Implementing the Clean Air Act Amendments of 1990:
Where Are We Now?

Susan L. Mayer, Analyst
Environment and Natural Resources Policy Division

January 30, 1995

95-234 ENR

TABLE OF CONTENTS

SUMMARY
INTRODUCTION
BACKGROUND
MEETING STATUTORY SCHEDULES
NONATTAINMENT REQUIREMENTS

Meeting the NAAQS
State Implementation Plan
Sanctions
Employer Trip-Reduction Programs

MOBILE SOURCE CONTROLS
Reformulated Gasoline
-- The Role of Ethanol in the RFG Market
-- Venezuelan Gasoline Imports
Low-Emission Vehicles
Vehicle Inspection and Maintenance

OPERATING PERMIT PROGRAMS FOR STATIONARY SOURCES

SUMMARY

The Clean Air Act (CAA) was last reauthorized in 1990, and is scheduled to be reauthorized again by 1998. There have been four years of implementation experience with the 1990 amendments to the Act. To date, implementation of CAA programs such as the acid rain control program, and the program to control ozone-depleting substances has progressed mostly as expected. However, implementation of other CAA programs has proved to be more contentious. Based on CAA implementation experience to date, several issues related to the implementation of the 1990 amendments have emerged.

The Act was designed with a series of very tight deadlines under which States would have to respond to rules promulgated by EPA. Therefore, EPA rulemaking delays have become an important implementation issue. EPA delays have caused States to miss deadlines for submitting their own State Implementation Plans (SIPs), causing States to delay the implementation of air pollution control programs.

To date, the Act has been effective at bringing nonattainment areas into compliance with national ambient air quality standards (NAAQS). More than 80 percent of the marginal nonattainment areas that were to have reached the NAAQS by November 1993, were successful, and more than half of the moderate areas that must comply by November 1996 are already meeting NAAQS.

States with more severe air pollution problems have had less success implementing CM requirements. Few States have been able to submit complete SIPs by the statutory deadlines. However, most States have been able to complete SIP submissions within an 18-month "grace period" to avoid the imposition of sanctions.

Another important implementation issue under the CAA is the amount of flexibility that EPA has given States in allowing them to develop air pollution control programs. In several programs, including trip-reduction programs, permit programs, and automobile inspection and maintenance (I/M) programs, EPA has recently granted more flexibility to States in complying with EPA-promulgated rules. The added flexibility is intended to make the regulations less burdensome and costly for the regulated community.

The reformulated gasoline (RFG) program has been one of the most contentious under the CAA. The Act requires that cleaner-burning reformulated gasoline be sold in the nine areas with the worst ozone pollution. The requirement became effective on January 1, 1995. Although supply disruptions and price increases that were expected did not materialize, other issues related to the RFG program have arisen. First, the ethanol industry lobbied for a March 1993 rulemaking requiring that 30 percent of the oxygen used in RFG comes from renewable sources such as ethanol. After EPA promulgated the 30-percent renewable oxygenate standard (ROS), Congress considered, but did not pass an amendment that would have prevented its implementation. In response to a lawsuit, the U.S. circuit court stayed implementation of the ROS until a decision is reached in the case. The court's decision is expected in the spring of 1995. In addition, the 103rd Congress voted to prevent EPA from implementing a rule that would have made gasoline imports from Venezuela more competitive in the U.S. RFG market.

INTRODUCTION

The Clean Air Act (CAA) was last reauthorized in 1990, and is scheduled to be reauthorized again by 1998. There have been four years of implementation experience with the 1990 amendments to the Act. To date, implementation of CAA programs such as the acid rain control program, and the program to control ozone-depleting substances has progressed mostly as expected. However, the implementation of other CAA programs has proved to be more contentious. In some cases, Congress has not approved of EPA's interpretation of the statute. In others, EPA has not approved of a State or local agencies attempt to meet the Act's requirements. Some industries have objected to the stringency of regulations, while some environmental groups have sued EPA over rulemakings believed to be too lenient, or failing to adequately address the requirements of the Act.

Based on CAA implementation experience to date, some issues are beginning to emerge as potential focal points of the next reauthorization. This report examines progress in implementing the CAA and provides some detail on current areas of controversy. It focuses mainly on programs related to attainment of air quality standards, mobile source controls, and the operating permit program for stationary sources.

BACKGROUND

The Clean Air Act comprises a series of related programs designed to protect health and the public welfare from emissions polluting the ambient (outdoor) air. Comprehensive amendments to the Clean Air Act (CM) were enacted November 15, 1990 (P.L. 101-549). The 1990 amendments required new programs and made major changes to the way that air pollution is controlled in the United States. EPA is required to undertake many rulemaking activities during the first few years to implement the CAA amendments. The amendments also require State and local air quality agencies to help implement the Act. They must develop or revise existing State Implementation Plans (SIPs) showing how new air pollution control programs will help achieve air quality goals. In some cases, States must enact legislation to implement required programs. Air pollution sources are also required to respond to new and more stringent requirements. Polluting facilities must obtain permits, conduct monitoring, and add pollution controls or change production processes to further reduce emissions. Many of the programs required by the 1990 CAA amendments were staggered so that they commence at various times. Some of the new requirements have yet to be fully implemented.

Air pollution was initially regulated locally and later became predominately a State responsibility. In 1955, the first Federal initiatives to address air pollution focused on research and on financial and technical support for State programs. As knowledge about air pollution increased and air quality appeared to worsen, the Federal Government's role was strengthened in a series of amendments. This activity culminated in December 1970, when the Clean Air Act was reauthorized (P.L. 91-604). The newly created Environmental Protection Agency (EPA) was authorized to carry out the provisions of the Act, which stressed a Federal-State partnership in solving air pollution problems. The Act was further amended in 1974 (P.L. 93-319) and in 1977 (P.L. 95-95). These amendments did not change the basic structure or goals of the Act; nor did they permit any waiver of health-based air quality standards, although delays in attaining required air quality were allowed.

During the 1980s, no further amendments were enacted despite many proposals both to strengthen the Act (particularly with respect to acid rain, air tonics, and the failure of many urban areas to attain ozone and carbon monoxide (CO) standards) and to reduce its regulatory burden by curtailing requirements or extending deadlines. This stalemate was broken on July 21, 1989, when President Bush proposed comprehensive amendments to the CAA. Following extended debates, negotiations, and revisions of language, P.L. 101-549 was signed on November 15, 1990.

The most important changes made to existing provisions of the Act by the 1990 amendments were (1) to classify areas in nonattainment according to the extent they exceed the standard and to tailor deadlines, planning, and controls according to each area's status and problem; (2) to tighten automobile emission standards and to require reformulated and alternative fuels in the most polluted areas; (3) to revise the air taxies section, establishing a new program of technology-based standards and addressing the problem of sudden, catastrophic releases of toxics; (4) to change the stratospheric ozone protection provision to phaseout the most ozone-depleting chemicals; and (5) to update the enforcement provisions so they parallel those in other pollution control acts, including authority for EPA to assess administrative penalties.

The most important new programs added to the Act by the 1990 amendments were (1) acid rain control program, including the use of marketable allowances for introducing flexibility into the sulfur oxides reduction program; (2) a State-run program requiring permits for the operation of many sources of air pollutants, including a requirement that fees be imposed to cover administrative costs; and (3) the authorization for a 5-year, $250-million program providing training and unemployment benefits for workers displaced by requirements of the Act. Also, the Act was reauthorized for 7 years. (For a more detailed overview of the key components of the Clean Air Act, as amended by P.L. 101-549, see the CRS Report 95-59 ENR, Summaries of Environmental Laws Administered by the Environmental Protection Agency.)

MEETING STATUTORY SCHEDULES

It has been estimated that the Clean Air Act Amendments of 1990 require EPA (sometimes in conjunction with other agencies) to issue some 175 new regulations, write more than 30 guidance documents, conduct some 50 research efforts, prepare 25 reports to Congress, and create 7 panels. This involves reviewing and revising many existing rules and guidelines as well as developing new programs for which notices, new rules, and guidelines will be needed. Despite increases in EPA's budget for CAA implementation, the adjustment period following passage of the 1990 amendments was slow. Many actions were delayed while the Agency hired new staff and adapted to the ambitious pace of the new rulemaking schedule. Early delays ultimately affected the Agency's ability to conduct its business according to statutory schedules.

EPA's missed rulemaking deadlines became an important implementation issue because the CM was designed with a series of very tight deadlines under which States would have to respond to rules promulgated by EPA. In many cases, EPA's rulemaking delays caused states to delay their own SIP submissions and subsequent implementation of required programs. For example, the CAA required States to begin implementing programs for enhanced automobile inspection and maintenance (I/M) by November 15, 1992. Because EPA did not promulgate final I/M rules until November 1992, program implementation has been delayed at least until January 1995, with some areas starting the I/M program later.

Missed rulemaking deadlines also became the basis for several citizen suits in which individuals or groups sued EPA for failing to perform required duties. In settling these suits, EPA often agreed to new court-imposed deadlines for delayed rulemakings. This created a situation where EPA was criticized for ignoring statutorily-imposed deadlines in favor of meeting court-ordered deadlines.

Delays are also resulting from EPA's failure to meets its statutory requirement for timely review of SIP submissions. EPA has 60 days to determine if a State's SIP submission is complete. If a SIP is determined to be complete, EPA then has 12 months to review and take final action to approve or disapprove the SIP. A June 1993 GAO report found that EPA exceeded the 60-day completeness review for 35 percent of ozone SIP revisions that had been submitted as of December 31, 1992. Approximately 50 percent of EPA's SIP approvals took longer than the 12 months allowed.(1)

Delays in promulgating CAA regulations may continue to plague EPA because of inadequate funding. A November 1994 GAO report examined EPA's FY 1994 budget for air quality programs and found it insufficient to meet the Agency's statutory requirements for promulgating CAA rulemakings on schedule. GAO anticipates that budget shortfalls in FY 1994 will hamper the Agency's ability to meet 1997 deadlines for promulgating maximum achievable control technology (MACT) standards for sources of hazardous air pollutants.(2)

Some major rulemakings that are past their statutory deadlines for promulgation include MACT standards for polymers and resins, petroleum refineries, shipbuilding, wood furniture, printing and publishing, and lead smelters. Other delayed rulemakings that have not yet been completed, include CFC labeling requirements, enhanced monitoring, citizen suits, nonroad emission standards for marine engines, emission standards for large and small municipal waste combustors and medical waste incinerators, and rules for risk management plans and accidental release prevention.

Despite delays in many areas, EPA has completed many rulemakings according to statutory schedules. For example, almost all rulemakings under the acid rain program were completed on time. In addition, programs to control ozone-depleting substances are being implemented mostly as expected.

NONATTAINMENT REQUIREMENTS

The Clean Air Act requires that all area of the country meet National Ambient Air Quality Standards (NAAQS) which are set by EPA at levels that are expected to be protective of human health and the environment. NAAQS are established by EPA on the basis of available scientific information. NAAQS have been established for six criteria air pollutants (i.e., ozone(3), carbon monoxide, nitrogen dioxide, sulfur dioxide, particulate matter, and lead). States have primary responsibility- for attaining and maintaining the NAAQS in all areas of the State. All States containing nonattainment areas must have a State implementation plan (SIP) detailing the pollution control programs that the State intends to implement to reach the air quality standards. Depending on the extent of an area's air pollution problem, it is classified by EPA as being a marginal, moderate, serious, severe, or extreme nonattainment area. Currently, Los Angeles is the only extreme ozone nonattainment area. The controls which must be included in the SIP for each type of nonattainment area are proscribed by the Act.

Meeting the NAAQS

The nonattainment requirements of the CM are designed to bring areas into attainment with the NAAQS by the deadlines specified in the Act. Many areas are either already meeting NAAQS, or are actively implementing programs that are expected to bring them into attainment by statutory deadlines. Those areas designated as marginal nonattainment areas were the first to be required to attain the NAAQS. Marginal areas were required to meet the NAAQS for ozone by November 15, 1993. Based on data collected from 1991 through 1993, 33 of 40 marginal ozone nonattainment areas were meeting NAAQS, leaving only seven marginal areas that did not meet CM goals by the required deadline. Moderate ozone nonattainment areas must meet the NAAQS by November 15, 1996. To date, 15 of 29 moderate nonattainment areas are already meeting the NAAQS. With respect to the carbon monoxide (CO) standard, 28 of 42 nonattainment areas are now in compliance with the standard. CO nonattainment areas are not required to meet the standard until the end of 1995. Los Angeles has until the end of year 2000 to meet the CO standard.

State Implementation Plans

SIPs are the primary means of implementing air pollution control programs. An initial step in the SIP development process is determining baseline air pollution levels through an inventory of air pollution sources. Complex modeling techniques are used to estimate the reduction in emissions that would be achieved by implementing pollution control programs. SIP control programs must be fully adopted by the State's legislature, then submitted to EPA for approval. Once a SIP is fully approved, it is legally binding and enforceable under both State and Federal law.

The 1990 CM amendments required revised SIPs for all nonattainment areas. SIPs must show net reductions in emissions of volatile organic compounds (VOCs) from baseline levels equalling 15 percent over the first six years (by November 15, 1996) and three percent each year thereafter until NAAQS are met. The initial 15-percent reduction SIPs were due in November 1993. The three-percent annual rate of progress SIPs required of serious, severe, and extreme ozone nonattainment areas were due in November 1994. Most States missed the November 1993 SIP-submittal deadline. Although EPA has not yet determined how many nonattainment areas submitted three-percent SIPs by the November 1994 deadline, it is expected that most nonattainment areas also missed that deadline.

According to an assessment by the Clean Air Network, of the 35 States required to develop SIPs to meet the ozone NAAQS, 28 have not completed final SIPs for bringing nonattainment areas into attainment. The study divided States into three categories based on their performance with respect to implementing required CM programs. Ten States were included in the category of States that have made little or no progress toward bringing nonattainment areas into attainment. Seventeen States and the District of Columbia were deemed to be making some advances. Only eight States were judged to have made significant progress.

Sanctions

Among the most important implementation issue for States, is the timely completion of State Implementation Plan (SIP) revisions. Aside from the air quality benefits of implementing pollution controls in a timely manner, the threat of possible sanctions has also motivated States to complete SIP submissions according to CAA deadlines. The CAA requires EPA to impose sanctions against certain areas that fail to submit and implement adequate SIPs for meeting NAAQS. The sanctions generally apply to States that fail to submit a SIP, when a SIP is inadequate, or when an approved SIP is not being implemented. Potential sanctions include an increased offset requirement, or a loss of Federal highway construction funds. The Act allows an 18-month "grace period" between the time a State is notified that it has failed to submit an adequate SIP, and the time that sanctions are applied if the SIP deficiency remains uncorrected.

Many States that failed to submit required SIPs on November 15, 1992, still had not submitted complete SIPs more than 18 months later (i.e., by May 1994). However, no State had been sanctioned by August 1994. Under EPA's interpretation of the CAA, it could not sanction any State until it completed a rulemaking setting forth the order in which sanctions would be applied. EPA published its final sanctions rule on August 4, 1994. The rule became effective on September 6, 1994. When the rule was finalized in August 1994, EPA published a list of 27 areas in nine States that would be subject to sanctions because their SIPs were overdue. By the time the sanctions rule became effective 30 days later, only West Virginia and Vermont has still not submitted complete SIPs and were sanctioned. In both cases, sanctions were imposed because the States failed to submit a SIP that would implement an automobile inspection and maintenance program.

According to the sanction rule, the first sanction that applies is an increased offset requirement of 2:1, meaning that any new source of air pollution must demonstrate a reduction of emissions from another source that is twice as large as the expected increase in emissions from the new project. The sanction is meant to curtail industrial development and the accompanying air pollution. If the offset sanction remains in place for six months, and the area still fails to submit an adequate SIP, the second sanction, a loss of Federal highway construction funds, is imposed. Both sanctions remain in effect until the SIP deficiency is corrected.

Employer Trip-Reduction Programs

Among the many requirements for nonattainment areas, severe and extreme nonattainment areas are required to develop SIPs for a program that is intended to reduce the number of work-related trips taken by employees. It is one of the few programs in the CAA that relies on individual behavior for compliance rather than regulating industry to achieve emission reductions. In the nine nonattainment areas subject to this requirement (i.e., Baltimore, Chicago, Houston, Los Angeles, Milwaukee, New York, Philadelphia, San Bernardino, and Ventura), employers of 100 or more are responsible for implementing programs that will increase the average vehicle occupancy of cars coming to the work place by about 25 percent from baseline levels. To meet this requirement, employers in these areas must first survey their employees over a week-long period to determine how employees commute to work. Employers must then develop a plan for reducing single-occupancy driving. The types of strategies that may be included in the plans are subsidizing carpools, vanpools, or transit passes, encouraging walking or biking to work, allowing compressed work-week or telecommuting options, preferential parking for carpools and vanpools, or a guaranteed ride home program. Approximately 28,000 employers and 11 to 12 million employees are affected by the program.

In response to concern about the lack of flexibility in the trip-reduction program, EPA Administrator Carol Browner wrote a June 10, 1994, letter to the Chairman of the Clean Air and Nuclear Regulation Subcommittee of the Senate Committee on Environment and Public Works. The letter clarified that the CAA cannot force an employee to change commuting habits, but only that employers must offer incentives. The Administrator also clarified that employers who implement trip-reduction programs, but do not succeed in meeting trip reduction goals should not be penalized. In the letter, EPA further outlined its intent to be flexible in evaluating trip reduction SIPs submitted by States. Some flexible approaches deemed approvable by EPA include programs that apply only during seasons with high pollution levels, allowing employers to average trip-reduction targets among different work sites, or setting different trip-reduction targets for employers in different zones, such as downtown and suburban zones within the same nonattainment area.

As part of the Clinton Administration's Climate Change Action Plan, EPA is seeking "parking cashout" legislation which would provide a means for many employers to meet the trip-reduction target. Parking cashout would mean that employers could offer employees cash in lieu of employer-provided parking, with the cash payments receiving the same tax status as the parking costs. It is estimated that this strategy alone would help many employers meet the trip-reduction target.

Although SIP revisions for this program were due in November 1992, many States did not complete their SIPs until early 1994. The CAA requires employers to develop their trip reduction plans within two years after the SIP is submitted, therefore, some employers may not begin implementing their programs until 1996. However, in many areas, employers have already begun to submit compliance plans to the State.

MOBILE SOURCE CONTROLS

The 1990 CAA amendments impose stricter controls on mobile sources of air pollution, including cars, trucks, buses, and other non-road engines. In addition, the Act changes fuel requirements so that cleaner fuels are required in the most polluted areas. In some cases, alternative fuels such as natural gas or electricity must be used to power vehicles. In other cases, gasoline must be reformulated so that it has at least a two-percent oxygen content, which encourages more complete (i.e., cleaner) combustion. In addition, reformulated gasoline must have lower emissions of toxics such as benzene.

Reformulated Gasoline

Since January 1, 1995, reformulated gasoline is required to be sold in the nine worst ozone nonattainment areas in the country (i.e., Los Angeles, San Diego, Hartford, New York, Philadelphia, Baltimore, Houston, Milwaukee, and Chicago). EPA predicts that RFG may account for up to 35 percent of all gasoline sold in the United States in the next few years. Although the transition to reformulated gasoline has already begun, there are lingering concerns about the implementation of the RFG requirements. Some fear supply disruption problems similar to those experienced when the required use of low-sulfur diesel fuel began on October 1, 1993. Estimates of gasoline price increases that could result from the new requirements range up to 10 or 15 cents per gallon higher in the short term. The House Energy and Commerce subcommittee on Energy and Power held a September 29, 1994, hearing at which officials from DOE and EPA testified that despite temporary price spikes and possible shortages, the system should be able to adjust quickly. Testimony from representatives from the Independent Fuel Terminal Operators Association was less optimistic. To date, price increases have not been experienced.

Another RFG implementation issue has been continued concern about potential negative health effects from methyl tertiary butyl ether (MTBE), a chemical used in RFG to increase the oxygen content. Health complaints began surfacing in Alaska shortly after the gasoline additive was introduced as part of the oxygenated fuels program in November 1992. Typical complaints included headaches, dizziness, nausea, and other flu-like symptoms. In addition, some complained of eye irritation, coughing, and burning of the nose or throat. After health complaints became widely publicized in Alaska, similar health complaints began to be reported in cities throughout the U.S. where oxygenated fuels containing MTBE were being sold. A November 1993 study of MTBE health risks found that there was unlikely to be a substantial risk of acute health symptoms among healthy individuals under normal exposure.(4) The study did not assess health effects in very cold temperatures such as those in Alaska, nor did it assess the risk to susceptible populations.

Although RFG is only mandatory in nine areas, other areas of the country may opt-in to the RFG program as well. Many areas in 14 States and the District of Columbia have agreed to voluntarily participate in the RFG program to achieve the 15-percent VOC reduction required by November 1996. As the effective date of the RFG program neared, nonattainment areas in Pennsylvania and New York that had voluntarily opted-in to the program requested that they be permitted to opt-out of the program. Areas in Maine may also seek to opt-out of the RFG program. EPA has adopted a policy that will allow areas that voluntarily agreed to the RFG program to opt-out. Opt-out requests will generally be approved within 30 days. Although the opt-out requests were driven in part by presently unfounded fears of higher fuel prices, the RFG program is publicly viewed by some as a burdensome Government regulation.

The Role of Ethanol ill the RFG Market

Another controversial aspect of the RFG program is an EPA rule that was issued in March 1993, requiring that 30 percent of the oxygen used in reformulated gasoline comes from renewable sources, such as ethanol. The rulemaking was intended to increase ethanol's share of the RFG market relative to other oxygenates such as MTBE, a methanol-derived ether. Opponents of the rule claim that EPA did not have the authority to issue a renewable oxygenate mandate, and that the CM requires a "fuel-neutral" approach in the RFG program. The ethanol industry claims that the original RFG rule would reduce the market share for ethanol, contrary to the national energy policy which favors renewable fuels. On August 3, 1994, the Senate considered, but did not pass an amendment that would have prevented EPA from implementing the renewable oxygenate requirement. In September, the U.S. circuit court stayed implementation of the renewable oxygenate requirement until a lawsuit challenging the requirement is decided. The court's decision is expected in the spring of 1995.

Venezuelan Gasoline Imports

Another CM vote during the 103rd Congress was also related to the implementation of the RFG rule. EPA promulgated a rule that would have allowed gasoline imports from Venezuela to be more competitive with U.S. fuels by allowing foreign refiners to set their own baselines for determining improvements in the cleanliness of gasoline. There was some concern that Venezuelan gasoline was dirtier than U.S. gasoline on average, at least with respect to certain gasoline components. However, Venezuela argued that failure to allow the Venezuelan national oil company, PDVSA, to certify its own baseline in the same way that U.S. refiners could, would be a violation of the General Agreement on Tariffs and Trade (GATT). on August 4, 1994, the Senate voted for an amendment to the appropriation bill for HUD, VA, and Independent Agencies that would prevent EPA from implementing the foreign refiner baseline rule. On September 12, the House voted to accept the Senate language, effectively excluding Venezuela and other foreign refiners from the RFG market in the United States. Although P.L. 103-327 now prevents EPA from enforcing a foreign refiner baseline for RFG, the measure passed as part of an appropriation bill, and therefore lasts only one year. If no further action is taken during FY 1995, the foreign refiner baseline is still in place, and can be implemented beginning in FY 1996.

Low-Emission Vehicles

The CAA called for a new program requiring low-emission vehicles (LEVs) to be manufactured for sale in California. To prevent auto manufacturers from potentially responding to different emission standards in all 50 States, the CAA clarified that States could either adopt the Federal auto emission standards, or the California LEV program standards, but could not adopt a third set of standards requiring the production of a third type of vehicle. Any State could petition EPA to be allowed to opt-in to the California LEV program. The 13 States that comprise the Northeast Ozone Transport Commission (OTC), petitioned EPA in February 1993 to require the stricter California LEV standards in the northeastern States. Automakers objected, claiming that autos designed to meet California LEV standards would only be effective if more stringent fuel standards adopted by California were also used. The automakers argued unsuccessfully in the New York court that the use of California cars with the national gasoline constituted the creation of a third car which was explicitly prohibited with the CAA.

Automakers have generated a compromise proposal know as the 49-State LEV program which accelerates the emission reductions from new cars sold nationwide, but does not mandate the sale of California LEVs in the northeast States. Some of the OTC States now prefer the 49-State LEV program. In addition, six of the nine Governors that supported the original petition are no longer in office. Despite these changes, EPA was required to reach a decision on the original petition. On December 19, 1994, EPA announced that it was approving the OTC petition. However, at the same time EPA announced that it would continue to work with the northeastern States and the auto industry toward an alternative agreement. If a new agreement is reached, it would negate the requirement for the sale of California LEVs in the OTC States. If no such agreement is reached, beginning with model year 1999, California LEVs must be sold in the OTC States. Any OTC State that does not adopt the clean car program must implement other measures that would provide equivalent pollution reductions.

Vehicle Inspection and Maintenance

Part of the CAA strategy for controlling mobile source emissions includes a program ensuring that cars are properly maintained in use, and that cars whose emission control systems are not functioning properly are detected and repaired. The Act requires that most polluted cities adopt either "basic" or "enhanced" I/M programs, depending on the severity of the problem and the population of the area. In addition, areas with populations greater than 100,000 that are located in the northeast ozone transport region must also implement an enhanced I/M program. The new enhanced test required by the EPA regulations (known as I/M 240) simulates actual driving conditions and allows more accurate measurement of tailpipe emissions. This high-tech test requires new equipment such as an automobile treadmill called a dynamometer. The new equipment required for the I/M 240 test is estimated to cost about $140,000 per testing lane compared to about $15,000 to $40,000 for current testing equipment.

On November 5, 1992, EPA promulgated a final performance standard demonstrating how a State could develop an approvable I/M program. The rule included a model program that would be approved by EPA if adopted by a State. SIPs could differ from the model program if a State could demonstrate how its program would result in equal or greater emission reductions when compared to the model program. One of the more controversial aspects of EPA's model program is that it calls for centralized testing in which the test and repair functions are separated. Although this separation would reduce the potential for fraud, it would preclude States from continuing existing systems where emissions are tested in private garages. It would also prevent the continuation of existing programs where emissions are initially tested at a centralized State-run facility, but automobiles failing the initial test may be retested at a private garage after being repaired. States that previously allowed private service stations to perform emissions tests feared that centralized testing would harm the industry by taking away a significant source of income. In addition, the public feared long lines at centralized inspection stations.

As States began to develop SIPs for enhanced I/M programs, many balked at the inflexible approaches mandated by EPA. California was the first State to oppose EPA's approach in its SIP submission. EPA eventually agreed to a compromise with the State after several months of threatening California with sanctions for failing to adopt the EPA model program. California adopted a two-tier program in which some cars would continue to be tested at private facilities, while others would be required to go to a centralized testing station. In addition, California would install roadside emission detectors to help catch gross polluters. Other States followed California's lead, and began developing I/M programs that did not conform to EPA's rule. Public resistance to the I/M program in Pennsylvania caused the legislature to withdraw its previously adopted I/M program authorization. Although the measure was vetoed by the Governor, the legislature was able to override the veto.

Realizing the extent of public opposition to the program, EPA announced at a meeting with State Governors in December 1994, that it would allow States more flexibility in developing I/M programs. States will now be able to develop I/M programs that do not conform with the November 1992 rule as long as they achieve emission reductions required to meet the NAAQS through other means. States will be given an opportunity to revise their I/M program SIPs without being sanctioned.

OPERATING PERMIT PROGRAMS FOR STATIONARY SOURCES

Title V of the CM established a new program for State air pollution permits. Under a State permit program, about 35,000 major stationary sources of air pollution are required to obtain an operating permit limiting allowable emissions of air pollutants. A source's operating permit will describe each of the Federally required air pollution controls that apply to the source. The Act requires States to collect fees from permit applicants that are sufficient to cover the costs of developing and implementing the permit program.

EPA promulgated regulations establishing the minimum requirements for State permit programs in July 1992. Based on those regulations, States were required to develop an operating permit program and submit a SIP to EPA by November 15, 1993. In all, 56 States (including the District of Columbia, and U.S. territories) were required to submit SIP revisions for a permit program. In addition, many local governments are responsible for developing and implementing a permit program in local areas of jurisdiction. By December 1994, SIPs had been submitted by 43 States, and 58 local air programs. EPA has taken final action on five SIP submittals. Four States have been approved, and one has been disapproved. Several States have received "conditional approval" for their permit program allowing them to issue permits in the interim while they fix the deficiencies in their original SIPs. Any State or local program that does not submit an approvable permit program SIP to EPA could be subject to sanctions after May 15, 1995.

During preliminary discussions regarding the development of a permit rule, industries lobbied for the rule to allow routine plant operational changes to be made without requiring the air pollution source to go through a lengthy permit revision process. The industries claimed that they often need to make quick changes in their operating procedures to meet the product demands of their customers. Although EPA considered including a provision in the final rule that would have required a 21-day public review and comment period for minor permit modifications, the final rule allows minor permit modifications that would increase allowable emissions with a 7-day advanced notice requirement. On August 29, 1994, EPA proposed revisions to the final operating permits rule that would allow a less stringent approval process for permit revisions for changes to an industrial facility that result in de minimis increases in air pollution. A final rule allowing for a de minimis approach is expected by October 1995.

Endnotes

l. U.S. General Accounting Office, Air Pollution: State Planning Requirements Will Continue to Challenge EPA and the States, GAO/RCED-93-113, June 1993.

2. U.S. General Accounting Office, Air Pollution: Reduction in EPA's 1994 Air Quality Program Budget, GAO/RCED-95-31BR, November 1994.

3. Ozone is the only criteria air pollutant that is not emitted directly into the air, but is the result of a reaction of volatile organic compounds (VOCs) and nitrogen oxides (NOx) which are both emitted into the air by stationary and mobile sources.

4. U.S. Environmental Protection Agency, Assessment of Potential Health Risks of Gasoline Oxygenated with Methyl Tertiary Butyl Ether (MTBE), EPA/6001R-93/206, November 1993.