Improving the State Implementation Plan Process

Prepared by:
AIR QUALITY INITIATIVE
STEERING COMMITTEE

INTRODUCTION

As part of an ongoing effort to investigate and implement more effective ways of achieving environmental objectives in the West, the Governors initiated the Air Quality Initiative (AQI) Project. In June, 1996, the Governors passed a resolution, attached as an appendix to this report, directing the WGA staff to work with the Environmental Protection Agency (EPA), state staff, industry, tribes and environmental groups to develop institutional and regulatory reforms that will better focus resources on solving air quality problems. The initiative is especially significant in light of a changing regulatory environment across the nation characterized by budget constraints at all levels of government. There is increased emphasis on state and regional management of environmental problems, and interest in innovative and more cost-effective approaches to achieving environmental goals.

A stakeholder Steering Committee with expertise in air quality planning was formed to address the Governors' issues. On the Committee were key individuals from the states, tribes, environmental groups, private business and industry, local government, EPA, and other federal agencies. Through a series of facilitated meetings including an examination of recent planning efforts, the AQI Steering Committee identified problem areas associated with the air quality planning process and suggested solutions to address those areas. Three specific issues were identified by the Steering Committee:

- use of prescriptive requirements as opposed to performance measures to reduce air emissions;

- timeliness of guidance and technical tools; and

- stakeholder participation and partnership.

This report presents the findings and recommendations of the Steering Committee. The recommendations reflect an effort to think creatively and constructively and not necessarily be constrained by existing rules.

While there was tribal participation in various stages of the AQI process, when this report refers to "Steering Committee", it does not reflect an endorsement by tribes. Tribal governments are beginning to develop their air quality programs and EPA regulations and guidance regarding tribal air quality programs, such as the Tribal Authority Rule, are imminent but have not yet been issued. In the absence of the Tribal Authority Rule, most tribes do not have experience with Tribal Implementation Plans (TIPs) and therefore cannot recommend improvements or changes to the air quality planning process at this time.

Whenever this report refers to "stakeholders", it includes all levels of government, industry, environmental groups and other public interest groups. The Steering Committee recognizes that a continuing, cooperative and shared sense of responsibility by all stakeholders is fundamental to the success of the AQI process.

PROBLEM STATEMENT

The following is a discussion of the problems identified by the Steering Committee:

1.0 In the past, there has been an emphasis on prescriptive approaches to meeting air quality goals and standards. While prescriptive approaches have resulted in cleaner air and a level playing field, they have also been barriers to both innovation and the effective use of resources. The emphasis on prescriptive approaches has resulted in decreased flexibility for meeting environmental goals. The challenge is maintaining accountability while allowing for flexible approaches to meeting environmental goals. (Performance vs. Prescription)

Prescriptive requirements may not produce the most effective control measures for individual nonattainment areas. There have been instances when the focus has emphasized process rather than results. There are also disagreements on how success is measured. For example, is success measured by meeting air quality standards, by reducing emissions, and/or by implementing the control requirements in the Clean Air Act?

Many states believe that a great percentage of the resources which go into plan development are spent on fulfilling technical, administrative, and legal requirements, while lesser expenditures are made for the development of the control strategy programs which will ultimately allow states to achieve the air quality goals. Plan development and approval can take years, encompass tens of thousands of person hours, and cost millions of dollars. The sheer magnitude and complexity of air quality plans, as well as the need to make regular revisions, makes it difficult to accelerate the development and processing of plans. The states have expressed a concern that the time spent in preparation of the air quality plans is both excessive and costly, and ultimately diverts resources which could be better spent on activities which directly affect air quality.

2.0 The excessive length of the development and approval processes and the lack of timely rules, guidance, and technical tools have led to delays in plan preparation, uncertainties, and inefficient use of resources. (Timeliness)

State Implementation Plan (SIP) development includes several highly complex technical activities such as data reduction, design day selection, inventory development, control strategy evaluation, and air quality modeling. National guidance on many of these activities does not always address circumstances and issues which states face due to the characteristics of the nonattainment area or technical limitations of available tools. Additionally, such guidance is not always issued in a timely manner.

For example, the Clean Air Act required EPA to develop Control Technique Guidelines (CTGs) for 13 source categories by November of 1993. Due to a lack of resources, EPA has only developed CTGs for three of the categories. For the remaining categories, EPA issued alternative Control Techniques (ACTs) that states could use as guidance when establishing Reasonably Available Control Technology (RACT) to meet SIP submittal deadlines. Despite the lack of CTGs, states were still required to establish RACT requirements for those ten categories to meet their SIP submittal deadlines. When the national CTGs are completed, the state RACT rules may need to be revised, and the control requirements for industry may change.

The problem with the availability of technical tools was apparent during the preparation of the PM10 air quality plans. Emission factors for certain significant source categories, such as paved road emissions, were generally seen as inadequate for making accurate estimates. Even while faced with imminent Clean Air Act deadlines, some states were required to reevaluate and adjust air quality models and emission factors to be used in making the attainment demonstration.

3.0 Stakeholder participation and partnership has been inadequate. (Stakeholder Participation)

Early involvement by all interested parties is critical to the success of the air quality plan. Lack of early participation and communication has led to uncertainty and unnecessary conflict in the SIP development and rulemaking processes. Additionally, in those instances when there have been up-front discussions and/or agreements on the SIP development requirements and process, unilateral changes have compromised the process.

For many years, rule-making and air quality plan development have been characterized by inconsistent stakeholder involvement. This has led to a number of perceived issues, including:

The rule-making process does not utilize the considerable expertise available within state and local agencies, the private sector, and other stakeholders.

- Resulting rules have been developed with insufficient regional information, making some of them ill-fitting to the needs of western states.

- The current practice of providing "one size fits all" guidance documents for technical support activities fails to account for any individual or unique needs of states or local areas.

- Failure to get stakeholder involvement during federal rule development can lead to contention as state statutes to implement federal rules are considered by legislatures. It can also lead to differences in the interpretation of rules.

Another stakeholder issue has been the need to have a pro-active partnership between the EPA and the states during the SIP development process. In some instances, EPA has been reluctant to provide feedback on SIP documents prior to submittal because of the need to preserve all options during the review phase of the process. States and EPA believe it is critical for EPA and all parties to provide input during plan development to ensure that the submitted product will meet EPA criteria and thus accelerate plan approval.

STATUS OF RECENT IMPROVEMENTS TO THE PROCESS

EPA has been working on methods to improve and streamline SIP processing since 1982. Prior to the 1990 Clean Air Act Amendments, EPA developed the direct final, parallel processing and letter notice SIP approval processes, the completeness review, and a stratified Headquarters review of SIPs. Since the 1990 Amendments, EPA recognized the need for further improvements in its SIP processing procedures.

In July 1995 Mary Nichols delegated to the Regional Administrators (RA) the authority to sign virtually all SIP actions. This delegation shortened the amount of time EPA traditionally spent processing SIPs since review and concurrence by EPA's Headquarters' Offices was no longer required. However, this delegation contained several conditions: Regions must follow the "consistency process" and involve the Office of General Counsel for specified reviews. The consistency process tries to balance the need to have consistent application of regulations and policy nationally with the need for regional flexibility to address local issues.

EPA has a national workgroup that continually evaluates methods for streamlining the SIP review process. This workgroup is currently preparing to implement revised procedures for incorporating by reference (IBR) state documents/regulations into the federally approved SIP. This new procedure will shorten the amount of time it takes to publish final action on SIPs as well as provide a better mechanism for identifying in the Code of Federal Regulations those state regulations, etc., incorporated into the federally approved SIP.

Historically, with respect to SIP development, Regions have attempted to work with States to define how various technical analyses are to be completed so that agreement is reached well in advance of SIP submittal. EPA will emphasize and prioritize resources to strengthen and enhance up-front development work with states as SIPs are prepared.

There are examples of recent improvements in EPA/State/Stakeholder involvement: the California Ozone SIP, the latest revision to the Utah Ozone SIP, and the Kootenai County PM SIP in Idaho. This involvement resulted in creative, unique solutions to region specific problems. It is important that this involvement occur early in the process so that significant issues can be identified and resolved.

RECOMMENDATIONS OF THE AQI STEERING COMMITTEE

Based on the identification of issues, the Steering Committee was able to identify a series of recommendations to improve the process. The recommendations are grouped in accordance with the problems identified:

1.0 Performance vs. Prescription:

1-1. EPA should adopt national measures for national source categories, such as ships, airplanes, locomotives, and consumer products. In cases where states are not preempted from regulation, the national measures should not limit state flexibility to implement equally or more effective local measures.

1-2. In implementing the Clean Air Act, EPA must recognize the expertise of the states and grant flexibility in the manner air quality objectives are achieved.

1-3. Mechanisms should be developed for states to obtain SIP credit for emissions reductions from voluntary strategies where the benefits of those strategies can be quantified.

1-4. EPA should move resources away from prescriptive oversight and towards technical assistance to states and the development and implementation of programs to improve air quality.

1-5. Incentives should be provided for implementation of early reductions.

1-6. There should be a process and funding for early intervention into areas at risk of exceeding air quality standards.

1-7. Where merited, EPA should take advantage of the Agency's discretionary authority in designating nonattainment areas based on air quality data, planning and other considerations. EPA should encourage alternative processes for areas that are able to meet air quality goals through means other than a nonattainment designation when such approaches offer more administrative and substantive flexibility than with the nonattainment designation. This provision must be designed to produce the desired result in a shorter time frame than if the area were redesignated to nonattainment and also meet the public notification goals associated with a nonattainment designation. Guidance should be developed to determine the conditions and approach when this discretion should be applied.

1-8 Administrative and technical requirements and control strategies that do not lead to significant air quality benefits should not be imposed.

1-9. States and EPA should enter into Performance Partnership Agreements based on environmental benefit.

1-10. States should adopt and implement the most effective programs feasible working closely with the EPA in its oversight role. This should be done in a manner to meet the regulations and guidelines established by EPA, balancing both flexibility and accountability.

2.0 Timeliness

2-1. The EPA should ensure the publication of timely guidance which can be used as a basis for the development of SIPs. In issuing guidance, EPA should balance the need for timely guidance with many other factors, including the degree of specificity needed, regional considerations, including those of the West, and stakeholder involvement.

2-2. All stakeholders should make every effort possible to work together to ensure there is sufficient technical information to issue timely guidance.

2-3. As part of EPA's role to provide technical assistance, EPA should be responsible for publishing timely guidance pertaining to:

- comprehensive and accurate emissions factors applicable in the West;

- air quality models tested for effectiveness and available for timely use in SIP development, including technical assistance for states required to use the models; and

- control strategy options to address single or multiple pollutant problems, including the development of credits associated with various program designs.

2-4. Because emissions reductions from national programs are a crucial element of achieving air quality goals, EPA should promulgate timely national control strategies.

3.0 Stakeholder Participation

3-1. Early cooperation and communication between the states, EPA, and stakeholders before the commencement of, as well as throughout, the air quality planning process is critical. There must be early agreement on the following key issues:

- The applicable Clean Air Act requirements.

- The method for inventorying emissions. The development of appropriate data quality objectives at the start of the process is crucial.

- Establishment of the design value, and agreement on the level of information which subsequently could change the design value during the completion and evaluation of the SIP.

- Method to demonstrate attainment (e.g. modeling).

Changes to any agreed upon protocols should be made only if the change will have a positive impact on the evaluation of air quality standards and goals.

- Data quality standards must indicate the required quality and detail of the data to be used in the air quality planning process.

- Methods for estimating emission credits, particularly those associated with innovative strategies.

- Agreement on how to credit commitments vs. enforceable reductions. This would allow a performance based approach to be used where appropriate. Any agreement must address the process of turning a commitment into an enforceable reduction.

- Agreement on how to develop and implement market based/trading programs.

- Agreement on a mechanism for airing and resolving disagreements.

3-2. A policy should be developed for establishing differential levels of EPA review based on the complexity of the submittal and the prior participation of EPA.

IMPLEMENTATION PLAN FOR RECOMMENDATIONS

The AQI Steering Committee, in concert with other efforts such as the Western Regional Air Partnership (WRAP), will continue to meet and further develop these recommendations. If the Governors adopt this action plan, the Steering Committee will reconvene to agree on the specific actions we will take to implement the recommendations. Attached is a matrix which outlines the types of actions we are considering. We will provide a progress report back to the Governors in November 1997 and June 1998.

Page last updated 10/10/1999