when no
applicable MACT standard has been proposed by the EPA.  The
procedures for determinations after MACT standards have been
proposed are more straightforward.
     Section 63.56 reviews a number of general principles
that would govern MACT determinations under the proposed
rule.  In general, the purpose of a case-by-case MACT
determination is to develop technology-based limitations for
HAP emissions that the Administrator (or a permitting agency
to whom authority has been delegated) approves as equivalent
to the emission limitations required for the source category
if promulgated MACT standards were in effect under 
section 112(d) or section 112(h) of the Act.
     The EPA believes that if a MACT standard has been
proposed, but not yet promulgated, this proposed standard is
the best estimator of the Agency's final action, and
therefore should be considered in establishing a case-by-
case MACT emission limitation, and followed unless the State
can adequately support an alternative.  Accordingly,
paragraph 63.56(a)(1) requires that in the absence of a
supportable alternative, the selected control technology
should be consistent with any such proposed standard.  Of
course, where improved information has become available
since MACT proposal, such information should be considered.
     When no MACT standard has been proposed, the proposed
rule requires, for a determination by the reviewing agency,
that the technology selected by the owner or operator is
consistent with the overall requirements described in
section 112(d) of the Act. 
     Section 112(d)(3) of the Act describes the general
considerations for a MACT determination.  A MACT level of
control is "the maximum degree of reduction in emissions of
the hazardous air pollutants ... that the Administrator,
taking into consideration the cost of achieving such
emission reduction, and any non-air quality health and
environmental impacts and energy requirements, determines is
achievable for new and existing sources in the category or
subcategory..."  This paragraph of the Act continues to
describe a number of items that might be considered in
designing MACT standards such as material substitutions,
enclosure of processes, capture and control of emissions,
design and work practice standards, and operational
standards.   In the proposed rule, this list of items is
included in the definition of "control technology" in
section 63.51 of the proposed rule. 
     Section 112(d) also imposes certain minimum
requirements on the determination of "maximum achievable
control technology."  Collectively, these minimum
requirements are defined in the proposed rule as the "MACT
floor."  
     For new sources, the MACT floor for a case-by-case MACT
determination, consistent with section 112(d), is the level
of control that is achieved in practice by the best
controlled similar source.  The EPA believes that the
legislative history of section 112 suggests that the "best
controlled similar source" could be located outside of the
United States.  The definition of MACT floor for new source
MACT is therefore not restricted to sources in the United
States., but could instead be based on a technology known to
be used in practice on a similar source located anywhere.
     For existing sources, the MACT floor for the case-by-
case determination, consistent with section 112(d) of the
Act, is an emission limitation equal to the average emission
limitation achieved by the best performing 12 percent of
existing sources in the category for categories or
subcategories with 30 or more sources, or the average
emission limitation achieved by the best 5 sources for
categories with fewer than 30 sources.  The MACT floor for
existing sources also takes into account sources achieving
the "lowest achievable emission rate" as defined for the
criteria pollutant new source review program under 
section 171 of the Act, and excludes them from the floor
calculation.  The EPA interprets the "best performing 
12 percent" to mean the best performing 12 percent of
sources in the United States, because all sources in each
category are in the United States.  The phrase "in the
United States" is added to the existing source MACT floor
definition in order to clarify that territories and
possessions of the United States are included.     
     The EPA believes that when information is available to
define a MACT floor, the case-by-case MACT determination
must take that information into account.  The EPA currently
maintains a number of databases that can be used as a
resource for information on available control technologies,
or to obtain data to calculate the MACT floor.  These
databases include the National Air Toxics Information
Clearinghouse (NATICH), the Best Available Control
Technology/Lowest Achievable Emission Rate (BACT/LAER)
Clearinghouse, and the Aerometric Information Retrieval
System (AIRS)/ AIRS Facility Subsystem (AFS).
     The EPA requests comment on the general principle that
a "sufficient effort" be made to determine the MACT floor.
     The EPA believes that in most cases where 112(j)
requirements are triggered, the EPA will have collected a
substantial amount of information on the source category.
When it appears that the 112(j) requirements will take
effect, the EPA intends to make available any such
information it has collected.  For example, the data
collection may be readily available in EPA-proposed
Background Information Document (BID) for which a MACT floor
has been determined.  The EPA believes that for such cases
it would be reasonable to expect that such a BID would be
taken into consideration in establishing a case-by-case MACT
emission limitation.
     In other cases, the EPA may have collected a great deal
of information on the industry but a BID will not be
available at the time of the 112(j) trigger date.  The EPA
anticipates sharing its information with interested parties.
The EPA believes that it is reasonable to expect that a
dialogue can be established with affected industries and
States to review this information for purposes of
establishing a case-by-case MACT emission limitation.
     In other cases, the EPA may have collected only
qualitative information on the types of control measures in
existence for a source category.  Such information would
often be a good starting point for evaluating control
options; in addition, such qualitative information may
sometimes indicate which measures have been taken by the
best performing 12% of the industry.
     The EPA expects that, in rare cases, if any, the Agency
will have collected little or no information about a source
category that would be useful for the purposes of
implementing section 112(j).
     When a MACT floor can be determined, the proposed rule
requires that the control technology selected by the owner
or operator achieve an equal or greater level of control
than that MACT floor.   The owner or operator should
consider, in determining whether to request approval of a
control technology achieving a level of control greater than
the floor, the cost, non-air quality health and
environmental impacts and energy requirements of achieving
that level of control.  (See section 112(d)(2) of the Act)
     When a MACT floor cannot be determined, the proposed
rule requires a maximum degree of reduction in emissions
with consideration to the cost, non-air quality health and
environmental impacts and energy requirements.  The MACT
Guidelines discuss methods for establishing a case-by-case
MACT emission limitation under these circumstances.  These
methods are patterned after similar guidelines for best
available control technology (BACT) determinations under
criteria pollutant permitting programs.
     A significant issue for this rulemaking is how to avoid
placing unmanageable information-gathering burdens on
sources and permitting authorities -- while still ensuring
that emissions limitations under 112(j) are equivalent in
stringency to MACT standards that the EPA would have issued. 
The EPA specifically requests comment on how to better
define the "available information" that, at a minimum, an
owner or operator must use to document a MACT floor finding
and to select a MACT candidate.  EPA also requests comment
on the definition of "available information" that, at a
minimum, a permitting authority must consider in determining
emission limitations for new and existing sources under this
rule.
     Section 63.56(c) establishes the requirement that the
permitting authority submit summary information pertinent to
the MACT application to an EPA-established national
database.  The EPA requests comment today on whether
approval or disapproval of a MACT application can be tied to
submission of such data to the national database.
H.   Section 63.57: Requirements after promulgation of a
subsequent standard under 112(d).
     Section 63.57 of the proposed rule sets out
requirements for incorporating subsequent standards into an
operating permit after the owner or operator has submitted a
permit application for a 112(j) case-by-case MACT
determination, or after a case-by-case MACT determination
has been made under section 112(j).  Section 63.57
implements the specific requirements of subsection 112(j)(6)
of the Act.
     Section 63.57 provides, as required in the Act, that if
the EPA promulgates a 112(d) standard for a source category
before approval of a 112(j) permit application for a source
in that source category, then the permit must reflect the
112(d) standard.  New sources must comply upon startup with
the 112(d) rule except that, if the MACT standard is more
stringent than the proposal, source commencing construction
or reconstruction between proposal and promulgation may
comply with the proposal for 3 years, then meet the final
MACT standard.
     If EPA promulgates a 112(d) standard after issuance of
a 112(j) permit for a source in the relevant source
category, then the permit must be revised upon renewal to
reflect the 112(d) standard.  However, the compliance period
must be no longer than a total of eight years from the
initial 112(j) compliance date, or the 112(d) promulgation
date, whichever is earlier.
     Paragraph 63.57(c) clarifies a State's responsibilities
when a case-by-case MACT standard is more stringent than a
subsequent 112(d) standard, and a permit containing that
case-by-case standard has been issued.  In that instance,
the State is not required to revise the permit to reflect
the less stringent 112(d) standard, but may presume that the
more stringent case-by-case determination satisfies the
requirements of both 112(j) and 112(d).  The EPA believes
that nothing in section 112 of the Clean Air Act requires
pre-emption of these more stringent State standards.
IV.  DISCUSSION OF THE RELATIONSHIP OF THE PROPOSED
     REQUIREMENTS TO OTHER REQUIREMENTS OF THE ACT
A.   112J, 112G and 112D:     OVERLAPPING REQUIREMENTS
     States and sources implementing the requirements of
section 112 of the Clean Air Act need to understand the
potentially complex relationships among several interlocking
provisions.  The EPA is currently contemplating different
interpretations of the relationship among the requirements
of section 112(d), (g) and (j).
Internal Consistency
     As discussed in section II.C. of this preamble, EPA's
primary goal is to create as seamless a web as possible
between case-by-case MACT determinations under 112(j) and
implementation of subsequent 112(d) standards for those same
source categories.  In addition, the Agency desires to
rationalize the 112(j) provisions with the 112(g) provisions
requiring case-by-case MACT determinations for constructed,
reconstructed, and modified major sources.  While under the
Act some of the specific substantive requirements of section
112(g) differ under the Act from the substantive
requirements of 112(j) and 112(d), the EPA intends to ensure
the greatest possible operational consistency among 
section 112(d), (g), and (j) provisions.
     One fundamental principal guiding the design of all
three programs is that substantive control requirements
under 112(g) hold only until the requirements of a 112(j) or
112(d) standard become effective.  In other words, after the
effective date of a 112(j) case-by-case MACT determination
or a 112(d) MACT standard, the control requirements of
section 112(j) or section 112(d) supersede the control
requirements of section 112(g).

     The EPA considered an alternative approach, i.e. the
finding that 112(g) governs all changes and additions of new
emission units at existing sources whether or not a 112(d)
or (j) standard exists.  The EPA rejected this approach for
reasons enumerated below.  Nevertheless the EPA requests
comment on both approaches.
     One reason for rejecting the approach that 112(g)
control extends to sources covered by 112(d) or 112(j)
standards is that it leads to the conclusion that many new
sources within the section 112(a)(4) definition of new
source would forever escape having to apply a new source
MACT level of control.  Such an interpretation is in
conflict with the requirements of section 112(d).
     Section 112(a)(4) defines a new source as "a stationary
source the construction or reconstruction of which is
commenced after the Administrator first proposes regulations
under this section establishing an emission standard
applicable to such source."  Thus, once a standard has been
set under section 112(d), any new source will be subject to
new source MACT.  Moreover, under section 112(a), a
"stationary source" can be "major" (112(a)(1)) or "area"
(112(a)(2)).  The MACT standard will define the portion of a
facility that is considered a "source" for the purposes of
the particular standard.
     Section 112(g) applies to construction, reconstruction,
or modification of major sources, and in many cases will
have an effect on sources earlier than section 112(d) or (j)
standards.  However, section 112(g) only requires new source
MACT on new major sources, and considers any other new
emission unit to be a modification of an existing major
source.  As a "modification," such a new emission unit will
be required to apply for existing source case-by-case MACT
determination under 112(g).  Therefore if 112(g) were to
constrain the application of a subsequent 112(j) or 112(d)
standard, many new emission units under the 112(a)(4)
definition of "new source" would never be required to comply
with new source MACT.
     In addition, under 112(g) a new emission unit might not
even be required to meet an existing source MACT level of
control.  Section 112(g) allows for modifications to either:
(1) comply with a case-by-case "existing source" MACT
determination under 112(g); (2) offset emissions increases
in lieu of applying 112(g) existing source MACT
requirements; or (3) if its emissions were below 112(g) de
minimis levels, not be subject to any control requirements
at all.  The EPA believes that 112(g) thus provides major
sources with a great deal of needed flexibility before
112(d) or (j) standards are set; but that once those
standards are in place the Act intends that these sources
must comply with the specific requirements of those
standards.

     Finally, the interpretation that 112(g) governs the
addition of new equipment at major sources to which 112(d)
or (j) standards already apply has some anomolous
implications.  One example would be a new emission unit
whose emissions are below 112(g) de minimis levels for a
particular hazardous air pollutant.  If that emission unit
were added to a major source, it would be exempt from the
requirements of 112(g), but would be required to apply new
source MACT control under 112(j).  However, if that emission
unit were not below 112(g) de minimis levels, it would be
required to comply with 112(g).  If 112(g) requirements
limit the application of 112(j), then the source would be
required to apply existing source MACT.  In this instance, a
smaller emission unit would be required to control more
stringently than a larger emission unit.
     Another example of anomolies resulting from this
reading of the statute would be a 112(d) standard that sets
new source MACT for new area sources in a source category.
Under this reading, major sources adding new sources could
avoid new source MACT, but any new area source would have to
meet new source MACT.  Again, a smaller unit would be
required to control more stringently than a larger emission
unit.
     Therefore EPA believes that the substantive control
requirements of 112(g) are pre-empted by the requirements of
a relevant 112(j) or 112(d) standard.   
Administrative Consistency
     Voluntary administrative procedures for new sources
under 112(j), as outlined in section 63.53 of the proposed
rule, are intended to be analogous to administrative
requirements to be set out for modified, constructed, and
reconstructed sources under section 112(g) of the CAA, which
will be proposed in sections 63.40-63.48 of this subpart.  
     Figure 3 illustrates the link between the voluntary
section 112(j) preconstruction review process and 
section 112(g) administrative requirements.  Although the
EPA believes that section 112(j) does not provide authority
for preconstruction review of all new sources, the EPA
strongly believes, as a matter of policy, that the
administrative process for new major sources or existing
sources adding new equipment should be the same regardless
of whether the 112(j) effective date has passed. 
     Before the 112(j) effective date, such sources will be
required to make a case-by-case MACT determination under
112(g).  After the 112(j) effective date, these sources will
be required to make a case-by-case MACT determination under
112(j).  In cases where 112(g) and 112(j) substantive 
control requirements differ, the more stringent 112(j)
controls will in effect apply.  However, these sources will
only be subject to preconstruction review under 112(g).
Sources applying for preconstruction approval under 112(g),
but who will be subject to 112(j) new source MACT, need to
know this before they construct, in order to install the
right equipment.
     In addition there will be sources, such as some new
emission units added to an existing major source, that may
not be covered by 112(g), but who will be required to
install new source MACT under 112(j).  For example, an
owner/operator may intend to make an offset showing that
would avoid a case-by-case MACT determination under 112(g).
Or a new unit's emissions may fall below a 112(g) de minimis
level for a specific pollutant.  In both of these cases, the
owner\operator will need to know in advance of a missed
promulgation date that they will be required to install new
source MACT under 112(j).  Without a preconstruction review
process, there is no way to ensure that new sources not
covered by 112(g) will know whether they are complying with
112(j) requirements until up to one year after they have
already commenced construction.
     Therefore, anyone planning to construct a new major
source, or any existing major source planning to install a
new emission unit after a scheduled promulgation date for a
source category, is strongly encouraged to undergo
preconstruction review under 112(j), in order to provide
some certainty as to required new source controls prior to
construction.
     The EPA specifically requests comment on the desired
relationships between the 112(g) and 112(j) administrative
processes in regard to preconstruction review, and on the
policy implications of a voluntary preconstruction review
process.
B. Section 112(l) Delegation Process
     Under section 112(l) of the Act, States have the option
of developing and submitting to the Administrator a program
for implementing the requirements of section 112, including
section 112(j).  The EPA proposed rules for the
implementation of section 112(l) on May 19, 1993 (58 FR
29296).  This rule proposed to add sections 63.90 through
63.96 to 40 CFR Part 63.
     The EPA proposes that the delegation process provided
under section 112(l) be used to smooth the transition to
State implementation of section 112(j) in a way that
minimizes disruption of existing State and local toxic air
pollutant permit programs.  The EPA proposes that the
section 112(l) process be used for States wishing to
preserve existing requirements, or add new requirements, in
combination with the requirements and suggested actions of
this proposed rule, into an overall program that meets the
requirements of the Act.
C. Section 112(i)(5) Early Reductions Program
     Section 112(i)(5) of the Act allows EPA to grant a
source a six year compliance extension from a section 112(d)
MACT standard if the source achieves "early reductions" of
its emissions.  An early reduction is defined as a 90%
reduction in a source's hazardous air pollutant emissions
(95% reduction in a source's particulate emissions) before
the applicable MACT standard is proposed.  The source's
commitment to achieve early reductions is federally
enforceable, must be included in the Title V permit, and
must be submitted to EPA before the relevant 112(d) standard
for that source category is proposed.  (Sources subject to
MACT standards scheduled for promulgation in November 1992
must submit an enforceable commitment to 90% reductions to
EPA by December 1, 1993.  By December 1, 1994, the source
must achieve the federally enforceable emission reduction).
These commitments to reduce emissions early become
classified as alternative emission limitations throughout
the six year extension period.  Alternative emission
limitations are the "applicable emission requirements" for
the early reduction source.  
     Paragraph 63.52(e) provides that an alternative
emission limitation established for the purpose of early
reduction credit can be included as a case-by-case MACT
limit in the permit, so long as the reduction was achieved 
by the date established in the source category schedule for
standards. This requirement is established pursuant to the
specific provisions of 112(j)(5).  



V.   ADMINISTRATIVE REQUIREMENTS
A.   Executive Order 12291
     An impact analysis was prepared for the proposed
regulation.  The impact analysis was prepared even though
the proposed regulation is not expected to meet the "major
rule" requirement as defined in Executive Order 12291.  The
regulation is not expected to have an annual effect on the
economy of $100 million or more; it is not expected to cause
significant adverse effects on competition.  The objective
of the impacts analysis is to evaluate, to the extent
possible, the costs and benefits associated with the
proposed regulation. 
     The impacts (cost and emission reduction) of the 
section 112(j) program are assumed to begin in either 1994
or 1996 and increase as additional source categories are
subject to the program.
     The absence of valuation and sufficient exposure-
response information precludes a full quantitative benefits
analysis.  Therefore EPA evaluated the mimimum benefits that
would justify general program directions.
B.   Regulatory Flexibility Act
     The Regulatory Flexibility Act (5 U.S.C. 601 et. seq.)
requires the EPA to consider potential impacts of proposed
regulations on small business "entities." If a preliminary
analysis indicates that a proposed regulation would have a
significant economic impact on 20 percent or more of small
entities, then a regulatory flexibility analysis must be
prepared.
     Present Regulatory Flexibility Act guidelines indicate
that an economic impact should be considered significant if
it meets one of the following criteria: (1) compliance
increases annual production costs by more than 5 percent,
assuming costs are passed on to consumers; (2) compliance
costs as a percentage of sales for small entities are at
least 10 percent more than compliance costs as a percentage
of sales for large entities; (3) capital costs of compliance
represent a "significant" portion of capital available to
small entities, considering internal cash flow plus external
financial capabilities; or (4) regulatory requirements are
likely to result in closures of small entities.
     This regulation does not affect a significant number of
small businesses, small governmental jurisdictions, or small
institutions.  Pursuant to the provisions of 5 U.S.C.
605(b), I hereby certify that this proposed rule, if
promulgated, will not have a significant economic impact on
a substantial number of small business entities.
C.   Paperwork Reduction Act
     The information collection requirements in this
proposal have been submitted for approval to the Office of
Management and Budget (OMB) under the Paperwork Reduction
Act, 44 U.S.C. 3501 et seq. An Information Collection
Request (ICR) document has been prepared by the EPA (ICR No.
1648.01) and a copy may be obtained from Sandy Farmer,
Information Policy Branch (PM-223Y), U.S. Environmental
Protection Agency, 401 M St., SW, Washington, D.C. 20460, or
by calling (202) 260-2740.
     This collection of information is estimated to have an
average annual public reporting burden of approximately 200
hours per respondent.  This includes time for reviewing
instructions, searching existing data sources, gathering and
maintaining the data needed, and completing and reviewing
the collection of information.
     Send comments regarding the burden estimate or any
other aspect of this collection of information, including
suggestions for reducing this burden to Chief, Information
Policy Branch (PM-223Y); U.S. Environmental Protection
Agency, 401 M St., SW, Washington, D.C. 20460; and to the
Office of Information and Regulatory Affairs, Office of
Management and Budget, Washington, D.C. 20503, marked
"Attention: Desk Officer for EPA."  The final rule will
respond to any OMB or public comments on the information
collection requirements contained in this proposal.

                                                          
      Date                            The Administrator
For the reasons set out in the preamble, chapter I. of Title
40 of the Code of Federal Regulations is proposed to be
amended as follows.


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