6/19/96 
                           FACT SHEET

                FINAL REGULATION IMPLEMENTING THE
                FEDERAL OPERATING PERMITS PROGRAM
                     UNDER THE CLEAN AIR ACT

TODAY'S ACTION...

^D    The Environmental Protection Agency (EPA) is today issuing a
     final rule describing how EPA will implement a Clean Air Act
     operating permits program for States that do not have EPA-
     approved programs already in place.  EPA's operating permits
     program is designed to be administered by the States. 
     However, if States do not have approved permits programs in
     place, the Federal operating permits program would serve as
     a "safety net" to ensure that sources of air pollution are
     meeting their permitting requirements under the Clean Air
     Act. 

^D    EPA has already approved or proposed approval for the 
     majority of operating permit programs, including 44 State
     and 59 of 60 local programs.  Virtually all of the remaining
     States have submitted programs to EPA for review.  As a
     result, EPA expects that the impact of this rule will be
     minimal, affecting only a handful of States that do not yet
     have approved programs in place. 

^D    EPA has worked closely with stakeholders, including
     representatives from industry and environmental groups, and
     state and local agencies, over the past two years to
     streamline and improve the operating permits program.  EPA
     has proposed a series of initiatives, including revisions to
     its operating permits rule and two important guidance
     documents ("White Papers"), that will significantly
     streamline and simplify the process for revising operating
     permits and other provisions of the program, and reduce
     recordkeeping and reporting requirements.

BACKGROUND: EPA'S OPERATING PERMITS PROGRAM

^D    The Clean Air Act Amendments of 1990 included new provisions
     requiring all States to develop operating permits programs
     that meet certain Federal criteria.  The States, in turn,
     are to require affected facilities to obtain permits that
     contain all of their Clean Air Act requirements.  

^D    The operating permits program builds on similar State
     programs that were already in place in some 35 States prior
     to EPA's program.  The purpose of the operating permits
     program is to improve enforcement by issuing each source or
     facility a permit that consolidates all of its Clean Air Act
     requirements into a federally enforceable document. 
     Consolidating facilities' permit requirements, including
     improved monitoring requirements (which are implemented by
     the permit), will help the public and permitting authorities
     better determine whether sources are in compliance with
     their Clean Air Act requirements.  The results should yield
     improved air quality through better compliance by the
     regulated community and more effective enforcement.
     
^D    On July 21, 1992, EPA issued a regulation outlining the
     specific minimum requirements that States must meet in their
     operating permits program.  EPA's operating permits
     regulation requires States to develop comprehensive
     operating permit programs that cover "major" sources of air
     pollution.  Major sources include those that emit 100
     tons/year or more of volatile organic compounds, carbon
     monoxide, lead, sulfur dioxide, nitrogen dioxide, or
     particulate matter (PM-10), those that emit 10 tons/year or
     more of any single toxic air pollutant (specifically listed
     under the Clean Air Act), or those that emit 25 tons/year or
     more of a combination of toxic air pollutants. 

^D    State and local agencies were required to submit programs to
     EPA by November 15, 1993, and EPA is required to approve or
     disapprove these programs within one year of their
     submittal.  Most State operating permit programs have been
     reviewed and approved by EPA.  However, a few States have
     not yet obtained approval or have had their programs
     disapproved.

^D    State programs that "substantially" meet the regulatory
     requirements may be granted interim approval for up to two
     years by EPA.  To obtain interim approval, programs must
     satisfy a number of minimum requirements.  Permitting
     authorities receiving interim approval must correct
     deficiencies in their programs and submit the corrections to
     EPA at least six months prior to expiration of the interim
     approval.   

^D    Facilities must submit permit applications to the State or
     local permitting authority within one year after EPA's
     approval of the program.  Initially, the agencies have three
     years after program approval in which to issue permits. 
     After a permit is issued, sources must apply to their
     permitting authorities to revise their permits if they wish
     to make changes in the operation of their facilities that
     would be prohibited by the permit.  

^D    Many provisions of the July 1992 rule were legally
     challenged by representatives from State and local agencies,
     environmental groups, and industry.  As a result of
     negotiations with these groups, EPA proposed revisions to
     the operating permits rule in August 1994 that address many
     of the issues raised during litigation.  The result,
     however, was a proposal that stakeholders believed was too
     complicated and administratively burdensome.  EPA agreed
     with many of these criticisms and worked closely with
     stakeholders on a supplemental proposal that was issued in
     August 1995.   

^D    EPA plans to issue a final rule later this winter that will
     incorporate the supplemental proposal as well as certain
     provisions from the August 1994 proposal.  EPA believes that
     this rule will create a more flexible and streamlined
     operating permits program, including simplified procedures
     for revising both State and Federal operating permits.  

WHAT ARE THE MAIN FEATURES OF THE FEDERAL OPERATING PERMITS RULE?

^D    EPA's Federal operating permits program will apply only in
     those rare situations where a State or local agency has not
     obtained approval of its operating permits program by the
     effective date of today's rule (30 days after publication in
     the Federal Register), or where the State or local agency
     has failed to adequately administer an operating permits
     program.  EPA's Federal operating permits program will apply
     to any major "stationary" facility or source of air
     pollution located in the jurisdiction of the State or local
     agency. 

^D    Federal operating permits will also be issued to: 
     (1) sources located in areas over which Indian Tribes have
     jurisdiction, if Tribes have not developed permit programs,
     and (2) certain sources on the Outer Continental Shelf.  The
     rule provides a mechanism for improving air quality in areas
     under the jurisdiction of Indian Tribes, where sufficient
     resources may be unavailable to implement their own
     operating permit programs.  EPA is delaying implementation
     of Federal operating permits programs on Tribal lands to
     give the Agency additional time to work with Tribes to
     strengthen their capacity to develop their own programs and
     to prepare to issue permits where there is no Tribal
     program.
 
^D    The Federal permitting rules are consistent with EPA's State
     operating permits rule which sets minimum standards for
     State programs.  The Federal permitting rules will be
     modified where applicable to ensure consistency with the
     final State operating permits program.

^D    Thirty days after the rule is published in the Federal
     Register, Federal operating permits programs will be
     effective in any State which lacks an approved program. 
     Federal operating permits programs will be effective no
     later than November 15, 1997 in Tribal areas that lack
     approved programs. 

^D    Under the Federal operating permits program, sources of air
     pollution may be subject to an annual fee to cover the cost
     of administering the permits program (roughly $24-36 per ton
     of emissions).  Since any State affected by this rule would
     not have an approved State program, those fees would go to
     the Federal government under this rule.  Fees will be
     reviewed biennially and adjusted if necessary.

^D    Today's action provides some flexibility by allowing EPA to
     delegate the administration of the operating permits
     program, in whole or in part, to a State, local or Tribal
     agency, where appropriate. 

^D    Based on final revisions to EPA's operating permits
     regulation, which will be issued later this year, EPA
     expects to revise the Federal operating permits rule to
     incorporate more streamlined permit revision procedures.  

WHO MUST COMPLY WITH THE RULE?

^D    Initially, only major sources, solid waste incineration
     units (required to obtain a permit under section 129 of the
     Clean Air Act), and certain sources subject to requirements
     under the acid rain program will be required to obtain
     Federal permits.  Sources whose potential emissions exceed
     certain levels are considered "major."   

^D    Before EPA administers a program in an area, the regulated
     community will be notified of the program's effective date
     and its obligation to apply for permits. 

WHAT ARE THE IMPACTS ON INDUSTRY?

^D    Generally, sources which would ordinarily have been issued
     operating permits from an EPA-approved State or local
     program will now instead obtain Federal permits from their
     applicable EPA Regional office.  Each permit will
     incorporate terms and conditions to assure that the source
     complies with all applicable requirements.  Because States
     generally have expertise and personnel in place to
     administer operating permits programs, EPA will delegate
     program responsibilities to State, local and Tribal
     permitting agencies whenever possible.  Depending on State
     law, sources may also be subject to State permitting
     requirements.

^D    When EPA approves a State, local or Tribal operating permits
     program, it will suspend the issuance of Federal operating
     permits for that area.  

^D    When EPA has not fully delegated the program to a State,
     local or Tribal permitting agency, sources will pay
     emissions-based fees directly to the Federal government to
     cover the costs of administering a Federal program.  The
     amount of the fees will depend, in part, as to whether
     contractor assistance is utilized to run a State's program. 
     Depending on State law, sources may also be subject to State
     fee requirements.  In some cases where the program has been
     fully delegated, EPA may suspend fee collection (to avoid
     subjecting sources to liability for Federal as well as State
     fees).

HOW MUCH WILL THE RULE COST?

^D    The costs of the rule are difficult to quantify because (1)
     the areas that will have part 71 programs cannot be
     identified with certainty until the effective date of this
     rule (2) it is not known how long the program will be in
     place and (3) to a large extent, the costs to regulated
     sources under the Federal operating permits program will
     supplant the cost sources would have borne under approved
     State permits programs.  The estimated annualized cost of
     implementing the Federal operating permits program in 8
     States, for example, is approximately $20 million to the
     Federal government and approximately $18 million to
     industry.  Since EPA's costs will be recaptured through
     permit fees, the true cost to the government is zero, and
     the true cost to industry is approximately $38 million.  The
     marginal cost to industry (i.e., the cost above what
     industry would incur to comply with State requirements) will
     be about $15 million.   

FOR FURTHER INFORMATION...
     
     Anyone with a computer and a modem can download the rule
from the Clean Air Act Amendments Bulletin Board of EPA's
electronic Technology Transfer Network (under "Recently Signed
Rules") by calling (919) 541-5742.  For further information about
how to access the board, call (919) 541-5384.  For further
information about the final rule, contact Candace Carraway at
(919) 541-3189 or Kirt Cox at (919) 541-5399.