TITLE 30.ENVIRONMENTAL QUALITY

Part 1. TEXAS NATURAL RESOURCE CONSERVATION COMMISSION

Chapter 114. CONTROL OF AIR POLLUTION FROM MOTOR VEHICLES

The Texas Natural Resource Conservation Commission (commission) proposes new §114.7, Low Income Vehicle Repair Assistance, Retrofit, and Accelerated Vehicle Retirement Program Definitions; §114.60, Applicability for LIRAP; §114.62, LIRAP Funding; §114.64, LIRAP Requirements; §114.66, Disposition of Retired Vehicle; §114.68, Emission Reduction Credits; §114.70, Records, Audits, and Enforcement; and §114.72, Local Advisory Panels.

BACKGROUND AND SUMMARY OF THE FACTUAL BASIS FOR THE PROPOSED RULES

To enhance the vehicle emissions inspection and maintenance (I/M) program's objectives, the Texas Legislature adopted provisions to assist low income individuals with repairs, retrofits, or retirement of vehicles that fail emissions inspections. House Bill (HB) 2134, 77th Legislature, 2001, requires the commission and the Texas Department of Public Safety (DPS), by rule, to provide the minimum guidelines for counties to implement a low income vehicle repair assistance, retrofit, and accelerated vehicle retirement program (LIRAP). The proposed rules would apply to counties that implement a vehicle emissions I/M program and have elected to implement LIRAP provisions.

House Bill 2134 requires the DPS and the commission by joint rule to establish and authorize the commissioners court of an affected county to implement a LIRAP subject to oversight by the executive director. Only those counties that have implemented a vehicle I/M program are eligible for participation in the LIRAP. Under the program, monetary or other compensatory assistance will be provided for emission-related repairs directly related to bringing the vehicle into compliance or for replacement assistance for a vehicle that has failed the required emissions test and for which emission- related repairs would not be economical. Vehicle eligibility criteria has been developed by the commission, in association with the DPS. Emission-related repairs covered by the program will be required to be carried out at a recognized emissions repair facility. Participating counties may administer the program themselves or contract with a private entity or another county to administer the program. Participating counties must expend no less than 95% of the funds received from the state for vehicle repair, retrofit, or vehicle retirement assistance. Participation by counties is not mandatory.

House Bill 2134 also requires the commission to adopt rules to assist participating counties in implementing the program. These rules include the minimum and maximum amount for emission- related repairs and retrofit equipment and installation, and the minimum and maximum amount toward the purchase price of a replacement vehicle and criteria for determining eligibility. In addition, HB 2134 allows the commissioners court of the participating county to appoint one or more local advisory panels consisting of individuals representing automobile dealerships, automotive repair industry, safety inspection stations, local affected governments and local nonprofit organizations to advise the commissioners court on the operation of the LIRAP.

House Bill 2134 requires the commission to authorize the assignment of emissions reduction credits to private, commercial or business entities that purchase qualified vehicles for accelerated retirement under this program. Also, retired vehicles must be destroyed; recycled; dismantled, and the parts sold; or placed in storage and subsequently retired and repaired, brought into compliance, or used as replacement vehicles. No more than 10% of all vehicles eligible for retirement may be used as replacement vehicles. The commission anticipates that the DPS will adopt by reference these proposed rules once they are adopted and become effective.

SECTION BY SECTION DISCUSSION

Subchapter A, Definitions

The proposed new §114.7, Low Income Vehicle Repair Assistance, Retrofit, and Accelerated Vehicle Retirement Program Definitions, contains definitions applicable to the LIRAP. The following terms are defined in the proposed section: affected county, commercial vehicle, destroyed, dismantled, fleet vehicle, LIRAP, participating county, recognized emissions repair facility, recycled, replacement vehicle, retrofit, retrofit equipment, vehicle, and vehicle owner. Definitions for the terms affected county, commercial vehicle, fleet vehicle, participating county, retrofit, and retrofit equipment are defined by HB 2134. The statute requires the commission to develop criteria for certifying retrofit equipment. The commission has elected to use the United States Environmental Protection Agency's (EPA's) certification of retrofit equipment as the criteria for certification of retrofit equipment for LIRAP. The statute requires that vehicles eligible for participation in the LIRAP be repaired by a recognized emissions repair facility. Recognized emissions repair facility is defined in 37 TAC §23.93, relating to Vehicles Emissions Inspection Requirements. The statute also requires monetary or compensatory assistance for a replacement vehicle; therefore, replacement vehicle has been defined as a vehicle that has a valid DPS safety or safety and emissions inspection. The statute does not define the terms destroyed, dismantled, and recycled; but to avoid creating ambiguity, the proposed rules define these terms based on similar provisions in the Texas Transportation Code relating to automobile wrecking and salvage yards and non-repairable and salvage motor vehicles, and based on common understanding of these terms in this industry. The definition of "vehicle" was added to clarify that the only motor vehicles eligible for assistance under LIRAP are those subject under §114.50(a), Vehicle Emissions Inspection Requirements, which applies to all gasoline-powered motor vehicles two through 24 years old and does not include military tactical vehicles, motorcycles, diesel-powered vehicles, dual-fueled vehicles which cannot operate using gasoline, and antique vehicles registered with the Texas Department of Transportation. The definition of "vehicle owner" was added to clarify that a person holding a Certificate of Title to the vehicle and/or an operator who is granted possession and is authorized to make repairs under a lease or purchase agreement between the title holder and the operator will be considered the vehicle owner for the purposes of repair and retrofit assistance. For the purposes of accelerated retirement, however, vehicle owner means the person who holds the Certificate of Title for the vehicle.

Subchapter C, Vehicle Inspection and Maintenance

The proposed revisions to Subchapter C include changing the subchapter title from "Vehicle Inspection and Maintenance" to "Vehicle Inspection and Maintenance and Low Income Vehicle Repair Assistance, Retrofit, and Accelerated Vehicle Retirement Program" in order to correctly reflect the modified content of the subchapter. The subchapter is proposed to be divided into two divisions. The existing sections of the subchapter would be placed into Division 1, Vehicle Inspection and Maintenance, and the proposed new sections would be placed into Division 2, Low Income Vehicle Repair Assistance, Retrofit, and Accelerated Vehicle Retirement Program.

The proposed new §114.60, Applicability for LIRAP, establishes the applicability of §114.7, Low Income Vehicle Repair Assistance, Retrofit, and Accelerated Vehicle Retirement Program Definitions, and Subchapter C, Division 2, Low Income Vehicle Repair Assistance, Retrofit, and Accelerated Vehicle Retirement Program. The proposed new section applies to counties that implement a vehicle I/M program and have elected to implement LIRAP provisions as authorized by HB 2134. The proposed new §114.60(b) specifies that vehicles must be subject to §114.50(a), Vehicle Emissions Inspection Requirements, to be eligible for assistance under the LIRAP. In accordance with HB 2134, the proposed new §114.60(c) specifically excludes the following vehicles from being eligible to participate in the LIRAP: fleet vehicles; commercial vehicles; vehicles owned or leased by a governmental entity; vehicles registered as classic motor vehicles as defined by Transportation Code, §502.274; and exhibition vehicles, including antique and military vehicles, as defined by Transportation Code, §502.275; and vehicles that are not regularly used for transportation during the normal course of daily activities. The proposed new §114.60(d) requires participating counties to ensure that owners of vehicles excluded from LIRAP under the proposed new subsection (c) do not receive monetary or compensatory assistance through LIRAP. The commission is developing guidance to assist participating counties in ensuring that only owners of the eligible vehicles receive assistance.

The proposed new §114.62, LIRAP Funding, specifies the funding requirements for the LIRAP. The proposed new §114.62(a) states that the LIRAP will be funded from emissions test fees collected by the DPS under §114.53, Inspection and Maintenance Fees. In accordance with the requirements of HB 2134, the proposed new §114.62(b) specifies that participating counties must expend no less than 95% of the funds received from the commission for vehicle repair, retrofit, or vehicle retirement assistance. Also in accordance with the requirements of HB 2134, the proposed new §114.62(c) specifies that counties electing to participate in the LIRAP shall receive, to the extent practicable, funding in reasonable proportion to the amount in fees collected in the affected county or area from emissions testing fees designated by the commission.

The proposed new §114.64, LIRAP Requirements, specifies the requirements for establishing and implementing a LIRAP. The proposed new §114.64(a) specifies that, upon receiving the request by a county commissioners court, the executive director shall authorize the implementation of LIRAP in a requesting county, and that the county and the executive director shall enter into a grant contract for the implementation of the LIRAP. The proposed new subsection (a) specifies that the grant contract will provide conditions, requirements, and projected funding allowances for the implementation of LIRAP. The proposed new subsection (a) also allows a participating county to implement the LIRAP through a contract with an entity approved by the executive director. The proposed rulemaking requires that the participating county or its entity take appropriate measures to determine applicant eligibility and repair effectiveness and to ensure against fraud. The proposed rules specify that the county will remain the contracted entity even if the county contracts for the services necessary to implement the LIRAP. A grant contract between the participating county and the executive director of the commission must adhere to uniform grant management standards. Since fees collected by the state will be used to fund local LIRAPs, other contract procedures required by other agencies such as the Comptroller's Office may also be applicable. The commission is developing a guidance document that will include sample application forms, sample contracts, and other related information for counties to use to implement the LIRAP.

The proposed new §116.64(b) specifies the requirements for repair and retrofit assistance. The proposed new subsection (b), as required by statute, specifies that a LIRAP shall provide for monetary or other compensatory assistance to eligible vehicle owners for repairs directly related to bringing certain vehicles that have failed a required emissions test into compliance with emissions requirements or installing retrofit equipment on vehicles that have failed a required emissions test, if practically and economically feasible, in lieu of or in combination with repairs performed to bring a vehicle into compliance with emissions requirements. The proposed subsection (b) requires that vehicles under the LIRAP be repaired or retrofitted at recognized emissions repair facilities. Additionally, the proposed subsection (b) requires the participating county or its designated entity to make applications available for LIRAP participants and specifies what the applicant must demonstrate, at a minimum, to be eligible for repair or retrofit assistance. The vehicle must have failed a vehicle emissions test within 30 days of application submittal. The requirement to have failed a vehicle emissions test within 30 days of application submittal is established to allow the vehicle owner a reasonable amount of time to consider participating in the LIRAP. In addition, HB 2134 requires that the eligible vehicle be capable of being operated or driven and be currently registered in and have been registered in the program county for the two years immediately preceding the application for assistance. To ensure that an eligible vehicle is capable of being operated or driven, the proposed subsection requires that the vehicle owner be able to demonstrate that vehicle can be started by keyed ignition and idle without the use of the accelerator pedal for at least ten continuous seconds, be driven in forward and reverse for a minimum of 25 feet each way, and be driven under its own power to the emissions inspection station or designated disposal facility. Additionally, the vehicle must have passed the safety portion of the DPS motor vehicle safety and emissions inspection as recorded in the Texas Vehicle Inspection Report (VIR), or the vehicle owner must provide assurance that actions will be taken to bring the vehicle into compliance with safety requirements. This requirement is proposed to ensure that the vehicle is roadworthy after emission-related repairs or retrofit work has been completed and the vehicle is in compliance with vehicle emissions requirements. Additionally, the vehicle owner must demonstrate that his or her net family income is at or below 200% of the federal poverty level. House Bill 2134 is specifically directed at assisting low income individuals and families. Commission staff researched other financial assistance programs and determined that the Texas Children's Health Insurance Program (CHIP) provides income eligibility requirements similar to the targeted population that the LIRAP was intended to cover. Thus, the income eligibility for the LIRAP is based on the CHIP eligibility requirement. For example, a family of four whose annual income is $35,300 or less would be eligible to receive assistance under the proposed rules. The applicant must also demonstrate that any other requirements of the participating county or the executive director are met. The commission solicits comments on the adequacy of the income eligibility requirements.

The proposed new §114.64(c) specifies the requirement for accelerated vehicle retirement. The proposed new subsection (c) states that a LIRAP shall provide for monetary or other compensatory assistance to eligible vehicle owners to be used for the purchase of a replacement vehicle. New subsection (c) also requires the participating county or its designated entity to make applications available for LIRAP participants and specifies what an applicant must demonstrate, at a minimum, to be eligible for accelerated vehicle retirement. For the reasons previously discussed regarding repair and retrofit assistance, the applicant must demonstrate that the vehicle has failed a vehicle emissions test within 30 days of application submittal, can be started by keyed ignition and idle without the use of the accelerator pedal for at least ten continuous seconds, can be driven in forward and reverse for a minimum of 25 feet each way, can be driven under its own power to the emissions inspection station or designated disposal facility, and is currently registered in and has been registered in the program county for the two years immediately preceding the application for assistance. The vehicle owner must also demonstrate that his or her net family income is at or below 200% of the federal poverty level for the same reasons as discussed previously. Additionally, the vehicle must have passed a DPS motor vehicle safety or safety and emissions inspection within 15 months prior to application submittal. This is to avoid unnecessary safety-related work being done prior to retiring the vehicle. Additionally, the applicant is required to demonstrate that other requirements of the county or executive director are met.

The proposed new §114.64(d) specifies the requirements related to compensation. The proposed new subsection (d) requires that participating counties determine eligibility and authorize monetary or other compensation to the eligible vehicle owner based on available funding. The amount of monetary or other compensatory assistance for emission repairs to eligible vehicles by participating counties will be determined on a case-by-case basis. As required by HB 2134, the proposed new §114.64(d)(1)(A) establishes the maximum and minimum compensation amounts for repair and retrofit assistance, and specifies that such repairs and retrofits must be performed by a recognized emissions repair facility. The proposed new subsection (d) establishes that compensation may be no more than $600 and no less than $50 per vehicle for emission-related repairs or retrofits performed at a recognized emissions repair facility, including diagnostics tests performed on the vehicle. The commission determined the maximum $600 emission-related repair fee to be a reasonable and equitable amount based on commission staff research on the State of California's Consumer Assistance Program which provides financial assistance for related repairs and accelerated vehicle retirement. The average repair cost in the State of California's Consumer Assistance Program for Acceleration Simulation Mode (ASM-2) emission-related repairs is $385 with some vehicles requiring higher amounts and some vehicles requiring lower amounts depending on the cause of emission failures. The proposed new §114.64(d)(2) also requires that vehicle owners be responsible for the first $50 of emission-related repairs or retrofit costs. Preventive work is normally performed as scheduled maintenance by the vehicle owner. In some cases, minor maintenance work such as an oil change, oil filter change, air filter change, or a positive crankcase ventilation valve replacement may be all that is needed for the vehicle to be brought into compliance. This maintenance work is not normally considered "vehicle repair," but may be included as part of a larger repair job. Average cost of this type of maintenance is $50. The commission proposes a $50 "copay" to cover such routine maintenance work. The commission solicits comments on the vehicle owner's responsibility to pay the first $50 of emission- related repairs or retrofit costs and the adequacy of the amount.

The proposed new §114.64(d)(1)(B) also establishes that compensation may be no more than $1,000 and no less than $600 per vehicle, including diagnostics tests to be used as required by HB 2134, toward the cost of a replacement vehicle for the accelerated retirement of a vehicle. The $1,000 maximum compensation amount was determined by commission staff research on the State of California's Consumer Assistance Program discussed previously, where originally $500 per vehicle was offered, but resulted in low participation. The State of California then raised the offer to $1,000 per vehicle which dramatically increased participation in the program. The minimum of $600 per vehicle for replacement was derived from the maximum allowed for repair assistance. A vehicle owner whose vehicle has failed an emissions test and for which repairs are deemed uneconomical is ensured of receiving no less than $600 or the maximum amount of what would be paid for repairs.

Provided the retirement minimum and maximum amounts are met, the proposed new §114.64(d)(3) provides that counties may implement a level of compensation schedule that allows flexibility. In accordance with the requirements of HB 2134, the proposed new subsection (d) states that the following criteria may be used for determining the amount of financial assistance provided: model year of the vehicle; miles registered on the vehicle's odometer; fair market value of the vehicle; estimated cost of emission-related repairs necessary to bring the vehicle into compliance with emission standards; the amount of money the vehicle owner has already spent to bring the vehicle into compliance, excluding the cost of the vehicle emissions inspection; and the vehicle owner's income. The commission solicits comments on the minimum and maximum compensation amounts for repair, retrofit, and vehicle retirement assistance.

The proposed new §114.64(e) establishes the requirements for reimbursement. The proposed new subsection (e) requires that counties reimburse the appropriate recognized emissions repair facilities or vehicle retirement entity for approved repairs, retrofits, or vehicle retirements within 30 calendar days of receiving an invoice that meets the requirements of the county or designated entity. The 30-calendar-day requirement is based on Texas Government Code, Prompt Payment Act, Chapter 2251. To ensure that vehicles are repaired to meet vehicle emissions standards, the proposed new subsection requires that repaired or retrofitted vehicles pass a DPS safety and emissions inspection before the recognized emissions repair facility is reimbursed.

The proposed new §114.66, Disposition of Retired Vehicle, explains that vehicles retired under an accelerated vehicle retirement program may not be resold or reused in their entirety in this or another state. As required by HB 2134, the vehicle must either be destroyed, recycled, or dismantled and its parts sold as used parts or used in the LIRAP; placed in a storage facility and subsequently destroyed, recycled, or dismantled within 12 months of vehicle retirement date and its parts sold or used in the LIRAP; or repaired, brought into compliance, and used as a replacement vehicle under this chapter. As required by HB 2134, not more than 10% of all vehicles eligible for retirement may be used as replacement vehicles.

The proposed new §114.68, Emission Reduction Credits, establishes emission reduction credits in accordance with the requirements of HB 2134. The proposed section explains that counties may allow private, commercial, and business entities to provide monetary assistance toward the LIRAP. The proposed new §114.68(a) specifies the emission reduction credits available under a LIRAP. The proposed new subsection (a) states that, to the extent allowed under state and federal law, private, commercial, and business entities may purchase an eligible vehicle under the proposed new §114.64(c), LIRAP Requirements, for accelerated retirement as approved by the participating county and may have 100% of the emission reductions certified as emission credits. This percentage of emission reduction credits is established as an incentive for private, commercial, and business entities to provide funding in support of LIRAP. This emission reduction credit may be transferred or used by the holder in accordance with 30 TAC Chapter 101, Subchapter H, Division 1 and 4 (relating to Emission Credit Banking and Trading and Discrete Emission Credit Banking and Trading).

The proposed new §114.68(b) specifies the emission reduction credits available for vehicles not covered under LIRAP. The proposed new subsection (b) states that, to the extent allowed under state and federal law, a fleet vehicle, a government owned or leased vehicle, or a commercial vehicle may be retired and may have 100% of the emission reductions certified as emission credits.

The total amount of emission reduction credits that may be eligible for certification or registration is subject to requirements under Chapter 101, Subchapter H, Division 1 and Division 4. For instance, mobile emission reduction credits must be enforceable, permanent, quantifiable, real, and surplus; and mobile discrete emission reduction credits must be real, quantifiable, and surplus in accordance with the banking and trading rules and policies in Chapter 101, Subchapter H, Division 1 of this title.

The proposed new §114.70, Records, Audits, and Enforcement, establishes requirements for recordkeeping, reporting, and enforcement in accordance with HB 2134 which specifies that LIRAP will be subject to agency oversight that may include reasonable periodic commission audits. The proposed new §114.70(a) requires that a participating county submit quarterly audit reports to the commission to ensure that funds expended have been used in accordance with the requirements in this subchapter. The recordkeeping required in the proposed new subsection (b) shall be transmitted to the state in paper copies or in an electronic database format, to be determined by mutual agreement between the state and the participating county. The proposed new §114.70(b) specifies the minimum information that the quarterly reports must include. The quarterly reports will provide the commission with the necessary information to ensure accountability on how the funds are spent and managed, and whether the vehicles are repaired, retrofitted, or retired according to requirements of state statutes and commission rules. The report must include the name of the county issuing the report; the name of the official representative certifying the report on behalf of the county; the amount of funds received during the reporting period; the amount of funds distributed for repair assistance, retrofitting, or voluntary retirement; information for each vehicle participating in the program, including vehicle identification number, license plate number, date of vehicle repair, retrofit, or retirement; and other pertinent information as required. The commission is preparing guidance that will include software for counties to use in meeting this requirement. In addition, the proposed new §114.70(c) requires that records be maintained for a minimum of three years by the participating county, its designated entity, a participating recognized emissions repair facility, and a participating vehicle retirement facility. This three-year record retention requirement is consistent with the vehicle scrappage program under §114.216 (relating to Records, Auditing and Enforcement). Such records must be available upon request by the executive director for auditing purposes.

The proposed new §114.70(d) requires that a participating county, its designated entity, a participating recognized emissions repair facility, and a participating vehicle retirement facility allow the executive director to conduct audits and inspections. The proposed §114.70(e) states that a person who, with intent to defraud, sells a vehicle in an accelerated vehicle retirement program under the LIRAP commits an offense that is a third degree felony. Under HB 2134, LIRAP is subject to commission oversight. Therefore, these recordkeeping, auditing, and reporting requirements are proposed to fulfill the statutory oversight responsibilities.

The proposed new §114.72, Local Advisory Panels, establishes the criteria for the appointment of local advisory panels in accordance with HB 2134. The proposed new §114.72(a) allows the commissioners court of a participating county to appoint one or more local advisory panels to assist in identifying vehicles with intrinsic value that make these vehicles existing or future collectibles. A vehicle identified under this proposed section could be sold to an individual if the vehicle is repaired and brought into compliance with I/M program requirements; removed from the state; removed from an affected county; or stored for future restoration and cannot be registered in an affected county except under Texas Transportation Code, §502.274 or §502.275 as a classic or antique vehicle. The proposed new §114.72(b) states that the court may delegate all or part of the financial administrative matters to any of the local advisory panels that it appoints. The proposed new §114.72(c) states that local advisory panels may consist of individuals representing automobile dealerships, automotive repair industry, safety inspection stations, local affected governments, and local nonprofit organizations.

FISCAL NOTE: COSTS TO STATE AND LOCAL GOVERNMENT

John Davis, Technical Specialist with Strategic Planning and Appropriations, has determined for the first five-year period the proposed new sections are in effect, there will be fiscal implications, which are not anticipated to be significant, to the commission to implement provisions in this rulemaking. There will be no fiscal implications to other units of state government to implement the provisions of these rules.

There will be significant fiscal implications to certain eligible counties that choose to voluntarily implement a LIRAP, because these counties would be able to receive funds through grant contracts from the commission to implement the LIRAP. There should be no fiscal implications to counties not eligible or which choose not to participate in this program.

The proposed new sections are intended to implement certain provisions of HB 2134. The bill directed the commission to establish a voluntary LIRAP funded by a portion of the fees collected from the statewide vehicle emissions tests. Funding has to be distributed to participating counties in proportion to the amount of vehicle emissions test fees collected in those counties.

The following counties are or will be eligible to participate in the LIRAP: Brazoria, Chambers, Collin, Dallas, Denton, El Paso, Ellis, Liberty, Tarrant, Fort Bend, Galveston, Harris, Johnson, Kaufman, Montgomery, Parker, and Waller Counties.

The LIRAP is intended to provide monetary or other compensatory assistance to vehicle owners for repairs directly related to bringing a vehicle into compliance with vehicle emission standards or for replacement assistance for a vehicle that has failed the required emissions test when emission-related repairs would not be economical. Eligible vehicle owners would be eligible to receive up to $600 per vehicle to pay towards emission-related repairs, or up to $1,000 per vehicle for purchasing a replacement vehicle if they choose to have their failed vehicle retired. To qualify for assistance, vehicle owners must be able to demonstrate that: the vehicle has failed a vehicle emissions test within 30 days of the application submittal, the vehicle is capable of being operated or driven, the vehicle is currently registered in and has been registered in an affected county for the two years immediately preceding the application for assistance, the vehicle has passed the safety portion of the DPS's motor vehicle safety and emissions inspection test, the vehicle owner's net family income is at or below 200% of the federal poverty level, and any other requirements of the participating county or executive director are met.

The LIRAP would not apply to fleet vehicles, commercial vehicles, vehicles owned by units of government, classic motor vehicles, exhibition vehicles, and vehicles not regularly used for transportation during the normal course of daily activities.

County governments that are required or have opted to implement the state's vehicle emissions I/M program may elect to implement and manage a LIRAP. These counties will have the option of managing the program themselves or contracting with another county or entity to run the program. Participating counties would be limited to using no more than 5% of the funds received from the commission for administrative costs of running the LIRAP.

The commission was appropriated approximately $3.2 million in Fiscal Year 2002 and approximately $13.6 million in Fiscal Year 2003 to implement this program. These appropriations were based on revenue estimates derived from emission test fees and anticipated funding assistance requests. Actual funding assistance available to the public will be dependent on the amount of revenue the commission receives from vehicle emissions inspection fees. The commission received additional appropriation for three full-time employees and $186,365 in Fiscal Year 2002 and $162,365 in Fiscal Year 2003 to develop the program and to provide guidance to counties participating in the program. Assuming the entire amount of the appropriations is granted to participating counties, the total funding for administrative costs for all participating counties would be limited to $159,881 in Fiscal Year 2002 and $679,681 in Fiscal Year 2003.

The commission estimates that 6,600 vehicles would be eligible for repair assistance in Fiscal Year 2002 and 17,000 in Fiscal Year 2003. Another 2,200 vehicles would be eligible for accelerated retirement in Fiscal Year 2002 and 5,700 in Fiscal Year 2003. Depending on the number of vehicle owners that apply for assistance, the funding needed to cover all eligible vehicles may potentially surpass the additional funding allocated to the commission to support the LIRAP. Therefore, it will be up to the participating counties to prioritize and determine which vehicle owner receives the monetary assistance.

PUBLIC BENEFITS AND COSTS

Mr. Davis also determined for each year of the first five years the proposed new sections are in effect, the public benefit anticipated from enforcement of and compliance with the proposed new sections will be monetary incentives for vehicle owners to repair or replace polluting vehicles, which could result in decreased emissions in affected counties.

The proposed new sections are intended to implement certain provisions of HB 2134, which directed the commission to establish a voluntary LIRAP funded by a portion of the fees collected from the statewide vehicle emissions tests. Funding is required by the bill to be distributed to participating counties in proportion to the amount of vehicle emission test fees collected in those counties.

The following counties are or will be eligible to participate in the LIRAP: Brazoria, Chambers, Collin, Dallas, Denton, El Paso, Ellis, Liberty, Tarrant, Fort Bend, Galveston, Harris, Johnson, Kaufman, Montgomery, Parker, and Waller Counties.

The LIRAP is intended to provide monetary or other compensatory assistance to vehicle owners for repairs directly related to bringing a vehicle into compliance with vehicle emission standards or for replacement assistance for a vehicle that has failed the required emissions test when emission-related repairs would not be economical. Eligible vehicle owners would be eligible to receive up to $600 per vehicle to pay towards emission-related repairs, or up to $1,000 per vehicle for purchasing a replacement vehicle if they choose to have their failed vehicle retired. To qualify for assistance, vehicle owners must be able to demonstrate that: the vehicle has failed a vehicle emissions test within 30 days of the application submittal, the vehicle is capable of being operated or driven, the vehicle is currently registered in and has been registered in an affected county for the two years immediately preceding the application for assistance, the vehicle has passed the safety portion of the DPS's motor vehicle safety and emissions inspection test, the vehicle owner's net family income is at or below 200% of the federal poverty level, and any other requirements of the participating county or executive director are met.

The LIRAP does not apply to fleet vehicles, commercial vehicles, classic motor vehicles, exhibition vehicles, and vehicles not regularly used for transportation during the normal course of daily activities. As a result, this assistance is only available to individual vehicle owners. Businesses within affected counties would not be eligible to apply for repair or replacement assistance for company vehicles that have failed a vehicle emissions inspection test.

The commission was appropriated approximately an additional $3.2 million in Fiscal Year 2002 and approximately $13.6 million in Fiscal Year 2003 to be passed on to participating counties to be used to provide monetary assistance for emission repairs and accelerated vehicle retirement. These appropriations were based on revenue estimates derived from emission test fees and anticipated funding assistance requests. Actual funding assistance available to the public will be dependent on the amount of revenue the commission receives from vehicle emission inspection fees. The commission estimates that 6,600 vehicles would be eligible for repair assistance in Fiscal Year 2002 and 17,000 in Fiscal Year 2003. Another 2,200 vehicles would be eligible for accelerated retirement in Fiscal Year 2002 and 5,700 in Fiscal Year 2003. Depending on the number of vehicle owners that apply for assistance, the funding needed to cover all eligible vehicles may potentially surpass the additional funding allocated to the commission to support the LIRAP. Therefore, it will be up to the participating counties to prioritize and determine which vehicle owner receives the monetary assistance.

Vehicle owners that apply for assistance have to ensure their vehicles are repaired at DPS- recognized emissions repair facilities, some of which will be small or micro-businesses. Additionally, licensed auto dismantling or other retirement operators, some of which will be small or micro- businesses, will participate in the retirement of vehicles. The proposed new sections will require participating recognized emission repair facilities and participating vehicle retirement facilities to retain LIRAP repair records for a minimum period of three years. Although this is a new requirement, the commission does not anticipate there will be significant fiscal impacts to small or micro-businesses to comply.

SMALL BUSINESS AND MICRO-BUSINESS ASSESSMENT

There will be adverse fiscal implications, which are not anticipated to be significant, to small or micro-businesses as a result of implementing the proposed new sections. The proposed new sections are intended to establish a voluntary LIRAP funded by a portion of the fees collected from the statewide vehicle emissions inspection tests. The LIRAP does not apply to fleet vehicles, commercial vehicles, classic motor vehicles, exhibition vehicles, and vehicles not regularly used for transportation during the normal course of daily activities. This assistance is only available to individual vehicle owners. Businesses within the affected counties would not be eligible to apply for repair or replacement assistance for company vehicles that have failed a vehicle emissions inspection test.

Vehicle owners that apply for assistance have to ensure their vehicles are repaired at DPS- recognized emissions repair facilities, some of which will be small or micro-businesses. Additionally, licensed auto dismantling or other retirement operators, some of which will be small or micro- businesses, will participate in the retirement of vehicles. The proposed new sections will require participating recognized emission repair facilities and participating vehicle retirement facilities to retain LIRAP repair records for a minimum period of three years. Although this is a new requirement, the commission does not anticipate there will be significant fiscal impacts to small or micro-businesses to comply.

LOCAL EMPLOYMENT IMPACT STATEMENT

The commission has reviewed this proposed rulemaking and determined that a local employment impact statement is not required because the proposed rules do not adversely affect a local economy in a material way for the first five years that the proposed rules are in effect.

REGULATORY IMPACT ANALYSIS DETERMINATION

The commission has reviewed the proposed rulemaking in light of the regulatory analysis requirements of Texas Government Code, §2001.225, and determined that the rulemaking is not subject to §2001.0225 because it does not meet the definition of a "major environmental rule" as defined in the statute. A "major environmental rule" means a rule, the specific intent of which is to protect the environment or reduce risks to human health from environmental exposure and that may adversely affect in a material way the economy, a sector of the economy, productivity, competition, jobs, the environment, or the public health and safety of the state or a sector of the state. The proposed rulemaking implements HB 2134 by providing requirements for participating counties' implementation of the LIRAP and applies only to counties that implement a vehicle emissions I/M program. The proposed rules are intended to protect the environment or reduce risks to human health from environmental exposure to ozone by assisting low income motorists in repairing, retrofitting, or retiring vehicles that have failed an emissions test under the state's vehicle emissions I/M program. As such, these rules do not affect in a material way the economy, a sector of the economy, productivity, competition, jobs, the environment, or the public health and safety of the state or sector of the state.

Even if this was a major environmental rule, Texas Government Code, §2001.0225 only applies to a major environmental rule, the result of which is to: exceed a standard set by federal law, unless the rule is specifically required by state law; exceed an express requirement of state law, unless the rule is specifically required by federal law; exceed a requirement of a delegation agreement or contract between the state and an agency or representative of the federal government to implement a state and federal program; or adopt a rule solely under the general powers of the agency instead of under a specific state law. This rulemaking does not meet any of these four applicability requirements of a "major environmental rule." This rule is specifically required by state law. To enhance the vehicle emissions I/M program's objectives to meet the ozone national ambient air quality standard (NAAQS) set by the EPA under 42 United States Code (USC), 7409, HB 2134 provided for monetary assistance to low income vehicle owners for repair assistance, retrofit, and accelerated vehicle retirement of vehicles that have failed emissions tests. This rulemaking does not exceed an express requirement of state law because this rulemaking specifically implements the provisions of HB 2134. The rulemaking does not exceed a requirement of a delegation agreement. Also, the rulemaking was not developed solely under the general powers of the agency, but was specifically authorized under Texas Clean Air Act (TCAA), §§382.202, 382.209 - 382.213.

The commission invites public comment on the draft regulatory impact analysis determination.

TAKINGS IMPACT ASSESSMENT

The commission evaluated this rulemaking action and did an analysis of whether the proposed rules are subject to Texas Government Code, §2007.043. The following is a summary of that analysis. This rulemaking is proposed to assist low income motorists in repairing, retrofitting, or retiring vehicles that have failed an emissions test under the state's I/M program, in an effort towards reducing emissions from these vehicles and to help meet the ozone NAAQS set by the EPA under 42 USC, §7409.

Promulgation and enforcement of the rules will not burden private, real property because this rulemaking action is intended to provide compensation to eligible vehicle owners for repair assistance, retrofit, and accelerated vehicle retirement. Although the rule revisions do not directly prevent a nuisance or prevent an immediate threat to life or property, they do prevent a real and substantial threat to public health and safety and are part of the efforts towards meeting the ozone NAAQS. Specifically, LIRAP provides monetary assistance to certain vehicle owners towards repair assistance, retrofit, and accelerated vehicle retirement that have failed an emissions test. The proposed rules are one part of the strategy to enhance the vehicle I/M program. The vehicle I/M program was developed in order to meet the ozone NAAQS set by the EPA under 42 USC, §7409. States are primarily responsible for ensuring attainment and maintenance of NAAQS once the EPA has established them. Under 42 USC, §7410 and related provisions, states must submit, for approval by the EPA, SIPs that provide for the attainment and maintenance of NAAQS through control programs directed to sources of the pollutants involved. The vehicle I/M program is one of the control strategies submitted to the EPA as part of the SIP. Based on this analysis, exemptions which apply to these rules is that this is: 1) an action reasonably taken to fulfill federal ozone NAAQS requirements; 2) in response to a real and substantial threat to public health and safety; 3) is designed to significantly advance the health and safety purpose; and 4) does not impose a greater burden than is necessary to achieve the health and safety purpose. Therefore, this rulemaking action will not constitute a takings under Texas Government Code, Chapter 2007.

The commission invites public comment on the draft takings impact assessment.

CONSISTENCY WITH THE COASTAL MANAGEMENT PROGRAM

The commission has determined that the proposed rulemaking relates to an action or actions subject to the Texas Coastal Management Program (CMP) in accordance with the Coastal Coordination Act of 1991, as amended (Texas Natural Resources Code, §§33.201 et seq.), and the commission rules in 30 TAC Chapter 281, Subchapter B, Consistency with the CMP. As required by 31 TAC §505.11(b)(2) and 30 TAC §281.45(a)(3) relating to actions and rules subject to the CMP, commission rules governing air pollutant emissions must be consistent with the applicable goals and policies of the CMP. The commission has reviewed the proposed rulemaking for consistency with the CMP goals and policies in accordance with the rules of the Coastal Coordination Council, and determined that the rulemaking is consistent with the applicable CMP goals and policies. The CMP goal applicable to this rulemaking is the goal to protect, preserve, and enhance the diversity, quality, quantity, functions, and values of coastal natural resource areas (31 TAC §501.12(l)). The CMP policy applicable to this rulemaking is the policy (31 TAC §501.14(q)) that commission rules comply with federal regulations in 40 Code of Federal Regulations to protect and enhance air quality in the coastal area (31 TAC §501.14(q)). This rulemaking does not authorize any new air contaminants and is intended to provide compensation to eligible vehicle owners for repair assistance, retrofit, and accelerated vehicle retirement as one part of the strategy to enhance the state's vehicle emissions I/M program. Therefore, this rulemaking is consistent with the applicable policy and goal.

The commission seeks public comment on the consistency of the proposed rulemaking with applicable CMP goals and policies.

ANNOUNCEMENT OF HEARING

Public hearings on the proposal will be held at the following times and locations: January 22, 2002, 10:00 a.m. and 7:00 p.m., City of Houston City Council Chambers, 2nd Floor, 901 Bagby, Houston; January 23, 2002, 10:00 a.m. and 6:30 p.m., City of Irving Central Library Auditorium, 801 West Irving Boulevard, Irving; and January 24, 2002, 2:00 p.m. and 7:00 p.m., City of El Paso City Council Chambers, 2nd Floor, 2 Civic Center Plaza, El Paso.

The hearings are structured for the receipt of oral or written comments by interested persons. Individuals may present oral statements when called upon in order of registration. Open discussion will not occur during the hearings; however, an agency staff member will be available to discuss the proposal 30 minutes prior to the hearings, and answer questions before and after the hearings.

Persons with disabilities who have special communication or other accommodation needs who are planning to attend the hearings should contact the Office of Environmental Policy, Analysis, and Assessment at (512) 239-4900. Requests should be made as far in advance as possible.

SUBMITTAL OF COMMENTS

Comments may be submitted to Joyce Spencer, Office of Environmental Policy, Analysis, and Assessment, MC 205, P.O. Box 13087, Austin, Texas 78711-3087; or by fax at (512) 239-4808. All comments must be received by 5:00 p.m. on January 24, 2002. All comments should reference Rule Log No. 2001-035a-114-AI. For further information, please contact Jill Burditt, Policy and Regulations Division, at (512) 239-0560.

Subchapter A. DEFINITIONS

30 TAC §114.7

STATUTORY AUTHORITY

The new section is proposed under Texas Water Code (TWC), §5.103, which authorizes the commission to adopt rules necessary to carry out its powers and duties under the TWC; and under Texas Health and Safety Code, TCAA, §382.017, concerning Rules, which authorizes the commission to adopt rules consistent with the policy and purposes of the TCAA. The new section is proposed under TCAA, Subchapter G, concerning Vehicle Emissions (§§382.201 - 382.216 as added by HB 2134, §1, 77th Legislature, 2001). Specifically, the proposed rule is authorized under TCAA, §§382.202, 382.209 - 382.213.

The proposed rule implements TWC, §5.103 and TCAA, §§382.017, and 382.201 - 382.216.

§114.7.Low Income Vehicle Repair Assistance, Retrofit, and Accelerated Vehicle Retirement Program Definitions.

Unless specifically defined in the TCAA or in the rules of the commission, the terms used in this chapter have the meanings commonly ascribed to them in the field of air pollution control. In addition to the terms which are defined by the TCAA, §§3.2, 101.1, and 114.1 of this title (relating to Definitions), the following words and terms, when used in Subchapter C, Division 2, of this chapter (relating to LIRAP) shall have the following meanings, unless the context clearly indicates otherwise.

(1) Affected county -- A county with a motor vehicle emissions inspection and maintenance program established under Transportation Code, §548.301.

(2) Commercial vehicle -- A vehicle that is owned or leased in the regular course of business of a commercial or business entity.

(3) Destroyed -- Crushed, shredded, or otherwise dismantled to render a vehicle permanently and irreversibly incapable of functioning as originally intended.

(4) Dismantled -- Extraction of parts, components, and accessories for use in the low income vehicle repair assistance, retrofit, and accelerated vehicle retirement program or sold as used parts.

(5) Fleet vehicle -- A motor vehicle operated as one of a group that consists of more than ten motor vehicles and that is owned and operated by a public or commercial entity or by a private entity other than a single household.

(6) LIRAP -- Low income vehicle repair assistance, retrofit, and accelerated vehicle retirement program.

(7) Participating county -- An affected county in which the commissioners court by resolution has chosen to implement a low income vehicle repair assistance, retrofit, and accelerated vehicle retirement program authorized by Texas Health and Safety Code, §382.209.

(8) Recognized emissions repair facility -- An automotive repair facility as defined in 37 TAC, §23.93, relating to Vehicle Emissions Inspection Requirements.

(9) Recycled -- Conversion of metal or other material into raw material products that have prepared grades; and an existing or potential economic value; and using these raw material products in the production of new products.

(10) Replacement vehicle -- A vehicle that has a valid Texas Department of Public Safety or safety and emissions inspection.

(11) Retrofit -- To equip, or the equipping of, an engine or an exhaust or fuel system with new, emissions-reducing parts or equipment designed to reduce air emissions and improve air quality, after the manufacture of the original engine or exhaust or fuel system, so long as the parts or equipment allow the vehicle to meet or exceed state and federal air emissions reduction standards.

(12) Retrofit equipment -- Emissions-reducing equipment designed to reduce air emissions and improve air quality that is approved by the EPA and is installed after the manufacture of the original engine, exhaust, or fuel system.

(13) Vehicle -- A motor vehicle subject to §114.50(a) of this title (relating to Vehicle Emissions Inspection Requirements).

(14) Vehicle owner -- For the purposes of repair assistance or retrofit, the person who holds the Certificate of Title for the vehicle and/or the operator who is granted possession and is authorized to make repairs under a lease or purchase agreement; and for the purposes of accelerated retirement, the person who holds the Certificate of Title for the vehicle.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on December 20, 2001.

TRD-200108177

Stephanie Bergeron

Director, Environmental Law Division

Texas Natural Resource Conservation Commission

Earliest possible date of adoption: February 3, 2002

For further information, please call: (512) 239-5017


Subchapter C. VEHICLE INSPECTION AND MAINTENANCE AND LOW INCOME VEHICLE REPAIR ASSISTANCE, RETROFIT, AND ACCELERATED VEHICLE RETIREMENT PROGRAM

2. LOW INCOME VEHICLE REPAIR ASSISTANCE, RETROFIT, AND ACCELERATED VEHICLE RETIREMENT PROGRAM

30 TAC §§114.60, 114.62, 114.64, 114.66, 114.68, 114.70, 114.72

STATUTORY AUTHORITY

The new rules are proposed under TWC, §5.103, which authorizes the commission to adopt rules necessary to carry out its powers and duties under the TWC; and under Texas Health and Safety Code, TCAA, §382.017, concerning Rules, which authorizes the commission to adopt rules consistent with the policy and purposes of the TCAA. The rules are proposed under TCAA, Subchapter G, concerning Vehicle Emissions (§§382.201 - 382.216 as added by HB 2134, §1, 77th Legislature, 2001). Specifically, the proposed rules are authorized under TCAA, §§382.202, 382.209 - 382.213.

The proposed new sections implement TWC, §5.103; and TCAA, §382.017 and §§382.201 - 382.216.

§114.60.Applicability for LIRAP.

(a) The provisions of §114.7 of this title (relating to Low Income Vehicle Repair Assistance, Retrofit, and Accelerated Vehicle Retirement Program Definitions) and Division 2 of this subchapter (relating to Low Income Vehicle Repair Assistance, Retrofit, and Accelerated Vehicle Retirement Program) provide the minimum requirements for county implementation of a Low Income Vehicle Repair Assistance, Retrofit, and Accelerated Vehicle Retirement Program (LIRAP) and apply to counties that implement a vehicle emissions inspection program and have elected to implement LIRAP provisions.

(b) To be eligible for assistance under this division, vehicles must be subject to §114.50(a) of this title (relating to Vehicle Emissions Inspection Requirements).

(c) LIRAP does not apply to a vehicle that is a:

(1) fleet vehicle;

(2) commercial vehicle;

(3) vehicle owned or leased by a governmental entity;

(4) vehicle registered as a classic motor vehicle as defined by Transportation Code, §502.274;

(5) vehicle registered as an exhibition vehicle, including antique or military vehicles, as defined by Transportation Code, §502.275; or

(6) vehicle not regularly used for transportation during the normal course of daily activities.

(d) A participating county must ensure that owners of vehicles under subsection (c) of this section do not receive monetary or compensatory assistance under LIRAP.

§114.62.LIRAP Funding.

(a) The executive director shall provide funding for the Low Income Vehicle Repair Assistance, Retrofit, and Accelerated Vehicle Retirement Program (LIRAP) with available funds from fees collected under §114.53 of this title (relating to Inspection and Maintenance Fees) or other designated and available funds.

(b) Not less than 95% of the money provided by the commission to a participating county must be used for vehicle repair, retrofit, or vehicle retirement assistance in accordance with the grant contract between the executive director and the county.

(c) A participating county shall receive, to the extent practicable, funding in reasonable proportion to the amount in fees collected in the affected county or area from emissions testing fees designated by the commission.

§114.64.LIRAP Requirements.

(a) Implementation. Upon receiving a written request to implement a Low Income Vehicle Repair Assistance, Retrofit, and Accelerated Vehicle Retirement Program (LIRAP) by a county commissioners court, the executive director shall authorize the implementation of a LIRAP in the requesting county. The executive director and county shall enter into a grant contract for the implementation of the LIRAP.

(1) The grant contract must provide conditions, requirements, and projected funding allowances for the implementation of the LIRAP.

(2) A participating county may contract with an entity approved by the executive director for services necessary to implement the LIRAP. A participating county or its designated entity must demonstrate to the executive director that, at a minimum, the county or its designated entity has provided for appropriate measures for determining applicant eligibility and repair effectiveness and ensuring against fraud.

(3) The participating county shall remain the contracted entity even if the county contracts with another county or another entity approved by the executive director to administer the LIRAP.

(b) Repair and Retrofit Assistance. A LIRAP shall provide for monetary or other compensatory assistance to eligible vehicle owners for repairs directly related to bringing certain vehicles that have failed a required emissions test into compliance with emissions requirements or for installing retrofit equipment on vehicles that have failed a required emissions test, if practically and economically feasible, in lieu of or in combination with repairs performed to bring a vehicle into compliance with emissions requirements. Vehicles under the LIRAP must be repaired or retrofitted at a recognized emissions repair facility. To determine eligibility, the participating county or its designated entity shall make applications available for LIRAP participants. The application, at a minimum, must require the vehicle owner to demonstrate that:

(1) the vehicle has failed a vehicle emissions test within 30 days of application submittal;

(2) the vehicle can be started by keyed ignition and idle without the use of the accelerator pedal for at least ten continuous seconds, be driven in forward and reverse for a minimum of 25 feet each way, and be driven under its own power to the emissions inspection station or designated disposal facility;

(3) the vehicle is currently registered in and has been registered in the program county for the two years immediately preceding the application for assistance;

(4) the vehicle has passed the safety portion of the Texas Department of Public Safety (DPS) motor vehicle safety and emissions inspection as recorded in the Vehicle Inspection Report (VIR), or provide assurance that actions will be taken to bring the vehicle into compliance with safety requirements;

(5) the vehicle owner's net family income is at or below 200% of the federal poverty level; and

(6) any other requirements of the participating county or the executive director are met.

(c) Accelerated Vehicle Retirement. A LIRAP shall provide monetary or other compensatory assistance to eligible vehicle owners to be used toward the purchase of a replacement vehicle. To determine eligibility, the participating county or its designated entity shall make applications available for LIRAP participants. The application, at a minimum, must require the vehicle owner to demonstrate that:

(1) the vehicle meets the requirements under subsection (b)(1) - (3), and (5) of this section;

(2) the vehicle has passed a DPS motor vehicle safety or safety and emissions inspection within 15 months prior to application submittal; and

(3) any other requirements of the participating county or the executive director are met.

(d) Compensation. The participating county must determine eligibility and approve or deny the application promptly. If the requirements of subsection (b) or (c) of this section are met and based on available funding, the county shall authorize monetary or other compensations to the eligible vehicle owner.

(1) Compensations shall be:

(A) no more than $600 and no less than $50 per vehicle to be used for emission-related repairs or retrofits performed at recognized emissions repair facilities, including diagnostics tests performed on the vehicle; or

(B) no more than $1,000 and no less than $600 per vehicle, including diagnostics tests, to be used toward a replacement vehicle for the accelerated retirement of a vehicle meeting the requirements under this subsection.

(2) Vehicle owners shall be responsible for paying the first $50 of emission-related repairs or retrofit costs which may include diagnostics tests performed on the vehicle.

(3) For accelerated vehicle retirement, provided that the maximum and minimum levels in paragraph (1)(B) of this subsection are met and minimum eligibility requirements under subsection (c) of this section are met, a participating county may set a specific level of compensation or implement a level of compensation schedule that allows flexibility. The following criteria may be used for determining the amount of financial assistance:

(A) model year of the vehicle;

(B) miles registered on the vehicle's odometer;

(C) fair market value of the vehicle;

(D) estimated cost of emission-related repairs necessary to bring the vehicle into compliance with emission standards;

(E) amount of money the vehicle owner has already spent to bring the vehicle into compliance, excluding the cost of the vehicle emissions inspection; and

(F) vehicle owner's income.

(e) Reimbursement. A participating county must reimburse the appropriate recognized emissions repair facility or vehicle retirement entity for approved repairs, retrofits, or vehicle retirements within 30 calendar days of receiving an invoice that meets the requirements of the county or designated entity. Repaired or retrofitted vehicles must pass a DPS safety and emissions inspection before the recognized emissions repair facility is reimbursed.

§114.66.Disposition of Retired Vehicle.

Vehicles retired under a Low Income Vehicle Repair Assistance, Retrofit, and Accelerated Vehicle Retirement Program (LIRAP) may not be resold or reused in their entirety in this or another state. The vehicle must be:

(1) destroyed;

(2) recycled;

(3) dismantled and its parts sold as used parts or used in the LIRAP;

(4) placed in a storage facility and subsequently destroyed, recycled, or dismantled within 12 months of the vehicle retirement date and its parts sold or used in the LIRAP; or

(5) repaired, brought into compliance, and used as a replacement vehicle under this division. Not more than 10% of all vehicles eligible for retirement may be used as replacement vehicles.

§114.68.Emission Reduction Credits.

(a) Emission Reduction Credits Available Under a Low Income Vehicle Repair Assistance, Retrofit, and Accelerated Vehicle Retirement Program (LIRAP). A participating county may allow private, commercial, and business entities to provide monetary assistance towards the LIRAP. To the extent allowed under state and federal law, private, commercial, and business entities may purchase eligible vehicles under §114.64(c) of this title (relating to LIRAP Requirements) for accelerated retirement as approved by the participating county, and may have 100% of the emission reductions certified as emission credits. This emission reduction credit may be transferred or used by the holder in accordance with Chapter 101, Subchapter H, Division 1 or 4 of this title (relating to Emission Credit Banking and Trading; and Discrete Emission Credit Banking And Trading).

(b) Emission Reduction Credits Available for Vehicles Not Covered Under a LIRAP. To the extent allowed under state and federal law, a fleet vehicle, a government owned or leased vehicle, or a commercial vehicle may be retired and may have 100% of the emission reductions certified as emission credits.

(c) Other Requirements. Emission reduction credits under subsection (a) or (b) of this section must meet the requirements of Chapter 101, Subchapter H, Division 1 or 4 of this title.

§114.70.Records, Audits, and Enforcement.

(a) A participating county must submit quarterly audit reports to ensure that the funds provided to implement the Low Income Vehicle Repair Assistance, Retrofit, and Accelerated Vehicle Retirement Program (LIRAP) have been used in accordance with requirements of this division. The quarterly reports (September - November, December - February, March - May, June - August) must be transmitted to the executive director in paper copies or in an electronic database format to be determined by mutual agreement between the state and the participating county no later than 30 days after the end of the quarter.

(b) At a minimum, the quarterly reports must include the following:

(1) name of the county department or entity implementing the program and their mailing address;

(2) name of the official representative of the county department or entity;

(3) amount of funds received during the reporting period;

(4) amount distributed for repair assistance, retrofitting, accelerated retirement, and administrative costs;

(5) information regarding the recognized emissions repair facilities and vehicle retirement facilities participating in the LIRAP, including the number of approved assistance transactions, the amount of each transaction, and the total amounts paid to each facility;

(6) pending amount of funds that must be paid out;

(7) information for each vehicle participating in program, including:

(A) vehicle identification number (VIN);

(B) vehicle license plate number;

(C) name and business address of the Texas Department of Public Safety recognized emissions repair facility or vehicle retirement entity; and

(D) date of vehicle repair, retrofit, or retirement; and

(8) any other information requested by the executive director.

(c) Records on the LIRAP must be maintained for a minimum period of three years by a participating county, its designated entity, a participating recognized emissions repair facility, and a participating vehicle retirement facility. Such records must be available upon request by the executive director for auditing purposes.

(d) A participating county, its designated entity, a participating recognized emissions repair facility, and a participating vehicle retirement facility must allow the executive director to conduct audits and inspections.

(e) A person who, with intent to defraud, sells a vehicle in an accelerated vehicle retirement program under LIRAP commits an offense that is classified as a third degree felony.

§114.72.Local Advisory Panels.

(a) The commissioners court of a participating county may appoint one or more local advisory panels to provide advice on Low Income Vehicle Repair Assistance, Retrofit, and Accelerated Vehicle Retirement Program (LIRAP) and to assist in identifying vehicles with intrinsic value that make these vehicles existing or future collectibles. A vehicle identified under this section may be sold to an individual if the vehicle is:

(1) repaired and brought into compliance;

(2) removed from the state;

(3) removed from an affected county; or

(4) stored for future restoration and cannot be registered in an affected county except under Transportation Code, §502.274 or §502.275.

(b) A commissioners court may delegate all or part of the financial and administrative matters to any of the local advisory panels that it appoints.

(c) A local advisory panel may consist of representatives from:

(1) automobile dealerships;

(2) automotive repair industry;

(3) safety inspection facilities;

(4) the general public;

(5) antique and vintage car clubs;

(6) local nonprofit organizations; and

(7) locally affected governments.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on December 20, 2001.

TRD-200108178

Stephanie Bergeron

Director, Environmental Law Division

Texas Natural Resource Conservation Commission

Earliest possible date of adoption: February 3, 2002

For further information, please call: (512) 239-5017


Chapter 115. CONTROL OF AIR POLLUTION FROM VOLATILE ORGANIC COMPOUNDS

The Texas Natural Resource Conservation Commission (commission) proposes amendments to Subchapter A, Definitions, §115.10; Subchapter B, General Volatile Organic Compound Sources, §§115.113, 115.116, 115.117, 115.132, 115.133, 115.136, 115.137, 115.139, 115.140, 115.145, 115.147, 115.153, 115.159, 115.161, and 115.169; Subchapter C, Volatile Organic Compound Transfer Operations, §115.214; Subchapter D, Petroleum Refining, Natural Gas Processing, and Petrochemical Processes, §§115.311 - 115.313, 115.316, 115.319, 115.322, 115.325 - 115.327, 115.352, 115.353, 115.355 - 115.357, and 115.359; Subchapter E, Solvent-Using Process, §§115.420 - 115.422, 115.440, 115.442, 115.445, and 115.446; Subchapter F, Miscellaneous Industrial Sources, §§115.532, 115.533, 115.535, 115.539, 115.541 - 115.543, 115.545 - 115.547, 115.549, 115.552, and 115.559; and Subchapter J, Administrative Provisions, §§115.910 - 115.916, 115.920, 115.923, 115.930, 115.932, 115.934, and 115.940. These sections are proposed to be submitted to the United States Environmental Protection Agency (EPA) as revisions to the state implementation plan (SIP).

BACKGROUND AND SUMMARY OF THE FACTUAL BASIS FOR THE PROPOSED RULES

The commission proposes these amendments to Chapter 115, Control of Air Pollution from Volatile Organic Compounds (VOC), and revisions to the SIP in order to make a variety of changes which clarify and add flexibility to existing requirements, correct technical and typographical errors, update references to terms, and delete redundant language.

SECTION BY SECTION DISCUSSION

Throughout this rulemaking the outdated term "undesignated head" is proposed to be replaced with the proper term "division" in response to revised Texas Register rules published in the February 13, 1998, issue of the Texas Register (23 TexReg 1289). Also throughout the rulemaking, the term "Centigrade" is proposed to be replaced with the term "Celsius" which is now the term commonly used to describe this temperature scale. In a separate rulemaking published in the July 16, 1999, issue of the Texas Register (24 TexReg 5490), the commission added a definition of vapor control system to §115.10 which is identical to the definition of vapor recovery system. This will facilitate a transition in the Chapter 115 rules to this term from the misleading term "vapor recovery system," which is defined to include both recovery and combustion control devices. Consequently, the proposed amendments also change references from "vapor recovery system" to "vapor control system" for clarification. Justification for these changes will not be discussed any further in this discussion other than to point out where each change has been made.

Additionally, formatting, punctuation, and other nonsubstantive corrections are made throughout the rulemaking as necessary. These corrections include the deletion of unnecessary section title references. These nonsubstantive corrections will not be discussed further.

Subchapter A, Definitions

The proposed amendment to §115.10, Definitions, revises the definition of marine terminal to clarify that both loading and unloading can occur at a marine terminal. This change is necessary for consistency with §115.214(a)(3)(B)(i) and (C), Inspection Requirements, which applies to unloading of VOC at marine terminals.

Subchapter B, General Volatile Organic Compound Sources

Division 1, Storage of Volatile Organic Compounds

The proposed amendments to §115.113, Alternate Control Requirements, incorporate Aransas, Bexar, Calhoun, Gregg, Matagorda, Nueces, San Patricio, Travis, and Victoria Counties into subsection (a), now implied, and delete all of subsections (b) and (c) which currently contain the alternate control requirements for these nine counties. The proposed amendments to §115.113 also revise the term "section" (which should have been "undesignated head") to "division." Finally, the proposed amendments to §115.113 change "executive director" to lower-case for consistency with other divisions.

The proposed amendments to §115.116, Monitoring and Recordkeeping Requirements, abbreviate "EPA" because this term is defined in 30 TAC §3.2, Definitions, and delete the existing §115.116(a)(3)(D) and (b)(3)(D), which concern records associated with control device maintenance activities, because maintenance activities are already addressed in 30 TAC §101.7, Maintenance, Start-up and Shutdown Reporting, Recordkeeping, and Operational Requirements.

The proposed amendments to §115.117, Exemptions, revise the term "undesignated head" to "division," spell out "pounds per square inch absolute" (psia), and add an exemption for storage containers which have a storage capacity of no more than 1,000 gallons for consistency with Tables I(a), I(b), and II(a) in §115.112, Control Requirements.

Subchapter B, General Volatile Organic Compound Sources

Division 3, Water Separation

The proposed amendments to §115.132, Control Requirements, update the old term "standard exemption" with the correct term "permit by rule" and correct the reference to the Chapter 106 title to "Permits by Rule."

The proposed amendments to §115.133, Alternate Control Requirements, incorporate Aransas, Bexar, Calhoun, Gregg, Matagorda, Nueces, San Patricio, Travis, and Victoria Counties into subsection (a), now implied, and delete all of subsections (b) and (c), which currently contain the alternate control requirements for these nine counties. The proposed amendments to §115.133 also revise the term "section" (which should have been "undesignated head") to "division." Finally, the proposed amendments to §115.133 change "executive director" to lower-case for consistency with other divisions.

The proposed amendments to §115.136, Monitoring and Recordkeeping Requirements, abbreviate "EPA" because this term is defined in §3.2, and delete the existing §115.136(a)(2)(D) and (b)(2)(D), which concern records associated with control device maintenance activities, because maintenance activities are already addressed in §101.7.

The proposed amendments to §115.137, Exemptions, revise the term "undesignated head" to "division," spell out "pounds per square inch absolute," and change a reference from "vapor recovery system" to "vapor control system."

The proposed amendment to §115.139, Counties and Compliance Schedule, revises the term "undesignated head" to "division."

Subchapter B, General Volatile Organic Compound Sources

Division 4, Industrial Wastewater

The proposed amendment to §115.140, Industrial Wastewater Definitions, replaces "Texas Natural Resource Conservation Commission" with "commission" for consistency with the commission's style guidelines.

The proposed amendments to §115.145, Approved Test Methods, correct a punctuation error and delete unnecessary section title references.

The proposed amendments to §115.147, Exemptions, correct the term "portion" to "division" and correct the formatting of the numerical number "10" to the term "ten." The proposed amendments to §115.147 also clarify the applicability of the exemption available under §115.147(3) by changing the reference to "the requirements of this division" to "the control requirements of §115.142." This exemption was initially added to ensure that duplication of control requirements did not occur. However, the exemption was not added to make the rule less stringent than control requirements that were already in place (i.e., the VOC/water separator rules). The proposed amendments clarify this intent.

Subchapter B, General Volatile Organic Compound Sources

Division 5, Municipal Solid Waste Landfills

The proposed amendment to §115.153, Alternate Control Methods, revises the term "undesignated head" to "division."

The proposed amendments to §115.159, Counties and Compliance Schedule, revise the term "undesignated head" to "division" and revise the phrase "be in compliance" to "demonstrate compliance" to emphasize the testing, monitoring and recordkeeping, and determination of mass emissions and flow rates.

Subchapter B, General Volatile Organic Compound Sources

Division 6, Batch Processes

The proposed amendment to §115.161, Applicability, adds a reference to §115.167(2)(A). This revision is necessary to ensure that vent gas streams which are currently subject to the requirements of Subchapter B, General Volatile Organic Compound Sources, Division 2, Vent Gas Control, remain controlled under that division if they are not required to be controlled under §115.162, Control Requirements, because they qualify for the exemption under §115.167(2)(A).

The proposed amendment to §115.169, Counties and Compliance Schedule, revises the phrase "be in compliance" to "demonstrate compliance" to emphasize the testing, monitoring and recordkeeping, and determination of mass emissions and flow rates.

Subchapter C, Volatile Organic Compound Transfer Operations

Division 1, Loading and Unloading of Volatile Organic Compounds

The proposed amendments to §115.214, Inspection Requirements, add the phrase "to or from transport vessels" to the catchlines in subsections (a)(1) and (b)(1) to more accurately describe the requirements of these paragraphs. The proposed amendments to §115.214 also correct a typographical error in §115.214(b)(1)(D)(ii) by changing a reference from §115.213(b) to §115.213(c).

Subchapter D, Petroleum Refining, Natural Gas Processing, and Petrochemical Processes

Division 1, Process Unit Turnaround and Vacuum-Producing Systems in Petroleum Refineries

The proposed amendments to §115.311, Emission Specifications, correct a typographical error in §115.311(a)(1) and (2) by changing references from §115.312(a) to §115.312(a)(2).

The proposed amendments to §115.312, Control Requirements, change "Centigrade" to "Celsius" in §115.312(a)(2)(A) and (b)(2)(A), and change "vapor recovery system" to "vapor control system" in §115.312(a)(2)(C) and (b)(2)(C). In addition, the proposed amendments to §115.312 replace the phrase "volatile organic compound (VOC)" with the acronym "VOC" because this acronym was previously established within the section.

The proposed amendments to §115.313, Alternate Control Requirements, incorporate Gregg, Nueces, and Victoria Counties into subsection (a), now implied, and delete all of subsection (b), which currently contains the alternate control requirements for these three counties. The proposed amendments to §115.313 also revise the term "undesignated head" to "division."

The proposed amendments to §115.316, Monitoring and Recordkeeping Requirements, delete the existing §115.316(a)(1)(D) and (b)(1)(D), which concern records associated with control device maintenance activities, because maintenance activities are already addressed in §101.7. The proposed amendments to §115.316 also update references from the "Texas Air Control Board" and "TACB" (one of the commission's predecessor agencies) to "executive director" for consistency with the commission's style guidelines and abbreviate "EPA" because this term is defined in §3.2, Definitions.

The proposed amendment to §115.319, Counties and Compliance Schedules, revises the term "undesignated head" to "division."

Subchapter D, Petroleum Refining, Natural Gas Processing, and Petrochemical Processes Division 2, Fugitive Emission Control in Petroleum Refineries in Gregg, Nueces, and Victoria Counties

The proposed amendments to §115.322, Control Requirements, revise the phrase "safety pressure relief valves" in §115.322(4) to "pressure relief valves" for consistency with other sections in Chapter 115. The proposed amendments to §115.322 also revise §115.322(5), which requires that pipeline valves and pressure relief valves in gaseous VOC service be marked in some manner that will be readily obvious to monitoring personnel, by adding an option that the owner or operator may choose to monitor all components in liquid service on the schedule for components in gaseous service specified in §115.324(2), Inspection Requirements. This proposed option would result in more frequent monitoring of components in liquid service, but would add flexibility for owners or operators to be able to choose which option would be most efficient and effective for their refinery.

The proposed amendments to §115.325, Testing Requirements, change "Centigrade" to "Celsius" and spell out "American Petroleum Institute."

The proposed amendments to §115.326, Recordkeeping Requirements, spell out and acronym "parts per million by volume (ppmv)" and revise the recordkeeping requirements for consistency with the fugitive emissions monitoring program required by §115.324. Specifically, the amendments add requirements for keeping records of the date the component was monitored, the results of the monitoring (in ppmv), the test method used (Test Method 21, or sight/sound/smell), and the date on which a first attempt at repair was made to a leaking component.

The proposed amendments to §115.327, Exemptions, revise the term "these sections" (which should have been "this undesignated head") to "division" and spell out and acronym "pounds per square inch absolute (psia)" and "centimeters (cm)." The proposed amendments to §115.327 also correct the formatting of the numerical number "5" to the word "five."

Subchapter D, Petroleum Refining, Natural Gas Processing, and Petrochemical Processes

Division 3, Fugitive Emission Control in Petroleum Refining, Natural Gas/Gasoline Processing, and Petrochemical Processes in Ozone Nonattainment Areas

The proposed amendment to §115.352, Control Requirements, revises the phrase "safety pressure relief valves" in §115.322(4) to "pressure relief valves" for consistency with other sections in Chapter 115.

The proposed amendment to §115.353, Alternate Control Requirements, revises the term "undesignated head" to "division."

The proposed amendments to §115.355, Testing Requirements, revise the term "undesignated head" to "division," correct the title of the division, and spell out and acronym "American Petroleum Institute (API)." The proposed amendments to §115.355 also specify that the calibration for Test Method 21 is at 500 ppmv rather than at 10,000 ppmv because the leak definition in §115.352(1)(a) is a VOC concentration of 500 ppmv.

The proposed amendments to §115.356, Recordkeeping Requirements, revise the recordkeeping requirements for consistency with the fugitive emissions monitoring program required by §115.354 by adding a requirement for keeping records of the date on which a first attempt at repair was made to a leaking component. The proposed amendments to §115.356 also abbreviate "EPA" because this term is defined in §3.2.

The proposed amendments to §115.357, Exemptions, revise the term "undesignated head" to "division" in §115.357(2) and (6) - (8) and add the title of the division to §115.357(2). In addition, the proposed amendments to §115.357 spell out and acronym "volatile organic compound (VOC)" and "parts per million by volume (ppmv)" and acronym the term "pounds per square inch absolute" as "psia."

The proposed amendments to §115.359, Counties and Compliance Schedules, add a reference to the division in place of a reference to the sections in the division for brevity and clarity, and replace language which is obsolete due to the passing of a November 15, 1996 compliance date with new language stating that all affected persons in Brazoria, Chambers, Collin, Dallas, Denton, El Paso, Fort Bend, Galveston, Hardin, Harris, Jefferson, Liberty, Montgomery, Orange, Tarrant, and Waller Counties shall continue to comply with this division (relating to Fugitive Emission Control in Petroleum Refining, Natural Gas/Gasoline Processing, and Petrochemical Processes in Ozone Nonattainment Areas) as required by §115.930 (relating to Compliance Dates).

Subchapter E, Solvent-Using Process

Division 2, Surface Coating Processes

The proposed amendments to Subchapter E include revising the subchapter title from "Solvent- Using Process" to "Solvent-Using Processes" in order to more accurately describe the contents of this subchapter.

The proposed amendments to §115.420, Surface Coating Definitions, add a definition of "hydrocarbon-based cleaning solvent" to §115.420(b)(1) which is consistent with the requirements for hydrocarbon-based cleaning solvents specified in Table 1 - Composition Requirements for Approved Cleaning Solvents of 40 Code of Federal Regulations (CFR) §63.744, Standards: Cleaning operations. The EPA's Control of Volatile Organic Compound Emissions from Coating Operations at Aerospace Manufacturing and Rework Operations (aerospace Control Techniques Guideline (CTG)) was the basis for the adoption of the aerospace coating requirements which were added to the Surface Coating Processes Division effective July 20, 2000, as published in the July 14, 2000 issue of the Texas Register (25 TexReg 6752). The July 2000 adopted rule language was based on rule language provided in the Aerospace Manufacturing and Rework Operations Model Rule, found in Appendix B of the aerospace CTG. In the aerospace CTG's model rule, however, hydrocarbon-based cleaning solvents specified in Table 1 of 40 CFR §63.744 were inadvertently not exempted from the housekeeping measures, thereby creating an inconsistency between the Chapter 115 aerospace rules and 40 CFR §63.744.

The proposed amendments to §115.420(b)(1) also renumber subsequent definitions to accommodate the new definition of "hydrocarbon-based cleaning solvent," correct the abbreviation for "basecoat/clearcoat" in §115.420(b)(12)(B)(i), and correct the variable "i" to "e" in the first summation sign in the denominator of the definition of "VOC composite vapor pressure" in the renumbered §115.420(b)(1)(EEEE).

The proposed amendments to §115.421, Emission Specifications, revise §115.421(a)(11) to clarify that the exemption for separate coating formulations in volumes less than 50 gallons per year to a maximum of 200 gallons per year for all such formulations applies to the total usage of these coatings at the account. The amendments also clarify that the term "formulations" refers to coating formulations and clarify that the term "antique aerospace" refers to antique aerospace vehicles.

The proposed amendment to §115.422, Control Requirements, adds "hydrocarbon-based cleaning solvents" to the list of cleaning solvents that are exempt from the housekeeping measures for the reasons explained in the discussion of §115.420.

Subchapter E, Solvent-Using Process

Division 4, Offset Lithographic Printing

The proposed amendment to §115.440, Offset Printing Definitions, adds a new §115.440(10) to define "VOC composite partial pressure," which is necessary due to the proposed new §115.442(1)(F)(iii).

The proposed amendments to §115.442, Control Requirements, add a new §115.442(1)(F)(iii) to give an additional option for meeting VOC reduction requirements by using cleaning solutions with a VOC composite partial vapor pressure less than or equal to ten millimeters of mercury (mm Hg) at 20 degrees Celsius (68 degrees Fahrenheit). This proposed revision is needed to provide additional flexibility in this rule to encourage the use of low vapor pressure cleaning solutions which have lower VOC emissions than conventional cleaning solutions. The proposed amendments also spell out and acronym "parts per million by volume (ppmv)" in §115.442(2).

The proposed amendments to §115.445, Approved Test Methods, abbreviate "EPA" in §115.445(5) because this term is defined in §3.2, and add a needed section symbol for a federal regulation citation along with the effective date of October 18, 1983 for the federal regulations.

The proposed amendments to §115.446, Monitoring and Recordkeeping Requirements, revise the temperature monitoring device accuracy requirement in §115.446(1) to include an option that the accuracy be ±1.0% of the temperature being monitored. The proposed amendments to §115.446 also revise §115.446(5) to add an option for the monitoring and recording of temperature readings with respect to fountain solutions. These proposed revisions are needed to provide additional flexibility in the rule for consistency with the offset printing CTG and other federal guidance. In addition, the proposed amendments to §115.446 change a reference from "§115.442(1)(A) - (D)" to "§115.442(1)(A), (C), or (D)" because §115.442(1)(B) does not include fountain solution refrigeration as an option.

Subchapter F, Miscellaneous Industrial Sources

Division 2, Pharmaceutical Manufacturing Facilities

The proposed amendments to §115.532, Control Requirements, update the old term "standard exemption" with the correct term "permit by rule" and correct the reference to the title of Chapter 106 to "Permits by Rule."

The proposed amendments to §115.533, Alternate Control Requirements, incorporate Gregg, Nueces, and Victoria Counties into subsection (a), now implied, and delete all of subsection (b) which currently contains the alternate control requirements for these three counties. The proposed amendments to §115.533 also revise the term "undesignated head" to "division."

The proposed amendments to §115.535, Testing Requirements, revise the term "undesignated head" to "division."

The proposed amendment to §115.539, Counties and Compliance Schedules, revises the term "undesignated head" to "division."

Subchapter F, Miscellaneous Industrial Sources

Division 3, Degassing or Cleaning of Stationary, Marine, and Transport Vessels

The proposed amendments to §115.541, Emission Specifications, update references in §115.541(b) and (b)(5) to the definition of "marine vessel," which was previously relocated from §115.10 to §101.1.

The proposed amendment to §115.542, Control Requirements, corrects a reference in §115.542(b)(4) to reflect the common usage of the term "lower explosive limit (LEL)."

The proposed amendments to §115.543, Alternate Control Requirements, revise the term "undesignated head" to "division," and change "executive director" to lower-case for consistency with other divisions.

The proposed amendments to §115.545, Approved Test Methods, reference an additional vapor-tightness test available under 40 CFR §63.565(c). The inclusion of this second test method for determining marine vessel vapor tightness will provide additional flexibility. The proposed amendments also add effective dates for the federal regulations cited.

The proposed amendments to §115.546, Monitoring and Recordkeeping Requirements, update a reference from the "Texas Natural Resource Conservation Commission" to "executive director" for consistency with the commission's style guidelines and abbreviate "EPA" because this term is defined in §3.2. The proposed amendments to §115.546 also delete the existing §115.546(2)(D), which concerns records associated with control device maintenance activities, because maintenance activities are already addressed in §101.7 and add an effective date for the federal regulation cited.

The proposed amendments to §115.547, Exemptions, revise the term "undesignated head" to "division" in §115.547(1), (2), and (5), add the division title to the first reference to the division, add language necessary to complete the sentence in paragraph (3), and revise paragraph (4) by correcting a reference from §115.541(3) to §115.541(b).

The proposed amendments to §115.549, Counties and Compliance Schedules, delete an incorrect reference to "El Paso" in §115.549(a), revise the term "undesignated head" to "division," and revise references to "Texas Natural Resource Conservation Commission" or "TNRCC" to "commission" for consistency with the commission's style guidelines. The proposed amendments to §115.549 also replace language in §115.549(a) which is obsolete due to the passing of a November 15, 1996 compliance date with new language stating that all affected persons in Brazoria, Chambers, Fort Bend, Galveston, Hardin, Harris, Jefferson, Liberty, Montgomery, Orange, and Waller Counties shall continue to comply with this division (relating to Degassing or Cleaning of Stationary, Marine, and Transport Vessels) as required by §115.930 (relating to Compliance Dates).

Subchapter F, Miscellaneous Industrial Sources

Division 4, Petroleum Dry Cleaning Systems

The proposed amendments to §115.552, Control Requirements, update the old term "standard exemption" with the correct term "permit by rule" and correct the reference to the title of Chapter 106 to "Permits by Rule." In addition, the proposed amendments to §115.552 correct the phrase "concerning" in §115.552(b)(1) to the phrase "relating to" for consistency with other divisions.

The proposed amendments to §115.559, Counties and Compliance Schedules, revise a reference from "Texas Natural Resource Conservation Commission" to "commission" for consistency with the commission's style guidelines, add a reference to the division in place of a reference to the sections in the division for brevity and clarity, and change "National Ambient Air Quality Standard" to lower-case for consistency with other divisions.

Subchapter J, Administrative Provisions

Division 1, Alternate Means of Control

The proposed amendments to §115.910, Availability of Alternate Means of Control, revise the term "undesignated head" to "division" and reference the division title, abbreviate "EPA" because this term is defined in §3.2, and correct references to titles of sections in Division 1.

The proposed amendments to §115.911, Criteria for Approval of Alternate Means of Control, delete an unnecessary reference to "Texas Natural Resource Conservation Commission" in §115.910(1), correct the formatting of section references in §115.910(6), delete unnecessary references to the title of Chapter 115 in §115.910(4) and (6), and revise references from "TNRCC" to "commission" in §115.910(10) for consistency with the commission's style guidelines.

The proposed amendments to §115.912, Calculations for Determining AMOC Reductions, revise the title of this section to "Calculations for Determining Alternate Means of Control Reductions" for consistency with the other section titles in Division 1. The proposed amendments to §115.912 also spell out and acronym "alternate means of control (AMOC)" in §115.912(a)(1), abbreviate this term in §115.912(b), and revise §115.912(c) by correcting a reference to the title of §115.911.

The proposed amendments to §115.913, Procedures for Alternate Means of Control Plan Submittal, abbreviate "EPA" because this term is defined in §3.2, and delete unnecessary references to "Texas Natural Resource Conservation Commission" or "TNRCC" in §115.913(a) and (b)(1) and (9).

The proposed amendments to §115.914, Procedures for Alternate Means of Control Plan Approval, abbreviate "EPA" because this term is defined in §3.2, revise references from "TNRCC" to "commission" in §115.914(8) for consistency with the commission's style guidelines, and delete unnecessary references to "Texas Natural Resource Conservation Commission" or "TNRCC."

The proposed amendments to §115.915, Public Notice Format, delete unnecessary references to "Texas Natural Resource Conservation Commission" or "TNRCC" in §115.915(a), (b) (7) and (11), and (c). The proposed amendments to §115.915 also abbreviate "EPA" in §115.915(b)(7) because this term is defined in §3.2, and revise references from "TNRCC" to "executive director" in §115.915(b)(1) and (c) for consistency with the commission's style guidelines.

The proposed amendments to §115.916, Review of Approved Alternate Means of Control Plans and Termination of Alternate Means of Control Plans, revise the term "undesignated head" to "division," add the division title to the first reference to the division, and revise a reference from "TNRCC" to "executive director" in §115.916(d) for consistency with the commission's style guidelines. The proposed amendments to §115.916 also add EPA and any local air pollution control agency having jurisdiction as entities to which a copy of an approved AMOC plan must be provided upon request. This is consistent with the underlying recordkeeping requirements of Chapter 115.

Subchapter J, Administrative Provisions

Division 2, Early Reductions

The proposed amendments to §115.920, Applicability, revise a reference from "Texas Natural Resource Conservation Commission (TNRCC)" to "executive director" for consistency with the commission's style guidelines, correct a referenced section title in §115.920(3), and spell out "Code of Federal Regulations."

The proposed amendments to §115.923, Documentation, revise the term "undesignated head" to "division" and reference the division title, delete an unnecessary reference to "TNRCC" in §115.923(b) for consistency with the commission's style guidelines.

Subchapter J, Administrative Provisions

Division 3, Compliance and Control Plan Requirements

The proposed amendments to §115.930, Compliance Dates, revise the term "undesignated head" to "division" for consistency with the commission's style guidelines.

The proposed amendments to §115.932, Control Plan Procedure, revise a reference from "Texas Natural Resource Conservation Commission (TNRCC)" to "executive director" for consistency with the commission's style guidelines, delete an unnecessary reference to the title of Chapter 115, and correct the term "regulation" to "chapter."

The proposed amendments to §115.934, Control Plan Deviation, update references from the "Texas Air Control Board" and "TACB" (one of the commission's predecessor agencies) to "executive director" for consistency with the commission's style guidelines, correct the term "regulation" to "chapter," and abbreviate "EPA" because this term is defined in §3.2.

The proposed amendment to §115.940, Equivalency Determination, abbreviates "EPA" because this term is defined in §3.2.

FISCAL NOTE: COSTS TO STATE AND LOCAL GOVERNMENT

Jeffrey Horvath, Analyst with Strategic Planning and Appropriations, determined that for each year of the first five-year period the proposed rules are in effect, there will be no fiscal implications to units of state or local government as a result of implementation of the proposed rules.

The proposed amendments to the commission's VOC rules are intended to clarify and add flexibility to existing requirements, correct technical and typographical errors, update references to terms, and delete redundant language. These proposed rules are an agency initiative to implement regulatory reform so that the rules are free of technical and typographical errors and are more clear and easy to read.

The proposed rulemaking would also revise recordkeeping requirements relating to the fugitive emissions monitoring program for petroleum refineries in Gregg, Nueces, and Victoria Counties. The proposed rules would add requirements for keeping records of the date a leaking component was monitored, the results of the monitoring, the test method used, and the date on which a first attempt at repair was made to a leaking component.

The proposed recordkeeping requirements will also require owners and operators of petroleum refineries; synthetic organic chemical, polymer, resin, or methyl tert-butyl ether manufacturing processes; and natural gas/gasoline processing operations in Brazoria, Chambers, Collin, El Paso, Dallas, Denton, Fort Bend, Galveston, Hardin, Harris, Jefferson, Liberty, Montgomery, Orange, Tarrant, and Waller Counties to keep records to document compliance with the fugitive emissions monitoring program. Specifically, the proposed rules add requirements for keeping records of the date on which a first attempt at repair was made to a leaking component. The new recordkeeping requirements are needed so that staff can determine compliance with existing inspection requirements.

The proposed rules also correct an inconsistency between current Chapter 115 rules for aerospace coating and federal rules, and provide flexibility in the offset printing rules by providing an additional option for the use of certain cleaning solutions.

Staff estimates that approximately 140 privately-owned and operated facilities in Brazoria, Chambers, Collin, El Paso, Dallas, Denton, Fort Bend, Galveston, Hardin, Harris, Jefferson, Liberty, Montgomery, Orange, Tarrant, and Waller Counties and six privately-owned and operated facilities in Gregg, Nueces, and Victoria Counties would be required to maintain compliance records due to implementation of the proposed rules. The commission estimates that there will be no fiscal implications to units of state and local government due to implementation of the recordkeeping requirements of this proposal because none of the petroleum refineries; synthetic organic chemical, polymer, resin, or methyl tert-butyl ether manufacturing processes; and natural gas/gasoline processing operations which are required to keep records to document compliance with the Chapter 115 fugitive monitoring programs are owned or operated by units of state and local government. No fiscal implications are anticipated for the agency due to the implementation of the proposed rules as the requirements would be incorporated into existing inspection requirements. The remaining provisions are procedural in nature and are not expected to result in additional fiscal implications for units of state and local government.

PUBLIC BENEFITS AND COSTS

Mr. Horvath also determined that for each year of the first five years the proposed rules are in effect, the public benefit anticipated from enforcement of and compliance with the proposed rules would be increased compliance with air emission standards due to rules that are more clear and understandable and more extensive record retention requirements.

The proposed recordkeeping requirements will require owners and operators of petroleum refineries in Gregg, Nueces, and Victoria Counties to keep records to document compliance with the fugitive emissions monitoring program. Specifically, the proposed rules add requirements for keeping records of the date the component was monitored, the results of the monitoring (in ppmv), the test method used (Test Method 21, or sight/sound/smell), and the date on which a first attempt at repair was made to a leaking component.

The commission estimates that approximately six privately-owned and operated facilities would be required to maintain compliance records due to implementation of the proposed rules. Based on information from the commission's regional inspectors, most, if not all, of the affected facilities already comply with the proposed recordkeeping requirements in order to comply with similar recordkeeping requirements of a federal fugitive monitoring program under federal rules. In the event that a facility does not already comply with the proposed recordkeeping requirements, the cost for a facility to comply with the recordkeeping requirements of this proposal is estimated not to exceed $500 a year. Included in the compliance cost is the purchase of filing space and administrative supplies, printing of records, and the initial training of persons responsible for maintaining the records.

In the event that none of the facilities already comply with the proposed recordkeeping requirements, the total costs to privately owned and operated businesses in Gregg, Nueces, and Victoria Counties to comply with this proposal are estimated not to exceed approximately $3,000 a year.

The proposed recordkeeping requirements will also require owners and operators of petroleum refineries; synthetic organic chemical, polymer, resin, or methyl tert-butyl ether manufacturing processes; and natural gas/gasoline processing operations in Brazoria, Chambers, Collin, El Paso, Dallas, Denton, Fort Bend, Galveston, Hardin, Harris, Jefferson, Liberty, Montgomery, Orange, Tarrant, and Waller Counties to keep records to document compliance with the fugitive emissions monitoring program. Specifically, the amendments add requirements for keeping records of the date on which a first attempt at repair was made to a leaking component.

The commission estimates that approximately 140 privately-owned and operated facilities in Brazoria, Chambers, Collin, El Paso, Dallas, Denton, Fort Bend, Galveston, Hardin, Harris, Jefferson, Liberty, Montgomery, Orange, Tarrant, and Waller Counties would be required to maintain compliance records due to implementation of the proposed rules. Based on information from the commission's regional inspectors, most, if not all, of the affected facilities already comply with the proposed recordkeeping requirements in order to comply with similar recordkeeping requirements of federal fugitive monitoring programs under federal rules. In the event that a facility does not already comply with the proposed recordkeeping requirements, the cost for a facility to comply with the recordkeeping requirements of this proposal is estimated not to exceed $500 a year. Included in the compliance cost is the purchase of filing space and administrative supplies, printing of records, and the initial training of persons responsible for maintaining the records.

In the event that none of the facilities already comply with the proposed recordkeeping requirements, the total costs to all privately owned and operated businesses in Brazoria, Chambers, Collin, El Paso, Dallas, Denton, Fort Bend, Galveston, Hardin, Harris, Jefferson, Liberty, Montgomery, Orange, Tarrant, and Waller Counties to comply with this proposal are estimated not to exceed approximately $70,000 a year.

The proposed rules also clarify and add flexibility to existing requirements, correct technical and typographical errors, update references to terms, and delete redundant language. These proposed rules are an agency initiative to implement regulatory reform so that the rules are free of technical and typographical errors and are more clear and easy to read.

The proposed rules also correct an inconsistency between current Chapter 115 rules for aerospace coating and federal rules, and provide flexibility in the offset printing rules by providing an additional option for the use of certain cleaning solutions.

Any fiscal implications resulting from the implementation of the proposed recordkeeping amendments are not considered significant. The remaining provisions are procedural in nature and are not expected to result in additional fiscal implications for any individual or owners and operators of privately-owned and operated facilities.

SMALL BUSINESS AND MICRO-BUSINESS ASSESSMENT

No adverse fiscal implications are anticipated for small or micro-businesses as a result of implementation of the proposed rules because none of the petroleum refineries; synthetic organic chemical, polymer, resin, or methyl tert-butyl ether manufacturing processes; and natural gas/gasoline processing operations which are required to keep records to document compliance with the fugitive monitoring programs are small or micro-businesses.

LOCAL EMPLOYMENT IMPACT STATEMENT

The commission has review this proposed rulemaking and determined that a Local Employment Impact Statement is not required because the proposed rules do not adversely affect a local economy in a material way for the first five years that the proposed rules are in effect.

DRAFT REGULATORY IMPACT ANALYSIS DETERMINATION

The commission reviewed the proposed rulemaking in light of the regulatory analysis requirements of Texas Government Code, §2001.0225, and determined that this proposal is not subject to §2001.0025 because it does not meet the definition of a "major environmental rule" as defined in that statute. "Major environmental rule" means a rule the specific intent of which is to protect the environment or reduce risks to human health from environmental exposure and that may adversely affect in a material way the economy, productivity, competition, jobs, the environment, or the public health and safety of the state or a sector of the state.

This proposal is not a major environmental rule because its primary purpose is to clarify procedural and technical requirements for facilities subject to Chapter 115 rules. Specifically, the proposed rules clarify and add flexibility to existing requirements, correct technical and typographical errors, update references to terms, delete redundant language, and ensure adequate recordkeeping to document compliance with the Chapter 115 fugitive monitoring programs. Also, as determined in the preceding fiscal note, the fiscal impacts associated with this proposal are not anticipated to be significant.

In addition, a draft regulatory impact analysis is not required because the rules do not meet any of the four applicability criteria for requiring a regulatory analysis of a "major environmental rule" as defined in the Texas Government Code. Section 2001.0225 applies only to a major environmental rule the result of which is to: 1) exceed a standard set by federal law, unless the rule is specifically required by state law; 2) exceed an express requirement of state law, unless the rule is specifically required by federal law; 3) exceed a requirement of a delegation agreement or contract between the state and an agency or representative of the federal government to implement a state and federal program; or 4) adopt a rule solely under the general powers of the agency instead of under a specific state law. This proposal does not exceed a standard set by federal law, and the proposed technical requirements are consistent with applicable federal standards. In addition, this proposal does not exceed an express requirement of state law and is not proposed solely under the general powers of the agency, but is specifically authorized by the provisions cited in the STATUTORY AUTHORITY section of this preamble. Finally, this proposal does not exceed a requirement of a delegation agreement or contract to implement a state and federal program. The commission invites public comment on the draft regulatory impact analysis determination.

TAKINGS IMPACT ASSESSMENT

The commission evaluated this rulemaking action and performed an analysis of whether the proposed rules are subject to Texas Government Code, Chapter 2007. The following is a summary of that analysis. The primary purpose of the rulemaking is to revise specific rules in Chapter 115 to clarify and add flexibility to existing requirements, correct errors, update references, and delete redundant and obsolete language. Promulgation and enforcement of these proposed rules would be neither a statutory nor a constitutional taking because they do not affect private real property. Specifically, the proposed rules do not affect a landowner's rights in private real property because this proposal does not burden (constitutionally), nor restrict or limit the owner's right to property and reduce its value by 25% or more beyond that which would otherwise exist in the absence of the rules. Therefore, these rules will not constitute a takings under the Texas Government Code, Chapter 2007.

CONSISTENCY WITH THE COASTAL MANAGEMENT PROGRAM

The commission reviewed the proposed rulemaking and found that the proposal is a rulemaking identified in Coastal Coordination Act Implementation Rules, 31 TAC §505.11, or will affect an action/authorization identified in Coastal Coordination Act Implementation Rules, 31 TAC §505.11, and therefore will require that applicable goals and policies of the Coastal Management Program be considered during the rulemaking process.

The commission prepared a preliminary consistency determination for the proposed rules pursuant to 31 TAC §505.22 and found the proposed rulemaking is consistent with the applicable CMP goals and policies. The CMP goal applicable to this rulemaking action is the goal to protect, preserve, and enhance the diversity, quality, quantity, functions, and values of coastal natural resource areas (31 TAC §501.12(1)). No new sources of air contaminants will be authorized. The CMP policy applicable to this rulemaking action is the policy that commission rules comply with regulations in 40 CFR, to protect and enhance air quality in the coastal area (31 TAC §501.14(q)). This rulemaking action complies with 40 CFR. Therefore, in compliance with 31 TAC §505.22(e), this rulemaking action is consistent with CMP goals and policies. Interested persons may submit comments on the consistency of the proposed rules with the CMP during the public comment period.

EFFECT ON SITES SUBJECT TO THE FEDERAL OPERATING PERMIT PROGRAM

Chapter 115 is an applicable requirement under 30 TAC Chapter 122; therefore, owners or operators subject to the Federal Operating Permit Program must, consistent with the revision process in Chapter 122, revise their operating permit to include the revised Chapter 115 requirements for each emission unit affected by the revisions to Chapter 115 at their site.

ANNOUNCEMENT OF HEARING

A public hearing on this proposal will be held in Austin on January 23, 2002 at 2:00 p.m. at the Texas Natural Resource Conservation Commission complex in Building F, Room 3202A, located at 12100 Park 35 Circle. The hearing will be structured for the receipt of oral or written comments by interested persons. Individuals may present oral statements when called upon in order of registration. There will be no open discussion during the hearing; however, an agency staff member will be available to discuss the proposal 30 minutes prior to the hearing and will answer questions before and after the hearing.

Persons with disabilities who have special communication or other accommodation needs who are planning to attend the hearing should contact the Office of Environmental Policy, Analysis, and Assessment at (512) 239-4900. Requests should be made as far in advance as possible.

SUBMITTAL OF COMMENTS

Comments may be submitted to Angela Slupe, MC 205, Office of Environmental Policy, Analysis, and Assessment, Texas Natural Resource Conservation Commission, P.O. Box 13087, Austin, Texas 78711-3087, or faxed to (512) 239-4808. All comments should reference Rule Log Number 2002-037-115-AI. Comments must be received by 5:00 p.m., January 23, 2002. For further information, please contact Eddie Mack of the Policy and Regulations Division at (512) 239-1488.

Subchapter A. DEFINITIONS

30 TAC §115.10

STATUTORY AUTHORITY

The amendment is proposed under Texas Water Code (TWC), §5.103, which authorizes the commission to adopt rules necessary to carry out its powers and duties under TWC; Texas Health and Safety Code, Texas Clean Air Act (TCAA), §382.017, which provides the commission authority to adopt rules consistent with the policy and purposes of TCAA; §382.002, which establishes the commission's purpose to safeguard the state's air resources, consistent with the protection of public health, general welfare, and physical property; §382.011, which authorizes the commission to control the quality of the state's air; §382.012, which authorizes the commission to develop plans to protect the state's air; and §382.016, which authorizes the commission to require that records of the air contaminant emissions from a source or activity be made and maintained.

The proposed amendment implements TCAA, §382.011, relating to General Powers and Duties; §382.012, relating to State Air Control Plan; §382.017, relating to Rules; and TWC, §5.103, relating to Rules.

§115.10.Definitions.

Unless specifically defined in the Texas Clean Air Act (TCAA) or in the rules of the commission [ Texas Natural Resource Conservation Commission (commission) ], the terms used by the commission have the meanings commonly ascribed to them in the field of air pollution control. In addition to the terms which are defined by the TCAA, the following terms, when used in this chapter, shall have the following meanings, unless the context clearly indicates otherwise. Additional definitions for terms used in this chapter are found in §101.1 [ of this title (relating to Definitions) ] and §3.2 of this title (relating to Definitions).

(1) - (19) (No change.)

(20) Marine terminal - Any marine facility or structure constructed to transfer [ load ] oil, gasoline, or other volatile organic liquid bulk cargo to or from [ into ] a marine vessel. A marine terminal may include [ consists of ] one or more marine loading facilities.

(21) - (32) (No change.)

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on December 20, 2001.

TRD-200108144

Stephanie Bergeron

Director, Environmental Law Division

Texas Natural Resource Conservation Commission

Earliest possible date of adoption: February 3, 2002

For further information, please call: (512) 239-4712


Subchapter B. GENERAL VOLATILE ORGANIC COMPOUND SOURCES

1. STORAGE OF VOLATILE ORGANIC COMPOUNDS

30 TAC §§115.113, 115.116, 115.117

STATUTORY AUTHORITY

The amendments are proposed under TWC, §5.103, which authorizes the commission to adopt rules necessary to carry out its powers and duties under TWC; Texas Health and Safety Code, TCAA, §382.017, which provides the commission authority to adopt rules consistent with the policy and purposes of TCAA; §382.002, which establishes the commission's purpose to safeguard the state's air resources, consistent with the protection of public health, general welfare, and physical property; §382.011, which authorizes the commission to control the quality of the state's air; §382.012, which authorizes the commission to develop plans to protect the state's air; and §382.016, which authorizes the commission to require that records of the air contaminant emissions from a source or activity be made and maintained.

The proposed amendments implement TCAA, §382.011, relating to General Powers and Duties; §382.012, relating to State Air Control Plan; §382.017, relating to Rules; and TWC, §5.103, relating to Rules.

§115.113.Alternate Control Requirements.

[ (a) ] Alternate [ For all persons in the Beaumont/Port Arthur, Dallas/Fort Worth, El Paso, and Houston/ Galveston areas, alternate ] methods of demonstrating and documenting continuous compliance with the applicable control requirements or exemption criteria in this division [ section ] may be approved by the executive director [ Executive Director ] in accordance with §115.910 of this title (relating to Availability of Alternate Means of Control) if emission reductions are demonstrated to be substantially equivalent.

[(b) For all persons in Gregg, Nueces, and Victoria Counties, alternate methods of demonstrating and documenting continuous compliance with the applicable control requirements or exemption criteria in this section may be approved by the Executive Director in accordance with §115.910 of this title if emission reductions are demonstrated to be substantially equivalent.]

[(c) For all persons in Aransas, Bexar, Calhoun, Matagorda, San Patricio, and Travis Counties, alternate methods of demonstrating and documenting continuous compliance with the applicable control requirements or exemption criteria in this section may be approved by the Executive Director in accordance with §115.910 of this title if emission reductions are demonstrated to be substantially equivalent.]

§115.116.Monitoring and Recordkeeping Requirements.

(a) For all persons in the Beaumont/Port Arthur, Dallas/Fort Worth, El Paso, and Houston/Galveston areas, the following recordkeeping requirements shall apply.

(1) - (2) (No change.)

(3) Affected persons shall install and maintain monitors to continuously measure and record operational parameters of any of the following emission control devices installed to meet applicable control requirements. Such records must be sufficient to demonstrate proper functioning of those devices to design specifications, including:

(A) (No change.)

(B) the inlet and outlet gas temperature of a chiller or catalytic incinerator; and

(C) the exhaust gas VOC concentration of any carbon adsorption system, as defined in §115.10 of this title (relating to Definitions), to determine if breakthrough has occurred . [ ; and ]

[(D) the date and reason for any maintenance and repair of the required control devices and the estimated quantity and duration of VOC emissions during such activities.]

(4) (No change.)

(5) All records shall be maintained for two years and be made available for review upon request by authorized representatives of the executive director, EPA [ United States Environmental Protection Agency (EPA) ], or local air pollution control agencies.

(b) For all persons in Gregg, Nueces, and Victoria Counties, the following recordkeeping requirements shall apply.

(1) (No change.)

(2) The results of inspections required by §115.114(b) of this title [ (relating to Inspection Requirements) ] shall be recorded.

(3) In Victoria County, affected persons shall install and maintain monitors to continuously measure and record operational parameters of any of the following emission control devices installed to meet applicable control requirements. Such records must be sufficient to demonstrate proper functioning of those devices to design specifications, including:

(A) (No change.)

(B) the inlet and outlet gas temperature of a chiller or catalytic incinerator; and

(C) the exhaust gas VOC concentration of any carbon adsorption system, as defined in §115.10 of this title [ (relating to Definitions) ], to determine if breakthrough has occurred . [ ; and ]

[(D) the date and reason for any maintenance and repair of the required control devices and the estimated quantity and duration of VOC emissions during such activities.]

(4) The results of any testing conducted in accordance with the provisions specified in §115.115(b) of this title [ (relating to Testing Requirements) ] shall be maintained at an affected facility.

(5) (No change.)

§115.117.Exemptions.

(a) For all persons in the Beaumont/Port Arthur, Dallas/Fort Worth, El Paso, and Houston/Galveston areas, the following exemptions apply.

(1) Except as provided in §115.116 of this title (relating to Monitoring and Recordkeeping Requirements), any volatile organic compound (VOC) with a true vapor pressure less than 1.5 pounds per square inch absolute (psia) [ psia ] (10.3 kPa) at storage conditions is exempt from the requirements of this division [ undesignated head ] (relating to the Storage of Volatile Organic Compounds).

(2) Crude oil and condensate stored in tanks with a nominal capacity less than 210,000 gallons (794,850 liters), prior to custody transfer, is exempt from the requirements of this division [ undesignated head concerning storage of volatile organic compounds ].

(3) Storage containers which have a capacity of less than 25,000 gallons (94,625 liters) located at motor vehicle fuel dispensing facilities are exempt from the requirements of this division [ undesignated head concerning storage of volatile organic compounds ].

(4) - (7) (No change.)

(8) Storage containers which have a capacity of no more than 1,000 gallons are exempt from the requirements of this division.

(b) For all persons in Gregg, Nueces, and Victoria Counties, the following exemptions apply.

(1) Except as provided in §115.116 of this title, any VOC with a true vapor pressure less than 1.5 psia (10.3 kPa) at storage conditions is exempt from the requirements of this division [ undesignated head (relating to the Storage of Volatile Organic Compounds) ].

(2) Crude oil and condensate stored in tanks with a nominal capacity less than 210,000 gallons (794,850 liters), prior to custody transfer, is exempt from the requirements of this division [ undesignated head ].

(3) Storage containers which have a capacity of less than 25,000 gallons (94,625 liters) located at motor vehicle fuel dispensing facilities are exempt from the requirements of this division [ undesignated head ].

(4) (No change.)

(5) External floating roof tanks storing waxy, high pour point crude oils are exempt from any secondary seal requirements of §115.112(b) of this title [ (relating to Control Requirements) ].

(6) - (7) (No change.)

(8) Storage containers which have a capacity of no more than 1,000 gallons are exempt from the requirements of this division.

(c) For all persons in Aransas, Bexar, Calhoun, Matagorda, San Patricio, and Travis Counties, the following exemptions apply.

(1) Any VOC with a true vapor pressure less than 1.5 psia (10.3 kPa) at storage conditions is exempt from the requirements of this division [ undesignated head (relating to the Storage of Volatile Organic Compounds) ].

(2) Slotted sampling and gauge pipes installed in any floating roof storage tank are exempt from the provisions of §115.112(c) of this title [ (relating to Control Requirements) ].

(3) Storage tanks with nominal capacities between 1,000 gallons (3,785 liters) and 25,000 gallons (94,625 liters) are exempt from the requirements of §115.112(c)(1) of this title [ (relating to Control Requirements) ] if construction began before May 12, 1973.

(4) Storage tanks with a nominal capacity of 420,000 gallons (1,589,700 liters) or less are exempt from the requirements of §115.112(c)(3) of this title [ (relating to Control Requirements) ].

(5) Storage containers which have a capacity of no more than 1,000 gallons are exempt from the requirements of this division.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on December 20, 2001.

TRD-200108145

Stephanie Bergeron

Director, Environmental Law Division

Texas Natural Resource Conservation Commission

Earliest possible date of adoption: February 3, 2002

For further information, please call: (512) 239-4712


3. WATER SEPARATION

30 TAC §§115.132, 115.133, 115.136, 115.137, 115.139

STATUTORY AUTHORITY

The amendments are proposed under TWC, §5.103, which authorizes the commission to adopt rules necessary to carry out its powers and duties under TWC; Texas Health and Safety Code, TCAA, §382.017, which provides the commission authority to adopt rules consistent with the policy and purposes of TCAA; §382.002, which establishes the commission's purpose to safeguard the state's air resources, consistent with the protection of public health, general welfare, and physical property; §382.011, which authorizes the commission to control the quality of the state's air; §382.012, which authorizes the commission to develop plans to protect the state's air; and §382.016, which authorizes the commission to require that records of the air contaminant emissions from a source or activity be made and maintained.

The proposed amendments implement TCAA, §382.011, relating to General Powers and Duties; §382.012, relating to State Air Control Plan; §382.017, relating to Rules; and TWC, §5.103, relating to Rules.

§115.132.Control Requirements.

(a) For the Beaumont/Port Arthur, Dallas/Fort Worth, El Paso, and Houston/Galveston areas, no person shall use any single or multiple compartment volatile organic compound (VOC) water separator which separates materials containing VOC obtained from any equipment which is processing, refining, treating, storing, or handling VOC, unless each compartment is controlled in one of the following ways:

(1) - (3) (No change.)

(4) any water separator that becomes subject to the provisions of paragraphs (1), (2), or (3) of this subsection by exceeding provisions of §115.137(a) of this title (relating to Exemptions) will remain subject to the provisions of this subsection, even if throughput or emissions later fall below the exemption limits unless and until emissions are reduced to no more than the controlled emissions level existing before implementation of the project by which throughput or emission rate was reduced to less than the applicable exemption limits in §115.137(a) of this title; and

(A) the project by which throughput or emission rate was reduced is authorized by any permit or permit amendment or standard permit or permit by rule [ standard exemption ] required by Chapter 116 or Chapter 106 of this title (relating to Control of Air Pollution by Permits for New Construction or Modification; and Permits by Rule [ Exemptions from Permitting ]). If a permit by rule [ standard exemption ] is available for the project, compliance with this subsection must be maintained for 30 days after the filing of documentation of compliance with that permit by rule [ standard exemption ]; or

(B) if authorization by permit, permit amendment, standard permit, or permit by rule [ standard exemption ] is not required for the project, the owner/operator has given the executive director 30 days' notice of the project in writing.

(b) For Gregg, Nueces, and Victoria Counties, no person shall use any single or multiple compartment VOC water separator which separates materials containing VOC obtained from any equipment which is processing, refining, treating, storing, or handling VOC, unless each compartment is controlled in one of the following ways:

(1) - (2) (No change.)

(3) the compartment is equipped with a vapor recovery system which satisfies the provisions of §115.131(b) of this title [ (relating to Emission Specifications) ].

(c) For Aransas, Bexar, Calhoun, Matagorda, San Patricio, and Travis Counties, no person shall use any single or multiple compartment VOC water separator which separates materials containing VOC obtained from any equipment which is processing, refining, treating, storing, or handling VOC, unless each compartment is controlled in one of the following ways:

(1) - (2) (No change.)

(3) the compartment is equipped with a vapor recovery system which satisfies the provisions of §115.131(c) of this title [ (relating to Emission Specifications) ].

§115.133.Alternate Control Requirements.

[ (a) ] Alternate [ For all persons in the Beaumont/Port Arthur, Dallas/Fort Worth, El Paso, and Houston/Galveston areas, alternate ] methods of demonstrating and documenting continuous compliance with the applicable control requirements or exemption criteria in this division (relating to Water Separation) [ section ] may be approved by the executive director [ Executive Director ] in accordance with §115.910 of this title (relating to Alternate Means of Control) if emission reductions are demonstrated to be substantially equivalent.

[(b) For all persons in Gregg, Nueces, and Victoria Counties, alternate methods of demonstrating and documenting continuous compliance with the applicable control requirements or exemption criteria in this section may be approved by the Executive Director in accordance with §115.910 of this title if emission reductions are demonstrated to be substantially equivalent.]

[(c) For all persons in Aransas, Bexar, Calhoun, Matagorda, San Patricio, and Travis Counties, alternate methods of demonstrating and documenting continuous compliance with the applicable control requirements or exemption criteria in this section may be approved by the Executive Director in accordance with §115.910 of this title if emission reductions are demonstrated to be substantially equivalent.]

§115.136.Monitoring and Recordkeeping Requirements.

(a) For the Beaumont/Port Arthur, Dallas/Fort Worth, El Paso, and Houston/Galveston areas, the following recordkeeping requirements shall apply.

(1) (No change.)

(2) Affected persons shall install and maintain monitors to continuously measure and record operational parameters of any emission control device installed to meet applicable control requirements. Such records must be sufficient to demonstrate proper functioning of those devices to design specifications, including:

(A) (No change.)

(B) the gas temperature immediately upstream and downstream of any catalytic incinerator or chiller; and

(C) the VOC concentration of any carbon adsorption system exhaust gas to determine if breakthrough has occurred . [ ; and ]

[(D) the dates and reasons for any maintenance and repair of the required control devices and the estimated quantity and duration of VOC emissions during such activities.]

(3) (No change.)

(4) All records shall be maintained at the affected facility for at least two years and be made available upon request to representatives of the executive director, EPA [ United States Environmental Protection Agency (EPA) ], or any local air pollution control agency having jurisdiction in the area.

(b) For Gregg, Nueces, and Victoria Counties, the following recordkeeping requirements shall apply.

(1) Any person who operates a single or multiple compartment VOC water separator without the controls specified in §115.132(b) of this title [ (relating to Control Requirements) ] shall maintain complete and up-to-date records sufficient to demonstrate continuous compliance with the applicable exemption criteria including, but not limited to, the names and true vapor pressures of all such materials stored, processed, or handled at the affected property, and any other necessary operational information.

(2) In Victoria County, affected persons shall install and maintain monitors to continuously measure and record operational parameters of any emission control device installed to meet applicable control requirements. Such records must be sufficient to demonstrate proper functioning of those devices to design specifications, including:

(A) (No change.)

(B) the gas temperature immediately upstream and downstream of any catalytic incinerator or chiller; and

(C) the exhaust gas VOC concentration of any carbon adsorption system, as defined in §115.10 of this title (relating to Definitions), to determine if breakthrough has occurred . [ ; and ]

[(D) the dates and reasons for any maintenance and repair of the required control devices and the estimated quantity and duration of VOC emissions during such activities.]

(3) Affected persons shall maintain the results of any testing conducted in accordance with the provisions specified in §115.135(b) of this title [ (relating to Testing Requirements) ].

(4) (No change.)

§115.137.Exemptions.

(a) For the Beaumont/Port Arthur, Dallas/Fort Worth, El Paso, and Houston/Galveston areas, the following exemptions shall apply.

(1) (No change.)

(2) Any single or multiple compartment VOC water separator which separates materials having a true vapor pressure of VOC less than 0.5 pounds per square inch absolute (psia) [ psia ] (3.4 kPa) obtained from any equipment is exempt from §115.132(a) of this title.

(3) Any single or multiple compartment VOC water separator which is designed solely to capture stormwater, spills, or exterior surface cleanup waters is exempt from this division [ undesignated head ] (relating to Water Separation), provided that the separator is fully covered. These separators are not required to be equipped with pressure/vacuum vents or vapor control [ recovery ] systems.

(b) For Gregg, Nueces, and Victoria Counties, the following exemptions shall apply . [ : ]

(1) VOC water separators used exclusively in conjunction with the production of crude oil or condensate are exempt from §115.132(b) of this title [ (relating to Control Requirements) ].

(2) Any single or multiple compartment VOC water separator which separates less than 200 gallons (757 liters) a day of materials containing VOC obtained from any equipment is exempt from §115.132(b) of this title [ (relating to Control Requirements) ].

(3) Any single or multiple compartment VOC water separator which separates materials having a true vapor pressure of VOC less than 1.5 psia (10.3 kPa) obtained from any equipment is exempt from §115.132(b) of this title [ (relating to Control Requirements) ].

(4) In Gregg County, any single or multiple compartment VOC water separator which separates materials obtained from any equipment in a facility other than a petroleum refinery is exempt from §115.132(b) of this title [ (relating to Control Requirements) ].

(5) Any single or multiple compartment VOC water separator which is designed solely to capture stormwater, spills, or exterior surface cleanup waters is exempt from this division [ undesignated head (relating to Water Separation) ], provided that the separator is fully covered. These separators are not required to be equipped with pressure/vacuum vents or vapor control [ recovery ] systems.

(c) For Aransas, Bexar, Calhoun, Matagorda, San Patricio, and Travis Counties, the following exemptions shall apply . [ : ]

(1) VOC water separators used exclusively in conjunction with the production of crude oil or condensate are exempt from §115.132(c) of this title [ (relating to Control Requirements) ].

(2) Any single or multiple compartment VOC water separator which separates less than 200 gallons (757 liters) a day of materials containing VOC obtained from any equipment is exempt from §115.132(c) of this title [ (relating to Control Requirements) ].

(3) Any single or multiple compartment VOC water separator which separates materials having a true vapor pressure of VOC less than 1.5 psia (10.3 kPa) obtained from any equipment is exempt from §115.132(c) of this title [ (relating to Control Requirements) ].

(4) Any single or multiple compartment VOC water separator which is designed solely to capture stormwater, spills, or exterior surface cleanup waters is exempt from this division [ undesignated head (relating to Water Separation) ], provided that the separator is fully covered. These separators are not required to be equipped with pressure/vacuum vents or vapor control [ recovery ] systems.

§115.139.Counties and Compliance Schedules.

All affected persons in Aransas, Bexar, Brazoria, Calhoun, Chambers, Collin, Dallas, Denton, El Paso, Fort Bend, Galveston, Gregg, Hardin, Harris, Jefferson, Liberty, Matagorda, Montgomery, Nueces, Orange, San Patricio, Tarrant, Travis, Victoria, and Waller Counties shall continue to comply with this division [ undesignated head ] (relating to Water Separation) as required by §115.930 of this title (relating to Compliance Dates).

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on December 20, 2001.

TRD-200108146

Stephanie Bergeron

Director, Environmental Law Division

Texas Natural Resource Conservation Commission

Earliest possible date of adoption: February 3, 2002

For further information, please call: (512) 239-4712


4. INDUSTRIAL WASTEWATER

30 TAC §§115.140, 115.145, 115.147

STATUTORY AUTHORITY

The amendments are proposed under TWC, §5.103, which authorizes the commission to adopt rules necessary to carry out its powers and duties under TWC; Texas Health and Safety Code, TCAA, §382.017, which provides the commission authority to adopt rules consistent with the policy and purposes of TCAA; §382.002, which establishes the commission's purpose to safeguard the state's air resources, consistent with the protection of public health, general welfare, and physical property; §382.011, which authorizes the commission to control the quality of the state's air; §382.012, which authorizes the commission to develop plans to protect the state's air; and §382.016, which authorizes the commission to require that records of the air contaminant emissions from a source or activity be made and maintained.

The proposed amendments implement TCAA, §382.011, relating to General Powers and Duties; §382.012, relating to State Air Control Plan; §382.017, relating to Rules; and TWC, §5.103, relating to Rules.

§115.140.Industrial Wastewater Definitions.

The following terms, when used in this division, shall have the following meanings, unless the context clearly indicates otherwise. Additional definitions for terms used in this division are found in §§115.10, 101.1, and 3.2 [ §115.10 of this title (relating to Definitions), §101.1 of this title (relating to Definitions), and §3.2 ] of this title (relating to Definitions).

(1) - (2) (No change.)

(3) Plant--All facilities included within the same commission [ Texas Natural Resource Conservation Commission ] account number.

(4) - (8) (No change.)

§115.145.Approved Test Methods.

Compliance with the emission specifications, vapor control system efficiency, and certain control requirements, inspection requirements, and exemption criteria of §§115.142 - 115.144 and 115.147 of this title (relating to Control Requirements; Alternate Control Requirements; Inspection and Monitoring Requirements; and Exemptions) shall be determined by applying one or more of the following test methods and procedures, as appropriate . [ : ]

(1) - (4) (No change.)

(5) Leak determination by instrument method. Use Test Method 21 (40 CFR 60, Appendix A) for determining VOC leaks and for monitoring a carbon canister in accordance with §115.144(3)(D) of this title [ (relating to Inspection and Monitoring Requirements) ].

(6) - (9) (No change.)

(10) Alternate test methods. Test methods other than those specified in paragraphs (1) - (8) of this section [ (concerning to Approved Test Methods) ] may be used if validated by 40 CFR 63, Appendix A, Test Method 301 (effective December 29, 1992). For the purposes of this paragraph, substitute "executive director" each place that Test Method 301 references "administrator."

§115.147.Exemptions.

The following exemptions apply in the Beaumont/Port Arthur, Dallas/Fort Worth, El Paso, and Houston/Galveston areas.

(1) Any plant with an annual volatile organic compounds (VOC) loading in wastewater, as determined in accordance with §115.148 of this title (relating to Determination of Wastewater Characteristics), less than or equal to ten [ 10 ] megagrams (Mg) (11.03 tons) is exempt from the control requirements of §115.142 of this title (relating to Control Requirements).

(2) At any plant with an annual VOC loading in wastewater, as determined in accordance with §115.148 of this title greater than ten [ 10 ] Mg (11.03 tons), any person who is the owner or operator of the plant may exempt from the control requirements of §115.142 of this title one or more affected VOC wastewater streams for which the sum of the annual VOC loading in wastewater for all of the exempted streams is less than or equal to ten [ 10 ] Mg (11.03 tons).

(3) Unless specifically required by this division (relating to Industrial Wastewater), any component of a wastewater storage, handling, transfer, or treatment facility to which the control requirements of §115.142 of this title [ this division ] apply is exempt from the requirements of any other division [ portion ] of this chapter.

(4) (No change.)

(5) Wet weather retention basins are exempt from the requirements of this division [ (relating to Industrial Wastewater) ].

(6) Petroleum refineries in the Beaumont/Port Arthur area are exempt from the requirements of this division [ (relating to Industrial Wastewater) ].

(7) (No change.)

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on December 20, 2001.

TRD-200108147

Stephanie Bergeron

Director, Environmental Law Division

Texas Natural Resource Conservation Commission

Earliest possible date of adoption: February 3, 2002

For further information, please call: (512) 239-4712


5. MUNICIPAL SOLID WASTE LANDFILLS

30 TAC §115.153, §115.159

STATUTORY AUTHORITY

The amendments are proposed under TWC, §5.103, which authorizes the commission to adopt rules necessary to carry out its powers and duties under TWC; Texas Health and Safety Code, TCAA, §382.017, which provides the commission authority to adopt rules consistent with the policy and purposes of TCAA; §382.002, which establishes the commission's purpose to safeguard the state's air resources, consistent with the protection of public health, general welfare, and physical property; §382.011, which authorizes the commission to control the quality of the state's air; §382.012, which authorizes the commission to develop plans to protect the state's air; and §382.016, which authorizes the commission to require that records of the air contaminant emissions from a source or activity be made and maintained.

The proposed amendments implement TCAA, §382.011, relating to General Powers and Duties; §382.012, relating to State Air Control Plan; §382.017, relating to Rules; and TWC, §5.103, relating to Rules.

§115.153.Alternate Control Requirements.

For all persons in the Houston/Galveston, El Paso, and Dallas/Fort Worth ozone nonattainment areas, alternate methods of demonstrating and documenting continuous compliance with the applicable control requirements or exemption criteria in this division [ undesignated head ] (relating to Municipal Solid Waste Landfills) may be approved by the executive director in accordance with §115.910 of this title (relating to Availability of Alternate Means of Control) if emission reductions are demonstrated to be substantially equivalent.

§115.159.Counties and Compliance Schedule.

(a) All affected municipal solid waste landfills (MSWLFs) in Collin, Dallas, Denton, and Tarrant Counties shall demonstrate [ be in ] compliance with this division [ undesignated head ] (relating to Municipal Solid Waste Landfills) as soon as practicable, but no later than May 31, 1996.

(b) All affected MSWLFs in El Paso County shall demonstrate [ be in ] compliance with this division [ undesignated head (relating to Municipal Solid Waste Landfills) ] as soon as practicable, but no later than November 15, 1996.

(c) All affected MSWLFs in Brazoria, Chambers, Fort Bend, Galveston, Harris, Liberty, Montgomery, and Waller Counties shall demonstrate [ be in ] compliance with this division [ undesignated head (relating to Municipal Solid Waste Landfills) ] as soon as practicable, but no later than one year, after the commission publishes notification in the Texas Register of its determination that this contingency rule is necessary as a result of failure to attain the National Ambient Air Quality Standard (NAAQS) for ozone by the attainment deadline or failure to demonstrate reasonable further progress as set forth in the 1990 Amendments to the Federal Clean Air Act (FCAA), §172(c)(9).

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on December 20, 2001.

TRD-200108148

Stephanie Bergeron

Director, Environmental Law Division

Texas Natural Resource Conservation Commission

Earliest possible date of adoption: February 3, 2002

For further information, please call: (512) 239-4712


6. BATCH PROCESSES

30 TAC §115.161, §115.169

STATUTORY AUTHORITY

The amendments are proposed under TWC, §5.103, which authorizes the commission to adopt rules necessary to carry out its powers and duties under TWC; Texas Health and Safety Code, TCAA, §382.017, which provides the commission authority to adopt rules consistent with the policy and purposes of TCAA; §382.002, which establishes the commission's purpose to safeguard the state's air resources, consistent with the protection of public health, general welfare, and physical property; §382.011, which authorizes the commission to control the quality of the state's air; §382.012, which authorizes the commission to develop plans to protect the state's air; and §382.016, which authorizes the commission to require that records of the air contaminant emissions from a source or activity be made and maintained.

The proposed amendments implement TCAA, §382.011, relating to General Powers and Duties; §382.012, relating to State Air Control Plan; §382.017, relating to Rules; and TWC, §5.103, relating to Rules.

§115.161.Applicability.

(a) (No change.)

(b) Any batch process operation that is exempt under §115.167(1) or (2)(A) of this title [ (relating to Exemptions) ] is subject to the requirements of Division 2 of this subchapter (relating to Vent Gas Control).

§115.169.Counties and Compliance Schedules.

(a) The owner or operator of each batch process operation in Hardin, Jefferson, and Orange Counties shall demonstrate [ be in ] compliance with this division (relating to Batch Processes) as soon as practicable, but no later than December 31, 2001. All batch process operations subject to this division in Hardin, Jefferson, and Orange Counties shall continue to comply with the requirements of Division 2 of this subchapter (relating to Vent Gas Control) until these batch process operations are in compliance with the requirements of this division.

(b) The owner or operator of each batch process operation in Brazoria, Chambers, Fort Bend, Galveston, Harris, Liberty, Montgomery, and Waller Counties shall demonstrate [ be in ] compliance with this division (relating to Batch Processes) as soon as practicable, but no later than December 31, 2002. All batch process operations subject to this division in Brazoria, Chambers, Fort Bend, Galveston, Harris, Liberty, Montgomery, and Waller Counties shall continue to comply with the requirements of Division 2 of this subchapter (relating to Vent Gas Control) until these batch process operations are in compliance with the requirements of this division.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on December 20, 2001.

TRD-200108149

Stephanie Bergeron

Director, Environmental Law Division

Texas Natural Resource Conservation Commission

Earliest possible date of adoption: February 3, 2002

For further information, please call: (512) 239-4712


Subchapter C. VOLATILE ORGANIC COMPOUND TRANSFER OPERATIONS

1. LOADING AND UNLOADING OF VOLATILE ORGANIC COMPOUNDS

30 TAC §115.214

STATUTORY AUTHORITY

The amendment is proposed under TWC, §5.103, which authorizes the commission to adopt rules necessary to carry out its powers and duties under TWC; Texas Health and Safety Code, TCAA, §382.017, which provides the commission authority to adopt rules consistent with the policy and purposes of TCAA; §382.002, which establishes the commission's purpose to safeguard the state's air resources, consistent with the protection of public health, general welfare, and physical property; §382.011, which authorizes the commission to control the quality of the state's air; §382.012, which authorizes the commission to develop plans to protect the state's air; and §382.016, which authorizes the commission to require that records of the air contaminant emissions from a source or activity be made and maintained.

The proposed amendment implements TCAA, §382.011, relating to General Powers and Duties; §382.012, relating to State Air Control Plan; §382.017, relating to Rules; and TWC, §5.103, relating to Rules.

§115.214.Inspection Requirements.

(a) The owner or operator of each volatile organic compound (VOC) transfer operation in the Beaumont/Port Arthur, Dallas/Fort Worth, El Paso, and Houston/Galveston areas shall comply with the following inspection requirements.

(1) Land-based VOC transfer to or from transport vessels .

(A) - (D) (No change.)

(2) - (3) (No change.)

(b) The owner or operator of each VOC transfer operation in the covered attainment counties shall comply with the following inspection requirements.

(1) Land-based VOC transfer to or from transport vessels . At all VOC transfer operations in Aransas, Bexar, Calhoun, Gregg, Matagorda, Nueces, San Patricio, Travis, and Victoria Counties, and at gasoline terminals and gasoline bulk plants in the covered attainment counties:

(A) - (C) (No change.)

(D) Subparagraphs (A) and (B) of this paragraph do not apply to fumes from hatches or vents if the fumes result from:

(i) (No change.)

(ii) a VOC loading operation which, under the 90% control option in §115.213(c) [ §115.213(b) ] of this title, is not required to control vapors caused by loading VOC.

(2) (No change.)

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on December 20, 2001.

TRD-200108150

Stephanie Bergeron

Director, Environmental Law Division

Texas Natural Resource Conservation Commission

Earliest possible date of adoption: February 3, 2002

For further information, please call: (512) 239-4712


Subchapter D. PETROLEUM REFINING, NATURAL GAS PROCESSING, AND PETROCHEMICAL PROCESSES

1. PROCESS UNIT TURNAROUND AND VACUUM-PRODUCING SYSTEMS IN PETROLEUM REFINERIES

30 TAC §§115.311 - 115.313, 115.316, 115.319

STATUTORY AUTHORITY

The amendments are proposed under TWC, §5.103, which authorizes the commission to adopt rules necessary to carry out its powers and duties under TWC; Texas Health and Safety Code, TCAA, §382.017, which provides the commission authority to adopt rules consistent with the policy and purposes of TCAA; §382.002, which establishes the commission's purpose to safeguard the state's air resources, consistent with the protection of public health, general welfare, and physical property; §382.011, which authorizes the commission to control the quality of the state's air; §382.012, which authorizes the commission to develop plans to protect the state's air; and §382.016, which authorizes the commission to require that records of the air contaminant emissions from a source or activity be made and maintained.

The proposed amendments implement TCAA, §382.011, relating to General Powers and Duties; §382.012, relating to State Air Control Plan; §382.017, relating to Rules; and TWC, §5.103, relating to Rules.

§115.311.Emission Specifications.

(a) For all affected persons in the Beaumont/Port Arthur, Dallas/Fort Worth, El Paso, and Houston/Galveston areas as defined in §115.10 of this title (relating to Definitions), the following emission specifications on vacuum-producing systems shall apply . [ : ]

(1) No person may be allowed to emit any volatile organic compound (VOC) from a steam ejector or mechanical vacuum pump in a petroleum refinery unless the vent stream is controlled properly in accordance with §115.312(a)(2) [ §115.312(a) ] of this title (relating to Control Requirements).

(2) No person may be allowed to emit any VOC from a hotwell with a contact condenser unless the hotwell is covered and the vapors from the hotwell are controlled properly in accordance with §115.312(a)(2) [ §115.312(a) ] of this title.

(b) For all affected persons in Gregg, Nueces, and Victoria Counties, the following emission specifications on vacuum-producing systems shall apply . [ : ]

(1) - (2) (No change.)

§115.312.Control Requirements.

(a) For all affected persons in the Beaumont/Port Arthur, Dallas/Fort Worth, El Paso, and Houston/Galveston areas, the following control requirements shall apply . [ : ]

(1) (No change.)

(2) Vent gas streams affected by §115.311(a) of this title (relating to Emission Specifications) must be controlled properly with a control efficiency of at least 90% or to a VOC [ volatile organic compound (VOC) ] concentration of no more than 20 parts per million by volume (ppmv) (on a dry basis corrected to 3.0% oxygen for combustion devices):

(A) in a direct-flame incinerator at a temperature equal to or greater than 1,300 degrees Fahrenheit (704 degrees Celsius [ Centigrade ]);

(B) (No change.)

(C) by any other vapor control [ recovery ] system, as defined in §115.10 of this title (relating to Definitions).

(b) For all affected persons in Gregg, Nueces, and Victoria Counties, the following control requirements shall apply . [ : ]

(1) (No change.)

(2) Vent gas streams affected by §115.311(b) of this title must be controlled properly with a control efficiency of at least 90% or to a VOC concentration of no more than 20 ppmv (on a dry basis corrected to 3.0% oxygen for combustion devices):

(A) in a direct-flame incinerator at a temperature equal to or greater than 1,300 degrees Fahrenheit (704 degrees Celsius [ Centigrade ]);

(B) (No change.)

(C) by any other vapor control [ recovery ] system, as defined in §115.10 of this title.

§115.313.Alternate Control Requirements.

[ (a) ] Alternate [ For all affected persons in the Beaumont/Port Arthur, Dallas/Fort Worth, El Paso, and Houston/Galveston areas, alternate ] methods of demonstrating and documenting continuous compliance with the applicable control requirements in this division [ undesignated head ] (relating to Process Unit Turnaround and Vacuum-Producing Systems in Petroleum Refineries) may be approved by the executive director in accordance with §115.910 of this title (relating to Availability of Alternate Means of Control) if emission reductions are demonstrated to be substantially equivalent.

[(b) For all affected persons in Gregg, Nueces, and Victoria Counties, alternate methods of demonstrating and documenting continuous compliance with the applicable control requirements in this undesignated head (relating to Process Unit Turnaround and Vacuum-Producing Systems in Petroleum Refineries) may be approved by the executive director in accordance with §115.910 of this title (relating to Availability of Alternate Means of Control) if emission reductions are demonstrated to be substantially equivalent.]

§115.316.Monitoring and Recordkeeping Requirements.

(a) For all affected persons in the Beaumont/Port Arthur, Dallas/Fort Worth, El Paso, and Houston/Galveston areas, the following recordkeeping requirements shall apply . [ : ]

(1) Any person who operates a vacuum-producing system affected by §115.311(a) of this title (relating to Emission Specifications) shall keep the following records:

(A) (No change.)

(B) continuous monitoring of temperatures upstream and downstream of a catalytic incinerator or chiller; and

(C) continuous monitoring of the exhaust gas volatile organic compound (VOC) concentration of any carbon adsorption system, as defined in §115.10 of this title (relating to Definitions), to determine breakthrough . [ ; and ]

[(D) the date and reason for any maintenance and repair of the required control devices and the estimated quantity and duration of VOC emissions during such activities.]

(2) - (3) (No change.)

(4) All records shall be maintained for two years and be made available for review upon request by authorized representatives of the executive director [ Texas Air Control Board (TACB) ], EPA [ United States Environmental Protection Agency (EPA) ], or local air pollution control agencies.

(b) For all affected persons in Victoria County, the following recordkeeping requirements shall apply . [ : ]

(1) Any person who operates a vacuum-producing system affected by §115.311(b) of this title [ (relating to Emission Specifications) ] shall keep the following records:

(A) (No change.)

(B) continuous monitoring of temperatures upstream and downstream of a catalytic incinerator or chiller; and

(C) continuous monitoring of the exhaust gas VOC concentration of any carbon adsorption system, as defined in §115.10 of this title [ (relating to Definitions) ], to determine breakthrough . [ ; and ]

[(D) the date and reason for any maintenance and repair of the required control devices and the estimated quantity and duration of VOC emissions during such activities.]

(2) Any person who conducts a process unit turnaround affected by §115.312(b) of this title [ (relating to Control Requirements) ] shall keep the following records:

(A) - (C) (No change.)

(3) The results of any testing conducted in accordance with the provisions specified in §115.315(b) of this title [ (relating to Testing Requirements) ] shall be maintained at the affected facility.

(4) All records shall be maintained for two years and be made available for review upon request by authorized representatives of the executive director [ TACB ], EPA, or local air pollution control agencies.

§115.319.Counties and Compliance Schedules.

All affected persons in Brazoria, Chambers, Collin, Dallas, Denton, El Paso, Fort Bend, Galveston, Gregg, Hardin, Harris, Jefferson, Liberty, Montgomery, Nueces, Orange, Tarrant, Victoria, and Waller Counties shall continue to comply with this division [ undesignated head ] (relating to Process Unit Turnaround and Vacuum-Producing Systems in Petroleum Refineries) as required by §115.930 of this title (relating to Compliance Dates).

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on December 20, 2001.

TRD-200108151

Stephanie Bergeron

Director, Environmental Law Division

Texas Natural Resource Conservation Commission

Earliest possible date of adoption: February 3, 2002

For further information, please call: (512) 239-4712


2. FUGITIVE EMISSION CONTROL IN PETROLEUM REFINERIES IN GREGG, NUECES, AND VICTORIA COUNTIES

30 TAC §§115.322, 115.325 - 115.327

STATUTORY AUTHORITY

The amendments are proposed under TWC, §5.103, which authorizes the commission to adopt rules necessary to carry out its powers and duties under TWC; Texas Health and Safety Code, TCAA, §382.017, which provides the commission authority to adopt rules consistent with the policy and purposes of TCAA; §382.002, which establishes the commission's purpose to safeguard the state's air resources, consistent with the protection of public health, general welfare, and physical property; §382.011, which authorizes the commission to control the quality of the state's air; §382.012, which authorizes the commission to develop plans to protect the state's air; and §382.016, which authorizes the commission to require that records of the air contaminant emissions from a source or activity be made and maintained.

The proposed amendments implement TCAA, §382.011, relating to General Powers and Duties; §382.012, relating to State Air Control Plan; §382.017, relating to Rules; and TWC, §5.103, relating to Rules.

§115.322.Control Requirements.

For Gregg, Nueces, and Victoria Counties, no person shall operate a petroleum refinery without complying with the following requirements . [ : ]

(1) - (3) (No change.)

(4) Except for [ safety ] pressure relief valves, no valves shall be installed or operated at the end of a pipe or line containing a VOC, unless the pipe or line is sealed with a second valve, a blind flange, a plug, or a cap. The sealing device may be removed only while a sample is being taken or during maintenance operations, and when closing the line, the upstream valve shall be closed first.

(5) Pipeline valves and pressure relief valves in gaseous VOC service shall be marked in some manner that will be readily obvious to monitoring personnel. Alternatively, the owner or operator of the refinery may choose to monitor all components in liquid service on the schedule for components in gaseous service specified in §115.324(2) of this title (relating to Inspection Requirements).

§115.325.Testing Requirements.

For all affected persons in Gregg, Nueces, and Victoria Counties, compliance with this division (relating to Fugitive Emission Control in Petroleum Refineries in Gregg, Nueces, and Victoria Counties) shall be determined by applying the following test methods, as appropriate:

(1) (No change.)

(2) determination of true vapor pressure using ASTM Test Method D323-82 for the measurement of Reid vapor pressure, adjusted for 68 degrees Fahrenheit (20 degrees Celsius [ Centigrade ]) in accordance with American Petroleum Institute (API) [ API ] Publication 2517, Third Edition, 1989; or

(3) (No change.)

§115.326.Recordkeeping Requirements.

For Gregg, Nueces, and Victoria Counties, the owner or operator of a petroleum refinery shall have the following recordkeeping requirements . [ : ]

(1) (No change.)

(2) Maintain a leaking-components monitoring log for all leaks of more than 10,000 parts per million by volume (ppmv) [ ppmv ] of volatile organic compound (VOC) detected by the monitoring program required by §115.324 of this title (relating to Inspection Requirements). This log shall contain, at a minimum, the following data:

(A) - (C) (No change.)

(D) the date the component was monitored;

(E) the results of the monitoring (in ppmv);

(F) a record of the calibration of the monitoring instrument;

(G) if a component is found leaking:

(i) [ (D) ] the date on which a leaking component is discovered;

(ii) the date on which a first attempt at repair was made to a leaking component;

(iii) [ (E) ] the date on which a leaking component is repaired;

(iv) [ (F) ] the date and instrument reading of the recheck procedure after a leaking component is repaired; and

[(G) a record of the calibration of the monitoring instrument;]

(v) [ (H) ] those leaks that cannot be repaired until turnaround; [ and ]

(H) [ (I) ] the total number of components checked and the total number of components found leaking ; and [ . ]

(I) the test method used (Test Method 21, or sight/sound/smell).

(3) - (4) (No change.)

§115.327.Exemptions.

For all affected persons in Gregg, Nueces, and Victoria Counties, the following exemptions shall apply . [ : ]

(1) Valves with a nominal size of two inches (five centimeters (cm)) [ (5 cm) ] or less are exempt from the requirements of this division (relating to Fugitive Emission Control in Petroleum Refineries in Gregg, Nueces, and Victoria Counties), provided allowable emissions at any refinery from sources affected by this division [ these sections ] after controls are applied with exemptions will not exceed by more than 5.0% such allowable emissions with no exemptions. Any person claiming an exemption for valves two inches ( five [ 5 ] cm) nominal size or smaller under this section shall, at the time he provides his control plan, also provide the following information:

(A) - (C) (No change.)

(2) (No change.)

(3) Components which contact a process liquid containing a VOC having a true vapor pressure equal to or less than 0.147 pounds per square inch absolute (psia) [ psia ] (1.013 kPa) at 68 degrees Fahrenheit (20 degrees Celsius) are exempt from the requirements of §115.324 of this title if the components are inspected visually according to the inspection schedules specified within this same section.

(4) (No change.)

(5) Pressure relief devices connected to an operating flare header, components in continuous vacuum service, storage tank valves, and valves that are not externally regulated (such as in-line check valves) are exempt from the monitoring requirement of §115.324 of this title [ (relating to Inspection Requirements) ].

(6) (No change.)

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on December 20, 2001.

TRD-200108152

Stephanie Bergeron

Director, Environmental Law Division

Texas Natural Resource Conservation Commission

Earliest possible date of adoption: February 3, 2002

For further information, please call: (512) 239-4712


3. FUGITIVE EMISSION CONTROL IN PETROLEUM REFINING, NATURAL GAS/GASOLINE PROCESSING, AND PETROCHEMICAL PROCESSES IN OZONE NONATTAINMENT AREAS

30 TAC §§115.352, 115.353, 115.355 - 115.357, 115.359

STATUTORY AUTHORITY

The amendments are proposed under TWC, §5.103, which authorizes the commission to adopt rules necessary to carry out its powers and duties under TWC; Texas Health and Safety Code, TCAA, §382.017, which provides the commission authority to adopt rules consistent with the policy and purposes of TCAA; §382.002, which establishes the commission's purpose to safeguard the state's air resources, consistent with the protection of public health, general welfare, and physical property; §382.011, which authorizes the commission to control the quality of the state's air; §382.012, which authorizes the commission to develop plans to protect the state's air; and §382.016, which authorizes the commission to require that records of the air contaminant emissions from a source or activity be made and maintained.

The proposed amendments implement TCAA, §382.011, relating to General Powers and Duties; §382.012, relating to State Air Control Plan; §382.017, relating to Rules; and TWC, §5.103, relating to Rules.

§115.352.Control Requirements.

For the Beaumont/Port Arthur, Dallas/Fort Worth, El Paso, and Houston/Galveston areas as defined in §115.10 of this title (relating to Definitions), no person shall operate a petroleum refinery; a synthetic organic chemical, polymer, resin, or methyl tert-butyl ether manufacturing process; or a natural gas/gasoline processing operation as defined in §115.10 of this title, without complying with the following requirements.

(1) - (3) (No change.)

(4) Except for [ safety ] pressure relief valves, no valves shall be installed or operated at the end of a pipe or line containing VOC unless the pipe or line is sealed with a second valve, a blind flange, a plug, or a cap. The sealing device may be removed only while a sample is being taken or during maintenance operations, and when closing the line, the upstream valve shall be closed first.

(5) - (9) (No change.)

§115.353.Alternate Control Requirements.

For all affected persons in the Beaumont/Port Arthur, Dallas/Fort Worth, El Paso, and Houston/Galveston areas, any alternate methods of demonstrating and documenting continuous compliance with the applicable control requirements or exemption criteria in this division [ undesignated head ] (relating to Fugitive Emission Control in Petroleum Refining, Natural Gas/Gasoline Processing, and Petrochemical Processes in Ozone Nonattainment Areas) may be approved by the executive director in accordance with §115.910 of this title (relating to Availability of Alternate Means of Control) if emission reductions are demonstrated to be substantially equivalent.

§115.355.Approved Test Methods.

For all affected persons in the Beaumont/Port Arthur, Dallas/Fort Worth, El Paso, and Houston/Galveston areas, compliance with this division [ undesignated head ] (relating to Fugitive Emission Control in Petroleum Refining , Natural Gas/Gasoline Processing, and Petrochemical Processes in Ozone Nonattainment Areas) shall be determined by applying the following test methods, as appropriate:

(1) Test Method 21 (40 CFR 60, Appendix A) for determining volatile organic compound leaks , except the calibration shall be at 500 parts per million by volume (ppmv) rather than at 10,000 ppmv;

(2) determination of true vapor pressure using American Society for Testing and Materials Test Methods D323-89, D2879, D4953, D5190, or D5191 for the measurement of Reid vapor pressure, adjusted for 68 degrees Fahrenheit (20 degrees Celsius) in accordance with American Petroleum Institute (API) [ API ] Publication 2517, Third Edition, 1989;

(3) - (4) (No change.)

§115.356.Monitoring and Recordkeeping Requirements.

All affected persons in the Beaumont/Port Arthur, Dallas/Fort Worth, El Paso, and Houston/Galveston areas shall have the following recordkeeping requirements:

(1) maintain [ Maintain ] a components monitoring log which shall contain, at a minimum, the following data:

(A) - (F) (No change.)

(G) if a component is found leaking:

(i) (No change.)

(ii) the date on which a first attempt at repair was made to a leaking component;

(iii) [ (ii) ] the date on which a leaking component is repaired;

(iv) [ (iii) ] the date and instrument reading of the recheck procedure after a leaking component is repaired; and

(v) [ (iv) ] those leaks that cannot be repaired until a unit shutdown;

(H) (No change.)

(I) the test method used (Test Method 21, or sight/sound/smell) ; [ . ]

(2) records [ Records ] of the visual, audible, and olfactory inspections of flanges are not required unless a leak is detected ; and [ . ]

(3) maintain [ Maintain ] all monitoring records for at least two years and make them available for review upon request by authorized representatives of the executive director, EPA [ United States Environmental Protection Agency ], or local air pollution control agencies.

§115.357.Exemptions.

For all affected persons in the Beaumont/Port Arthur, Dallas/Fort Worth, El Paso, and Houston/Galveston areas, the following exemptions shall apply.

(1) Components which contact a process fluid containing volatile organic compounds (VOCs) [ VOCs ] having a true vapor pressure equal to or less than 0.044 pounds per square inch absolute (psia) (0.3 kPa) at 68 degrees Fahrenheit (20 degrees Celsius) are exempt from the requirements of §115.354 of this title (relating to Inspection Requirements) if the components are inspected visually according to the inspection schedules specified within this same section.

(2) Storage tank valves, pressure relief valves equipped with a rupture disc or venting to a control device, components in continuous vacuum service, and valves that are not externally regulated (such as in-line check valves) are exempt from all the requirements of this division (relating to Fugitive Emission Control in Petroleum Refining, Natural Gas/Gasoline Processing, and Petrochemical Processes in Ozone Nonattainment Areas) [ undesignated head ], except that each pressure relief valve equipped with a rupture disk shall comply with §115.352(9) of this title (relating to Control Requirements).

(3) - (5) (No change.)

(6) Components at a petroleum refinery; synthetic organic chemical, polymer, resin, or methyl-tert-butyl ether manufacturing process, which contact a process fluid that contains less than 10% VOC by weight and components at a natural gas/gasoline processing operation which contact a process fluid that contains less than 1.0% VOC by weight are exempt from the requirements of this division [ undesignated head ].

(7) Facilities with less than 250 components in VOC service are exempt from the requirements of this division [ undesignated head ].

(8) Components in ethylene, propane, or propylene service, not to exceed 5.0% of the total components, may be classified as non-repairable beyond the second repair attempt at 500 parts per million by volume (ppmv) [ ppmv ]. These components will remain in the fugitive monitoring program and be repaired no later than 15 calendar days after the concentration of VOC detected via Test Method 21 exceeds 10,000 ppmv. For the purposes of this division [ undesignated head ], components which contact a process fluid with greater than 85% ethylene, propane, or propylene by weight are considered in ethylene, propane, or propylene service, respectively.

(9) Valves rated greater than 10,000 pounds per square inch gauge (psig) are exempt from the requirements of §115.352(4) of this title [ (relating to Control Requirements) ].

§115.359.Counties and Compliance Schedules.

All affected persons in Brazoria, Chambers, Collin, El Paso, Dallas, Denton, Fort Bend, Galveston, Hardin, Harris, Jefferson, Liberty, Montgomery, Orange, Tarrant, and Waller Counties shall continue to comply [ be in compliance ] with this division (relating to Fugitive Emission Control in Petroleum Refining, Natural Gas/Gasoline Processing, and Petrochemical Processes in Ozone Nonattainment Areas) [ §115.352 of this title (relating to Control Requirements), §115.353 of this title (relating to Alternate Control Requirements), §115.354 of this title (relating to Inspection Requirements), §115.355 of this title (relating to Testing Requirements), §115.356 of this title (relating to Monitoring and Recordkeeping Requirements), and §115.357 of this title (relating to Exemptions) ] as required by §115.930 of this title (relating to Compliance Dates) [ soon as practicable, but no later than November 15, 1996 ].

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on December 20, 2001.

TRD-200108153

Stephanie Bergeron

Director, Environmental Law Division

Texas Natural Resource Conservation Commission

Earliest possible date of adoption: February 3, 2002

For further information, please call: (512) 239-4712


Subchapter E. SOLVENT-USING PROCESSES

2. SURFACE COATING PROCESSES

30 TAC §§115.420 - 115.422

STATUTORY AUTHORITY

The amendments are proposed under TWC, §5.103, which authorizes the commission to adopt rules necessary to carry out its powers and duties under TWC; Texas Health and Safety Code, TCAA, §382.017, which provides the commission authority to adopt rules consistent with the policy and purposes of TCAA; §382.002, which establishes the commission's purpose to safeguard the state's air resources, consistent with the protection of public health, general welfare, and physical property; §382.011, which authorizes the commission to control the quality of the state's air; §382.012, which authorizes the commission to develop plans to protect the state's air; and §382.016, which authorizes the commission to require that records of the air contaminant emissions from a source or activity be made and maintained.

The proposed amendments implement TCAA, §382.011, relating to General Powers and Duties; §382.012, relating to State Air Control Plan; §382.017, relating to Rules; and TWC, §5.103, relating to Rules.

§115.420.Surface Coating Definitions.

(a) (No change.)

(b) Specific surface coating definitions. The following terms, when used in this division (relating to Surface Coating Processes), shall have the following meanings, unless the context clearly indicates otherwise.

(1) Aerospace coating.

(A) - (QQ) (No change.)

(RR) Hydrocarbon-based cleaning solvent -- A solvent which is composed of VOC (photochemically reactive hydrocarbons) and/or oxygenated hydrocarbons, has a maximum vapor pressure of seven millimeters of mercury (mm Hg) at 20 degrees Celsius (68 degrees Fahrenheit), and contains no hazardous air pollutant (HAP) identified in the 1990 Amendments to the Federal Clean Air Act (FCAA), §112(b).

(SS) [ (RR) ] Insulation covering -- Material that is applied to foam insulation to protect the insulation from mechanical or environmental damage.

(TT) [ (SS) ] Intermediate release coating -- A thin coating applied beneath topcoats to assist in removing the topcoat in depainting operations and generally to allow the use of less hazardous depainting methods.

(UU) [ (TT) ] Lacquer -- A clear or pigmented coating formulated with a nitrocellulose or synthetic resin to dry by evaporation without a chemical reaction. Lacquers are resoluble in their original solvent.

(VV) [ (UU) ] Limited access space -- Internal surfaces or passages of an aerospace vehicle or component that cannot be reached without the aid of an airbrush or a spray gun extension for the application of coatings.

(WW) [ (VV) ] Metalized epoxy coating -- A coating that contains relatively large quantities of metallic pigmentation for appearance and/or added protection.

(XX) [ (WW) ] Mold release -- A coating applied to a mold surface to prevent the molded piece from sticking to the mold as it is removed.

(YY) [ (XX) ] Monthly weighted average -- The [ the ] total weight of VOC emission from all coatings divided by the total volume of those coatings (minus water and exempt solvents) delivered to the application system each calender month. Coatings shall not be combined for purposes of calculating the monthly weighted average. In addition, determination of compliance is based on each individual coating operation.

(ZZ) [ (YY) ] Nonstructural adhesive -- An adhesive that bonds nonload bearing aerospace components in noncritical applications and is not covered in any other specialty adhesive categories.

(AAA) [ (ZZ) ] Operating parameter value -- A minimum or maximum value established for a control equipment or process parameter that, if achieved by itself or in combination with one or more other operating parameter values, determines that an owner or operator has continued to comply with an applicable emission limitation.

(BBB) [ (AAA) ] Optical antireflection coating -- A coating with a low reflectance in the infrared and visible wavelength ranges that is used for antireflection on or near optical and laser hardware.

(CCC) [ (BBB) ] Part marking coating -- Coatings or inks used to make identifying markings on materials, components, and/or assemblies of aerospace vehicles. These markings may be either permanent or temporary.

(DDD) [ (CCC) ] Pretreatment coating -- An organic coating that contains at least 0.5% acids by weight and is applied directly to metal or composite surfaces to provide surface etching, corrosion resistance, adhesion, and ease of stripping.

(EEE) [ (DDD) ] Primer -- The first layer and any subsequent layers of identically formulated coating applied to the surface of an aerospace vehicle or component. Primers are typically used for corrosion prevention, protection from the environment, functional fluid resistance, and adhesion of subsequent coatings. Primers that are defined as specialty coatings are not included under this definition.

(FFF) [ (EEE) ] Radome -- The nonmetallic protective housing for electromagnetic transmitters and receivers (e.g., radar, electronic countermeasures, etc.).

(GGG) [ (FFF) ] Rain erosion-resistant coating -- A coating or coating system used to protect the leading edges of parts such as flaps, stabilizers, radomes, engine inlet nacelles, etc. against erosion caused by rain impact during flight.

(HHH) [ (GGG) ] Research and development -- An operation whose primary purpose is for research and development of new processes and products and that is conducted under the close supervision of technically trained personnel and is not involved in the manufacture of final or intermediate products for commercial purposes, except in a de minimis manner.

(III) [ (HHH) ] Rocket motor bonding adhesive -- An adhesive used in rocket motor bonding applications.

(JJJ) [ (III) ] Rocket motor nozzle coating -- A catalyzed epoxy coating system used in elevated temperature applications on rocket motor nozzles.

(KKK) [ (JJJ) ] Rubber-based adhesive -- A quick setting contact cement that provides a strong, yet flexible bond between two mating surfaces that may be of dissimilar materials.

(LLL) [ (KKK) ] Scale inhibitor -- A coating that is applied to the surface of a part prior to thermal processing to inhibit the formation of scale.

(MMM) [ (LLL) ] Screen print ink -- An ink used in screen printing processes during fabrication of decorative laminates and decals.

(NNN) [ (MMM) ] Sealant -- A material used to prevent the intrusion of water, fuel, air, or other liquids or solids from certain areas of aerospace vehicles or components. There are two categories of sealants: extrudable/rollable/brushable sealants and sprayable sealants.

(OOO) [ (NNN) ] Seal coat maskant -- An overcoat applied over a maskant to improve abrasion and chemical resistance during production operations.

(PPP) [ (OOO) ] Self-priming topcoat -- A topcoat that is applied directly to an uncoated aerospace vehicle or component for purposes of corrosion prevention, environmental protection, and functional fluid resistance. More than one layer of identical coating formulation may be applied to the vehicle or component.

(QQQ) [ (PPP) ] Semiaqueous cleaning solvent -- A solution in which water is a primary ingredient. More than 60% by volume of the solvent solution as applied must be water.

(RRR) [ (QQQ) ] Silicone insulation material -- An insulating material applied to exterior metal surfaces for protection from high temperatures caused by atmospheric friction or engine exhaust. These materials differ from ablative coatings in that they are not "sacrificial."

(SSS) [ (RRR) ] Solid film lubricant -- A very thin coating consisting of a binder system containing as its chief pigment material one or more of the following: molybdenum, graphite, polytetrafluoroethylene, or other solids that act as a dry lubricant between faying (i.e., closely or tightly fitting) surfaces.

(TTT) [ (SSS) ] Space vehicle -- A man-made device, either manned or unmanned, designed for operation beyond earth's atmosphere. This definition includes integral equipment such as models, mock-ups, prototypes, molds, jigs, tooling, hardware jackets, and test coupons. Also included is auxiliary equipment associated with test, transport, and storage, that through contamination can compromise the space vehicle performance.

(UUU) [ (TTT) ] Specialty coating -- A coating that, even though it meets the definition of a primer, topcoat, or self-priming topcoat, has additional performance criteria beyond those of primers, topcoats, and self- priming topcoats for specific applications. These performance criteria may include, but are not limited to, temperature or fire resistance, substrate compatibility, antireflection, temporary protection or marking, sealing, adhesively joining substrates, or enhanced corrosion protection.

(VVV) [ (UUU) ] Specialized function coating -- A coating that fulfills extremely specific engineering requirements that are limited in application and are characterized by low volume usage. This category excludes coatings covered in other specialty coating categories.

(WWW) [ (VVV) ] Structural autoclavable adhesive -- An adhesive used to bond load-carrying aerospace components that is cured by heat and pressure in an autoclave.

(XXX) [ (WWW) ] Structural nonautoclavable adhesive -- An adhesive cured under ambient conditions that is used to bond load-carrying aerospace components or other critical functions, such as nonstructural bonding in the proximity of engines.

(YYY) [ (XXX) ] Surface preparation -- The removal of contaminants from the surface of an aerospace vehicle or component or the activation or reactivation of the surface in preparation for the application of a coating.

(ZZZ) [ (YYY) ] Temporary protective coating -- A coating applied to provide scratch or corrosion protection during manufacturing, storage, or transportation. Two types include peelable protective coatings and alkaline removable coatings. These materials are not intended to protect against strong acid or alkaline solutions. Coatings that provide this type of protection from chemical processing are not included in this category.

(AAAA) [ (ZZZ) ] Thermal control coating -- A coating formulated with specific thermal conductive or radiative properties to permit temperature control of the substrate.

(BBBB) [ (AAAA) ] Topcoat -- A coating that is applied over a primer on an aerospace vehicle or component for appearance, identification, camouflage, or protection. Topcoats that are defined as specialty coatings are not included under this definition.

(CCCC) [ (BBBB) ] Touch-up and repair coating -- A coating used to cover minor coating imperfections appearing after the main coating operation.

(DDDD) [ (CCCC) ] Touch-up and repair operation -- That portion of the coating operation that is the incidental application of coating used to cover minor imperfections in the coating finish or to achieve complete coverage. This definition includes out-of-sequence or out-of-cycle coating.

(EEEE) [ (DDDD) ] VOC composite vapor pressure -- The sum of the partial pressures of the compounds defined as VOCs , [ and is ] determined by the following calculation:

Figure: 30 TAC §115.420(b)(1)(EEEE)

[ Figure: 30 TAC §115.420(b)(1)(DDDD) ]

(FFFF) [ (EEEE) ] Waterborne (water-reducible) coating -- A coating which contains more than 5.0% water by weight as applied in its volatile fraction.

(GGGG) [ (FFFF) ] Wet fastener installation coating -- A primer or sealant applied by dipping, brushing, or daubing to fasteners that are installed before the coating is cured.

(HHHH) [ (GGGG) ] Wing coating -- A corrosion-resistant topcoat that is resilient enough to withstand the flexing of the wings.

(2) - (11) (No change.)

(12) Vehicle coating.

(A) (No change.)

(B) Vehicle refinishing (body shops).

(i) Basecoat/clearcoat system -- A topcoat system composed of a pigmented basecoat portion and a transparent clearcoat portion. The VOC content of a basecoat (bc)/clearcoat (cc) [ basecoat (Bc)/clearcoat (cc) ] system shall be calculated according to the following formula:

Figure: 30 TAC §115.420(b)(12)(B)(i) (No change.)

(ii) - (ix) (No change.)

(13) - (14) (No change.)

§115.421.Emission Specifications.

(a) No person in the Beaumont/Port Arthur, Dallas/Fort Worth, El Paso, and Houston/Galveston areas as defined in §115.10 of this title (relating to Definitions) may cause, suffer, allow, or permit volatile organic compound (VOC) emissions from the surface coating processes affected by paragraphs (1) - (15) of this subsection to exceed the specified emission limits. These limitations are based on the daily weighted average of all coatings delivered to each coating line, except for those in paragraph (10) of this subsection which are based on paneling surface area, and those in paragraph (14) of this subsection which, if using an averaging approach, must use one of the daily averaging equations within that paragraph. The owner or operator of a surface coating operation subject to paragraph (11) of the subsection may choose to comply by using the monthly weighted average option as defined in §115.420 (b)(1)(XX) of this title (relating to Surface Coating Definitions).

(1) - (10) (No change.)

(11) Aerospace coatings. The VOC content of coatings, including any VOC-containing materials added to the original coating supplied by the manufacturer, which are applied to aerospace vehicles or components shall not exceed the following limits (in grams of VOC per liter of coating, less water and exempt solvent). The following applications are exempt from the VOC content limits of this paragraph: manufacturing or re-work of space vehicles or antique aerospace vehicles or components of each; touchup ; [ , and ] United States Department of Defense classified coatings; and separate coating formulations in volumes less than 50 gallons per year to a maximum of 200 gallons per year for all such formulations at an account .

(A) - (B) (No change.)

(12) - (15) (No change.)

(b) (No change.)

§115.422.Control Requirements.

For the Beaumont/Port Arthur, Dallas/Fort Worth, El Paso, and Houston/Galveston areas, the following control requirements shall apply.

(1) - (2) (No change.)

(3) The following requirements apply to each wood furniture manufacturing facility subject to §115.421(a)(14) of this title (relating to Emission Specifications).

(A) - (B) (No change.)

(C) Conventional air spray guns shall not be used for applying finishing materials except under one or more of the following circumstances:

(i) to [ To ] apply finishing materials that have a VOC content no greater than 1.0 kilograms of VOC per kilogram of solids (1.0 pounds of VOC per pound of solids), as delivered to the application system;

(ii) for [ For ] touch-up and repair under the following circumstances:

(I) the [ The ] finishing materials are applied after completion of the finishing operation; or

(II) the [ The ] finishing materials are applied after the stain and before any other type of finishing material is applied, and the finishing materials are applied from a container that has a volume of no more than 2.0 gallons.

(iii) if [ If ] spray is automated, that is, the spray gun is aimed and triggered automatically, not manually;

(iv) if [ If ] emissions from the finishing application station are directed to a vapor control system;

(v) the [ The ] conventional air gun is used to apply finishing materials and the cumulative total usage of that finishing material is no more than 5.0% of the total gallons of finishing material used during that semiannual period; or

(vi) the [ The ] conventional air gun is used to apply stain on a part for which:

(I) - (II) (No change.)

(D) - (E) (No change.)

(4) (No change.)

(5) The following requirements apply to each aerospace vehicle or component coating process subject to §115.421(a)(11) or (b)(10) of this title.

(A) - (D) (No change.)

(E) All fresh and used cleaning solvents used in solvent cleaning operations shall be stored in containers that are kept closed at all times except when filling or emptying. Cloth and paper, or other absorbent applicators, moistened with cleaning solvents shall be stored in closed containers. Cotton-tipped swabs used for very small cleaning operations are exempt from this subparagraph. In addition, the owner or operator must implement handling and transfer procedures to minimize spills during filling and transferring the cleaning solvent to or from enclosed systems, vats, waste containers, and other cleaning operation equipment that hold or store fresh or used cleaning solvents. The requirements of this subparagraph are known collectively as housekeeping measures. Aqueous , [ and ] semiaqueous , and hydrocarbon-based cleaning solvents , as defined in §115.420(b)(1) of this title, are exempt from this subparagraph.

(6) Any surface coating operation that becomes subject to the provisions of §115.421(a) of this title by exceeding the provisions of §115.427(a) of this title (relating to Exemptions) shall remain subject to the provisions in §115.421(a) of this title, even if throughput or emissions later fall below exemption limits unless and until emissions are reduced to no more than the controlled emissions level existing before implementation of the project by which throughput or emission rate was reduced to less than the applicable exemption limits in §115.427(a) of this title, and

(A) the project by which throughput or emission rate was reduced is authorized by any permit or permit amendment or standard permit or permit by rule required by Chapter 116 or Chapter 106 of this title (relating to Control of Air Pollution by Permits for New Construction or Modification; and Permits by [ By ] Rule). If a permit by rule is available for the project, compliance with this subsection must be maintained for 30 days after the filing of documentation of compliance with that permit by rule; or

(B) (No change.)

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on December 20, 2001.

TRD-200108154

Stephanie Bergeron

Director, Environmental Law Division

Texas Natural Resource Conservation Commission

Earliest possible date of adoption: February 3, 2002

For further information, please call: (512) 239-4712


4. OFFSET LITHOGRAPHIC PRINTING

30 TAC §§115.440, 115.442, 115.445, 115.446

STATUTORY AUTHORITY

The amendments are proposed under TWC, §5.103, which authorizes the commission to adopt rules necessary to carry out its powers and duties under TWC; Texas Health and Safety Code, TCAA, §382.017, which provides the commission authority to adopt rules consistent with the policy and purposes of TCAA; §382.002, which establishes the commission's purpose to safeguard the state's air resources, consistent with the protection of public health, general welfare, and physical property; §382.011, which authorizes the commission to control the quality of the state's air; §382.012, which authorizes the commission to develop plans to protect the state's air; and §382.016, which authorizes the commission to require that records of the air contaminant emissions from a source or activity be made and maintained.

The proposed amendments implement TCAA, §382.011, relating to General Powers and Duties; §382.012, relating to State Air Control Plan; §382.017, relating to Rules; and TWC, §5.103, relating to Rules.

§115.440.Offset Printing Definitions.

The following terms, when used in this division (relating to Offset Lithographic Printing), shall have the following meanings, unless the context clearly indicates otherwise. Additional definitions for terms used in this division are found in §§115.10, 101.1, and 3.2 [ §115.10 of this title (relating to Definitions), §101.1 of this title (relating to Definitions), and §3.2 ] of this title (relating to Definitions).

(1) Alcohol -- An alcohol is any of the hydroxyl-containing organic compounds with a molecular weight equal to or less than 74.12 [ , ] (which includes methanol, ethanol, propanol, and butanol).

(2) - (9) (No change.)

(10) VOC composite partial pressure - The sum of the partial pressures of the compounds which meet the definition of volatile organic compound (VOC) in §101.1 of this title. The VOC composite partial pressure is calculated as follows.

Figure: 30 TAC §115.440(10)

§115.442.Control Requirements.

For the Dallas/Fort Worth, El Paso, and Houston/Galveston areas as defined in §115.10 of this title (relating to Definitions), the following control requirements shall apply . [ : ]

(1) No person shall operate or allow the operation of an offset lithographic printing line that uses solvent-containing ink, unless volatile organic compound (VOC) emissions are limited by the following . [ : ]

(A) - (E) (No change.)

(F) Any person who owns or operates an offset lithographic printing press shall reduce VOC emissions from cleaning solutions by one of the following methods:

(i) using cleaning solutions with a VOC content of 50% or less (by volume, as used); [ or ]

(ii) using cleaning solutions with a VOC content of 70% or less (by volume, as used) and incorporating a towel handling program which ensures that all waste ink, solvents, and cleanup rags shall be stored in closed containers until removed from the site by a licensed disposal/cleaning service ; or [ . ]

(iii) using cleaning solutions with a VOC composite partial vapor pressure less than or equal to ten millimeters of mercury (mm Hg) at 20 degrees Celsius (68 degrees Fahrenheit).

(2) No person shall operate or allow the operation of a heatset offset lithographic printing press unless VOC emissions from the press dryer exhaust vent are reduced 90% by weight or a maximum dryer exhaust outlet concentration of 20 parts per million by volume (ppmv) [ ppmv ] is maintained, whichever is less stringent when the press is in operation.

§115.445.Approved Test Methods.

For the Dallas/Fort Worth, El Paso, and Houston/Galveston areas as defined in §115.10 of this title (relating to Definitions), compliance shall be determined by applying the following test methods, as appropriate:

(1) - (4) (No change).

(5) EPA [ U.S. Environmental Protection Agency (EPA) ] guidelines series document "Procedures for Certifying Quantity of Volatile Organic Compounds Emitted by Paint, Ink, and Other Coatings," EPA-450/3-84-019, as in effect December 1984; or

(6) additional performance test procedures described in 40 CFR §60.444 [ 60.444 ] (effective October 18, 1983) .

§115.446.Monitoring and Recordkeeping Requirements.

For the Dallas/Fort Worth, El Paso, and Houston/Galveston areas as defined in §115.10 of this title (relating to Definitions), the following monitoring and recordkeeping requirements shall apply.

(1) The owner or operator of a heatset offset lithographic printing press shall install, calibrate, maintain, and operate a temperature monitoring device, according to the manufacturer's instructions, at the outlet of the control device. The temperature monitoring device shall be equipped with a continuous recorder and shall have an accuracy of ± 0.5 degrees Fahrenheit , or alternatively ±1.0% of the temperature being monitored .

(2) The owner or operator of any offset lithographic printing press shall install and maintain monitors to continuously measure and record operational parameters of any emission control device installed to meet applicable control requirements on a regular basis. Such records must be sufficient to demonstrate proper functioning of those devices to design specifications, including:

(A) - (B) (No change.)

(C) the exhaust gas VOC concentration of any carbon adsorption system, as defined in §115.10 of this title [ (relating to Definitions) ], to determine if breakthrough has occurred.

(3) - (4) (No change.)

(5) The owner or operator of any offset lithographic printing press using refrigeration equipment on the fountain solution in order to comply with §115.442(1)(A), (C), or (D) [ §115.442(1)(A) - (D) ] of this title (relating to Control Requirements) shall monitor the temperature of the fountain solution reservoir at least once per hour. Alternatively, the owner or operator of any offset lithographic printing press using refrigeration equipment on the fountain solution shall install, maintain, and continuously operate a temperature monitor of the fountain solution reservoir. The temperature monitor shall be attached to a continuous recording device such as a strip chart, recorder, or computer.

(6) For any offset lithographic printing press with continuous cleaning equipment, flow meters are required to monitor water and cleaning solution flow rates. The flow meters shall be calibrated so that the VOC content of the mixed solution complies with the requirements of §115.442 of this title [ (relating to Control Requirements) ].

(7) (No change.)

(8) The owner or operator of any offset lithographic printing press shall maintain all records at the affected facility for at least two years and make such records available upon request to representatives of the executive director, [ the ] EPA, or any [ the ] local air pollution agency having jurisdiction in the area.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on December 20, 2001.

TRD-200108155

Stephanie Bergeron

Director, Environmental Law Division

Texas Natural Resource Conservation Commission

Earliest possible date of adoption: February 3, 2002

For further information, please call: (512) 239-4712


Subchapter F. MISCELLANEOUS INDUSTRIAL SOURCES

2. PHARMACEUTICAL MANUFACTURING FACILITIES

30 TAC §§115.532, 115.533, 115.535, 115.539

STATUTORY AUTHORITY

The amendments are proposed under TWC, §5.103, which authorizes the commission to adopt rules necessary to carry out its powers and duties under the TWC; Texas Health and Safety Code, TCAA, §382.017, which provides the commission authority to adopt rules consistent with the policy and purposes of the TCAA; §382.002, which establishes the commission's purpose to safeguard the state's air resources, consistent with the protection of public health, general welfare, and physical property; §382.011, which authorizes the commission to control the quality of the state's air; §382.012, which authorizes the commission to develop plans to protect the state's air; and §382.016, which authorizes the commission to require that records of the air contaminant emissions from a source or activity be made and maintained.

The proposed amendments implement the TCAA, §382.011, relating to General Powers and Duties; §382.012, relating to State Air Control Plan; §382.017, relating to Rules; and TWC, §5.103, relating to Rules.

§115.532.Control Requirements.

(a) For the Beaumont/Port Arthur, Dallas/Fort Worth, El Paso, and Houston/Galveston areas, the owner or operator of a synthesized pharmaceutical manufacturing facility shall provide the following specified controls.

(1) - (4) (No change.)

(5) Pharmaceutical manufacturing facility. Any pharmaceutical manufacturing facility that becomes subject to the provisions of paragraphs (1) - (4) of this subsection by exceeding provisions of §115.537(a) of this title (relating to Exemptions) will remain subject to the provisions of this subsection, even if throughput or emissions later fall below exemption limits , unless and until emissions are reduced to no more than the controlled emissions level existing before implementation of the project by which throughput or emission rate was reduced to less than the applicable exemption limits in §115.537(a) of this title ; and:

(A) the project by which throughput or emission rate was reduced is authorized by any permit or permit amendment or standard permit or permit by rule [ standard exemption ] required by Chapter 116 or Chapter 106 of this title (relating to Control of Air Pollution by Permit for New Construction or Modification; and Permits by Rule [ Exemptions from Permitting ]). If a permit by rule [ standard exemption ] is available for the project, compliance with this subsection must be maintained for 30 days after the filing of documentation of compliance with that permit by rule [ standard exemption ]; or

(B) if authorization by permit, permit amendment, standard permit, or permit by rule [ standard exemption ] is not required for the project, the owner/operator has given the executive director 30 days' notice of the project in writing.

(b) For Gregg, Nueces, and Victoria Counties, the owner or operator of a synthesized pharmaceutical manufacturing facility shall provide the following specified controls.

(1) - (3) (No change.)

(4) Air dryers, production equipment exhaust systems, and loading facilities. Sources affected by §115.531(b) of this title [ (relating to Emission Specifications) ] shall be controlled by a system with a reduction efficiency of at least 90% of the uncontrolled emissions.

§115.533.Alternate Control Requirements.

(a) Alternate [ For all affected persons in the Beaumont/Port Arthur, Dallas/Fort Worth, El Paso, and Houston/Galveston areas, alternate ] methods of demonstrating and documenting continuous compliance with the applicable control requirements or exemption criteria in this division [ undesignated head ] (relating to Pharmaceutical Manufacturing Facilities) may be approved by the executive director in accordance with §115.910 of this title (relating to Availability of Alternate Means of Control) if emission reductions are demonstrated to be substantially equivalent.

(b) For all affected persons in Gregg, Nueces, and Victoria Counties, alternate methods of demonstrating and documenting continuous compliance with the applicable control requirements or exemption criteria in this undesignated head (relating to Pharmaceutical Manufacturing Facilities) may be approved by the executive director in accordance with §115.910 of this title (relating to Availability of Alternate Means of Control) if emission reductions are demonstrated to be substantially equivalent.

§115.535.Testing Requirements.

(a) For the Beaumont/Port Arthur, Dallas/Fort Worth, El Paso, and Houston/Galveston areas, compliance with this division (relating to Pharmaceutical Manufacturing Facilities) [ undesignated head concerning Pharmaceutical Manufacturing Facilities ] shall be determined by applying the following test methods, as appropriate:

(1) - (6) (No change.)

(b) For Gregg, Nueces, and Victoria Counties, compliance with this division [ undesignated head ] shall be determined by applying the following test methods , [ . ] as appropriate:

(1) - (6) (No change.)

§115.539.Counties and Compliance Schedules.

All affected persons in Brazoria, Chambers, Collin, Dallas, Denton, El Paso, Fort Bend, Galveston, Gregg, Hardin, Harris, Jefferson, Liberty, Montgomery, Nueces, Orange, Tarrant, Victoria, and Waller Counties shall continue to comply with this division [ undesignated head ] (relating to Pharmaceutical Manufacturing Facilities) as required by §115.930 of this title (relating to Compliance Dates).

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on December 20, 2001.

TRD-200108156

Stephanie Bergeron

Director, Environmental Law Division

Texas Natural Resource Conservation Commission

Earliest possible date of adoption: February 3, 2002

For further information, please call: (512) 239-4712


3. DEGASSING OR CLEANING OF STATIONARY, MARINE, AND TRANSPORT VESSELS

30 TAC §§115.541 - 115.543, 115.545 -115.547, 115.549

STATUTORY AUTHORITY

The amendments are proposed under TWC, §5.103, which authorizes the commission to adopt rules necessary to carry out its powers and duties under TWC; Texas Health and Safety Code, TCAA, §382.017, which provides the commission authority to adopt rules consistent with the policy and purposes of TCAA; §382.002, which establishes the commission's purpose to safeguard the state's air resources, consistent with the protection of public health, general welfare, and physical property; §382.011, which authorizes the commission to control the quality of the state's air; §382.012, which authorizes the commission to develop plans to protect the state's air; and §382.016, which authorizes the commission to require that records of the air contaminant emissions from a source or activity be made and maintained.

The proposed amendments implement TCAA, §382.011, relating to General Powers and Duties; §382.012, relating to State Air Control Plan; §382.017, relating to Rules; and TWC, §5.103, relating to Rules.

§115.541.Emission Specifications.

(a) For all persons in the Beaumont/Port Arthur, Dallas/Fort Worth, El Paso, and Houston/Galveston areas as defined in §115.10 of this title (relating to Definitions), the following emission specifications shall apply to degassing during or in preparation of cleaning.

(1) (No change.)

(2) For all transport vessels, as defined in §115.10 of this title, with a nominal storage capacity of 8,000 gallons or more . [ : ]

(A) - (E) (No change.)

(b) For all persons in the Beaumont/Port Arthur and Houston/Galveston areas, the following emission specifications shall apply to degassing during or in preparation of cleaning for all marine vessels, as defined in §101.1 [ §115.10 ] of this title (relating to Definitions) , which have a nominal storage capacity of 10,000 barrels (420,000 gallons) or more and contain VOCs.

(1) - (4) (No change.)

(5) All marine vessels, as defined in §101.1 [ §115.10 ] of this title, containing VOCs shall have all cargo tank closures properly secured, or maintain a negative pressure within the tank when a closure is opened, and shall have all pressure/vacuum relief valves operating within certified limits as specified by classification society or flag state until the vapors are discharged to a vapor control system if the vessel is degassed or cleaned.

§115.542.Control Requirements.

(a) (No change.)

(b) For all persons in the Beaumont/Port Arthur and Houston/Galveston areas, the following control requirements shall apply to marine vessels.

(1) - (3) (No change.)

(4) Vapors shall be routed to the control device until the marine vessel is stripped VOC liquid-free and a turnover of at least four vapor space volumes has occurred, the partial vapor pressure is less than 0.5 psia (19,000 ppmw, or 34,000 ppmv expressed as methane), or the concentration of VOC is less than 20% of the lower explosive [ explosion ] limit (LEL) . After one of these conditions has been satisfied, the marine vessel may be vented to the atmosphere for the remainder of the degassing or cleaning process.

§115.543.Alternate Control Requirements.

For all persons in the Beaumont/Port Arthur, Dallas/Fort Worth, El Paso, and Houston/Galveston areas, alternate methods of demonstrating and documenting continuous compliance with the applicable control requirements or exemption criteria in this division (relating to Degassing or Cleaning of Stationary, Marine, and Transport Vessels) [ undesignated head ] may be approved by the executive director [ Executive Director ] in accordance with §115.910 of this title (relating to Availability of Alternate Means of Control) if emission reductions are demonstrated to be substantially equivalent.

§115.545.Approved Test Methods.

For the Beaumont/Port Arthur, Dallas/Fort Worth, El Paso, and Houston/Galveston areas, compliance with §115.541 and §115.542 of this title (relating to Emission Specifications and Control Requirements) shall be determined by applying the following test methods, as appropriate:

(1) - (4) (No change.)

(5) additional test procedures described in 40 CFR §60.503 [ 60.503 ] b, c, and d (effective February 14, 1989) [ , ] for determining compliance for bulk gasoline terminals;

(6) - (8) (No change.)

(9) 40 CFR §63.565(c) (effective September 19, 1995) or [ determination of cargo tank pressurization method described in ] 40 CFR §61.304(f) (effective October 17, 2000) for determination of marine vessel vapor tightness [ 61.304(f) ]; or

(10) (No change.)

§115.546.Monitoring and Recordkeeping Requirements.

For facilities in the Beaumont/Port Arthur, Dallas/Fort Worth, El Paso, and Houston/Galveston areas affected by §115.541 and §115.542 of this title (relating to Emission Specifications and Control Requirements), the owner or operator of any volatile organic compound (VOC) degassing or cleaning facility shall maintain the following information at the facility for at least two years and shall make such information available upon request to representatives of the executive director [ Texas Natural Resource Conservation Commission ], EPA [ United States Environmental Protection Agency ], or any local air pollution control agency having jurisdiction in the area:

(1) (No change.)

(2) for vapor control systems:

(A) (No change.)

(B) continuous monitoring and recording of the inlet and outlet gas temperature of a catalytic incinerator; and

(C) continuous monitoring and recording of the exhaust gas VOC concentration for carbon adsorption systems that contain facilities to regenerate the carbon bed directly, as defined in §115.10 of this title (relating to Definitions); or periodic monitoring of the exhaust gas VOC as specified by 40 Code of Federal Regulations §61.354(d) (effective October 17, 2000) [ 61.354(d) ], of any carbon adsorption system that does not regenerate the carbon bed directly, to determine breakthrough; [ and ]

[(D) the date and reason for any maintenance and repair of the required control devices and the estimated quantity and duration of VOC emissions during such activities;]

(3) the results of any leak inspection and repair conducted in accordance with the provisions specified in §115.544 of this title (relating to Inspection Requirements); and

(4) (No change.)

§115.547.Exemptions.

For all persons in the Beaumont/Port Arthur, Dallas/Fort Worth, El Paso, and Houston/Galveston areas as defined in §115.10 of this title (relating to Definitions), the following exemptions apply.

(1) Degassing or cleaning any vessel with a vapor space partial pressure less than 0.5 pounds per square inch absolute (3.4 kPa) of volatile organic compound (VOC) under actual storage conditions is exempt from the requirements of this division (relating to Degassing or Cleaning of Stationary, Marine, and Transport Vessels) [ undesignated head ].

(2) Degassing or cleaning any transport vessel with a nominal storage capacity of less than 8,000 gallons, or any stationary VOC storage tank with a nominal storage capacity of less than 1 million gallons, or any marine vessel with a nominal storage capacity of less than 10,000 barrels (420,000 gallons), is exempt from the requirements of this division [ undesignated head ].

(3) Any stationary VOC storage tank during preventative maintenance, roof repair, primary seal inspection, or removal and installation of a secondary seal, if product is not moved in or out of the storage tank, emissions are minimized, and the repair is completed within seven calendar days , is exempt from the requirements of this division .

(4) Any marine vessel which has sustained damage which prevents a cargo tank's opening from being properly secured, the onboard vapor recovery system to be inoperative, or the pressure/vacuum relief valves from operating within certified limits as specified by classification society or flag state is exempt from §115.541(b) [ §115.541(3) ] and §115.542(b) of this title (relating to Emission Specifications and Control Requirements); however, all reasonable measures shall be taken to minimize VOC emissions.

(5) Any oceangoing, self-propelled marine vessel is exempt from the degassing or cleaning requirements of this division [ undesignated head ].

§115.549.Counties and Compliance Schedules.

(a) All affected persons in the Brazoria, Chambers, [ El Paso, ] Fort Bend, Galveston, Hardin, Harris, Jefferson, Liberty, Montgomery, Orange, and Waller Counties shall continue to comply [ be in compliance ] with this division [ undesignated head ] (relating to Degassing or Cleaning of Stationary, Marine, and Transport Vessels) as required by §115.930 of this title (relating to Compliance Dates) [ soon as practicable, but no later than November 15, 1996 ].

(b) All affected persons in Collin, Dallas, Denton, and Tarrant Counties shall be in compliance with this division [ undesignated head ] as soon as practicable, but no later than one year, after the commission [ Texas Natural Resource Conservation Commission (TNRCC) ] publishes notification in the Texas Register of its determination that this contingency rule is necessary as a result of failure to attain the national ambient air quality standard (NAAQS) for ozone by the attainment deadline or failure to demonstrate reasonable further progress as set forth in the 1990 Amendments to the Federal Clean Air Act (FCAA), §172(c)(9).

(c) All affected persons in El Paso County shall be in compliance with this division [ undesignated head ] as soon as practicable, but no later than one year, after the commission [ TNRCC ] publishes notification in the Texas Register of its determination that this contingency rule is necessary as a result of failure to attain the NAAQS for ozone by the attainment deadline or failure to demonstrate reasonable further progress as set forth in the1990 Amendments to the FCAA, §172(c)(9).

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on December 20, 2001.

TRD-200108157

Stephanie Bergeron

Director, Environmental Law Division

Texas Natural Resource Conservation Commission

Earliest possible date of adoption: February 3, 2002

For further information, please call: (512) 239-4712


4. PETROLEUM DRY CLEANING SYSTEMS

30 TAC §115.552, §115.559

STATUTORY AUTHORITY

The amendments are proposed under TWC, §5.103, which authorizes the commission to adopt rules necessary to carry out its powers and duties under TWC; Texas Health and Safety Code, TCAA, §382.017, which provides the commission authority to adopt rules consistent with the policy and purposes of TCAA; §382.002, which establishes the commission's purpose to safeguard the state's air resources, consistent with the protection of public health, general welfare, and physical property; §382.011, which authorizes the commission to control the quality of the state's air; §382.012, which authorizes the commission to develop plans to protect the state's air; and §382.016, which authorizes the commission to require that records of the air contaminant emissions from a source or activity be made and maintained.

The proposed amendments implement TCAA, §382.011, relating to General Powers and Duties; §382.012, relating to State Air Control Plan; §382.017, relating to Rules; and TWC, §5.103, relating to Rules.

§115.552.Control Requirements.

(a) (No change.)

(b) Any petroleum solvent dry cleaning facility that becomes or is currently subject to the control requirements of subsection (a) of this section by exceeding the exemption limit of §115.157 of this title (relating to Exemptions) shall remain subject to the provisions of this section, even if its consumption of petroleum solvent later falls below the exemption level , unless and until its uncontrolled solvent consumption is reduced to no more than its solvent consumption level before lifting controls; and :

(1) the project by which solvent consumption was reduced is authorized by any permit or permit amendment or standard permit or permit by rule [ standard exemption ] required by Chapter 116 or Chapter 106 of this title (relating to [ (concerning ] Control of Air Pollution by Permits for New Construction or Modification; and Permits by Rule [ Exemptions from Permitting ]). If a permit by rule [ standard exemption ] is available for the project, compliance with this subsection shall be maintained for 30 days after the filing of documentation of compliance with that permit by rule [ standard exemption ]; or

(2) if authorization by permit, permit amendment, standard permit, or permit by rule [ standard exemption ] is not required for the project, the owner/operator has given the executive director 30 days' notice of the project in writing.

§115.559.Counties and Compliance Schedules.

(a) All affected petroleum solvent dry cleaning facilities in Collin, Dallas, Denton, and Tarrant Counties shall be in compliance with this division (relating to Petroleum Dry Cleaning Systems) [ §§115.552, 115.553, and 115.555 - 115.557 of this title (relating to Control Requirements; Alternate Control Requirements; Testing Methods and Procedures; Recordkeeping Requirements; and Exemptions) ] as soon as practicable, but no later than one year, after the commission [ Texas Natural Resource Conservation Commission (commission) ] publishes notification in the Texas Register of its determination that this contingency rule is necessary as a result of failure to attain the national ambient air quality standard [ National Ambient Air Quality Standard ] (NAAQS) for ozone by the attainment deadline or failure to demonstrate reasonable further progress as set forth in the 1990 Amendments to the Federal Clean Air Act, §172(c)(9).

(b) - (d) (No change.)

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on December 20, 2001.

TRD-200108158

Stephanie Bergeron

Director, Environmental Law Division

Texas Natural Resource Conservation Commission

Earliest possible date of adoption: February 3, 2002

For further information, please call: (512) 239-4712


Subchapter J. ADMINISTRATIVE PROVISIONS

1. ALTERNATE MEANS OF CONTROL

30 TAC §§115.910 - 115.916

STATUTORY AUTHORITY

The amendments are proposed under TWC, §5.103, which authorizes the commission to adopt rules necessary to carry out its powers and duties under TWC; Texas Health and Safety Code, TCAA, §382.017, which provides the commission authority to adopt rules consistent with the policy and purposes of TCAA; §382.002, which establishes the commission's purpose to safeguard the state's air resources, consistent with the protection of public health, general welfare, and physical property; §382.011, which authorizes the commission to control the quality of the state's air; §382.012, which authorizes the commission to develop plans to protect the state's air; and §382.016, which authorizes the commission to require that records of the air contaminant emissions from a source or activity be made and maintained.

The proposed amendments implement TCAA, §382.011, relating to General Powers and Duties; §382.012, relating to State Air Control Plan; §382.017, relating to Rules; and TWC, §5.103, relating to Rules.

§115.910.Availability of Alternate Means of Control.

(a) Any person affected by a control requirement and/or emission specification of this chapter may request approval of an alternate means of control (AMOC) plan using the procedures established in §115.913 of this title (relating to Procedures for Alternate Means of Control Plan Submittal). Such AMOC plan shall be approved if it is demonstrated that the plan meets all applicable criteria and procedures of §§115.911 - 115.913, 115.915, and 115.916 of this title (relating to Criteria for Approval of Alternate Means of Control [ AMOC ] Plans; Calculations for Determining Alternate Means of Control [ AMOC ] Reductions; Procedures for Alternate Means of Control [ AMOC ] Plan Submittal; Public Notice Format; and Review of Approved Alternate Means of Control [ AMOC ] Plans and Termination of Alternate Means of Control [ AMOC ] Plans). The AMOC plans not satisfying the requirements of this division (relating to Alternate Means of Control) [ undesignated head ] may apply for a site-specific State Implementation Plan revision approved by the executive director and EPA [ the United States Environmental Protection Agency ].

(b) An AMOC applicant may apply to the executive director for a waiver of portions of §115.913 of this title [ (relating to Procedures for Alternate Means of Control Plan Submittal) ] which may not apply to a single-source AMOC application and for §115.914 and §115.915 of this title (relating to Procedures for an Alternate Means of Control Plan Approval ; and Public Notice Format). A single-source AMOC application is one that proposes only the substitution of one control device for another.

(c) - (d) (No change.)

§115.911.Criteria for Approval of Alternate Means of Control Plans.

An alternate means of control (AMOC) plan shall be approved if it meets each of the following criteria, as applicable.

(1) All facilities covered by the AMOC plan are and remain in the same [ Texas Natural Resource Conservation Commission ] account number.

(2) - (3) (No change.)

(4) The AMOC application must demonstrate that the sum of the maximum daily potentials to emit from the sources subject to the proposed AMOC plan shall not be more than 200 pounds per day greater than the sum of the maximum daily potentials to emit from those sources if the emissions were controlled in accordance with this chapter [ , concerning Control of Air Pollution from Volatile Organic Compounds ]. For each nonattainment area, the executive director shall establish a limit upon the sum of the increases of the maximum daily potentials to emit from all AMOC plans in the nonattainment area. The limit shall be set so that the sum of the maximum daily potentials to emit shall not increase the measurable or modeled ozone level by one part per billion.

(5) (No change.)

(6) Reductions in actual emissions accounted for in the AMOC plan must be surplus and remain surplus to reductions required by this chapter and any netting or offsetting requirements of §§116.150, 116.151, 116.160, and 116.161 of this title (relating to New Major Source or Major Modification in Ozone Nonattainment Areas; New Major Source or Major Modification in Nonattainment Area Other Than Ozone; Prevention of Significant Deterioration Requirements; and Source Located in an Attainment Area with a Greater Than De Minimis Impact) [ §116.150 of this title (relating to New Major Source or Major Modification in Ozone Nonattainment Area), §116.151 of this title (relating to New Major Source or Major Modification in Nonattainment Area Other Than Ozone), §116.160 of this title (relating to Prevention of Significant Deterioration Requirements), and §116.161 of this title (relating to Source Located in an Attainment Area with a Greater Than De Minimis Impact) ]. Reductions for which the state has claimed credit in a State Implementation Plan may not be utilized as reductions in an AMOC plan.

(7) - (9) (No change.)

(10) The AMOC plan must include all necessary and appropriate provisions for monitoring, testing, reporting, and recordkeeping as specified by the executive director. The frequency of AMOC required monitoring, testing, reporting, and recordkeeping shall be sufficient to reasonably ensure compliance with applicable emission limits and/or control requirements. The monitoring, testing, reporting, and recordkeeping shall be at least as reliable, readily retrievable, and retained for a comparable period of time as the underlying requirements of this chapter [ , concerning the Control of Air Pollution from Volatile Organic Compounds ].

(A) If this chapter includes monitoring, testing, reporting, and/or recordkeeping requirements for sources of the type(s) to be covered by an alternate emission limitation and/or control requirement, then such requirement may be used to render the AMOC plan enforceable. If this chapter does not include readily transferable monitoring, testing, reporting, and/or recordkeeping requirements for sources of the type(s) to be covered by an alternate emission limitation and/or control requirement, then priority may be given to any such set of requirements adopted under other commission [ TNRCC ] rules for the control of volatile organic compounds (VOC) emissions from sources of the type(s) to be covered by an alternate emission limitation and/or control requirement.

(B) If this chapter includes emission limits and/or control requirements for sources of the type(s) to be covered by an alternate emission limitation and/or control requirement, then such alternative emission limitation and/or control requirement may be based on the same averaging time as is applied to those same type sources under this chapter. If this chapter does not include emission limitations and/or control requirements for sources of the type(s) to be covered by an alternate emission limit and/or control requirement, then priority may be given to averaging times for emission limits and/or control requirements on similar units governed by other commission [ TNRCC ] rules limiting VOC emissions from sources of the type(s) to be covered by an alternate emission limit and/or control requirement.

(C) If no such commission [ TNRCC ] monitoring, testing, reporting, and/or recordkeeping rules have been adopted that satisfy the criteria of subparagraphs (A) and (B) of this paragraph, then such requirements or averaging times shall be established on a case-by-case basis.

(D) (No change.)

§115.912.Calculations for Determining Alternate Means of Control [ AMOC ] Reductions.

(a) For purposes of this section, a source's baseline is defined as the annual emissions that are calculated assuming full compliance with the adopted requirements of this chapter and using data representative of actual operations in 1990 or thereafter for all variables necessary to calculate annual emissions for the identified source.

(1) For an alternate means of control (AMOC) [ AMOC ] application exclusively utilizing a source that existed prior to January 1, 1990, the AMOC application shall use data representative of actual operations in 1990.

(2) - (3) (No change.)

(b) The AMOC [ alternate means of control (AMOC) ] applicant shall determine annual emissions limits for each source included in the AMOC plan by utilizing the best available data and good engineering practice, which may include the use of statistical techniques to address variations in the data.

(c) For any source not controlled as otherwise specifically required by this chapter where an applicable adopted requirement exists, the AMOC applicant shall calculate credits needed by subtracting the source's baseline from the source's annual emissions limit under the AMOC plan. This difference shall then be multiplied by the appropriate factor in §115.911(3) of this title (relating to Criteria for Approval of Alternate Means of Control [ AMOC ] Plans), to determine the credits that must be generated by other sources.

(d) - (f) (No change.)

§115.913.Procedures for Alternate Means of Control Plan Submittal.

(a) All persons requesting an alternate means of control (AMOC) plan as provided by §115.910 of this title (relating to Availability of Alternate Means of Control) shall submit a proposed AMOC plan and demonstration to the executive director; copies of such plan and demonstration to the appropriate regional office [ Texas Natural Resource Conservation Commission (TNRCC) Regional Office ]; copies to any local air pollution control program with jurisdiction over the [ TNRCC ] account affected by the AMOC plan; and copies to the EPA regional office [ United States Environmental Protection Agency Regional Office in Dallas ].

(b) The proposed AMOC plan shall include the following information:

(1) the AMOC applicant name with mailing address, site name with physical address, [ TNRCC ] account number, and contact person including address and telephone number;

(2) - (8) (No change.)

(9) a list containing the name, address, and telephone number of any air pollution control program with jurisdiction over the [ TNRCC ] account affected by the AMOC plan; and

(10) (No change.)

(c) - (d) (No change.)

§115.914.Procedures for an Alternate Means of Control Plan Approval.

Upon a preliminary determination to approve or deny the proposed alternative means of control (AMOC) plan, the executive director shall, in writing, so notify the submitter of the plan, any local air pollution control program with jurisdiction over the [ Texas Natural Resource Conservation Commission (TNRCC or commission) ] account affected by the AMOC plan, and the EPA regional office [ United States Environmental Protection Agency (EPA) Regional Office in Dallas ].

(1) - (5) (No change.)

(6) The executive director shall send written notice of his/her final determination concerning each AMOC plan to the submitter of the plan, the EPA regional office [ Regional Office ], any local pollution control program with jurisdiction over the [ TNRCC ] account affected by the AMOC plan, and to each person who submitted timely written comments. Such notice shall include final AMOC plan provisions, a copy of the response to comments, and an announcement of the opportunity to appeal the executive director's determination to the commission. The notice required by this subsection shall be sent by a means evidencing receipt.

(7) (No change.)

(8) Within 45 days of final approval of the AMOC plan by the executive director, EPA may notify the commission [ TNRCC ] of EPA's disapproval of the executive director's final decision. Such notification shall be in writing and shall include a statement of the reason(s) for the disapproval and a specific listing of changes to the AMOC plan that must be made in order to overcome the disapproval. Any time prior to the expiration of the 45-day period, EPA may notify the executive director that no disapproval is forthcoming. Upon receipt of a timely EPA disapproval, the executive director shall void or revise the AMOC plan, and reissue the notice as required by paragraph (6) of this section.

(9) - (11) (No change.)

§115.915.Public Notice Format.

(a) Public notice shall be published in the public notice section of two successive issues of a newspaper of general circulation in or closest to the municipality in which the facility with the [ Texas Natural Resource Conservation Commission (TNRCC) ] account affected by the alternative means of control (AMOC) plan is located.

(b) Public notice shall contain the following information:

(1) AMOC plan application number assigned by the executive director [ TNRCC ];

(2) - (6) (No change.)

(7) the locations and availability of copies of the proposed AMOC plan, related documentation, and the executive director's preliminary analysis of the plan (including the [ TNRCC ] Austin and appropriate regional offices [ Regional Offices ], any local pollution control program with jurisdiction over the [ TNRCC ] account affected by the AMOC plan, and the EPA regional office [ United States Environmental Protection Agency's (EPA) Regional Office) ];

(8) - (10) (No change.)

(11) the name, address, and phone number of the regional [ TNRCC ] office to be contacted for further information.

(c) The AMOC plan submitter shall provide proof of adequate notice to the executive director [ TNRCC ], EPA, and any local pollution control program with jurisdiction over the [ TNRCC ] account affected by the AMOC plan before the executive director may take final action on the AMOC plan.

§115.916.Review of Approved Alternate Means of Control Plans and Termination of Alternate Means of Control Plans.

(a) For the purposes of this division (relating to Alternate Means of Control) [ undesignated head ], "compliance date" shall mean the date by which a source must comply with new or modified sections of this chapter.

(b) - (c) (No change.)

(d) Upon final approval of an AMOC plan, the owner or operator of the facilities affected by such plan shall keep a copy of the plan on the site affected by the plan and shall make the plan [ which shall be made ] available upon request to [ the Texas Natural Resource Conservation Commission ] representatives of the executive director, EPA, or any local air pollution control agency having jurisdiction in the area [ upon request ].

(e) Upon request, each holder of an AMOC plan shall submit to the executive director a demonstration that the plan continues to meet all applicable criteria of this division [ undesignated head ].

(f) (No change.)

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on December 20, 2001.

TRD-200108159

Stephanie Bergeron

Director, Environmental Law Division

Texas Natural Resource Conservation Commission

Earliest possible date of adoption: February 3, 2002

For further information, please call: (512) 239-4712


2. EARLY REDUCTIONS

30 TAC §115.920, §115.923

STATUTORY AUTHORITY

The amendments are proposed under TWC, §5.103, which authorizes the commission to adopt rules necessary to carry out its powers and duties under TWC; Texas Health and Safety Code, TCAA, §382.017, which provides the commission authority to adopt rules consistent with the policy and purposes of TCAA; §382.002, which establishes the commission's purpose to safeguard the state's air resources, consistent with the protection of public health, general welfare, and physical property; §382.011, which authorizes the commission to control the quality of the state's air; §382.012, which authorizes the commission to develop plans to protect the state's air; and §382.016, which authorizes the commission to require that records of the air contaminant emissions from a source or activity be made and maintained.

The proposed amendments implement TCAA, §382.011, relating to General Powers and Duties; §382.012, relating to State Air Control Plan; §382.017, relating to Rules; and TWC, §5.103, relating to Rules.

§115.920.Applicability.

Any person affected by any control requirement of this chapter may apply to the executive director [ Texas Natural Resource Conservation Commission (TNRCC) ] for a six-year extension of the compliance date for the control requirements imposed by any section of this chapter adopted after July 9, 1993, provided that the owner or operator of the affected sources has an approved early reduction application for those sources for which the owner or operator is seeking an extension as specified in 40 Code of Federal Regulations [ CFR ] §63.79, and for which:

(1) - (2) (No change.)

(3) the alternate VOC reductions created by the Early Reductions Program must be surplus to reductions required by this chapter and any netting or offsetting requirements of §116.150 of this title (relating to New Major Source or Major Modification in Ozone Nonattainment Areas [ Area Other Than Ozone ]) [ , ] and §116.161 of this title (relating to Source Located in an Attainment Area with a Greater Than De Minimis Impact); and

(4) (No change.)

§115.923.Documentation.

(a) For each source requesting a six-year extension of the compliance date for control requirements in accordance with §115.920 of this title (relating to Applicability), there shall be established an Early Reductions Plan reflecting the emission reduction for VOC which qualifies the source for the six-year extension. In lieu of preparing a site-specific State Implementation Plan (SIP) for such Early Reductions Plan, a facility owner or operator shall comply with the requirements of this division (relating to Early Reductions) [ undesignated head ].

(b) Documentation required for approval of the extension shall demonstrate to the satisfaction of the [ TNRCC ] executive director that emissions data for the identified source reflects verifiable data based on information for such source. Documentation shall include but is not limited to:

(1) - (11) (No change.)

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on December 20, 2001.

TRD-200108160

Stephanie Bergeron

Director, Environmental Law Division

Texas Natural Resource Conservation Commission

Earliest possible date of adoption: February 3, 2002

For further information, please call: (512) 239-4712


3. COMPLIANCE AND CONTROL PLAN REQUIREMENTS

30 TAC §§115.930, 115.932, 115.934, 115.940

STATUTORY AUTHORITY

The amendments are proposed under TWC, §5.103, which authorizes the commission to adopt rules necessary to carry out its powers and duties under TWC; Texas Health and Safety Code, TCAA, §382.017, which provides the commission authority to adopt rules consistent with the policy and purposes of TCAA; §382.002, which establishes the commission's purpose to safeguard the state's air resources, consistent with the protection of public health, general welfare, and physical property; §382.011, which authorizes the commission to control the quality of the state's air; §382.012, which authorizes the commission to develop plans to protect the state's air; and §382.016, which authorizes the commission to require that records of the air contaminant emissions from a source or activity be made and maintained.

The proposed amendments implement TCAA, §382.011, relating to General Powers and Duties; §382.012, relating to State Air Control Plan; §382.017, relating to Rules; and TWC, §5.103, relating to Rules.

§115.930.Compliance Dates.

For all counties affected by this chapter, the final compliance dates for revisions to control requirements are given within the section relating to counties and compliance schedules in each division [ undesignated head ] if the final compliance date of any provision is after the date of adoption of the current revision to this chapter. If the compliance dates are not specified for any provision, the compliance date is past and all affected persons must be and remain in compliance with the provision as of the original compliance date.

§115.932.Control Plan Procedure.

Within 30 days of a request by the executive director [ Texas Natural Resource Commission (TNRCC) ], the owner or operator of any facility affected by the requirements of any division [ undesignated head ] in this chapter [ (Chapter 115) ] shall submit a control plan for compliance which includes the compliance status of all emission controls required by this chapter [ regulation ], and a detailed description of the method to be followed to achieve compliance, specifying the exact dates by which the following steps will be taken to achieve compliance:

(1) - (4) (No change.)

§115.934.Control Plan Deviation.

No persons affected by §115.932 of this title (relating to Control Plan Procedure) shall deviate from the terms of the control plans including the date for final compliance and the dates for accomplishing the required steps in such plans. The executive director may, upon application of any person affected, change the date for accomplishing the required steps in a plan. Any control plan that specifies a final compliance date subsequent to the date specified by any sections of this chapter [ regulation ] must be approved by the executive director [ Texas Air Control Board (TACB) ]. Approval of a delayed compliance order by the executive director [ TACB ] does not constitute satisfaction of all federal requirements nor eliminate the need for EPA approval [ by the United States Environmental Protection Agency ].

§115.940.Equivalency Determination.

Upon final adoption of any volatile organic compound program of general applicability by EPA [ the United States Environmental Protection Agency (EPA) ], the executive director may review the provisions of the EPA program and the corresponding state program to determine the essential equivalency of the two programs. If the executive director determines that the EPA program is essentially equivalent to the requirements for this chapter, the executive director will state by notice published in the Texas Register that the regulated community will be considered to be in compliance with the new EPA program if they are in compliance with the applicable provisions of this chapter. Conversely, the regulated community will be considered to be in compliance with the applicable provisions of this chapter if they are in compliance with the new EPA program. Notice of intent to publish such equivalency determination shall be provided to the appropriate EPA regional office 45 days prior to publication. The executive director shall review any objection from EPA prior to final publication. Each affected company must file a notice of intent to inform the state which program they intend to use. The executive director will then inform the EPA regional office of each notice of intent.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on December 20, 2001.

TRD-200108161

Stephanie Bergeron

Director, Environmental Law Division

Texas Natural Resource Conservation Commission

Earliest possible date of adoption: February 3, 2002

For further information, please call: (512) 239-4712


Chapter 116. CONTROL OF AIR POLLUTION BY PERMITS FOR NEW CONSTRUCTION OR MODIFICATION

The Texas Natural Resource Conservation Commission (commission) proposes amendments to Subchapter A, Definitions, §116.10 and §116.18; and Subchapter I, Electric Generating Facilities, §§116.910, 116.911, 116.913, 116.921, and 116.930. The commission proposes new §§116.770 - 116.772, 116.774 - 116.777, 116.779 - 116.781, 116.783, 116.785 - 116.788, 116.790, 116.793 - 116.802, and 116.804 - 116.807 in Subchapter H, Voluntary Emission Reduction Permits; and new §§116.917, 116.918, 116.926, and 116.928 in Subchapter I. All sections of Subchapter H and the new and amended sections of Subchapter A and I are proposed to be submitted to the United States Environmental Protection Agency (EPA) as a revision to the state implementation plan (SIP).

BACKGROUND AND SUMMARY OF THE FACTUAL BASIS FOR THE PROPOSED RULES

During the 75th Legislature, 1997, House Bill (HB) 3019 directed the commission to develop a voluntary emissions reduction plan for the permitting of existing significant sources. These existing significant sources are commonly known as grandfathered facilities. A grandfathered facility is one that existed at the time the legislature created the Texas Clean Air Act (TCAA) in 1971. These facilities were not required to comply with (i.e., grandfathered from) the then new requirement to obtain permits for construction or modifications of facilities that emit air contaminants. If grandfathered facilities have not been modified since 1971, they continue to be authorized to operate without a permit. The intent of HB 3019 was to create a program that would encourage the remaining grandfathered facilities to voluntarily obtain permits that would reduce the emissions from those facilities. In response to HB 3019, the commission created the Clean Air Responsibility Enterprise (CARE) Committee to develop recommendations for the voluntary permitting of grandfathered facilities.

In 1999, the 76th Legislature used the CARE Committee's recommendation as the basis for Senate Bill (SB) 766 which directed the commission to develop rules containing incentives for the voluntary permitting of grandfathered facilities. This program is known as the Voluntary Emission Reduction Permit (VERP) program. The commission adopted rules to implement the VERP program on December 16, 1999. Since the VERP rules became effective, the owners and operators of a number of grandfathered facilities have taken advantage of the incentives offered by the VERP program and submitted VERP applications for their grandfathered facilities. Additionally, the owners and operators of other grandfathered facilities have submitted permit-by-rule registrations and other new source review permit applications to permit their grandfathered facilities. The deadline to apply for a VERP was August 31, 2001.

Additionally, the 76th Legislature, 1999, amended the Texas Utilities Code, Title 2, Public Utility Regulatory Act, Subtitle B, Electric Utilities, and created a new Chapter 39, Restructuring of Electric Utility Industry by adopting SB 7. Senate Bill 7 required the commission to implement the permitting and allowance requirements of new Texas Utilities Code, §39.264, concerning Emissions Reductions of "Grandfathered Facilities." Senate Bill 7 required the commission to develop a mass cap and trade system to distribute emission allowances for use by electric generating facilities (EGFs). Under SB 7, two categories of EGFs are eligible to use the proposed trading system. The first category consisted of EGFs in existence on January 1, 1999, which were not subject to the requirement to obtain a permit under TCAA, §382.0518(g). These facilities are commonly referred to as grandfathered facilities. Senate Bill 7 also mandated that grandfathered EGFs apply for a permit on or before September 1, 2000, and obtain a permit by, or cease operation after May 1, 2003. The second category of EGFs consisted of permitted EGFs that were not subject to the permitting requirements of SB 7, yet elected to participate in the allowance trading system.

Most recently, the 77th Legislature, 2001, amended the Texas Health and Safety Code (THSC), TCAA to require that all grandfathered facilities obtain permits. The mandatory permitting requirements of HB 2912 are the culmination of legislative efforts, beginning in 1997, to permit or otherwise authorize all grandfathered facilities. House Bill 2912 created four new types of permits for grandfathered facilities: existing facility permits, small business stationary source permits, EGF permits, and pipeline facility permits. House Bill 2912 also mandated the dates by which grandfathered facilities must apply for a permit and have controls operational or submit a shutdown notice. Grandfathered facilities that are addressed by an application for a VERP are not required to comply with the provisions of HB 2912 for grandfathered facilities. However, grandfathered facilities that withdraw their VERP applications and elect to submit a permit application for an authorization under HB 2912 will forfeit those incentives, including eligibility for amnesty from enforcement.

House Bill 2912 specifies certain requirements based upon the geographic location of the grandfathered facility. Grandfathered facilities must submit permit applications or notices of shutdown by September 1, 2003 for facilities in East Texas; September 1, 2004 for facilities in West Texas; and for small business stationary source permits, by September 1, 2004, irrespective of the location of the facility. The commission is required to act on applications by the first anniversary after receipt of an administratively complete application, but allows the commission to grant a facility's request for a one-year extension, for good cause.

Existing facility permits are available for all grandfathered facilities, and require consideration of ten year old best available control technology (BACT), considering the age and remaining useful life of the facility. Existing facility flexible permits are also available for grandfathered facilities and facilities permitted under a VERP, located at a single site. Small business stationary source permits are available for sources defined as a small business stationary source in TCAA, §382.0365(h) and which do not have to submit emissions inventory information under TCAA, §382.014. Facilities eligible for small business stationary source permits may not emit air contaminants after March 1, 2008 if they do not have a permit or a pending application. House Bill 2912 provides that gas-fired EGFs that were required to obtain a permit under SB 7, or were exempt from the requirement to obtain a SB 7 permit, are considered permitted for all air contaminants. House Bill 2912 also provided that coal-fired EGFs that were required to obtain a permit under SB 7 are considered permitted for nitrogen oxides (NO x ), sulfur dioxide (SO 2 ), and particulate matter (PM) as it relates to opacity. House Bill 2912 further provides that coal-fired EGFs are eligible for an EGF permit for the criteria pollutants not addressed by the SB 7 permit. Additionally, TCAA, §382.05185 provides for the permitting of: 1) generators that do not generate electric energy for compensation and are not used more than 10% of the annual operating schedule; and 2) auxiliary fossil-fuel-fired combustion facilities that do not generate electric energy and do not emit more than 100 tons per year (tpy) of any air contaminant.

Grandfathered reciprocating internal combustion engines that are part of the processing, treating, compression, or pumping facilities connected to, or part of, a gathering or transmission pipeline may apply for a pipeline facilities permit. An applicant may apply for a single permit for all engines connected to a pipeline or a separate permit for all discrete and separate engines. Additionally, the commission must allow for mandatory emission reductions to be achieved at either a single engine or by averaging reductions among multiple engines connected to a pipeline. House Bill 2912 requires a 50% reduction in NO x emissions at facilities located in East Texas, and allows the commission to require up to a 50% reduction in volatile organic compounds (VOC). For facilities located in West Texas, the commission may require up to a 20% reduction in NO x and VOC. If sources elect to average emissions to achieve the mandatory reductions, they cannot include reductions made to comply with other state or federal requirements. However, if a source does not average emissions to achieve the mandatory reductions, they may include reductions made since January 1, 2001 to comply with other state or federal requirements.

Texas Clean Air Act, §382.05181(h) provides that applications for pipeline facility permits, existing facility permits, existing facility flexible permits, and EGF permits are subject to the public notice and hearing requirements of TCAA, §382.05191. Texas Clean Air Act, §382.05191 provides that public participation for initial issuance of a permit under TCAA, §§382.05183, 382.05185(c) or (d), 382.05186, or 382.0519 will be done in the manner of TCAA, §382.0561, concerning Federal Operating Permit; Hearing, and TCAA, §382.0562, concerning Notice of Decision. These sections allow for notice and comment hearings instead of contested case hearings under Texas Government Code, Chapter 2001, and require the commission to send notice of final action to persons who comment during the comment period or during a hearing. This is the same process authorized for VERPs by SB 766.

Small business stationary source permits are not subject to these notice and comment hearing procedures. Review and renewals of existing facility permits, EGF permits, pipeline facility permits, and small business stationary source permits will be conducted under the same procedures for preconstruction permits, generally. Existing facility permits, EGF permits, pipeline facility permits, and small business stationary source permits are subject to judicial review, under TCAA, §382.032.

House Bill 2914, §78, 77th Legislature, 2001 created a new incentive program to assist in retrofitting reciprocating internal combustion engines associated with pipelines. The new TCAA, §382.051865, Reimbursement Program for Certain Emissions Reductions from Reciprocating Internal Combustion Engines Associated with Pipelines, provides that the commission may develop a program, in cooperation with local governments, other agencies, and EPA to provide incentives to owners or operators of reciprocating internal combustion engines that are required to make a 50% reduction in NO x emissions under new TCAA, §382.05186, Pipeline Facilities Permits.

House Bill 2914, §78 also established an Emissions Reductions Incentives Account within the Clean Air Account No. 151. The section establishes guidelines for how any money deposited into this account is to be distributed to owners or operators making reductions in NO x emissions from grandfathered reciprocating internal combustion engines associated with pipelines. House Bill 2914 provides for a partial reimbursement for the capital cost of installing technology to reduce emissions that meet certain criteria. To implement these revisions, the commission is proposing new §116.776, Distribution of Funds from the Emissions Reductions Incentives Account for Control of Emissions from Grandfathered Reciprocating Internal Combustion Engines Located in the East Texas Region, in Subchapter H. The proposed section identifies the facilities which are eligible for a partial reimbursement for the cost of controls. The proposed rules also contain the criteria the commission will consider in determining who will receive money from the account and how much money a particular facility will receive. In order to be eligible for reimbursement under this program, the owner or operator of a grandfathered reciprocating internal combustion engine must make a 50% reduction in actual emissions of NO x as compared to the emissions reported for the facility in the 1997 industrial point source emissions inventory. The commission believes that an actual reduction in emissions should be necessary to receive reimbursement in order to assure that air quality benefits will be achieved under this incentive program. Another criteria for reimbursement is the requirement to obtain a pipeline facilities permit or replace the grandfathered engine with an electric engine. This implements the HB 2914 requirement that limits reimbursement to facilities required to achieve a 50% reduction in NO x emissions. Facilities that obtain pipeline facility permits are the only facilities required to achieve a 50% reduction in NO x emissions and the replacement of grandfathered engines with electric engines will eliminate that source of NO x emissions. A pipeline facility permit must be issued prior to a request for distribution under the program, and emission controls identified in the permit must be operating prior to a distribution from the account to enable the commission to process applications for reimbursement and provide for a control check prior to distribution of funds. The commission further identified the following criteria for distribution: location of the facility, percentage of reduction in the hourly emissions of NO x , cost effectiveness of the controls, and when the reductions are actually achieved and the request for reimbursement is received. These criteria will provide incentives to ensure that reimbursements for emission reductions are prioritized for those reductions that occur in areas of the state where those reductions will be beneficial, for projects that achieve the highest percentage reductions first, are most cost effective, and for projects that occur early. Weighting the criteria to provide for larger, cost effective, earlier reductions considering the area of the state where the reduction is proposed will maximize the air quality benefits for the state. The commission will issue guidance concerning the implementation of the reimbursement program.

Currently, the proposal contains language allowing the commission to delegate to the executive director the authority to take action on permit applications for grandfathered facilities. The commission solicits comment on the proposal to delegate to the executive director the authority to take any action on these grandfathered facility permits, and also to make decisions regarding the implementation and administration of the permitting program, generally.

To implement these revisions to the TCAA, the commission is proposing new and amended rules in Chapter 116, Subchapter A, Definitions; Subchapter H, Voluntary Emission Reduction Permits; and Subchapter I, Electric Generating Facilities. Additionally, revisions to 30 TAC Chapter 39, Public Notice, are necessary to implement the provisions of HB 2912. The proposed amendments to Chapter 39 will be published in a later issue of the Texas Register . The commission was unable to open the necessary sections of Chapter 39 until those sections were officially closed in another rulemaking action.

SECTION BY SECTION DISCUSSION

Subchapter A, Definitions

The proposed amendment to §116.10, General Definitions, revises the definition of "grandfathered facility" to be consistent with TCAA, §382.0518(g). The revised definition clarifies that a grandfathered facility is one that is not a new facility, was constructed prior to August 30, 1971 (or no construction contract was executed on or before August 30, 1971 that specified a beginning construction date on or before February 29, 1972) and has not been modified since August 30, 1971.

The proposed amendments to §116.18, Electric Generating Facility Permits Definitions, adds a definition for "natural gas-fired electric generating facility" for consistency with the EGF permit requirements of HB 2912. House Bill 2912, in §382.05185(i), provides that a natural gas-fired EGF includes a facility that was designed to burn either natural gas or fuel oil of a grade approved by commission rule. It is the commission's position that "designed to burn" in this case means that all of the necessary equipment (including fuel oil tanks, fuel lines, atomizers, and pre-heaters if necessary) were constructed and maintained as part of the grandfathered EGF. Any construction or modification necessary to allow an EGF to burn fuel oil will be required to comply with the requirements of Subchapter B, New Source Review Permits, before beginning the construction.

The commission is conducting a modeling analysis of grandfathered EGFs with the potential to burn fuel oil. The commission modeled all grandfathered gas-fired EGFs in all areas of the state. The commission looked at the maximum short-term emission rate for each compound associated with burning fuel oil. This approach is conservative because not all grandfathered gas-fired EGFs are designed to burn fuel oil, and they will not all be firing at the maximum firing rate at the same time. The commission first looked at firing fuel oil of American Society for Testing and Materials (ASTM) grade number 2 with a sulfur content of 0.3% by weight or less. Using the conservative approach outlined above with ASTM grade number 2 fuel oil and a sulfur content of no more than 0.3% by weight, compound-specific maximum predicted ground level concentrations were compared to the respective Effects Screening Levels (ESLs), or relevant air standards. All concentrations were below ESLs or standards, with the exception of the state SO 2 30-minute standard. One site was identified as potentially exceeding the state SO2 standard. This site was then modeled again with all sources acting together rather than separately. The number of hours the site was predicted to exceed the SO 2 standard were counted at each point and found to be less than 0.1% of all hours modeled. Due to the conservative nature of the modeling demonstration, which assumes all sources operating at full capacity simultaneously at all hours of the year, 100% compliance with the state SO 2 standard is expected. The commission's Toxicology and Risk Assessment Section has concluded that given the assumptions made in the review, burning ASTM grade number 2 fuel oil will not pose adverse health or welfare effects in the general public. Because ASTM grade number 1 fuel oil is cleaner burning than grade number 2, the analysis thus far has concluded that burning fuel oil of ASTM grades 1 or 2 with a sulfur content of 0.3% by weight or less is protective of public health and physical property. The commission is continuing to analyze other fuel oil grades and refine the modeling analysis. The commission solicits comment on the possible inclusion of other acceptable fuel oil grades and the blending of different fuel oil grades in this rulemaking. The establishment of acceptable fuel oil grades does not relieve the owner or operator of a natural-gas-fired EGF from the responsibility to comply with any emissions limitations or conditions of any permit or state or federal regulation.

The proposed amendments also add a definition for "normal annual operating schedule." This definition is needed to establish the normal annual operating schedule at an EGF site. The normal annual operating schedule is needed to determine if a generator that the owner or operator is seeking to permit under an EGF permit is used not more than 10% of the normal annual operating schedule as required by TCAA, §382.05185(d)(1).

Subchapter H, Voluntary Emission Reduction Permits

The proposed amendments to Subchapter H include changing the subchapter title from "Voluntary Emission Reduction Permits" to "Permits for Grandfathered Facilities" in order to correctly reflect the modified content of the subchapter. The subchapter is proposed to be divided into four divisions. The existing sections of the subchapter would be placed into Division 4, Voluntary Emission Reduction Permits. Division 1, General Applicability; Division 2, Small Business Stationary Source Permits, Pipeline Facility Permits, and Existing Facility Permits; and Division 3, Existing Facility Flexible Permits are new sections of Subchapter H proposed to implement and administer the requirements of HB 2912 and HB 2914.

Division 1, General Applicability

Proposed new §116.770, Requirements to Apply, contains the deadlines by which the owner or operator of a grandfathered facility must apply for a permit to operate that facility under Chapter 116, qualify for a permit by rule under 30 TAC Chapter 106, or submit a notice of shutdown. As required by HB 2912, a permit application or notice of shutdown must be submitted before September 1, 2003, for facilities located in the East Texas region and before September 1, 2004, for facilities located in the West Texas region and El Paso County. House Bill 2912 defines the East Texas region as all counties traversed by or east of Interstate Highway 35 North of San Antonio or traversed by or east of Interstate Highway 37 South of San Antonio, including Bexar, Bosque, Coryell, Hood, Parker, Somervell, and Wise Counties. The West Texas region is then defined as all counties not contained in the East Texas region. This definition is slightly different from the definition created by SB 7 in that the SB 7 definition for West Texas region does not include El Paso County. Therefore, rather than create a new definition, the commission will use the language, "West Texas Region as defined in §101.330 of this title (relating to Definitions) and El Paso County" in place of the West Texas region as defined by HB 2912.

Proposed new §116.771, Implementation Schedule for Additional Controls, explains the implementation schedule to be contained in a permit if the installation of additional controls is required for a grandfathered facility to meet an emissions limit for a pollutant. As required by HB 2912, installation of required controls must be completed before March 1, 2007, for facilities located in the East Texas region and before March 1, 2008, for facilities located in the West Texas region and El Paso County.

Consistent with TCAA, §382.05182, Notice of Shutdown, proposed new §116.772, Notice of Shutdown, establishes the procedures for submitting a notice of shutdown in lieu of obtaining a permit for a grandfathered facility, and the deadlines by which a grandfathered facility shutting down must cease emitting air contaminants. Facilities for which the owner or operator submits a notice of shutdown by the application deadlines contained in §116.770 may continue to operate until March 1, 2007, if the facility is located in the East Texas region or March 1, 2008, if the facility is located in the West Texas region or El Paso County. Facilities that have been shut down and for which a notice of shutdown has been submitted must obtain authorization under Chapter 116 or Chapter 106 prior to restarting operations. In order to enable the commission to keep better track of facilities which are shut down, the notice of shutdown will be required to include, at a minimum, an identification of the facility being shut down, the date the facility intends to cease operating, and an inventory of the type and amount of emissions that will be eliminated.

Division 2, Small Business Stationary Source Permits, Pipeline Facilities Permits, and Existing Facility Permits

Proposed new §116.774, Eligibility for Small Business Stationary Source Permits, states the facilities which are eligible for a small business stationary source permit in accordance with TCAA, §382.05184. Only the owners or operators of facilities located at small business stationary sources as defined by TCAA, §382.0365(h), and which are not required by TCAA, §382.014 to submit emissions inventories to the commission may apply for a small business stationary source permit, and the application must be made before September 1, 2004. The proposed section specifies that any grandfathered facility, including any facility for which the owner or operator has submitted a notice of shutdown under proposed §116.772, located at a small business stationary source may not emit air contaminants on or after March 1, 2008, unless the facility is permitted or has a pending permit application under Chapter 116, or a pending registration for a permit by rule under Chapter 106. The proposed section also requires an application for a small business stationary source permit to be submitted under the seal of a Texas licensed professional engineer, if required by §116.110(e), and states that the facility's owner or operator is responsible for applying for the permit and complying with the subchapter.

Proposed new §116.775, Eligibility for Pipeline Facilities Permits, states the facilities which are eligible for a pipeline facilities permit in accordance with TCAA, §382.05186. The owner or operator of a grandfathered reciprocating internal combustion engine or group of engines that are part of processing, treating, compression, or pumping facilities connected to or part of a gathering or transmission pipeline may apply for a pipeline facilities permit. The proposed section also requires an application for a pipeline facilities permit to be submitted under the seal of a Texas licensed professional engineer, if required by §116.110(e), and states that the facility's owner or operator is responsible for applying for the permit and complying with the subchapter. The proposed section allows the owner or operator of more than one grandfathered reciprocating internal combustion engine to apply for a pipeline facilities permit for a single grandfathered engine or for all grandfathered engines connected to or part of a gathering or transmission pipeline.

Proposed new §116.776, Distribution of Funds from the Emissions Reductions Incentives Account for Control of Emissions from Grandfathered Reciprocating Engines Located in the East Texas Region, implements the requirements of HB 2914, §78 to establish procedures and criteria for reimbursement to owners or operators for the partial cost of installing controls to reduce emissions from grandfathered reciprocating internal combustion engines at facilities associated with pipelines. The proposed section establishes which facilities will be eligible for reimbursement, the limitations on reimbursement, and the criteria for distribution. Although HB 2912 limits reimbursement to the owners or operators of those facilities required to reduce emissions of NOx by 50% because they are seeking a pipeline facilities permit, the commission believes it is also appropriate to provide the opportunity for reimbursement to certain owners or operators who choose to replace their grandfathered internal combustion engines with new electric engines. This section will allow the commission to process requests for reimbursement for the replacement of grandfathered reciprocating internal combustion engines through the registration of the replacement electric engines. Registration of the electric engines is necessary because there is no requirement to permit an electric engine since there are no emissions associated with electric engines. The owners or operators of grandfathered engines required to reduce emissions by some other state or federal law, including the requirement to reduce emissions of NO x in the Houston/Galveston, Dallas/Fort Worth, or Beaumont/Port Arthur nonattainment areas, are not eligible for reimbursement.

Proposed new §116.777, Eligibility for Existing Facility Permits, states the facilities which are eligible for an existing facility permit in accordance with TCAA, §382.05183. The owner or operator of any grandfathered facility may apply for an existing facility permit. The proposed section also requires an application for an existing facility permit to be submitted under the seal of a Texas licensed professional engineer, if required by §116.110(e), and states that the facility's owner or operator is responsible for applying for the permit and complying with the subchapter.

Proposed new §116.779, Applications for Small Business Stationary Source Permits, Pipeline Facilities Permits, or Existing Facility Permits, specifies the application requirements and demonstrations which must be met in order for a facility to be granted a small business stationary source permit, pipeline facilities permit, or existing facility permit. These requirements are consistent with the requirements for other permits issued under Chapter 116.

The proposed new §116.779(a)(1) provides that the emissions from the facility must comply with the rules and regulations of the commission, including the protection of the health and physical property of the people. The commission may not issue a permit for a grandfathered facility if it finds that the emissions from the grandfathered facility will not be protective of public health and property. The requirement to protect physical health and property is also included in the proposed §116.794(1), concerning existing facility flexible permits and the proposed §116.917(a)(1), concerning permits for certain grandfathered coal-fired EGFs and certain grandfathered facilities located at EGF sites. In order to assure that permits are protective of public health and property, the commission will conduct an appropriate health effects review for each permit application for a grandfathered facility. Details of what the review will entail will be developed and provided in a guidance document. This guidance document will be published at a later date. The permit may also have provisions for the measurement of air contaminants, including installation of sampling ports and sampling platforms.

In order to be consistent with the current review process for permits and applicable federal requirements, §§116.779, 116.794, and 116.917 would require the owner or operator of a grandfathered facility applying for a small business stationary source permit, pipeline facilities permit, existing facility permit, existing facility flexible permit, or EGF permit to be able to demonstrate that they meet applicable federal New Source Performance Standards (NSPS) and National Emission Standards for Hazardous Air Pollutants (NESHAP). Facilities must be able to meet performance standards specified in the application and may be required to provide information that demonstrates ongoing compliance after the permit is issued. If applicable, facilities would be required to comply with Prevention of Significant Deterioration (PSD) and nonattainment review as specified in Chapter 116, Subchapter B. Since grandfathered facilities must comply with federal requirements, if applicable, it is appropriate to ensure that these facilities are in compliance with federal requirements in the process of reviewing applications. These sections also require the facility to submit air dispersion modeling if a more refined health effects review is required. Finally, these sections require the application to identify each grandfathered facility to be included in the permit, identify the air contaminants emitted, and provide emission rate calculations.

Proposed §116.779(b) specifies additional requirements with which applicants for a pipeline facilities permit would have to comply. In accordance with TCAA, §382.05186(e), facilities located in the East Texas region would be required to demonstrate that each engine will achieve at least a 50% reduction of the hourly emissions rate of NO x , expressed in terms of grams per brake horsepower-hour (g/hp-hr), and may also be required to demonstrate a 50% reduction of the hourly emissions rate of VOC, expressed in terms of g/hp-hr. Consistent with TCAA, §382.05186(f), the proposed section also states that the commission shall require up to a 20% reduction in hourly emissions rate of NO x and VOC, expressed in terms of g/hp-hr, for facilities located in the West Texas region or El Paso County. In accordance with TCAA, §382.05186(b), the proposed section allows the owner or operator of more than one grandfathered reciprocating internal combustion engine to average the reductions achieved among more than one engine connected to or part of a gathering or transmission pipeline in order to demonstrate the required reductions or to demonstrate that the required reductions will be achieved at each individual facility. Consistent with TCAA, §382.05186(c) and (d), the proposed section states that, if the owner or operator chooses to average among engines located in both the East and West Texas regions or El Paso County, the owner or operator must demonstrate that the sum of the reductions achieved from all of the engines located in the East Texas region will achieve the 50% reduction required for facilities located in the East Texas region. If the emission reductions required by this proposed subsection will be achieved by averaging reductions, the proposal also states that the average may not include emission reductions achieved in order to comply with any other state or federal law. If the emission reductions required by this proposed subsection will be achieved at one account, the proposal allows the reduction to include emission reductions achieved since January 1, 2001 in order to comply with another state or federal law.

Proposed §116.779(c) specifies additional requirements with which applicants for a existing facility permit would have to comply. In accordance with TCAA, §382.05183(b), applicants for existing facility permits would have to propose an air pollution control method that is at least as beneficial as the BACT that the commission required or would have required for a facility of the same class or type as a condition of issuing a permit or permit amendment 120 months before the submittal of the existing facility permit application, considering the age and remaining useful life of the facility, and identify the date by which the control method would be implemented.

Proposed new §116.780, Public Participation for Initial Issuance of Pipeline Facilities Permits and Existing Facility Permits, requires that an applicant for a pipeline facilities permit or an existing facility permit publish notice of intent to obtain a permit in accordance with Chapter 39, Subchapters H and K. The proposed section establishes that any person who may be affected by emissions from the grandfathered facility seeking a permit may request that the commission hold a notice and comment hearing on the permit application. The proposed section states that any hearing request must be submitted during the 30-day comment period, which ends 30 days after publication of the notice of intent. The proposed section specifies the procedures and requirements for the hearing and the rights of affected persons. In accordance with TCAA, §382.05181, small business stationary source permits are not subject to these notice and comment hearing procedures.

Proposed new §116.781, Notice and Comment Hearings for Initial Issuance of Pipeline Facilities Permits and Existing Facility Permits, specifies the applicability of the hearing requirements in the section, the responsibilities of the commission in determining whether or not to hold a hearing, the applicant's responsibilities if a hearing is to be held, and the requirements regarding submission of oral or written statements and data concerning a draft permit. Texas Clean Air Act, §382.05181(h) provides that applications for pipeline facility permits, existing facility permits, existing facility flexible permits, and EGF permits are subject to the public notice and hearing requirements of TCAA, §382.05191. Texas Clean Air Act, §382.05191 provides that public participation for initial issuance of a permit under TCAA, §§382.05183, 382.05185(c) or (d), 382.05186, or 382.0519 will be done in the manner of TCAA, §382.0561, concerning Federal Operating Permit; Hearing, and §382.0562, concerning Notice of Decision. These sections allow for notice and comment hearings instead of contested case hearings under Texas Government Code, Chapter 2001, and require the commission to send notice of final action to persons who comment during the comment period or during a hearing.

Proposed new §116.783, Notice of Final Action on Pipeline Facilities Permit Applications and Existing Facility Permit Applications, specifies the commission's responsibilities for sending notice of the final action on an application for a pipeline facilities permit or an existing facility permit, and the information that the commission must include in the notice. The proposed section will require the commission to individually notify persons who commented during the public comment period or at a permit hearing, of the final action of the commission. The notice must be sent by first-class mail to the commenters and to the applicant. The notice must include the response to comments, the identification of any changes in the permit, and a statement that any person affected by the decision of the commission may petition for rehearing and for judicial review.

Proposed new §116.785, Permit Fee, establishes a permit fee of $450 for persons applying for a permit under Subchapter H, Division 1, unless the facility is a small business stationary source, as defined by TCAA, §382.0365(h), then the fee will be $100. These fees will allow the commission to partially offset the cost of processing the applications. The proposed section also establishes requirements for payment and return of fees. Texas Clean Air Act, §382.062 authorizes the commission to establish fees for permits.

Proposed new §116.786, General and Special Conditions, will allow the commission to include general and special conditions in the permits issued under Subchapter H, Division 2, and requires that permit holders comply with any and all general and special conditions that the permit may contain. The proposed section also lists the general conditions permit holders are subject to, regardless of whether they are specifically stated within the permit document. These requirements are consistent with the requirements for other permits issued under Chapter 116.

Proposed new §116.787, Amendments and Alterations of Permits Issued Under this Division, specifies that owners or operators planning the modifications of a facility permitted under Chapter 116, Subchapter H, Division 2, must comply with the requirements of Subchapter B, New Source Review Permits, before beginning the construction of the modification. The proposed section also states that amendments and alterations of permits issued under Subchapter H, Division 2, are subject to the requirements of Subchapter B.

Proposed new §116.788, Renewal of Permits Issued Under this Division, implements TCAA, §382.055 and the changes to §382.05192 to require that small business stationary source permits, pipeline facilities permits, and existing facility permits be renewed in accordance with Chapter 116, Subchapter D, Permit Renewals.

In accordance with the commission's authority under Texas Water Code (TWC), §5.122, proposed new §116.790, Delegation, allows the commission to delegate to the executive director the authority to take any action on a permit issued under Subchapter H, Division 2.

Division 3, Existing Facility Flexible Permits

Proposed new §116.793, Eligibility for Existing Facility Flexible Permits, identifies the conditions under which a grandfathered facility or group of grandfathered facilities is eligible for an existing facility flexible permit in accordance with TCAA, §382.05183(c). Consistent with §382.05183(c), the proposed section also allows facilities permitted under §382.0519 to be included in the existing facility flexible permit. The proposed section requires an application for an existing facility flexible permit to be submitted under the seal of a Texas licensed professional engineer, if required by §116.110(e). The proposed section also requires specific actions by owners or operators of facilities covered by an existing facility flexible permit for changes of ownership. The proposed section specifies that the facility's owner or operator is responsible for applying for the permit and complying with the subchapter, except after a change of ownership as explained in the section.

Proposed new §116.794, Existing Facility Flexible Permit Application, specifies the application requirements and demonstrations which must be met in order for a facility to be granted an existing facility flexible permit. These requirements are consistent with current flexible permit requirements, except for the required level of control. The level of control required by the proposed section, consistent with the requirement of TCAA, §382.05183, is at least as beneficial as ten year old BACT, considering the age and remaining useful life of the facility.

Proposed new §116.795, Public Participation for Initial Issuance of Existing Facility Flexible Permits, requires that an applicant for an existing facility flexible permit publish notice of intent to obtain a permit in accordance with Chapter 39, Subchapters H and K. The proposed section establishes that any person who may be affected by emissions from the grandfathered facility seeking a permit may request that the commission hold a notice and comment hearing on the permit application. The proposed section states that any hearing request must be submitted during the 30-day comment period, which ends 30 days after publication of the notice of intent. The proposed section specifies the procedures and requirements for the hearing and the rights of affected persons.

Proposed new §116.796, Notice and Comment Hearings for Initial Issuance of Existing Facility Flexible Permits, specifies the applicability of the hearing requirements in the section, the responsibilities of the commission in determining whether or not to hold a hearing, the applicant's responsibilities if a hearing is to be held, and the requirements regarding submission of oral or written statements and data concerning a draft permit. Texas Clean Air Act, §382.05181(h) provides that applications for pipeline facility permits, existing facility permits, existing facility flexible permits, and EGF permits are subject to the public notice and hearing requirements of §382.05191. Texas Clean Air Act, §382.05191 provides that public participation for initial issuance of a permit under §§382.05183, 382.05185(c) or (d), 382.05186, or 382.0519 will be done in the manner of TCAA, §382.0561, concerning Federal Operating Permit; Hearing, and §382.0562, concerning Notice of Decision. These sections allow for notice and comment hearings instead of contested case hearings under Texas Government Code, Chapter 2001, and require the commission to send notice of final action to persons who comment during the comment period or during a hearing.

Proposed new §116.797, Notice of Final Action on Existing Facility Flexible Permit Applications, specifies the commission's responsibilities for sending notice of the final action on an application for an existing facility flexible permit, and the information that the commission must be include in the notice. The proposed section will require the commission to individually notify persons who commented during the public comment period or at a permit hearing, of the final action of the commission. The notice must be sent by first-class mail to the commenters and to the applicant. The notice must include the response to comments, the identification of any changes in the permit, and a statement that any person affected by the decision of the commission may petition for rehearing and for judicial review.

Proposed new §116.798, Permit Fee, establishes a permit fee of $450 for persons applying for a permit under Subchapter H, Division 3, unless the facility is a small business stationary source facility, as defined by TCAA, §382.0365(h), then the fee would be $100. These fees will allow the commission to partially offset the cost of processing the applications. The proposed section also establishes requirements for payment and return of fees. Texas Clean Air Act, §382.062 authorizes the commission to establish fees for permits.

Proposed new §116.799, General and Special Conditions, requires that permit holders comply with any and all general and special conditions that the existing facility flexible permit may contain. The proposed section states that upon a specific finding by the executive director that an increase of a particular air contaminant could result in a significant impact on the air environment, or could cause the facility, group of facilities, or account to become subject to review under §116.150 and §116.151 and §§116.160 - 116.163 (relating to Nonattainment Review or Prevention of Significant Deterioration Review), or Subchapter C of Chapter 116 (relating to Hazardous Air Pollutants: Regulations Governing Constructed or Reconstructed Major Sources (FCAA, §112(g), 40 CFR Part 63), the permit may include a special condition which requires the permittee to obtain written approval from the executive director before constructing a facility under a standard permit or a permit by rule under Chapter 106. Additionally, the proposed section specifies that a pollutant specific emission cap or multiple emission caps and/or individual emission limitations shall be established for each air contaminant for all facilities authorized by the permit. The proposed section also lists the general conditions applicable to every existing facility flexible permit and states that there may be additional special conditions attached to an existing facility flexible permit upon issuance or amendment of the permit that may be more restrictive than the requirements of the section. These requirements are consistent with the requirements for flexible permits issued under Subchapter G of this chapter.

Proposed new §116.800, Emission Caps and Individual Emission Limitations, specifies the criteria for establishing the emission cap for a specific pollutant and the criteria for establishing an individual emission limitation for a pollutant. The proposed section also specifies the requirements for readjustment of the emission cap when a facility is shut down, a new facility is brought into the permit, or a facility becomes subject to any new state or federal regulation which would lower emissions or require an emissions reduction. These requirements are consistent with the requirements for flexible permits issued under Subchapter G of this chapter, except that there is not an insignificant emission factor specified for grandfathered facilities. The commission does not believe that an insignificant emission factor would be necessary or appropriate for grandfathered facilities, since use of the ten year old BACT control method will provide sufficient flexibility for these facilities.

Proposed new §116.801, Implementation Schedule for Additional Controls, explains the implementation schedule to be contained in a permit if the installation of additional controls is required for a grandfathered facility to meet an emission cap for an air contaminant. As required by TCAA, §382.05181, installation of required controls must be completed before March 1, 2007, for facilities located in the East Texas region, and before March 1, 2008, for facilities located in the West Texas region or El Paso County. The proposed section also specifies how the emission cap will be adjusted if such a facility is taken out of service or fails to install the additional control equipment as provided by the implementation schedule in the permit.

Proposed new §116.802, Significant Emission Increase, defines when an increase in emissions from operational or physical changes at an existing facility covered by an existing facility flexible permit will be considered insignificant for the purposes of state new source review under Subchapter H of this chapter, and will not require a permit amendment. The proposed section states that any increase in emissions from a new facility or emissions of an air contaminant not previously emitted by an existing facility will require a permit amendment.

Proposed new §116.804, Limitation on Physical and Operational Changes, states that neither operational nor physical changes at an account may result in an increase in actual emissions at facilities not covered by the existing facility flexible permit unless those affected facilities are authorized in accordance with §116.110, Applicability.

Proposed new §116.805, Amendments and Alterations for Existing Facility Flexible Permits, specifies that amendments and alterations for existing facility flexible permits are subject to the requirements of Subchapter B.

Proposed new §116.806, Existing Facility Flexible Permit Renewal, states that existing facility flexible permits will be renewed in accordance with the requirements of Subchapter D, Permit Renewals, consistent with the permit requirements of Chapter 116.

Proposed new §116.807, Delegation, is necessary to allow the commission to delegate to the executive director the authority to take any action on a permit issued under Subchapter H, Division 3 consistent with the authority of the TWC, §5.122. This delegation will allow for efficient processing of permit applications.

With the addition of three new divisions to this subchapter, the existing requirements for VERPs have been placed under a new Division 4. There have been no changes to the requirements for VERPs.

Subchapter I, Electric Generating Facility Permits

The proposed amendments to Subchapter I would implement the portions of TCAA, §382.05185 which create a new EGF permit. The EGF permit will allow the owners or operators of EGFs who have already applied for a permit required by SB 7, 76th Legislature to apply for a permit for: 1) generators that do not generate electric energy for compensation and are not used more than 10% of the annual operating schedule; and 2) auxiliary fossil-fuel-fired combustion facilities that do not generate electric energy and do not emit more than 100 tpy of any air contaminant. The proposed changes will also allow coal-fired EGFs which were required to apply for a permit under SB 7, 76th Legislature to apply for an EGF permit for criteria pollutants other than NO x , SO 2 , and PM as it relates to opacity. In addition, the amendments to Subchapter I provide that gas-fired EGFs which were required to be permitted under SB 7, 76th Legislature or were exempt from the requirement to apply for such a permit are considered permitted for all air contaminants.

The proposed amendments to §116.910, Applicability, allow the owners or operators of EGFs who have already applied for a permit required by SB 7, 76th Legislature to apply for an EGF permit for certain auxiliary generators or other combustion equipment. The proposed amendments delete the old subsection (e) as unnecessary since this section deals with applicability and the pollutants covered by the permit are identified in §116.119 and the permit document itself. The changes proposed in subsection (f) clarify that EGFs generating electric energy primarily for internal use are not required to obtain a permit under this subchapter. However, since these internal use generators are grandfathered, §382.05181, as codified in §116.770, requires that the owners or operators obtain authorization from the commission. The facility must obtain a permit under either Chapter 116, or qualify for a permit by rule under Chapter 106.

The proposed amendments to §116.911, Electric Generating Facility Permit Application, first clarify that gas-fired EGFs which were required to be permitted under SB 7, 76th Legislature or were exempt from the requirement to apply for such a permit are considered permitted under the TCAA for all air contaminants. The proposed additions to this section also allow the owners or operators of EGFs who have already applied for a permit required by SB 7, 76th Legislature to apply for a permit for generators that do not generate electricity for compensation and are not used more than 10% of the normal operating schedule, or for other combustion equipment that does not generate electric energy and does not emit more than 100 tpy of any air contaminant. The proposed amendments to this section allow coal-fired EGFs which were required to apply for a permit under SB 7, 76th Legislature to apply for an EGF permit for criteria pollutants other than NO x , SO2 , and PM as it relates to opacity. The proposed additions to this section identify the date by which applications must be filed and state that emissions of air contaminants from auxiliary generators or other combustion equipment that is permitted must be included in the allowance trading program created by SB 7, 76th Legislature.

The proposed amendments to §116.913, General and Special Conditions, update the conditions of any permit issued under this subchapter, including the pollutants or allowances that may be authorized for each permit and the requirements of the SB 7 allowance trading program for the additional equipment which may be permitted under this subchapter. Paragraph (2) under this section is being deleted as it is no longer necessary because HB 2912 either considers these additional air contaminants already permitted for gas-fired EGFs which have obtained or applied for a permit under SB 7, or provides for the permitting of the additional criteria pollutants for coal-fired EGFs which have obtained or applied for a SB 7 permit. Subsequent paragraphs have been renumbered. Permits for certain grandfathered coal-fired EGFs and certain grandfathered facilities located at EGF sites authorized under §116.917 will contain additional general and special conditions, as identified in §116.918.

The proposed new §116.917, Electric Generating Facility Permit Application for Certain Grandfathered Coal-Fired Electric Generating Facilities and Certain Grandfathered Facilities Located at Electric Generating Facility Sites, outlines the application requirements for grandfathered coal-fired EGFs which choose to permit their additional criteria pollutants, and the auxiliary generators and the additional combustion equipment which can now be permitted under this subchapter. In order to be consistent with the current review process for permits and applicable federal requirements, §116.917 would require the owner or operator of a grandfathered facility applying for an EGF permit to be able to demonstrate that they meet applicable federal NSPS and NESHAP. Facilities must be able to meet performance standards specified in the application and may be required to provide information that demonstrates ongoing compliance after the permit is issued. If applicable, facilities would be required to comply with PSD and nonattainment review as specified in Chapter 116, Subchapter B. Since grandfathered facilities must comply with federal requirements, if applicable, it is appropriate to ensure that these facilities are in compliance with federal requirements in the process of reviewing applications. These sections also require the facility to submit air dispersion modeling if a more refined health effects review is required. Finally, these sections require the application to identify each grandfathered facility to be included in the permit, identify the air contaminants emitted, and provide emission rate calculations.

The proposed new §116.918, Additional General and Special Conditions for Grandfathered Coal-Fired Electric Generating Facilities and Certain Grandfathered Facilities Located at Electric Generating Facility Sites, identifies some of the general and special conditions which may be included in any permit issued under the proposed §116.917, and states that there may be additional special conditions attached to a permit upon issuance or amendment of the permit that may be more restrictive than the requirements of the section. Additional general and special conditions are required by §116.913. Permit holders are required to comply with any and all general and special conditions that the permit may contain. These requirements are consistent with the requirements for permits issued under Chapter 116.

The proposed amendments to §116.921, Notice and Comment Hearings for Initial Issuance, are necessary to include the auxiliary generators and additional combustion equipment described in proposed §116.911(f), which are proposed to be permitted under this subchapter, as facilities subject to the notice and hearing requirements of this section. These changes implement the requirement contained in TCAA, §382.05191.

The proposed new §116.926, Permit Fee, is necessary to allow the commission to collect application fees for any permits issued in accordance with §116.917. These fees will allow the commission to partially offset the cost of processing the applications. Texas Clean Air Act, §382.062 authorizes the commission to establish fees for permits.

The proposed new §116.928, Delegation, is necessary to allow the commission to delegate to the executive director the authority to take any action on a permit issued under this subchapter, consistent with the authority of the TWC, §5.122. This delegation will allow for efficient processing of permit applications.

The proposed amendments to §116.930, Modifications, include a revision of the section title to "Amendments and Alterations of Permits Issued Under this Subchapter." The proposed amendments are intended to clarify that the owner or operator of a facility with a permit issued under this subchapter must comply with the requirements of Subchapter B prior to beginning the construction of the modification, and that any required alteration or amendment will follow the procedures contained in Subchapter B.

FISCAL NOTE: COSTS TO STATE AND LOCAL GOVERNMENT

John Davis, Technical Specialist with Strategic Planning and Appropriations, has determined that for the first five-year period the proposed amendments are in effect, there will be fiscal implications, which may be significant, for certain units of state and local government including institutions of higher education that operate grandfathered equipment that will be required to obtain permits created by this rulemaking. For those affected units of government that are required to obtain permits, there will be permit development, permit application, public notice, and pollution control device installation costs. The overall cost to these facilities will depend on the types of emissions, the specific processes involved, and the control methodologies employed for emission reductions.

The State of Texas began permitting new and modified sources of air pollutants in 1971. Sources built before the permitting rules became effective were not required to obtain permits for air emissions as long as they were not modified. These sources are known as grandfathered sources.

The proposed amendments implement certain provisions of HB 2912 and HB 2914, 77th Legislature, 2001. Provisions in HB 2912 require grandfathered air emission facilities to obtain a permit under this chapter or qualify for a permit by rule under Chapter 106.

House Bill 2912 creates four new types of permits for grandfathered facilities: existing facility permits, EGF permits, pipeline facility permits, and small business stationary source permits. Provisions in HB 2914 establish an account called the Emissions Reductions Incentives Account and allow the commission to use money in the account to provide partial reimbursement to certain pipeline operations to install pollution control equipment.

The proposed amendments require grandfathered air emission facilities owned or operated by units of government to obtain one of the four newly created permits. It is anticipated that these facilities will apply for either an existing facility permit or a pipeline facility permit as they would not be eligible for a small business stationary source permit and gas-fired grandfathered EGFs that have applied for or are exempt from current permitting provisions are now considered permitted for all air contaminants, in accordance with SB 7, 76th Legislature, 1999. There may be auxiliary generators or other combustion equipment located at city-owned facilities that will have to obtain an EGF permit.

All grandfathered facilities owned or operated by units of state or local government would be eligible to apply for an existing facility permit. Examples of grandfathered facilities include oil/coal/wood/gas-fired boilers; process heaters; kilns; gas turbines; duct burners; flares; storage tanks; connections and valves used in piping located at oil and gas production, processing, and transmission; chemical processing; electricity generation; metal manufacturing; general manufacturing; and oil refining operations. The existing facility permit would require a facility to use an air pollution control method at least as beneficial as ten year old BACT. The commission does not require any particular pollution control method to comply with this rulemaking. Examples of control methods that could be used include low NO x burners and flue gas recirculation for boilers and heaters, leak detection and repair programs for piping components, and combustion modifications for engines. House Bill 2912 mandated the dates by which all grandfathered facilities must apply for a permit and have controls operational, or shut down.

In addition to existing facility permits, some facilities would be eligible to obtain a pipeline facility permit. This permit would require reciprocating internal combustion engines used in pipeline operations to achieve a 50% reduction in NO x and up to a 50% reduction in VOC for sites in East Texas, and up to a 20% reduction in NO x and VOC at sites in West Texas. Some units of state or local government own grandfathered reciprocating internal combustion engines.

Compliance deadlines for the new permits depend on whether the facility is located in East or West Texas. The East Texas region includes all counties traversed by or east of Interstate Highway 35 north of San Antonio or traversed by or east of Interstate Highway 37 south of San Antonio, and also including Bexar, Bosque, Coryell, Hood, Parker, Somervell, and Wise Counties. All other counties in Texas are considered to be in the West Texas region. Affected facilities in East Texas must submit an application before September 1, 2003 and any controls required by the permit must be in operation by March 1, 2007. Affected facilities in West Texas must submit an application before September 1, 2004 and any control required by the permit must be in operation by March 1, 2008.

Based on analysis of the 1997 emissions inventory, there are a total of approximately 800 grandfathered facilities in Texas. Since 1997, it is estimated that 300 of these sites have been authorized to continue operations under a permit, permit by rule, or currently have a pending permit application. The commission anticipates there will be state and local government sites, including an unknown number of facilities owned and operated by river authorities, that would be affected by the proposed amendments.

The overall costs to affected units of state and local government will depend on which permit the site chooses to apply. There would be no significant fiscal implications for units of state and local government that own or operate gas-fired grandfathered EGFs that qualify for the EGF permit, because these facilities would already be considered permitted and not required to install pollution control devices or pay permit development and application fees. There may be auxiliary generators or other combustion equipment located at city-owned facilities that will have to obtain an EGF permit. Units of state and local government that decide to obtain an EGF permit would have to pay costs associated with permit development, the permit application, and public notice. Units of state and local government that decide to obtain an existing or pipeline facility permit would have to pay costs associated with permit development, the permit application, public notice, and installation of any required pollution control devices.

The cost of preparing a permit application will depend on the complexity of the facility. The commission estimates that on average, it will cost a unit of state and local government approximately $10,000 to prepare the permit application. The permit application fee will be $450 per application.

The costs for public notice vary significantly depending on the location of the facility and its proximity to large metropolitan areas. Small town/city newspapers generally charge much less for publication of a public notice. The commission estimates a large city newspaper would charge approximately $3,000 for the display notice and approximately $450 for the legal notice. A smaller city newspaper would charge approximately $210 for the display notice and $20 for the legal notice. The cost for alternative language publication, if needed, is estimated to be $150. The cost for signs at affected facilities would cost approximately $300. The total costs for public notice associated with permitting a grandfathered facility would range from $680 to $3,900, assuming alternative language notice is also required. If a request for notice and comment hearing is received on an application, the applicant would also be required to publish a legal notice for the hearing, which would cost an additional $450 for publication in a large city newspaper, and $20 in a smaller city newspaper.

The costs to meet the emission reduction requirements of the existing facility permit will vary depending on the types of emissions, the specific processes involved, and the control methodologies employed for emission reductions. There are three grandfathered natural gas-fired boilers operated by Texas A&M University, and two grandfathered natural gas-fired boilers operated by the University of Texas at Austin that would be affected by the proposed rulemaking. The university boilers would be required to obtain an existing facility permit, since they would not qualify for an EGF or pipeline facility permit. The University of Texas and Texas A&M University boilers would be required to use an air pollution control method at least as beneficial as ten year old BACT. Based on data in the 1997 emissions inventory and the document type-name="sub">x Emissions from Industrial/Commercial/Institutional (ICI) Boilers ," EPA, March, 1994 the commission estimates it will cost the University of Texas between $105,000 to $350,000 and Texas A&M University between $95,000 to $165,000 annually per boiler to install and operate pollution control devices that will reduce emissions to a level that meets the required BACT standard. The commission estimates that compliance costs would be similar or lower for other units of state and local government that operate grandfathered sites not listed on the 1997 emission inventory that decide to apply for an existing facility permit.

The costs to meet the emission reduction requirements of the pipeline facility permit will also vary depending on location of the facility, the types of emissions, the specific processes involved, the control methodologies employed for emission reductions, and the capacity of the affected reciprocating internal combustion engine. Although HB 2912 requires up to a 20% reduction in NOx for facilities located in West Texas, the commission anticipates that the controls required in West Texas will involve little or no capital costs. This rulemaking does not require any particular emission control technique. The proposed rules allow for emission averaging among engines on a pipeline. Because pipeline engines exist as part of a system of engines, owners may take advantage of this flexibility. The level of modifications can be tailored to achieve the most cost effective control strategy. The averaging strategy allows controls to range from complete low emission retrofits on engines with the lowest costs, limited retrofits on engines with average control costs, and no retrofits on engines with the highest control costs. The average required NO x reduction is 50% in the East Texas area and up to 20% in the West Texas area. The commission estimates that in order to comply with the proposed amendments, owners and operators of lean-burn engines will utilize some form of flue gas cleanup using systems such as selective catalytic reduction (SCR), conversion to electric motors, and combustion modifications.

Combustion modifications to reduce NO x emissions on lean-burn engines is the least costly and is sufficient to meet requirements. Combustion modifications include a range of techniques including low emission combustion, high pressure fuel injection, increased air/fuel ratio, high energy ignition systems, and ignition timing retard. For the purposes of this fiscal note, low emission combustion for lean-burn engines will be used. Although this is the most expensive of the combustion modification options listed, this technique results in greater emission reductions and would allow owners and operators to install pollution control devices on fewer engines and still meet the overall reduction requirements through emission averaging. The commission estimates the total capital costs to install low emission combustion on a 1,000 horsepower (hp) lean-burn engine would be $292,800 and the total annual cost would be $72,400. These costs are based on equations, total capital ($226,000 + $66.8*BHP) and annualized costs ($57,800 + $14.6*BHP), found on pages 5-4 and 5-8 of the document, " Stationary Reciprocating Internal Combustion Engines, Updated Information on NO x emissions and Control Techniques, " EPA, September 1, 2000. Because the statutory reduction requirements are substantially less than the reductions achievable with low emission combustion, the average engine control cost will be substantially less than the costs obtained by application of this low emission combustion cost equation to each affected engine.

For rich-burn engines, the costs for pipeline engine NO x reductions are based on use of non-selective catalytic reduction (NSCR). Non-selective catalytic reduction is a cost-effective control technique (99% reduction is feasible) in widespread use for rich-burn engines. This fiscal note estimates the NSCR total capital cost for a 1,000 hp rich-burn engine is $42,200 and the total annual cost would $90,300. These costs are based on equations, total capital ($12,100 + $30.1 *hp) and annualized cost ($68,300 + $22.0 *hp), found on pages 6-27 and 6-30 of the document, "Alternative Control Techniques Document NO x Emissions from Stationary Reciprocating Internal Combustion Engines ," EPA. The average costs for pipeline engines complying with these permitting requirements will be approximately 50% of the per engine costs in East Texas, based on emission averaging.

Units of state and local government that seek to obtain pipeline facility permits may be eligible for partial reimbursement of the costs of pollution controls. House Bill 2914 directed the Comptroller's Office to establish an account within the General Revenue Account 151, Clean Air, called the Emissions Reductions Incentives Account. House Bill 2914 allows the commission to use money within the Emissions Reductions Incentives Account to provide for partial reimbursement of the cost of controls for reciprocating internal combustion engines associated with pipeline operations. The commission was appropriated an additional $16.2 million in Fiscal Year 2002 from the emissions reductions incentives account to provide incentives. Any unexpended funds remaining from the original appropriation could be used to provide similar incentives during Fiscal Year 2003.

PUBLIC BENEFITS AND COSTS

Mr. Davis has also determined that for each year of the first five years the proposed amendments are in effect, the public benefit anticipated from enforcement of and compliance with the proposed amendments will be increased compliance with commission regulations and decreased air emissions due to pollution controls being required on emission sources that were previously exempt from utilizing pollution control devices.

The State of Texas began permitting new and modified sources of air pollutants in 1971. Sources built before the permitting rules became effective were not required to obtain permits for air emissions as long as they were not modified. These sources are known as grandfathered sources.

The proposed amendments implement certain provisions of HB 2912 and HB 2914, 77th Legislature, 2001. Provisions in HB 2912 require grandfathered air emission facilities to obtain a permit under this chapter or qualify for a permit by rule under Chapter 106.

House Bill 2912 creates four new types of permits for grandfathered facilities: existing facility permits, EGF permits, pipeline facility permits, and small business stationary source permits. Provisions in HB 2914 establish an account called the emissions reductions incentives account and allow the commission to use money in the account to provide partial reimbursement to certain pipeline operations to install pollution control equipment.

Grandfathered facilities owned and operated by large businesses would be eligible to apply for either the existing facility, EGF, or pipeline facility permits created by HB 2912. All grandfathered facilities located at large businesses would be eligible to apply for an existing facility permit. This permit would require a facility to use an air pollution control method at least as beneficial as ten year old BACT. The commission does not require any one particular pollution control method. Examples of control methods that could be used include low NO x burners and flue gas recirculation for boilers and heaters, leak detection and repair programs for piping components, and combustion modifications for engines. The commission anticipates that adoption of this rulemaking will result in the shutdown of a small number of grandfathered equipment owned and operated by businesses due to costs associated with preparing a permit application, the publication of public notice, and the installation of pollution control equipment. Businesses that may choose to cease operations as a result of this rulemaking may include some pipeline facilities in East Texas with compressor stations that will be required to replace engines in order to get the 50% reduction in NOx required to obtain a pipeline facilities permit, or some small or micro-businesses such as small cultured marble manufacturers who have to make equipment modifications.

In addition to existing facility permits, gas-fired grandfathered EGFs located at large businesses that have applied for or were exempt from the requirement to apply for a permit to comply with the provisions of SB 7, 76th Legislature, 1999, are now considered permitted for all air contaminants. The commission estimates there will be no significant fiscal implications for this provision because there would be no permit application or development fees, and installation of pollution control equipment would not be required for gas-fired grandfathered EGFs. There may be auxiliary generators or other combustion equipment located at city-owned facilities that will have to obtain an EGF permit. Units of state and local government that decide to obtain an EGF permit would have to pay costs associated with permit development, the permit application, and public notice.

In addition to existing facility permits, grandfathered reciprocating internal combustion engines owned and operated by large businesses that are part of processing, treating, compression, or pumping facilities connected to or part of a gathering or transmission pipeline would be eligible to obtain a pipeline facility permit. This permit would require grandfathered reciprocating internal combustion engines used in pipeline operations to achieve a 50% reduction in NO x and up to a 50% reduction in VOC for sites in East Texas, and up to a 20% reduction in NO x and VOC at sites in West Texas.

Compliance deadlines depend on whether the facility is located in East or West Texas. Affected facilities in East Texas must submit an application before September 1, 2003 and any controls required by the permit must be in operation by March 1, 2007. Affected facilities in West Texas must submit an application before September 1, 2004 and any control required by the permit must be in operation by March 1, 2008.

Based on analysis of the 1997 emissions inventory, there are a total of approximately 800 grandfathered facilities in Texas. Since 1997, it is estimated that 300 of these sites have been authorized to continue operations under a permit, permit by rule, or currently have a pending permit application. The remaining 500 facilities, the vast majority of which are owned and operated by large businesses, are oil/coal/wood/gas-fired boilers; process heaters; kilns; gas turbines; duct burners; and flares used in oil and gas production, processing, and transmission; chemical processing; electricity generation; metal manufacturing; general manufacturing; and oil refining operations. The commission estimates the actual number of affected large businesses will be higher since there are probably additional operational grandfathered facilities that were not included in the 1997 emissions inventory.

The overall costs to affected facilities will depend on which permit the site chooses to apply. There would be no significant fiscal implications for individuals or businesses that own or operate gas-fired grandfathered EGFs that qualify for the EGF permit, because these facilities would already be considered permitted and not required to install pollution control devices or pay permit development and application fees. There may be auxiliary generators or other combustion equipment located at sites that will have to obtain an EGF permit. Individuals or businesses that decide to obtain an EGF permit would have to pay costs associated with permit development, the permit application, and public notice. Individuals and businesses that decide to obtain an existing or pipeline facility permit would have to pay costs associated with permit development, the permit application, public notice, and installation of any required pollution control devices.

The cost of preparing a permit application will depend on the complexity of the facility. The commission estimates that on average, it will cost an individual or business approximately $10,000 to prepare the permit application. The permit application fee will be $450 per application.

The costs for public notice vary significantly depending on the location of the facility and its proximity to large metropolitan areas. Small town/city newspapers generally charge much less for publication of a public notice. The commission estimates a large city newspaper would charge approximately $3,000 for the display notice and approximately $450 for the legal notice. A smaller city newspaper would charge approximately $210 for the display notice and $20 for the legal notice. The cost for alternative language publication, if needed, is estimated to be $150. The cost for signs at affected facilities would cost approximately $300. The total costs for public notice associated with permitting a grandfathered facility would range from $680 to $3,900, assuming alternative language notice is also required. If a request for notice and comment hearing is received on an application, the applicant would also be required to publish a legal notice for the hearing, which would cost an additional $450 for publication in a large city newspaper, and $20 in a smaller city newspaper.

The costs to meet the emission reduction requirements of the existing facility permit will vary depending on the types of emissions, the specific processes involved, the control methodologies employed for emission reductions to meet the ten year old BACT requirements, and the overall capacity of the facility. Based on data in the 1997 emissions inventory and the document "Alternative Control Techniques Document--NO x Emissions from Industrial/Commercial/Institutional (ICI) Boilers, " EPA, March, 1994, the commission estimates it will cost between $40,000 to $900,000 per piece of equipment to install and operate pollution control devices necessary to meet the ten year old BACT standards. This cost estimate only addresses costs for boilers to reduce NO x . There are other types of facilities and equipment affected that would have to install different emission control devices, and some may need to control SO 2 and other air contaminants. However, the commission expects that in most cases, the costs will be similar to those identified for boilers.

The costs to meet the emission reduction requirements of the pipeline facility permit will also vary depending on the types of emissions, the specific processes involved, the control methodologies employed for emission reductions, and the capacity of the affected reciprocating internal combustion engine. This rulemaking does not require any particular emission control technique. The proposed rules allow for emission averaging among engines on a pipeline. The average required NO x reduction is 50% in the East Texas area and up to 20% in the West Texas area. The commission estimates that in order to comply with the proposed amendments, owners and operators of lean-burn engines will utilize some form of flue gas cleanup using systems such as SCR, conversion to electric motors, and combustion modifications.

Combustion modifications to reduce NO x emissions on lean-burn engines is the least costly and is sufficient to meet requirements. Combustion modifications include a range of techniques including low emission combustion, high pressure fuel injection, increased air/fuel ratio, high energy ignition systems, and ignition timing retard. For this fiscal note, low emission combustion for lean-burn engines is used. Although this is the most expensive of the combustion modification options listed, this technique results in greater emissions reductions and would allow owners and operators to install pollution control devices on fewer engines and still meet the overall reduction requirements through emission averaging. The commission estimates the total capital costs to install low emission combustion on a 1,000 hp lean-burn engine would be $292,800 and the total annual cost would be $72,400. These costs are based on equations, total capital ($226,000 + $66.8*BHP) and annualized costs ($57,800 + $14.6*BHP), found on pages 5-4 and 5-8 of the document, " Stationary Reciprocating Internal Combustion Engines, Updated Information on NO x emissions and Control Techniques, " EPA, September 1, 2000. Because the statutory reduction requirements are substantially less than the reductions achievable with low emission combustion, the average engine control cost will be substantially less than the costs obtained by application of this low emission combustion cost equation to each affected engine.

For rich-burn engines, the costs for pipeline engine NO x reductions are based on use of NSCR. Non-selective catalytic reduction is a cost effective control technique (99% reduction is feasible) in widespread use for rich-burn engines. This fiscal note estimates the NSCR total capital cost for a 1,000 hp rich-burn engine is $42,200 and the total annual cost would $90,300. These costs are based on equations, total capital ($12,100 + $30.1 *hp) and annualized cost ($68,300 + $22.0 *hp), found on pages 6-27 and 6-30 of the document, " Alternative Control Techniques Document NO x Emissions from Stationary Reciprocating Internal Combustion Engines ," EPA. The average costs for pipeline engines complying with these permitting requirements will be approximately 50% of the per engine costs in East Texas, based on emission averaging.

Businesses that seek to obtain pipeline facility permits may be eligible for partial reimbursement of the costs of pollution controls. The reimbursement would be paid from an account called the Emissions Reductions Incentives Account established by HB 2914 and appropriated to the commission for distribution. The commission was appropriated an additional $16.2 million from the new fund. Reimbursement will be based on the amount of money available and prioritized based on a set of criteria established by the commission.

SMALL BUSINESS AND MICRO-BUSINESS ASSESSMENT

There may be adverse fiscal implications, which could be significant, for small and micro-businesses that have to install pollution control equipment as a result of implementation and enforcement of the proposed amendments, which are intended to implement the grandfathered permitting provisions of HB 2912 and HB 2914. House Bill 2912 requires all grandfathered air emission facilities to obtain a permit, and HB 2914 provided additional funding for the commission to provide incentives to defray the costs for pollution control equipment on reciprocating internal combustion engines. The commission anticipates that adoption of this rulemaking will result in the shutdown of a small number of grandfathered equipment owned and operated by small and micro-businesses due to costs associated with preparing a permit application, the publication of public notice, and the installation of pollution control equipment. The majority of grandfathered equipment located at small or micro-businesses would be eligible for a permit by rule or a small business stationary source permit. However, there may be businesses, such as small cultured marble manufacturers, that may have to change operating procedures or conduct equipment modifications to comply with this rulemaking. This would be required if the executive director determined the location of the small business would pose an environmental problem to the surrounding area.

The commission anticipates that grandfathered facilities owned and operated by small and micro-businesses will likely apply for either existing facility or small business stationary source permits. There are no known small or micro-businesses that would be eligible for the EGF permit and the commission anticipates there are very few small or micro-businesses with equipment that would qualify for the pipeline facility permit. The commission anticipates that the owners or operators of these facilities will obtain a small business stationary source permit rather than a pipeline facility permit. There are no controls or emission reductions required for a small business stationary source permit, and there is no requirement for public notice. In order to qualify for the small business stationary source permit, the site must emit less than 50 tpy of any regulated air pollutant and cannot emit more than 75 tpy of all regulated air pollutants. Small or micro-businesses with emission outputs above these thresholds would have to obtain an existing source permit. Grandfathered facilities owned and operated by small or micro-business that intend to obtain a small business stationary source permit must submit an application before September 1, 2004 and any controls required by the permit must be in operation by March 1, 2008. Small and micro-businesses that do not qualify for the small business stationary source permit must submit a permit application by March 1, 2008 or shut down.

Based on analysis of the 1997 emissions inventory, there are a total of approximately 800 grandfathered facilities in Texas. Since 1997, it is estimated that 300 of these sites have been authorized to continue operations under a permit, permit by rule, or currently have a pending permit application. Of the remaining 500 facilities identified on the 1997 emissions inventory, the commission estimates that fewer than ten are small or micro-businesses. These facilities would have to apply for an existing facility permit or shut down since their emissions would exceed the maximum thresholds allowed for a site to qualify for a small business stationary source permit. The commission estimates there may be other grandfathered facilities owned and operated at small and micro-businesses that qualify for the small business stationary source permit, and therefore would not have shown up on the emissions inventory. Examples of grandfathered equipment owned and operated by small and micro-businesses include small ICI boilers, process heaters, and internal combustion engines.

Small and micro-businesses that qualify for the small business stationary source permit would only have to pay costs associated with developing the permit and the permit application fee. Facilities that decide to obtain an existing facility permit would also have to pay additional costs associated with installation and operation of pollution control devices and public notice. The cost of preparing a permit application will depend on the complexity of the facility and whether a detailed modeling analysis will be required to evaluate the impacts from the facility. The commission estimates that on average, it could cost a facility $10,000 to prepare the permit application for a small business stationary source and existing facility permit if a third party consultant is used. However, the commission can provide limited technical assistance with the permitting process for owners and operators of small and micro-businesses. The permit application fee will be $100 per facility instead of $450 for larger businesses and units of government.

The costs for public notice will also be decreased for small and micro-businesses, because they would not be required to publish a display notice. The public notice costs will vary depending on the location of the facility and its proximity to large metropolitan areas. Small town/city newspapers generally charge much less for publication of a public notice. The commission estimates a large city newspaper would charge approximately $450 for the legal notice. A smaller city newspaper would charge approximately $20 for the legal notice. The cost for alternative language publication, if needed, is estimated to be $150. The cost for signs at affected facilities would cost approximately $300. The total costs for public notice associated with permitting a grandfathered facility owned and operated by a small or micro-business would range from $170 to $600, assuming alternative language notice is also required. If a request for notice and comment hearing is received on an application, the applicant would also be required to publish a legal notice for the hearing, which would cost an additional $450 for publication in a large city newspaper, and $20 in a smaller city newspaper.

The costs to meet the emission reduction requirements of the existing facility permit will vary depending on the types of emissions, the specific processes involved, the control methodologies employed for emission reductions to meet the ten year old BACT requirements, and the overall capacity of the facility. Based on data in the 1997 emissions inventory and the document "Alternative Control Techniques Document--NO x Emissions from Industrial/Commercial/Institutional (ICI) Boilers, " EPA, March, 1994, the commission estimates it will cost between $40,000 to $165,000 per piece of equipment to install and operate pollution control devices necessary to meet the ten year old BACT standards. This cost estimate only addresses costs for boilers to reduce NO x . There are other types of facilities and equipment affected that would have to install different emission control devices, and some may need to control SO 2 and other air contaminants. However, the commission expects that in most cases, the costs will be similar to those identified for boilers.

The following is an analysis of the cost per employee for small or micro-businesses affected by the proposed amendments. Small and micro-businesses are defined as having fewer than 100 or 20 employees respectively. A small business that opts to obtain an existing facility permit for one natural gas-fired boiler and installs the required pollution control devices would incur additional costs of approximately $1,700 per employee. A micro-business that opts to obtain an existing facility permit for one natural gas-fired boiler and installs the required pollution control devices would incur additional costs of approximately $8,300 per employee. The cost to install and operate pollution control devices for affected facilities is the same for small businesses as for larger businesses.

LOCAL EMPLOYMENT IMPACT STATEMENT

The commission has reviewed this proposed rulemaking and determined that a local employment impact statement is not required. Although the proposed amendments may result in the shutdown of grandfathered equipment, the commission estimates the number will be small and not concentrated in any one region of the state. Additionally, the number of potential employee layoffs is estimated to be small and not concentrated in any one region so as to not have an adverse material affect on local or regional economies of the state.

DRAFT REGULATORY IMPACT ANALYSIS DETERMINATION

The commission has reviewed the proposed rulemaking in light of the regulatory analysis requirements of Texas Government Code, §2001.0225, and determined that the rulemaking implementing HB 2912, §§5.02 - 5.04 meets the definition of a "major environmental rule" as defined in that statute. However, the proposed rulemaking implementing HB 2914, §78 does not meet the definition of a "major environmental rule." The 77th Legislature amended the THSC to require that all grandfathered facilities obtain permits. These rules implement the comprehensive permitting system created by HB 2912, including four different types of permits which will cover all grandfathered facilities, and provide for potential emission reductions. The rules implementing HB 2914 specify the procedures and criteria governing reimbursement from the Emissions Reductions Incentives Account, established to assist owners or operators making reductions in grandfathered emissions from reciprocating internal combustion engines at facilities associated with pipelines.

A "major environmental rule" means a rule, the specific intent of which is to protect the environment or reduce risks to human health from environmental exposure and that may adversely affect in a material way the economy, productivity, competition, jobs, the environment, or the public health and safety of the state or a sector of the state.

Although the proposed rules to implement the HB 2912 sections are intended to protect the environment or reduce risks to human health from environmental exposure, they may have adverse effects on the economy, productivity, competition, jobs, the environment, or the public health and safety of the state or a sector of the state since they require mandatory permitting or shut down of certain grandfathered facilities. However, the analysis required by Texas Government Code, §2001.0225(c) does not apply because the proposed rules do not meet any of the four applicability requirements of a major environmental rule. The proposed rules do not exceed a standard set by federal law, exceed an express requirement of state law, exceed a requirement of a delegation agreement, or adopt a rule solely under the general powers of the agency. The rules are proposed specifically to comply with HB 2912 and related provisions of the TCAA, and do not exceed the requirements of either.

The proposed rules to implement the HB 2914 sections are intended to protect the environment or reduce risks to human health from environmental exposure. Because this is an incentive program designed to provide financial assistance to certain facilities, HB 2914 will not adversely affect in a material way the economy, productivity, competition, jobs, the environment, or the public health and safety of the state or a sector of the state. Therefore, the proposed rules to implement the HB 2914 sections do not fit the definition of a major environmental rule, and the analysis required by §2001.0225(c) does not apply.

TAKINGS IMPACT ASSESSMENT

The commission has completed a takings impact assessment for the proposed rules. The following is a summary of that assessment. The purpose of the proposed rules is to fulfill the commission's obligation to implement HB 2912, §§5.02 - 5.04 and HB 2914, §78, concerning grandfathered facilities. The proposed rules will advance this purpose by creating a comprehensive permitting system including four different types of permits which will cover all grandfathered facilities, and provide for emission reductions of NO x and VOC. The rules will also contain procedures and criteria governing partial reimbursement from the Emissions Reductions Incentives Account, established to assist owners or operators making reductions in grandfathered emissions from reciprocating internal combustion engines at facilities associated with pipelines.

The commission evaluated these proposed rules and performed a preliminary assessment of whether Texas Government Code, Chapter 2007 is applicable. The commission's preliminary assessment indicates that Texas Government Code, Chapter 2007 does not apply to these proposed rules because this is an action that is reasonably taken to fulfill an obligation mandated by federal law, which is exempt under Texas Government Code, §2007.003(b)(4). Section 2007.003(b)(13) states that Chapter 2007 does not apply to an action that: 1) is taken in response to a real and substantial threat to public health and safety; 2) is designed to significantly advance the health and safety purpose; and 3) does not impose a greater burden than is necessary to achieve the health and safety purpose. Although the rule revisions do not directly prevent a nuisance or prevent an immediate threat to life or property, they do prevent a real and substantial threat to public health and safety and significantly advance the health and safety purpose. In addition, these rules fulfill an obligation mandated by federal law. The proposed rules will implement requirements of 42 United States Code (USC), §7410. The reductions in NO x and VOC significantly advance a health and safety purpose by assisting the state's efforts to attain the ozone national ambient air quality standards set by the EPA under 42 USC, §7409, for nonattainment areas of the state and maintain the quality of the state's air in attainment areas. The action is mandated by federal law because the rules will be submitted for EPA approval as part of the SIP. Texas Government Code, Chapter 2007 also does not apply because this is an action that is taken in response to a real and substantial threat to public health and safety, that is designed to significantly advance the health and safety purpose, and that does not impose a greater burden than is necessary to achieve the health and safety purpose. Reductions required by these rules will be no greater than those required by HB 2912. Thus, this action is exempt under Texas Government Code, §2007.003(b)(13).

Promulgation and enforcement of these rules will not burden private real property. The proposed rules do not affect private property in a manner which restricts or limits an owner's right to the property that would otherwise exist in the absence of governmental action. Consequently, the proposed rules do not meet the definition of a takings under Texas Government Code, §2007.002(5).

CONSISTENCY WITH THE COASTAL MANAGEMENT PROGRAM

The commission determined that the proposed rulemaking relates to an action or actions subject to the Texas Coastal Management Program (CMP) in accordance with the Coastal Coordination Act of 1991, as amended (Texas Natural Resources Code, §§33.201 et seq.), and the commission rules in 30 TAC Chapter 281, Subchapter B, Consistency with the CMP. As required by 31 TAC §505.11(b)(2) and 30 TAC §281.45(a)(3) relating to actions and rules subject to the CMP, commission rules governing air pollutant emissions must be consistent with the applicable goals and policies of the CMP. The commission reviewed the proposed rulemaking for consistency with the CMP goals and policies in accordance with the rules of the Coastal Coordination Council, and determined that the rulemaking is consistent with the applicable CMP goals and policies. The CMP goal applicable to this rulemaking is the goal to protect, preserve, and enhance the diversity, quality, quantity, functions, and values of coastal natural resource areas (31 TAC §501.12(l)). The CMP policy applicable to this rulemaking is the policy (31 TAC §501.14(q)) that commission rules comply with federal regulations in 40 Code of Federal Regulations to protect and enhance air quality in the coastal area (31 TAC §501.14(q)). This proposal will require the owners or operators of all previously grandfathered facilities to obtain a permit for those facilities in order to continue to operate. The permits issued for these facilities are expected to result in reduced emissions of air contaminants and improved compliance with state and federal air pollution control requirements. Therefore, this rulemaking is consistent with the applicable policy and goal.

The commission seeks public comment on the consistency of the proposed rulemaking with applicable CMP goals and policies.

ANNOUNCEMENT OF HEARING

Public hearings on the proposal will be held at the following times and locations: January 22, 2002, 7:00 p.m., Tyler Junior College Regional Training and Development Center, Room 104, 1530 South Southwest Loop 323, Tyler; January 23, 2002, 7:00 p.m., City of Houston City Council Chambers, 2nd Floor, 901 Bagby, Houston; January 24, 2002, 7:00 p.m., City of Odessa City Council Chambers; 5th Floor, 411 West 8th Street, Odessa; January 28, 2002, 6:30 p.m., City of Irving Central Library Auditorium, 801 West Irving Boulevard, Irving; and January 29, 2002, 2:00 p.m., Texas Natural Resource Conservation Commission, 12100 North I-35, Building F, Room 2210, Austin.

The hearings are structured for the receipt of oral or written comments by interested persons. Individuals may present oral statements when called upon in order of registration. Open discussion will not occur during the hearings; however, an agency staff member will be available to discuss the proposal 30 minutes prior to the hearings, and answer questions before and after the hearings.

Persons with disabilities who have special communication or other accommodation needs who are planning to attend the hearing should contact the Office of Environmental Policy, Analysis, and Assessment at (512) 239-4900. Requests should be made as far in advance as possible.

SUBMITTAL OF COMMENTS

Comments may be submitted to Joyce Spencer, Office of Environmental Policy, Analysis, and Assessment, MC 205, P.O. Box 13087, Austin, Texas 78711-3087; or by fax at (512) 239-4808. All comments must be received by 5:00 p.m. on January 29, 2002. All comments should reference Rule Log No. 2001-076-116-AI. For further information, please contact Steve Hagle, Air Permits Division, at (512) 239-1295; or Jill Burditt, Policy and Regulations Division, at (512) 239-0560.

Subchapter A. DEFINITIONS

30 TAC §116.10, §116.18

STATUTORY AUTHORITY

The amendments are proposed under THSC, TCAA, §382.011, which authorizes the commission to administer the requirements of the TCAA; §382.012, which provides the commission the authority to develop a comprehensive plan for the state's air; §382.017, which authorizes the commission to adopt rules consistent with the policy and purposes of the TCAA; §382.051, which authorizes the commission to issue a permit for numerous similar sources; §382.0518, which authorizes the commission to issue permits for construction of new facilities or modifications of existing facilities; §382.05181 which requires grandfathered facilities to apply for a permit and comply with its conditions by certain dates, and requires certain actions of the commission; and TWC, §5.103, which authorizes the commission to adopt rules.

The proposed amendments implement THSC, TCAA, §382.002, concerning Policy and Purpose; §382.011, concerning General Powers and Duties; §382.012, concerning State Air Control Plan; §382.017, concerning Rules; §382.051, concerning Permitting Authority of Board; Rules; and §382.0518, concerning Preconstruction Permit; TWC, §5.103, concerning Rules.

§116.10.General Definitions.

Unless specifically defined in the TCAA or in the rules of the commission, the terms used by the commission have the meanings commonly ascribed to them in the field of air pollution control. In addition to the terms which are defined by the TCAA, and in §101.1 of this title (relating to Definitions), the following words and terms, when used in this chapter, shall have the following meanings, unless the context clearly indicates otherwise.

(1) - (5) (No change.)

(6) Grandfathered facility--Any facility that is not a new facility and has not been modified since August 30, 1971 [ it was constructed prior to the permit requirements of this chapter ].

(7) - (15) (No change.)

§116.18.Electric Generating Facility Permits Definitions.

The following words and terms, when used in Subchapter I of this chapter (relating to Electric Generating Facility Permits) shall have the following meanings, unless the context clearly indicates otherwise.

(1) - (10) (No change.)

(11) Natural gas-fired EGF--For purposes of Subchapter I of this chapter, an EGF that was designed to burn either natural gas or fuel oil of a grade determined by the commission to be acceptable. Burning of a fuel oil designated by this definition as acceptable does not relieve the owner or operator of the EGF from the responsibility to comply with the emission limitations, allowances, or conditions of any permit or state or federal regulation. Acceptable fuel oil grades are:

(A) American Society for Testing and Materials (ASTM) grade number 1 or 2 fuel oil containing not more than 0.3% sulfur by weight.

(B) Any other grade of fuel oil which the owner or operator of the EGF demonstrates to the executive director is protective of public health and physical property.

(12) Normal Annual Operating Schedule--For the purposes of §116.911(f)(1) of this title (relating to Electric Generating Facility Permit Application), the average annual operating hours for all electric generating facilities located at a single account for the calendar years 1997, 1998, and 1999.

(13) [ (11) ] Peaking unit--An EGF that has:

(A) an average capacity factor of no more than 10% during the past three calendar years; and

(B) a capacity factor of no more than 20% in each of those calendar years.

(14) [ (12) ] Person--As defined in §101.330(17) of this title.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on December 20, 2001.

TRD-200108179

Stephanie Bergeron

Director, Environmental Law Division

Texas Natural Resource Conservation Commission

Earliest possible date of adoption: February 3, 2002

For further information, please call: (512) 239-5017


Subchapter H. PERMITS FOR GRANDFATHERED FACILITIES

1. GENERAL APPLICABILITY

30 TAC §§116.770 - 116.772

STATUTORY AUTHORITY

The new sections are proposed under THSC, TCAA, §382.011, which authorizes the commission to administer the requirements of the TCAA; §382.012, which provides the commission the authority to develop a comprehensive plan for the state's air; §382.017, which authorizes the commission to adopt rules consistent with the policy and purposes of the TCAA; §382.051, which authorizes the commission to issue a permit for numerous similar sources; §382.0518, which authorizes the commission to issue permits for construction of new facilities or modifications of existing facilities; §382.05181 which requires grandfathered facilities to apply for a permit and comply with its conditions by certain dates, and requires certain actions of the commission; and TWC, §5.103, which authorizes the commission to adopt rules.

The proposed new sections implement THSC, TCAA, §382.002, concerning Policy and Purpose; §382.011, concerning General Powers and Duties; §382.012, concerning State Air Control Plan; §382.017, concerning Rules; §382.051, concerning Permitting Authority of Board; Rules; and §382.0518, concerning Preconstruction Permit; TWC, §5.103, concerning Rules.

§116.770.Requirement to Apply.

The owner or operator of a grandfathered facility must apply for a permit to operate that facility under this chapter, qualify for a permit by rule under Chapter 106 of this title (relating to Permits by Rule), or submit a notice of shutdown before September 1, 2003 for facilities located in the East Texas region as defined in §101.330 of this title (relating to Definitions), and before September 1, 2004 for facilities located in the West Texas region as defined in §101.330 of this title or El Paso County.

§116.771.Implementation Schedule for Additional Controls.

If the installation of additional controls is required for a grandfathered facility to meet an emission limit for a pollutant, the permit shall specify an implementation schedule for such additional controls. Any such schedule shall require installation and operation of controls before March 1, 2007 for facilities located in the East Texas region as defined in §101.330 of this title (relating to Definitions) or before March 1, 2008 for facilities located in the West Texas region as defined in §101.330 of this title or El Paso County.

§116.772.Notice of Shutdown.

(a) The owner or operator of a grandfathered facility who chooses to shut the facility down rather than obtain a permit under this chapter or qualify for a permit by rule under Chapter 106 of this title (relating to Permits by Rule), shall notify the executive director in writing by completing Form PI- 1GSD, Notice of Shutdown, prior to the deadlines specified in §116.770 or §116.774 of this title (relating to Requirement to Apply; and Eligibility for Small Business Stationary Source Permits). The owner or operator of a grandfathered facility who submits a Form PI-1GSD, Notice of Shutdown, prior to the deadlines specified in §116.770 or §116.774 of this title shall cease emitting air contaminants by:

(1) March 1, 2007, if the facility is not eligible for a small business stationary source permit and is located in the East Texas region as defined in §101.330 of this title (relating to Definitions); or

(2) March 1, 2008, if the facility is eligible for a small business stationary source permit or is located in the West Texas region as defined in §101.330 of this title or El Paso County.

(b) The owner or operator of a grandfathered facility who applies for a permit prior to the deadlines specified in §116.770 or §116.774 of this title, but prior to permit issuance, decides to shut the facility down must submit a Form PI-1GSD, Notice of Shutdown, prior to withdrawal of the permit application and must cease emitting air contaminants by the date specified in subsection (a)(1) or (2) of this section.

(c) The owner or operator of a facility that has been shut down and for which a Notice of Shutdown has been submitted must obtain the proper authorization under this chapter or Chapter 106 of this title prior to operating the facility.

(d) The Notice of Shutdown shall include, as a minimum, an identification of the facility to be shut down, the date the owner or operator intends to cease operating the facility, and an inventory of the type and amount of emissions that will be eliminated when the facility ceases to operate.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on December 20, 2001.

TRD-200108180

Stephanie Bergeron

Director, Environmental Law Division

Texas Natural Resource Conservation Commission

Earliest possible date of adoption: February 3, 2002

For further information, please call: (512) 239-5017


2. SMALL BUSINESS STATIONARY SOURCE PERMITS, PIPELINE FACILITIES PERMITS, AND EXISTING FACILITY PERMITS

30 TAC §§116.774 - 116.777, 116.779 - 116.781, 116.783, 116.785 - 116.788, 116.790

STATUTORY AUTHORITY

The new sections are proposed under THSC, TCAA, §382.011, which authorizes the commission to administer the requirements of the TCAA; §382.012, which provides the commission the authority to develop a comprehensive plan for the state's air; §382.017, which authorizes the commission to adopt rules consistent with the policy and purposes of the TCAA; §382.051, which authorizes the commission to issue a permit for numerous similar sources; §382.0518, which authorizes the commission to issue permits for construction of new facilities or modifications of existing facilities; §382.05181 which requires grandfathered facilities to apply for a permit and comply with its conditions by certain dates, and requires certain actions of the commission; and TWC, §5.103, which authorizes the commission to adopt rules.

The proposed new sections implement THSC, TCAA, §382.002, concerning Policy and Purpose; §382.011, concerning General Powers and Duties; §382.012, concerning State Air Control Plan; §382.017, concerning Rules; §382.051, concerning Permitting Authority of Board; Rules; and §382.0518, concerning Preconstruction Permit; TWC, §5.103, concerning Rules.

§116.774.Eligibility for Small Business Stationary Source Permits.

(a) The owner or operator of a grandfathered facility located at a small business stationary source, as defined in TCAA, §382.0365(h), and which is not required to report to the commission under TCAA, §382.014 may apply for a small business stationary source permit before September 1, 2004.

(b) The deadlines contained in §116.770 of this title (relating to Requirement to Apply) and §116.771 of this title (relating to Implementation Schedule for Additional Controls) do not apply to facilities eligible to apply for a small business stationary source permit. Any grandfathered facility, including any facility for which the owner or operator has submitted a notice of shutdown under §116.772 of this title (relating to Notice of Shutdown), located at a small business stationary source may not emit air contaminants on or after March 1, 2008, unless the facility has a permit application pending under this chapter or a registration for a permit by rule under Chapter 106 of this title (relating to Permits by Rule).

(c) Applications for a small business stationary source permit shall be submitted under the seal of a Texas licensed professional engineer, if required by §116.110(e) of this title (relating to Applicability).

(d) The owner or operator of the grandfathered facility, group of facilities, or account is responsible for applying for the small business stationary permit and for complying with this subchapter.

§116.775.Eligibility for Pipeline Facilities Permits.

(a) The owner or operator of a grandfathered reciprocating internal combustion engine or group of engines that is a part of processing, treating, compression, or pumping facilities connected to or part of a gathering or transmission pipeline may apply for a pipeline facilities permit.

(b) Applications for a pipeline facilities permit shall be submitted under the seal of a Texas licensed professional engineer, if required by §116.110(e) of this title (relating to Applicability).

(c) The owner or operator of the grandfathered facility, group of facilities, or account is responsible for applying for the pipeline facilities permit and for complying with this subchapter.

(d) The owner or operator of more than one grandfathered reciprocating internal combustion engine may apply for a pipeline facilities permit for a single grandfathered reciprocating internal combustion engine or all of the grandfathered reciprocating internal combustion engines connected to or part of a gathering or transmission pipeline.

§116.776.Distribution of Funds from the Emissions Reductions Incentives Account for Control of Emissions from Grandfathered Reciprocating Internal Combustion Engines Located in the East Texas Region.

(a) Eligible facilities. Owners or operators of grandfathered reciprocating internal combustion engines are eligible for reimbursement of a portion of the cost of controls from the Emissions Reductions Incentives Account based on the following criteria.

(1) The owner or operator of the grandfathered reciprocating internal combustion engine or engines must make an actual 50% reduction in the annual emissions of nitrogen oxides (NO x ) as compared to the emissions reported from the grandfathered reciprocating internal combustion engine or engines in the 1997 Industrial Point Source Emissions Inventory.

(2) The grandfathered reciprocating internal combustion engine or engines must be located in the East Texas region as defined in §101.330 of this title (relating to Definitions).

(3) The owner or operator must apply for and receive a pipeline facilities permit or replace the grandfathered reciprocating internal combustion engine with an electric engine.

(4) The project to control emissions must be initiated on or before September 1, 2006.

(5) The project to control emissions must be completed before March 1, 2007.

(6) The pipeline facilities permit must be issued before the owner or operator of the grandfathered reciprocating internal combustion engine can request a distribution from the Emissions Reductions Incentives Account.

(7) The owner or operator who elects to replace a grandfathered reciprocating internal combustion engine with an electric engine must submit a Registration of Replacement of a Grandfathered Reciprocating Internal Combustion Engine with an Electric Engine before the owner or operator can request a distribution from the Emissions Reductions Incentives Account.

(8) The emissions controls identified in the permit must be operating before the executive director can authorize payment from the Emissions Reductions Incentives Account.

(9) For grandfathered reciprocating internal combustion engines replaced by electric engines, the electric engine must be installed and operating and the grandfathered reciprocating internal combustion engine must be permanently shut down before the executive director can authorize payment from the Emissions Reductions Incentives Account.

(10) Facilities required by any other state or federal law to make emissions reductions are not eligible for reimbursement.

(b) Limitations on reimbursement. The commission may reimburse the owner or operator of a grandfathered reciprocating internal combustion engine or engines for no more than the cost associated with achieving emissions reductions between 30% and 50% of the engine's hourly emissions of NOx before the addition of controls. The commission may distribute less than the amount calculated in this manner based on the amount of money contributed to the fund and the criteria for distribution outlined in subsection (c) of this section.

(c) Criteria for distribution. The commission will distribute any money in the fund based on the following criteria:

(1) whether the facility is located in an attainment area for ozone, near a nonattainment area for ozone, or a nonattainment area for ozone;

(2) the percentage of reduction in the hourly emissions of NO x on a grams per brake horsepower-hour basis achieved;

(3) the cost effectiveness of the controls achieved based on the tons of emissions actually reduced per dollar of the cost of the control method; and

(4) when the reductions are actually achieved and the request for reimbursement is received.

(d) Verification of emissions reductions. Prior to reimbursement from the Emissions Reductions Incentives Account, the owner or operator of each grandfathered reciprocating internal combustion engine must provide documentation verifying the amount of actual emission reductions achieved.

§116.777.Eligibility for Existing Facility Permits.

(a) The owner or operator of a grandfathered facility may apply for an existing facility permit.

(b) Applications for an existing facility permit shall be submitted under the seal of a Texas licensed professional engineer, if required by §116.110(e) of this title (relating to Applicability).

(c) The owner or operator of the grandfathered facility, group of facilities, or account is responsible for applying for the existing facility permit and for complying with this subchapter.

§116.779.Applications for Small Business Stationary Source Permits, Pipeline Facilities Permits, or Existing Facility Permits.

(a) Any application for a small business stationary source permit, a pipeline facilities permit, or an existing facility permit must include a completed Form PI-1G, Grandfathered Facility Permit Application. The Form PI-1G must be signed by an authorized representative of the applicant. The Form PI-1G specifies additional support information which must be provided before the application is deemed complete. In order to be granted a permit, the owner or operator of the grandfathered facility shall submit information to the commission which demonstrates that all of the following are met.

(1) Protection of public health and welfare. The emissions from the grandfathered facility will comply with all rules and regulations of the commission and with the intent of the TCAA, including protection of the health and physical property of the people.

(2) Measurement of emissions. The permit may have provisions for measuring the emission of air contaminants as determined by the commission. These provisions may include the installation of sampling ports on exhaust stacks and construction of sampling platforms in accordance with guidelines in the "Texas Natural Resource Conservation Commission Sampling Procedures Manual," portable analyzers, or emissions calculations if a known process variable is monitored.

(3) New Source Performance Standards (NSPS). The emissions from each affected facility as defined in 40 Code of Federal Regulations (CFR) Part 60 will meet at least the requirements of any applicable NSPS as listed under 40 CFR Part 60, promulgated by EPA under authority granted under FCAA, §111, as amended.

(4) National Emission Standards for Hazardous Air Pollutants (NESHAP). The emissions from each facility as defined in 40 CFR Part 61 will meet at least the requirements of any applicable NESHAP, as listed under 40 CFR Part 61, promulgated by EPA under authority granted under FCAA, §112, as amended.

(5) NESHAPs for source categories. The emissions from each affected facility shall meet at least the requirements of any applicable maximum achievable control technology (MACT) standard as listed under 40 CFR Part 63, promulgated by EPA under FCAA, §112, or as listed in Chapter 113, Subchapter C of this title (relating to National Emission Standards for Hazardous Air Pollutants for Source Categories (FCAA Section 112, 40 CFR 63)).

(6) Performance demonstration. The grandfathered facility will achieve the performance specified in the permit application. The commission may require the applicant to submit additional engineering data after the permit has been issued in order to demonstrate further that the facility will achieve the performance specified in the permit. In addition, the commission may require initial compliance testing to determine ongoing compliance through engineering calculations based on measured process variables, parametric or predictive monitoring, stack monitoring, or stack testing.

(7) Nonattainment review. A grandfathered facility in a nonattainment area shall comply with all applicable requirements under Subchapter B, Division 5 of this chapter (relating to Nonattainment Review).

(8) Prevention of Significant Deterioration (PSD) review. A grandfathered facility in an attainment area shall comply with all applicable requirements under Subchapter B, Division 6 of this chapter (relating to Prevention of Significant Deterioration Review).

(9) Air dispersion modeling or ambient monitoring. The commission may require computerized air dispersion modeling and/or ambient monitoring to determine the air quality impacts from the grandfathered facility.

(10) Federal standards of review for constructed or reconstructed major sources of hazardous air pollutants. If the grandfathered facility is an affected source as defined in §116.15(1) of this title (relating to Section 112(g) Definitions), the affected source shall comply with all applicable requirements under Subchapter C of this chapter (relating to Hazardous Air Pollutants: Regulations Governing Constructed or Reconstructed Major Sources (FCAA, Section 112(g), 40 CFR Part 63)).

(11) Application content. In addition to any other requirements of this subchapter, the applicant shall:

(A) identify each facility to be included in the permit;

(B) identify the air contaminants emitted; and

(C) provide emission rate calculations.

(b) In addition to the requirements of subsection (a) of this section, an application for a pipeline facilities permit shall propose a control method and identify the date by which the control method will be implemented. The proposed control method shall demonstrate compliance with the following requirements.

(1) Facilities located in the East Texas region as defined in §101.330 of this title (relating to Definitions), shall demonstrate that each grandfathered reciprocating internal combustion engine will achieve at least a 50% reduction of the hourly emissions rate of nitrogen oxides (NOx ), expressed in terms of grams per brake horsepower-hour (g/hp-hr). The commission may also require a 50% reduction of the hourly emissions rate of volatile organic compounds (VOC), expressed in terms of g/hp-hr for each engine located in the East Texas region as defined in §101.330 of this title.

(2) The commission shall require up to a 20% reduction of the hourly emissions rate of NO x and VOC, expressed in terms of g/hp-hr, from grandfathered reciprocating internal combustion engines located in the West Texas region as defined in §101.330 of this title or El Paso County.

(3) Notwithstanding the requirements of paragraphs (1) and (2) of this subsection, the owner or operator of more than one grandfathered reciprocating internal combustion engine may average the reductions achieved among more than one reciprocating internal combustion engine connected to or part of a gathering or transmission pipeline in order to demonstrate the reductions required in paragraphs (1) and (2) of this subsection. If the owner or operator chooses to average among engines located in both the East and West Texas regions as defined in §101.330 of this title it must be demonstrated that the sum of the reductions achieved from all of the engines located in the East Texas region as defined in §101.330 of this title will achieve the reductions required in paragraph (1) of this subsection. For purposes of this paragraph, El Paso County is included in the West Texas region as defined in §101.330 of this title.

(4) If the emissions reductions required by paragraphs (1) and (2) of this subsection will be achieved by averaging reductions as allowed by paragraph (3) of this subsection, the average may not include emission reductions achieved in order to comply with any other state or federal law. If the emission reductions required by paragraphs (1) and (2) of this subsection will be achieved at one account, the reduction may include emission reductions achieved since January 1, 2001 in order to comply with another state or federal law.

(c) In addition to the requirements of subsection (a) of this section, an application for an existing facility permit shall propose an air pollution control method that is at least as beneficial as the best available control technology (BACT) that the commission required or would have required for a facility of the same class or type as a condition of issuing a permit or permit amendment 120 months before the submittal of the existing facility permit application, considering the age and remaining useful life of the facility. The application shall identify the date by which the control method will be implemented.

§116.780.Public Participation for Initial Issuance of Pipeline Facilities Permits and Existing Facility Permits.

(a) An applicant for a pipeline facilities permit or an existing facility permit shall publish a notice of intent to obtain the permit in accordance with Chapter 39, Subchapters H and K of this title (relating to Applicability and General Provisions; and Public Notice of Air Quality Applications).

(b) Any person who may be affected by emissions from a grandfathered facility may request the commission to hold a notice and comment hearing on the pipeline facilities permit application or the existing facility permit application. The public comment period shall end 30 days after the publication of Notice of Receipt of Application and Intent to Obtain Permit in accordance with §39.418 of this title (relating to Notice of Receipt of Application and Intent to Obtain Permit). Any request for a notice and comment hearing must be made in writing during the 30-day public comment period.

(c) Any notice and comment hearing regarding initial issuance of a pipeline facilities permit or an existing facility permit shall be conducted in accordance with the procedures in §116.781 of this title (relating to Notice and Comment Hearings for Initial Issuance of Pipeline Facilities Permits and Existing Facility Permits) and not under the APA.

(d) The commission's response to public comments and the notice of its decision on whether to issue or deny a pipeline facilities permit or an existing facility permit will be conducted in accordance with the procedures in §116.842 of this title (relating to Notice of Final Action).

(e) A person affected by a decision to issue or deny a pipeline facilities permit or an existing facility permit may seek review, as appropriate, under the appropriate procedure in Chapter 50 of this title (relating to Action on Applications and Other Authorizations), and may seek judicial review under TCAA, §382.032, relating to Appeal of Commission Action.

§116.781.Notice and Comment Hearings for Initial Issuance of Pipeline Facilities Permits and Existing Facility Permits.

(a) The notice and comment hearing requirements apply only to the initial issuance of a pipeline facilities permit or an existing facility permit.

(b) The commission shall decide whether to hold a hearing. The commission is not required to hold a hearing if it determines that the basis of the request by a person who may be affected by emissions from a grandfathered facility is unreasonable. If a hearing is requested by a person who may be affected by emissions from a grandfathered facility, and that request is reasonable, the commission will hold a hearing.

(c) At the applicant's expense, notice of a hearing on a draft permit must be published in the public notice section of one issue of a newspaper of general circulation in the municipality in which the grandfathered facility is located, or in the municipality nearest to the location of the facility. The notice must be published at least 30 days before the date set for the hearing. The notice must include the following:

(1) the time, place, and nature of the hearing;

(2) a brief description of the purpose of the hearing; and

(3) the name and phone number of the commission office to be contacted to verify that a hearing will be held.

(d) Any person, including the applicant, may submit oral or written statements and data concerning the draft permit.

(1) The commission may set reasonable time limits for oral statements, and may require the submission of statements in writing.

(2) The period for submitting written comments is automatically extended to the close of any hearing.

(3) At the hearing, the commission may extend the period for submitting written comments beyond the close of the hearing.

(e) The commission will make an audio recording or written transcript of the hearing available to the public.

(f) Any person, including the applicant, who believes that any condition of the draft permit is inappropriate or that the preliminary decision to issue or deny the permit is inappropriate, shall raise all issues and submit all arguments supporting that position by the end of the public comment period.

(g) Any supporting materials for comments submitted under subsection (f) of this section must be included in full and may not be incorporated by reference, unless the materials are one of the following:

(1) already part of the administrative record in the same proceedings;

(2) state or federal statutes and regulations;

(3) EPA documents of general applicability; or

(4) other generally available reference materials.

(h) The commission will keep a record of all comments received and issues raised in the hearing. This record will be available to the public.

(i) The draft permit may be changed based on comments pertaining to whether the permit provides for compliance with the requirements of this subchapter.

(j) The commission will respond to comments consistent with §116.783 of this title (relating to Notice of Final Action on Pipeline Facilities Permit Applications and Existing Facility Permit Applications).

§116.783.Notice of Final Action on Pipeline Facilities Permit Applications and Existing Facility Permit Applications.

(a) After the public comment period expires or the conclusion of any notice and comment hearing, the commission will send notice by first-class mail of the final action on the pipeline facilities permit application or the existing facility permit application to any person who commented during the public comment period or at the hearing, and to the applicant.

(b) The notice must include the following:

(1) the response to any comments submitted during the public comment period;

(2) identification of any change in the conditions of the draft permit and the reasons for the change; and

(3) a statement that any person affected by the decision of the commission may petition for a rehearing under the appropriate procedure in Chapter 50 of this title (relating to Action on Applications and Other Authorizations) and may seek judicial review under TCAA, §382.032, relating to Appeal of Commission Action.

§116.785.Permit Fee.

(a) Fees required. Any person who applies for a permit under this division relating to small business stationary source permits, pipeline facility permits, and existing facility permits must remit a fee of $450 at the time of application for such permit. If the facility is a small business stationary source facility as defined in TCAA, §382.0365(h), the fee shall be $100.

(b) Payment of fees. All permit fees must be remitted in the form of a check or money order made payable to the Texas Natural Resource Conservation Commission and delivered to the Texas Natural Resource Conservation Commission, P.O. Box 13088, MC 214, Austin, Texas 78711-3088. Required fees must be received before the commission will begin examination of the application.

(c) Return of fees. Fees must be paid at the time an application for a permit is submitted in accordance with this division. If the applicant withdraws the application prior to issuance of the permit, one-half of the fee will be refunded, except that the entire fee will be refunded for any such application for which a permit by rule in accordance with Chapter 106 of this title (relating to Permits by Rule) is allowed. No fees will be refunded after a deficient application has been voided, denied, or after a permit has been issued by the commission.

§116.786.General and Special Conditions.

(a) Permits issued under this division relating to small business stationary source permits, pipeline facility permits, and existing facility permits may contain general and special conditions. The holders of a permit under this division shall comply with any and all such conditions.

(b) General conditions. Holders of permits issued under this division shall comply with the following general conditions, regardless of whether they are specifically stated within the permit document.

(1) Sampling requirements.

(A) If sampling is required, the permit holder shall contact the commission's Office of Compliance and Enforcement prior to sampling to obtain the proper data forms and procedures.

(B) All sampling and testing procedures must be approved by the executive director and coordinated with the regional representatives of the commission.

(C) The permit holder is also responsible for providing sampling facilities and conducting the sampling operations, or contracting with an independent sampling consultant.

(2) Equivalency of methods. The permit holder must demonstrate or otherwise justify the equivalency of emission control methods, sampling or other emission testing methods, and monitoring methods proposed as alternatives to methods indicated in the conditions of the permit. Alternative methods shall be applied for in writing and must be reviewed and approved by the executive director prior to their use in fulfilling any requirements of the permit.

(3) Recordkeeping. The permit holder shall:

(A) maintain a copy of the permit along with records containing the information and data sufficient to demonstrate compliance with the permit, including production records and operating hours;

(B) keep all required records in a file at the plant site. If, however, the facility normally operates unattended, records shall be maintained at the nearest staffed location within the State of Texas as specified in the application;

(C) make the records available at the request of personnel from the commission or any air pollution control program having jurisdiction;

(D) comply with any additional recordkeeping requirements specified in special conditions attached to the permit; and

(E) retain information in the file for at least two years following the date that the information or data is obtained.

(4) Maximum allowable emission rates. The total emissions of air contaminants from any of the sources of emissions must not exceed the values stated on the table attached to the permit entitled "Emission Sources--Maximum Allowable Emission Rates."

(5) Maintenance of emission control. The permitted facilities shall not be operated unless all air pollution emission capture and abatement equipment is maintained in good working order and operating properly during normal facility operations. The permit holder shall provide notification for upset and maintenance in accordance with §101.6 and §101.7 of this title (relating to Upset Reporting and Recordkeeping Requirements; and Maintenance, Startup and Shutdown Reporting, Recordkeeping, and Operational Requirements).

(6) Compliance with rules.

(A) Acceptance of a permit by an applicant constitutes an acknowledgment and agreement that the permit holder will comply with all rules, regulations, and orders of the commission issued in conformity with the TCAA and the conditions precedent to the granting of the permit.

(B) If more than one state or federal rule or regulation or permit condition are applicable, the most stringent limit or condition shall govern and be the standard by which compliance shall be demonstrated.

(C) Acceptance includes consent to the entrance of commission employees and agents into the permitted premises at reasonable times to investigate conditions relating to the emission or concentration of air contaminants, including compliance with the permit.

(c) Special conditions. The holders of permits issued under this division shall comply with all special conditions contained in the permit document.

(1) Special conditions may be attached to a permit that are more restrictive than the requirements of this title.

(2) Special conditions for written approval.

(A) The executive director may require as a special condition that the permit holder obtain written approval before constructing a source under:

(i) a standard permit in accordance with Subchapter F of this chapter (relating to Standard Permits); or

(ii) a permit by rule in accordance with Chapter 106 of this title (relating to Permits by Rule).

(B) Such written approval may be required if the executive director specifically finds that an increase of a particular pollutant could either:

(i) result in a significant impact on the air environment; or

(ii) cause the facility to become subject to review in accordance with:

(I) Subchapter C of this chapter (relating to Hazardous Air Pollutants: Regulations Governing Constructed or Reconstructed Major Sources (FCAA, Section 112(g), 40 CFR Part 63)); or

(II) the provisions in §116.150 and §116.151 of this title (relating to Nonattainment Review), and §§116.160 - 116.163 of this title (relating to Prevention of Significant Deterioration Review).

§116.787.Amendments and Alterations of Permits Issued Under this Division.

The owner or operator planning the modification of a facility permitted under this division relating to small business stationary source permits, pipeline facility permits, and existing facility permits must comply with the requirements of Subchapter B of this chapter (relating to New Source Review Permits) before work begins on the construction of the modification. Amendments and alterations for permits issued under this division are subject to the requirements of Subchapter B of this chapter.

§116.788.Renewal of Permits Issued Under this Division.

Permits issued under this division (relating to Small Business Stationary Source Permits, Pipeline Facilities Permits, and Existing Facility Permits) shall be renewed in accordance with the requirements of Subchapter D of this chapter (relating to Permit Renewals).

§116.790.Delegation.

The commission may delegate to the executive director the authority to take any action on a permit issued under this division relating to small business stationary source permits, pipeline facility permits, and existing facility permits.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on December 20, 2001.

TRD-200108181

Stephanie Bergeron

Director, Environmental Law Division

Texas Natural Resource Conservation Commission

Earliest possible date of adoption: February 3, 2002

For further information, please call: (512) 239-5017


3. EXISTING FACILITY FLEXIBLE PERMITS

30 TAC §§116.793 - 116.802, 116.804 - 116.807

STATUTORY AUTHORITY

The new sections are proposed under THSC, TCAA, §382.011, which authorizes the commission to administer the requirements of the TCAA; §382.012, which provides the commission the authority to develop a comprehensive plan for the state's air; §382.017, which authorizes the commission to adopt rules consistent with the policy and purposes of the TCAA; §382.051, which authorizes the commission to issue a permit for numerous similar sources; §382.0518, which authorizes the commission to issue permits for construction of new facilities or modifications of existing facilities; §382.05181 which requires grandfathered facilities to apply for a permit and comply with its conditions by certain dates, and requires certain actions of the commission; and TWC, §5.103, which authorizes the commission to adopt rules.

The proposed new sections implement THSC, TCAA, §382.002, concerning Policy and Purpose; §382.011, concerning General Powers and Duties; §382.012, concerning State Air Control Plan; §382.017, concerning Rules; §382.051, concerning Permitting Authority of Board; Rules; and §382.0518, concerning Preconstruction Permit; TWC, §5.103, concerning Rules.

§116.793.Eligibility for Existing Facility Flexible Permits.

(a) Existing facility flexible permit. The owner or operator of a grandfathered facility or group of grandfathered facilities at a site may apply for an existing facility flexible permit. The existing facility flexible permit may also include facilities permitted under TCAA, §382.0519. A person may apply for an existing facility flexible permit in accordance with §116.794 of this title (relating to Existing Facility Flexible Permit Application) for a facility, group of facilities, or account, provided that:

(1) only one existing facility flexible permit may be issued at an account site;

(2) modifications to facilities covered by an existing facility flexible permit may be handled through the amendment of the existing facility flexible permit;

(3) permitting of a new facility may be handled through the amendment of an existing facility flexible permit; and

(4) an existing facility flexible permit may not cover sources at more than one account site.

(b) Change in ownership. The new owner of a facility, group of facilities, or account shall comply with §116.110(d) of this title (relating to Applicability) provided however, that all facilities covered by an existing facility flexible permit must change ownership at the same time and to the same person, or both the new owner and existing permit holder must obtain a permit alteration allocating the emission caps or individual emission limitation prior to the transfer of the permit by the commission. After the sale of a facility or facilities, but prior to the transfer of a permit requiring a permit alteration, the original permit holder remains responsible for ensuring compliance with the existing facility flexible permit and all rules and regulations of the commission.

(c) Applications for an existing facility flexible permit shall be submitted under the seal of a Texas licensed professional engineer if required by §116.110(e) of this title.

(d) Responsibility for existing facility flexible permit application. The owner of the facility, group of facilities, or account or the operator of the facility, group of facilities, or account who is authorized to act for the owner is responsible for complying with this section, except as provided by subsection (b) of this section.

§116.794.Existing Facility Flexible Permit Application.

Any application for a new existing facility flexible permit must include a completed Form PI-1G, Grandfathered Facility Permit Application. The Form PI-1G must be signed by an authorized representative of the applicant. The Form PI-1G specifies additional support information which must be provided before the application is deemed complete. In order to be granted an existing facility flexible permit, the owner or operator of the grandfathered facility shall submit information to the commission which demonstrates that all of the following are met.

(1) Protection of public health and welfare. The emissions from the facility, group of facilities, or account as determined under §116.800 of this title (relating to Emission Caps and Individual Emission Limitations), will comply with all rules and regulations of the commission and with the intent of the TCAA, including protection of the health and physical property of the people.

(2) Measurement of emissions. The facility, group of facilities, or account will have provisions for measuring the emission of air contaminants as determined by the executive director. This may include the installation of sampling ports on exhaust stacks and construction of sampling platforms in accordance with guidelines in the "Texas Natural Resource Conservation Commission Sampling Procedures Manual."

(3) Control method. The grandfathered facility or group of grandfathered facilities shall use an air pollution control method that is at least as beneficial as the best available control technology (BACT) that the commission required or would have required for a facility of the same class or type as a condition of issuing a permit or permit amendment 120 months before the submittal of the existing facility permit application, considering the age and remaining useful life of the facility. Facilities located in nonattainment or near nonattainment areas which obtained a voluntary emission reduction permit (VERP) under Division 4 of this subchapter (relating to Voluntary Emission Reduction Permits) shall use generally available control technology (GACT). Control technology beyond ten year old BACT, GACT, or a combination of ten year old BACT and GACT may be used on certain facilities to provide the emission reductions necessary to comply with this requirement on a group of facilities or account basis, provided however, that the existing level of control may not be lessened for any facility.

(4) New Source Performance Standards (NSPS). The emissions from each affected facility as defined in 40 Code of Federal Regulations (CFR), Part 60 will meet at least the requirements of any applicable NSPS as listed under 40 CFR Part 60, promulgated by the EPA under authority granted under FCAA, §111, as amended.

(5) National Emission Standards for Hazardous Air Pollutants (NESHAP). The emissions from each facility as defined in 40 CFR Part 61 will meet at least the requirements of any applicable NESHAP, as listed under 40 CFR Part 61, promulgated by EPA under authority granted under FCAA, §112, as amended.

(6) NESHAPs for source categories. The emissions from each affected facility shall meet at least the requirements of any applicable maximum achievable control technology (MACT) standard as listed under 40 CFR Part 63, promulgated by the EPA under FCAA, §112 or as listed under Chapter 113, Subchapter C of this title (relating to National Emission Standards for Hazardous Air Pollutants for Source Categories (FCAA Section 112, 40 CFR 63)).

(7) Performance demonstration. The facility, group of facilities, or account will achieve the performance specified in the existing facility flexible permit application. The applicant may be required to submit additional engineering data after an existing facility flexible permit has been issued in order to demonstrate further that the facility, group of facilities, or account will achieve the performance specified in the existing facility flexible permit. In addition, initial compliance testing with ongoing compliance determined through engineering calculations based on measured process variables, parametric or predictive monitoring, stack monitoring, or stack testing may be required.

(8) Nonattainment review. If the facility, group of facilities, or account is located in a nonattainment area, each facility shall comply with all applicable requirements in accordance with Subchapter B, Division 5 of this chapter (relating to Nonattainment Review).

(9) Prevention of Significant Deterioration (PSD) review. If the facility, group of facilities, or account is located in an attainment area, each facility shall comply with all applicable requirements in accordance with Subchapter B, Division 6 of this chapter (relating to Prevention of Significant Deterioration Review).

(10) Air dispersion modeling or ambient monitoring. Computerized air dispersion modeling and/or ambient monitoring may be required by the commission's Air Permits Division to determine the air quality impacts from the facility, group of facilities, or account.

(11) Federal standards of review for constructed or reconstructed major sources of hazardous air pollutants. If the source is an affected source (as defined in §116.15(1) of this title (relating to Section 112(g) Definitions)), it shall comply with all applicable requirements in accordance with Subchapter C of this chapter (relating to Hazardous Air Pollutants: Regulations Governing Constructed or Reconstructed Major Sources (FCAA, Section 112(g), 40 CFR Part 63)).

(12) Mass cap and trade allocations. If subject to Chapter 101, Subchapter H, Division 3 of this title (relating to Mass Emissions Cap and Trade Program) the facility, group of facilities, or account must obtain allocations to operate.

(13) Application content. In addition to any other requirements of this chapter, the applicant shall:

(A) identify each air contaminant for which an emission cap is desired;

(B) identify each facility to be included in the existing facility flexible permit;

(C) identify each source of emissions to be included in the existing facility flexible permit, and for each source of emissions identify the Emission Point Number (EPN) and the air contaminants emitted;

(D) for each emission cap, identify all associated EPNs and provide emission rate calculations based on the expected maximum capacity and the proposed control technology; and

(E) for each individual emission limitation, identify the EPN and provide emission rate calculations based on the expected maximum capacity and the proposed control technology.

(14) Proposed control technology and compliance demonstration. The applicant shall specify the control technology proposed for each unit to meet the emission cap and demonstrate compliance with all emission caps at expected maximum production capacity.

§116.795.Public Participation for Initial Issuance of Existing Facility Flexible Permits.

(a) An applicant for a permit under this division relating to existing facility flexible permits shall publish notice of intent to obtain the permit in accordance with Chapter 39, Subchapters H and K of this title (relating to Applicability and General Provisions; and Public Notice of Air Quality Applications).

(b) Any person who may be affected by emissions from a grandfathered facility may request the commission to hold a notice and comment hearing on the application. The public comment period shall end 30 days after the publication of Notice of Receipt of Application and Intent to Obtain Permit in accordance with §39.418 of this title (relating to Notice of Receipt of Application and Intent to Obtain Permit). Any hearing request must be made in writing during the 30-day public comment period.

(c) Any hearing regarding initial issuance of a permit under this division shall be conducted in accordance with the procedures in §116.796 of this title (relating to Notice and Comment Hearings for Initial Issuance of Existing Facility Flexible Permits) and not under the APA.

(d) The commission's response to public comments and the notice of its decision on whether to issue or deny a permit under this division will be conducted in accordance with the procedures in §116.797 of this title (relating to Notice of Final Action on Existing Facility Flexible Permit Applications).

(e) A person affected by a decision to issue or deny a permit under this division may seek review, as appropriate, in accordance with the appropriate procedure in Chapter 50 of this title (relating to Action on Applications and Other Authorizations), and may seek judicial review under TCAA, §382.032, relating to Appeal of Commission Action.

(f) Any person who applies for an amendment to an existing facility flexible permit regarding an affected source (as defined in §116.15(1) of this title (relating to Section 112(g) Definitions)) subject to Subchapter C of this chapter (relating to Hazardous Air Pollutants: Regulations Governing Constructed or Reconstructed Major Sources (FCAA, Section 112(g), 40 CFR Part 63)) shall comply with the provisions in Chapter 39 of this title (relating to Public Notice).

§116.796.Notice and Comment Hearings for Initial Issuance of Existing Facility Flexible Permits.

(a) The notice and comment hearing requirements apply only to the initial issuance of an existing facility flexible permit.

(b) The commission shall decide whether to hold a hearing. The commission is not required to hold a hearing if it determines that the basis of the request by a person who may be affected by emissions from a grandfathered facility is unreasonable. If a hearing is requested by a person who may be affected by emissions from a grandfathered facility, and that request is reasonable, the commission will hold a hearing.

(c) At the applicant's expense, notice of a hearing on a draft permit must be published in the public notice section of one issue of a newspaper of general circulation in the municipality in which the grandfathered facility is located, or in the municipality nearest to the location of the facility. The notice must be published at least 30 days before the date set for the hearing. The notice must include the following:

(1) the time, place, and nature of the hearing;

(2) a brief description of the purpose of the hearing; and

(3) the name and phone number of the commission office to be contacted to verify that a hearing will be held.

(d) Any person, including the applicant, may submit oral or written statements and data concerning the draft permit.

(1) The commission may set reasonable time limits for oral statements, and may require the submission of statements in writing.

(2) The period for submitting written comments is automatically extended to the close of any hearing.

(3) At the hearing, the commission may extend the period for submitting written comments beyond the close of the hearing.

(e) The commission will make an audio recording or written transcript of the hearing available to the public.

(f) Any person, including the applicant, who believes that any condition of the draft permit is inappropriate or that the preliminary decision to issue or deny the permit is inappropriate, shall raise all issues and submit all arguments supporting that position by the end of the public comment period.

(g) Any supporting materials for comments submitted under subsection (f) of this section must be included in full and may not be incorporated by reference, unless the materials are one of the following:

(1) already part of the administrative record in the same proceedings;

(2) state or federal statutes and regulations;

(3) EPA documents of general applicability; or

(4) other generally available reference materials.

(h) The commission will keep a record of all comments received and issues raised in the hearing. This record will be available to the public.

(i) The draft permit may be changed based on comments pertaining to whether the permit provides for compliance with the requirements of this subchapter.

(j) The commission will respond to comments consistent with §116.797 of this title (relating to Notice of Final Action on Existing Facility Flexible Permit Applications).

§116.797.Notice of Final Action on Existing Facility Flexible Permit Applications.

(a) After the public comment period or the conclusion of any notice and comment hearing, the commission will send notice by first-class mail of the final action on the existing facility flexible permit application to any person who commented during the public comment period or at the hearing, and to the applicant.

(b) The notice must include the following:

(1) the response to any comments submitted during the public comment period;

(2) identification of any change in the conditions of the draft permit and the reasons for the change; and

(3) a statement that any person affected by the decision of the commission may petition for a rehearing under the appropriate procedure in Chapter 50 of this title (relating to Action on Applications and Other Authorizations) and may seek judicial review under TCAA, §382.032, relating to Appeal of Commission Action.

§116.798.Permit Fee.

(a) Fees required. Any person who applies for a permit under this division relating to existing facility flexible permits must remit a fee of $450 at the time of application for such permit. If the facility is a small business stationary source facility as defined in TCAA, §382.0365(h), the fee shall be $100.

(b) Payment of fees. All permit fees must be remitted in the form of a check or money order made payable to the Texas Natural Resource Conservation Commission and delivered to the Texas Natural Resource Conservation Commission, P.O. Box 13088, MC 214, Austin, Texas 78711-3088. Required fees must be received before the commission will begin examination of the application.

(c) Return of fees. Fees must be paid at the time an application for a permit is submitted in accordance with this division. If the applicant withdraws the application prior to issuance of the permit, one-half of the fee will be refunded, except that the entire fee will be refunded for any such application for which a permit by rule in accordance with Chapter 106 of this title (relating to Permits by Rule) is allowed. No fees will be refunded after a deficient application has been voided, denied, or after a permit has been issued by the commission.

§116.799.General and Special Conditions.

(a) Existing facility flexible permits may contain general and special conditions. The holders of existing facility flexible permits shall comply with any and all such conditions. Upon a specific finding by the executive director that an increase of a particular air contaminant could result in a significant impact on the air environment, or could cause the facility, group of facilities, or account to become subject to review in accordance with §§116.150, 116.151, and 116.160 - 116.163 of this title (relating to Nonattainment Review or Prevention of Significant Deterioration Review); or Subchapter C of this chapter (relating to Hazardous Air Pollutants: Regulations Governing Constructed or Reconstructed Major Sources (FCAA, Section 112(g), 40 CFR Part 63)), the permit may include a special condition which requires the permittee to obtain written approval from the executive director before constructing a facility under a standard permit or a permit by rule under Chapter 106 of this title (relating to Permits by Rule).

(b) A pollutant specific emission cap or multiple emission caps and/or individual emission limitations shall be established for each air contaminant for all facilities authorized by the existing facility flexible permit.

(c) The following general conditions shall be applicable to every existing facility flexible permit.

(1) Sampling requirements. If sampling of stacks or process vents is required, the existing facility flexible permit holder shall contact the commission's Office of Compliance and Enforcement, Engineering Services Section prior to sampling to obtain the proper data forms and procedures. All sampling and testing procedures must be approved by the executive director and coordinated with the appropriate regional office of the commission. The existing facility flexible permit holder is also responsible for providing sampling facilities and conducting the sampling operations, or contracting with an independent sampling consultant.

(2) Equivalency of methods. It shall be the responsibility of the existing facility flexible permit holder to demonstrate or otherwise justify the equivalency of emission control methods, sampling or other emission testing methods, and monitoring methods proposed as alternatives to methods indicated in the conditions of the existing facility flexible permit. Alternative methods shall be applied for in writing and must be reviewed and approved by the executive director prior to their use in fulfilling any requirements of the permit.

(3) Recordkeeping. A copy of the existing facility flexible permit along with information and data sufficient to demonstrate continuous compliance with the emission caps and individual emission limitations contained in the existing facility flexible permit shall be maintained in a file at the plant site, and made available at the request of personnel from the commission or any air pollution control program having jurisdiction. For facilities that normally operate unattended, this information shall be maintained at the nearest staffed location within the State of Texas specified by the permit holder in the permit application. This information may include, but is not limited to, emission cap and individual emission limitation calculations based on a 12-month rolling basis and production records and operating hours. Additional recordkeeping requirements may be specified in special conditions attached to the existing facility flexible permit. Information in the file shall be retained for at least two years following the date that the information or data is obtained.

(4) Maximum allowable emission rates. An existing facility flexible permit covers only those sources of emissions and those air contaminants listed in the table entitled "Emission Sources, Emissions Caps and Individual Emission Limitations" attached to the existing facility flexible permit. Existing facility flexible permitted sources are limited to the emission limits and other conditions specified in the table attached to the existing facility flexible permit.

(5) Emission cap readjustment. If a schedule to install additional controls is included in the existing facility flexible permit and a facility subject to such a schedule is taken out of service, the emission cap contained in the existing facility flexible permit will be readjusted for the period the unit is out of service to a level as if no schedule had been established. Unless a special provision specifies the method of readjustment of the emission cap, a permit alteration shall be obtained.

(6) Maintenance of emission control. The facilities covered by the existing facility flexible permit shall not be operated unless all air pollution emission capture and abatement equipment is maintained in good working order and operating properly during normal facility operations. Notification for upset and maintenance shall be made in accordance with §101.6 and §101.7 of this title (relating to Upset Reporting and Recordkeeping Requirements; and Maintenance, Startup and Shutdown Reporting, Recordkeeping, and Operational Requirements).

(7) Compliance with rules. Acceptance of an existing facility flexible permit by a permit applicant constitutes an acknowledgment and agreement that the holder will comply with all rules, regulations, and orders of the commission issued in conformity with the TCAA and the conditions precedent to the granting of the permit. If more than one state or federal rule or regulation or existing facility flexible permit condition are applicable, then the most stringent limit or condition shall govern and be the standard by which compliance shall be demonstrated. Acceptance includes consent to the entrance of commission employees and agents into the permitted premises at reasonable times to investigate conditions relating to the emission or concentration of air contaminants, including compliance with the existing facility flexible permit.

(d) There may be additional special conditions attached to an existing facility flexible permit upon issuance or amendment of the permit. Such conditions in an existing facility flexible permit may be more restrictive than the requirements of this title.

§116.800.Emission Caps and Individual Emission Limitations.

(a) Emission caps. Each emission cap for a specific pollutant will be established as follows.

(1) Emissions will be calculated for each facility based on application of best available control technology (BACT) that the commission required or would have required for a facility of the same class or type as a condition of issuing a permit or permit amendment 120 months before the submittal of the existing facility permit application considering the age and remaining useful life of the facility, generally available control technology (GACT) for facilities with a voluntary emission reduction permit located in nonattainment areas or near nonattainment areas, or a combination of ten year old BACT and GACT at expected maximum capacity.

(2) The calculated emissions will be summed.

(b) Individual emission limitations. An individual emission limitation will be established in the same permit for each pollutant not covered by an emission cap for facilities covered by the existing facility flexible permit. In addition, an individual emission limitation may be established for a pollutant covered by an emission cap when the expected capacity of a facility is less than the expected maximum capacity to prevent a facility from exceeding emission levels appropriate for the proposed controls.

(c) Readjustment of emission cap. If a facility subject to an emission cap is shut down for a period longer than 12 months, the emission cap shall be readjusted by lowering the emission cap by an amount that the shut down facility contributed to the original calculation of the emission cap. If a new facility is brought into the existing facility flexible permit, an emission cap shall be adjusted by modifying the emission cap accordingly.

(d) An emission cap will be readjusted downward for any facility covered by an existing facility flexible permit if that facility becomes subject to any new state or federal regulation which would lower emissions or require an emission reduction. The adjustment will be made at the time the existing facility flexible permit is amended or altered. If an amendment to an existing facility flexible permit is not required to meet the new regulation, the permittee must submit a request to alter the permit and include information describing how compliance with the new requirement will be demonstrated within 60 days of making the change.

§116.801.Implementation Schedule for Additional Controls.

If the installation of additional controls is required for a grandfathered facility to meet an emission cap for a pollutant, the existing facility flexible permit shall specify an implementation schedule for such additional controls. Any such schedule shall require installation of controls before March 1, 2007 for facilities located in the East Texas region as defined in §101.330 of this title (relating to Definitions), or before March 1, 2008 for facilities located in the West Texas region as defined in §101.330 of this title or El Paso County. The permit may also specify how the emission cap will be adjusted if such a facility is taken out of service or fails to install the additional control equipment as provided by the implementation schedule.

§116.802.Significant Emission Increase.

An increase in emissions from operational or physical changes at an existing facility covered by an existing facility flexible permit is insignificant for the purposes of state new source review under this subchapter, if the increase does not exceed either the emission cap or individual emission limitation for the facility covered by the existing facility flexible permit. This section does not apply to an increase in emissions from a new facility nor to the emission of an air contaminant not previously emitted by an existing facility.

§116.804.Limitation on Physical and Operational Changes.

Neither operational nor physical changes at an account may result in an increase in actual emissions at facilities not covered by the existing facility flexible permit unless those affected facilities are authorized in accordance with §116.110 of this title (relating to Applicability).

§116.805.Amendments and Alterations for Existing Facility Flexible Permits.

The owner or operator planning a modification of a facility permitted under this division, relating to existing facility flexible permits, must comply with the requirements of Subchapter B of this chapter (relating to New Source Review Permits) before work begins on the construction of the modification. Amendments and alterations for existing facility flexible permits are subject to the requirements of Subchapter B of this chapter.

§116.806.Existing Facility Flexible Permit Renewal.

Permits issued under this division, relating to existing facility flexible permits, will be renewed in accordance with the requirements of Subchapter D of this chapter (relating to Permit Renewals).

§116.807.Delegation.

The commission may delegate to the executive director the authority to take any action on a permit issued under this division, relating to existing facility flexible permits.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on December 20, 2001.

TRD-200108182

Stephanie Bergeron

Director, Environmental Law Division

Texas Natural Resource Conservation Commission

Earliest possible date of adoption: February 3, 2002

For further information, please call: (512) 239-5017


Subchapter I. ELECTRIC GENERATING FACILITY PERMITS

30 TAC §§116.910, 116.911, 116.913, 116.917, 116.918, 116.921, 116.926, 116.928, 116.930

STATUTORY AUTHORITY

The amendments and new sections are proposed under THSC, TCAA, §382.011, which authorizes the commission to administer the requirements of the TCAA; §382.012, which provides the commission the authority to develop a comprehensive plan for the state's air; §382.017, which authorizes the commission to adopt rules consistent with the policy and purposes of the TCAA; §382.051, which authorizes the commission to issue a permit for numerous similar sources; §382.0518, which authorizes the commission to issue permits for construction of new facilities or modifications of existing facilities; §382.05181 which requires grandfathered facilities to apply for a permit and comply with its conditions by certain dates, and requires certain actions of the commission; and TWC, §5.103, which authorizes the commission to adopt rules.

The proposed amendments and new sections implement THSC, TCAA, §382.002, concerning Policy and Purpose; §382.011, concerning General Powers and Duties; §382.012, concerning State Air Control Plan; §382.017, concerning Rules; §382.051, concerning Permitting Authority of Board; Rules; and §382.0518, concerning Preconstruction Permit; TWC, §5.103, concerning Rules.

§116.910.Applicability.

(a) The owner or operator of a grandfathered electric generating facility (EGF) shall apply for a permit to operate that facility under this subchapter and may apply for permit authorization to operate certain facilities (identified in §116.911(f) of this title (relating to Electric Generating Facility Permit Application)) that are located at the same site as a grandfathered EGF.

(b) - (d) (No change.)

[(e) Emissions of nitrogen oxides shall be permitted under this subchapter for any grandfathered or electing EGF. Emissions of sulfur dioxide and particulate matter shall be permitted under this subchapter only for grandfathered or electing coal-fired EGFs. Emissions of other air contaminants from grandfathered EGFs may be permitted under this subchapter, provided the grandfathered EGFs meet the requirements of Chapter 116, Subchapter H of this title (relating to Voluntary Emission Reduction Permits).]

(e) [ (f) ] Owners or operators of grandfathered facilities as defined in §116.10 of this title (relating to General Definitions) at sites with grandfathered or electing EGFs subject to this subchapter may consolidate any permit issued under Chapter 116, Subchapter H of this title with a permit issued under this subchapter.

(f) [ (g) ] A grandfathered [ An ] EGF that generates electric energy primarily for internal use but that during 1997 sold, to a utility power distribution system, less than one-third of its potential electrical output capacity, or less than 219,000 megawatt-hours, is not required to obtain a permit under this subchapter [ subject to the requirements of this chapter ].

§116.911.Electric Generating Facility Permit Application.

(a) - (c) (No change.)

(d) Any grandfathered natural gas-fired EGF for which a permit application was filed under subsection (a) of this section, has obtained a permit in accordance with subsection (a) of this section, or is excluded in accordance with §116.910(d) of this title (relating to Applicability) from the requirement to submit an application under subsection (a) of this section is considered permitted for the emissions of all air contaminants from that EGF.

(e) An owner or operator of a grandfathered coal-fired EGF with a permit issued in accordance with to subsection (a) of this section or with an application pending under subsection (a) of this section may submit an application for an EGFP in accordance with to §116.917 of this title (relating to Electric Generating Facility Permit Application for Certain Grandfathered Coal-Fired Electric Generating Facilities and Certain Grandfathered Facilities Located at Electric Generating Facility Sites) to authorize the emissions of all criteria pollutants from the EGF other than NO x , SO 2 , and PM.

(f) An owner or operator of a grandfathered or electing EGF with a permit application pending under subsection (a) of this section or a permit issued in accordance with subsection (a) of this section may submit an application for an EGFP in accordance with §116.917 of this title to also authorize each of the following types of facilities that are located at the same site as the EGF:

(1) a generator that does not generate electric energy for compensation and is used not more than 10% of the normal annual operating schedule; or

(2) an auxiliary fossil-fuel-fired combustion facility that does not generate electric energy and does not emit more than 100 tons per year of any air contaminant.

(g) Any application submitted in accordance with §116.917 of this title for facilities identified in subsection (e) of this section must be submitted by September 1, 2003. Any application submitted in accordance with §116.917 of this title for facilities identified in subsection (f)(1) or (2) of this section must be submitted by September 1, 2002. Any additional controls specified in an EGF permit issued in accordance with an application filed under §116.917 of this title are subject to the schedule outlined in §116.771 of this title (relating to Implementation Schedule for Additional Controls.)

(h) Emissions of air contaminants from facilities identified in subsection (f)(1) or (2) of this section must be included in each applicable emissions allowance trading program under Chapter 101, Subchapter H, Division 2 of this title (relating to Emissions Banking and Trading Allowances). The commission will not issue any new emissions allowance for the emissions of any air contaminant from such a facility.

(i) [ (d) ] All applications for an EGFP shall be submitted under the seal of a Texas licensed professional engineer if required by §116.110(e) of this title (relating to Applicability).

§116.913.General and Special Conditions.

(a) The following general conditions shall be applicable to every electric generating facility permit (EGFP) unless otherwise specified in the permit.

(1) A permit issued under this subchapter may authorize [ authorizes ] the following:

(A) for grandfathered natural gas-fired electric generating facilities (EGFs), emissions of all air contaminants; [ nitrogen oxides (NO x ) emissions from all grandfathered and electing electric generating facilities (EGF); ]

(B) for grandfathered coal-fired EGFs, nitrogen oxides (NO x ) emissions, sulfur dioxide [ dioxides ] (SO 2 ) emissions , and particulate matter (PM) through opacity limitations as specified in §111.111 of this title (relating to Requirements for Specified Sources); [ from coal-fired grandfathered and electing EGFs. ]

(C) for electing natural gas-fired EGFs, allowances for NO x emissions; [ particulate matter through opacity limitations as specified in §111.111 of this title (relating to Requirements for Specified Sources) for coal-fired grandfathered and electing EGFs. ]

(D) for electing coal-fired EGFs, allowances for NO x emissions, allowances for SO 2 emissions, and PM through opacity limitations as specified in §111.111 of this title; and

(E) for facilities identified in §116.917(a) of this title (relating to Electric Generating Facility Permit Application for Certain Grandfathered Coal-Fired Electric Generating Facilities and Certain Grandfathered Facilities Located at Electric Generating Facility Sites), all air contaminants.

[(2) An EGFP may permit emissions of all other air contaminants from grandfathered EGFs, provided the requirements of Chapter 116, Subchapter H of this title (relating to Voluntary Emissions Reduction Permits) are met.]

(2) [ (3) ] Grandfathered facilities as defined in §116.10 of this title (relating to General Definitions) at sites with grandfathered or electing EGFs and permitted under [ Chapter 116, ] Subchapter H of this chapter (relating to Permits for Grandfathered Facilities) [ title ] may be consolidated with a permit issued under this subchapter.

(3) [ (4) ] The owner or operator of a grandfathered EGF, an [ or ] electing EGF , and if applicable, any facility included in an EGFP under §116.917 of this title, must comply with Chapter 101, Subchapter H, Division 2 of this title (relating to Emissions Banking and Trading of Allowances) including the requirement to maintain allowances in a compliance account. Allowances may be transferred in accordance with §101.335 of this title (relating to Allowance Banking and Trading ).

(4) [ (5) ] Mass emission monitoring and reporting shall be conducted in accordance with §116.914 of this title (relating to Emissions Monitoring and Reporting Requirements).

(5) [ (6) ] On June 1 after every control period, the owner or operator [ a grandfathered or electing EGF subject to this subchapter ] shall hold a quantity of allowances for emissions of NO x and, where applicable, SO2 , in its compliance account that is equal to or greater than the total emissions of that air contaminant emitted during the prior control period for each EGF permitted in accordance with §116.911(a) and (b) of this title (relating to Electric Generating Facility Permit Application) and for each facility permitted in accordance with §116.917 of this title .

(6) [ (7) ] Owners or operators shall submit a report of the amount of emissions of each allocated air contaminant, from the prior control period to the Air Permits Division consistent with the requirements of §101.336(b) of this title (relating to Emission Monitoring, Compliance Demonstration, and Reporting).

(7) [ (8) ] Coal-fired grandfathered and electing EGFs must meet the opacity limitations of §111.111 of this title [ (relating to Requirements for Specified Sources) ].

(b) (No change.)

§116.917.Electric Generating Facility Permit Application for Certain Grandfathered Coal-Fired Electric Generating Facilities and Certain Grandfathered Facilities Located at Electric Generating Facility Sites.

(a) Any application for an electric generating facility permit (EGFP) for additional criteria pollutants from grandfathered coal-fired electric generating facilities (EGFs) identified in §116.911(e) of this title (relating to Electric Generating Facility Permit Application) or for grandfathered facilities identified in §116.611(f)(1) or (2) of this title (relating to Registration To Use a Standard Permit) must include a completed Form PI-1G, Grandfathered Facility Permit Application. The Form PI-1G must be signed by an authorized representative of the applicant. The Form PI-1G specifies additional support information which must be provided before the application is deemed complete. In order to be granted a permit for a grandfathered facility under this section, the owner or operator of the grandfathered facility shall submit information to the commission which demonstrates that all of the following are met.

(1) Protection of public health and welfare. The emissions from the grandfathered facility will comply with all rules and regulations of the commission and with the intent of the TCAA, including protection of the health and physical property of the people.

(2) Measurement of emissions. The EGFP may have provisions for measuring the emission of air contaminants as determined by the commission. These may include the installation of sampling ports on exhaust stacks and construction of sampling platforms in accordance with guidelines in the "Texas Natural Resource Conservation Commission Sampling Procedures Manual," portable analyzers, or emissions calculations if a known process variable is monitored.

(3) New Source Performance Standards (NSPS). The emissions from each affected facility as defined in 40 Code of Federal Regulations (CFR) Part 60 will meet at least the requirements of any applicable NSPS as listed under 40 CFR Part 60, promulgated by the EPA under authority granted in accordance with FCAA, §111, as amended.

(4) National Emission Standards for Hazardous Air Pollutants (NESHAP). The emissions from each facility as defined in 40 CFR Part 61 will meet at least the requirements of any applicable NESHAP, as listed under 40 CFR Part 61, promulgated by the EPA under authority granted in accordance with FCAA, §112, as amended.

(5) NESHAPs for source categories. The emissions from each affected facility shall meet at least the requirements of any applicable maximum achievable control technology (MACT) standard as listed under 40 CFR Part 63, promulgated by the EPA in accordance with FCAA, §112, or as listed under Chapter 113, Subchapter C of this title (relating to National Emission Standards for Hazardous Air Pollutants for Source Categories (FCAA, Section 112, 40 CFR 63)).

(6) Performance demonstration. The grandfathered facility will achieve the performance specified in the permit application. The commission may require the applicant to submit additional engineering data after an EGFP has been issued in order to demonstrate further that the grandfathered facility will achieve the performance specified in the permit. In addition, the commission may require initial compliance testing to determine ongoing compliance through engineering calculations based on measured process variables, parametric or predictive monitoring, stack monitoring, or stack testing.

(7) Nonattainment review. A grandfathered facility in a nonattainment area shall comply with all applicable requirements under Subchapter B, Division 5 of this chapter (relating to Nonattainment Review).

(8) Prevention of Significant Deterioration (PSD) review. A grandfathered facility in an attainment area shall comply with all applicable requirements under Subchapter B, Division 6 of this chapter (relating to Prevention of Significant Deterioration Review).

(9) Air dispersion modeling or ambient monitoring. The commission may require computerized air dispersion modeling and/or ambient monitoring to determine the air quality impacts from the grandfathered facility.

(10) Federal standards of review for constructed or reconstructed major sources of hazardous air pollutants. If the grandfathered facility is an affected source (as defined in §116.15(1) of this title (relating to Section 112(g) Definitions)), the affected source shall comply with all applicable requirements under Subchapter C of this chapter (relating to Hazardous Air Pollutants: Regulations Governing Constructed or Reconstructed Major Sources (FCAA, Section 112(g), 40 CFR Part 63)).

(11) Application content. In addition to any other requirements of this subchapter, the applicant shall:

(A) identify each facility to be included in the electric generating facility permit;

(B) identify the air contaminants emitted; and

(C) provide emission rate calculations.

(b) Upon request, the commission shall consolidate an application submitted in accordance with this section with an application pending in accordance with §116.911(a) of this title.

(c) Applications submitted in accordance with this section are subject to the requirements of §116.920 of this title (relating to Public Participation for Initial Issuance).

§116.918.Additional General and Special Conditions for Grandfathered Coal-Fired Electric Generating Facilities and Certain Grandfathered Facilities Located at Electric Generating Facility Sites.

(a) Permits issued to facilities submitting applications under §116.917 of this title (relating to Electric Generating Facility Permit Application for Certain Grandfathered Coal-Fired Electric Generating Facilities and Certain Grandfathered Facilities Located at Electric Generating Facility Sites) may contain general and special conditions. The holders of a permit under this subchapter shall comply with any and all such conditions.

(b) General conditions. Holders of permits issued to facilities submitting applications in accordance with §116.917 of this title shall comply with the following general conditions, regardless of whether they are specifically stated within the permit document.

(1) Sampling requirements.

(A) If sampling is required, the permit holder shall contact the commission's Office of Compliance and Enforcement prior to sampling to obtain the proper data forms and procedures.

(B) All sampling and testing procedures must be approved by the executive director and coordinated with the regional representatives of the commission.

(C) The permit holder is also responsible for providing sampling facilities and conducting the sampling operations or contracting with an independent sampling consultant.

(2) Equivalency of methods. The permit holder must demonstrate or otherwise justify the equivalency of emission control methods, sampling or other emission testing methods, and monitoring methods proposed as alternatives to methods indicated in the conditions of the permit. Alternative methods shall be applied for in writing and must be reviewed and approved by the executive director prior to their use in fulfilling any requirements of the permit.

(3) Recordkeeping. The permit holder shall:

(A) maintain a copy of the permit along with records containing the information and data sufficient to demonstrate compliance with the permit, including production records and operating hours;

(B) keep all required records in a file at the plant site. If, however, the facility normally operates unattended, records shall be maintained at the nearest staffed location within the State of Texas specified in the application;

(C) make the records available at the request of personnel from the commission or any air pollution control program having jurisdiction;

(D) comply with any additional recordkeeping requirements specified in special conditions attached to the permit; and

(E) retain information in the file for at least two years following the date that the information or data is obtained.

(4) Maximum allowable emission rates. The total emissions of air contaminants from any of the sources of emissions must not exceed the values stated on the table attached to the permit entitled "Emission Sources--Maximum Allowable Emission Rates."

(5) Maintenance of emission control. The permitted facilities shall not be operated unless all air pollution emission capture and abatement equipment is maintained in good working order and operating properly during normal facility operations. The permit holder shall provide notification for upset and maintenance in accordance with §101.6 and §101.7 of this title (relating to Upset Reporting and Recordkeeping Requirements; and Maintenance, Startup and Shutdown Reporting, Recordkeeping, and Operational Requirements).

(6) Compliance with rules.

(A) Acceptance of a permit by an applicant constitutes an acknowledgment and agreement that the permit holder will comply with all rules, regulations, and orders of the commission issued in conformity with the TCAA and the conditions precedent to the granting of the permit.

(B) If more than one state or federal rule or regulation or permit condition are applicable, the most stringent limit or condition shall govern and be the standard by which compliance shall be demonstrated.

(C) Acceptance includes consent to the entrance of commission employees and agents into the permitted premises at reasonable times to investigate conditions relating to the emission or concentration of air contaminants, including compliance with the permit.

(c) Special conditions. The holders of permits issued under this subchapter shall comply with all special conditions contained in the permit document.

(1) Special conditions may be attached to a permit that are more restrictive than the requirements of title.

(2) Special condition for written approval.

(A) The executive director may require as a special condition that the permit holder obtain written approval before constructing a source under:

(i) a standard permit in accordance with Subchapter F of this chapter (relating to Standard Permits); or

(ii) a permit by rule under Chapter 106 of this title (relating to Permits by Rule).

(B) Such written approval may be required if the executive director specifically finds that an increase of a particular pollutant could either:

(i) result in a significant impact on the air environment; or

(ii) cause the facility to become subject to review under:

(I) Subchapter C of this chapter (relating to Hazardous Air Pollutants: Regulations Governing Constructed or Reconstructed Major Sources (FCAA, Section 112(g), 40 CFR Part 63)); or

(II) the provisions in Subchapter B, Division 5 of this chapter (relating to Nonattainment Review) and Subchapter B, Division 6 of this chapter (relating to Prevention of Significant Deterioration Review).

§116.921.Notice and Comment Hearings for Initial Issuance.

(a) The notice and comment hearing requirements apply only to the initial issuance of an [ a ] electric generating facility permit (EGFP).

(b) The commission shall decide whether to hold a hearing. The commission is not required to hold a hearing if the basis of the request by a person who may be affected by emissions from a grandfathered or electing electric generating facility (EGF) or a facility described in §116.911(f) of this title (relating to Electric Generating Facility Permit Application) is determined to be unreasonable. If a hearing is requested by a person who may be affected by emissions from a grandfathered or electing EGF or a facility described in §116.911(f) of this title , and that request is reasonable, the commission shall hold a hearing.

(c) At the applicant's expense, notice of a hearing on a draft EGFP must be published in the public notice section of one issue of a newspaper of general circulation in the municipality in which the grandfathered or electing EGF or a facility described in §116.911(f) of this title is located, or in the municipality nearest to the location of the grandfathered or electing EGF or a facility described in §116.911(f) of this title . The notice must be published at least 30 days before the date set for the hearing. The notice must include the following:

(1) - (3) (No change.)

(d) - (j) (No change.)

§116.926.Permit Fee.

(a) Fees required. Any person who applies for a permit in accordance with §116.917 of this title (relating to Electric Generating Facility Permit Application for Certain Grandfathered Coal-Fired Electric Generating Facilities and Certain Grandfathered Facilities Located at Electric Generating Facility Sites) must remit a fee of $450 at the time of application for such permit. If the facility is a small business stationary source facility, as defined in TCAA, §382.0365(h), the fee shall be $100.

(b) Payment of fees. All permit fees must be remitted in the form of a check or money order made payable to the Texas Natural Resource Conservation Commission and delivered to Texas Natural Resource Conservation Commission, P.O. Box 13088, MC 214, Austin, Texas 78711-3088. Required fees must be received before the commission will begin examination of the application.

(c) Return of fees. Fees must be paid at the time an application for a permit is submitted in accordance with this subchapter. If the applicant withdraws the application prior to issuance of the permit, one-half of the fee will be refunded, except that the entire fee will be refunded for any such application for which a permit by rule in accordance with Chapter 106 of this title (relating to Permits by Rule) is allowed. No fees will be refunded after a deficient application has been voided, denied, or after a permit has been issued by the commission.

§116.928.Delegation.

The commission may delegate to the executive director the authority to take any action on a permit issued under this subchapter.

§116.930. Amendments and Alterations of Permits Issued Under this Subchapter [ Modifications ].

The owner or operator planning a modification of a facility permitted under this subchapter must comply with Subchapter B of this chapter (relating to New Source Review Permits) before work is begun on the construction of the modification. Amendments and alterations for permits issued in accordance with this subchapter are subject to the requirements of Subchapter B of this chapter.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on December 20, 2001.

TRD-200108183

Stephanie Bergeron

Director, Environmental Law Division

Texas Natural Resource Conservation Commission

Earliest possible date of adoption: February 3, 2002

For further information, please call: (512) 239-5017