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                CLEAN AIR ACT AMENDMENTS OF 1990
                    NONATTAINMENT PROVISIONS
                         TALKING POINTS


SLIDE 3:     INTRODUCTION (OVERHEAD IS THE U.S. MAP)
     Our nation's most widespread air pollution problems are
     caused by ozone forming emissions of oxides of nitrogen and
     hydrocarbons, as well as emissions of carbon monoxide and
     small particulate matter (PM) (< 10 microns).

     Areas out of compliance with the national health standard
     for ozone or CO pollutants were to have met standards by
     1987.


     There are 96 cities violating the ozone (smog) standard, 41
     cities violating the carbon   monoxide standard and at least
     70 areas that still have not met the PM standard.

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          SLIDE  4:  MAJOR  SECTIONS
          o    The  new  nonattainment provisions contain these major
              sections:   (read what is  on  the overhead)

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SLIDE 5:  GENERAL PROVISIONS

o    Designations

        Areas that do not meet air quality standards  are called
     nonattainment areas.  The new law requires that areas
     currently designated nonattainment retain that designation
     and that other areas with air quality worse than the
     standards be designated nonattainment by the Governor.

        If the Governor fails to do this,  EPA must do it.  While
     the law requires the Governor to propose ozone and CO
     nonattainment area boundaries, EPA can modify them if it
     believes other boundaries are more appropriate.

        The more seriously polluted ozone and CO areas must take
     as their boundary the entire urbanized area — inner city
     plus suburbs (and in some cases outlying counties), unless
     EPA and the state believe a smaller area is adequate.  This
     means that pollution controls will affect more people and
     industries.

o    Sanctions

        Sanctions are an important tool for creating incentives
     for states to work diligently toward attaining Federal air
     quality standards.

        The bill contains two sanctions - one is a cutoff of
     highway funding.  The other is a large increase in the
     emission reductions required from existing sources to
     offset the emission increases from new sources.

        EPA must impose at least one sanction in 18 months, and
     the second one 6 months later, if a state fails to submit a
     complete plan or if EPA disapproves a plan or finds that a
     plan is not being executed.

        If the state lacks "good faith" in submitting the plan,
     EPA must impose both sanctions at the 18 month mark.  EPA
     can also cut-off Federal funding to the state or local air
     pollution control agency, if necessary.


o    Federal Implementation Plans (FIPs)

        The new law requires EPA to promulgate FIPs within 24
     months of a finding that a state has failed to make an
     approvable SIP submission.

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SLIDE 6:  CLASSIFICATION OF AREAS

o    A key feature of the new law is that it "classifies" areas
     with similar pollution levels.

o    The purpose of this classification system is to match
     pollution control requirements with the severity of an
     area's air quality problem. Therefore, marginal areas are
     subject to the least stringent requirements and extreme
     areas are subject to the most stringent requirements.

o    The higher classes must meet requirements of all the areas
     below them plus the requirements for their class.   The
     higher classes also have more time to attain.

o    For ozone, there are five classes: marginal, moderate,
     serious, severe and extreme.  The severe class has 2 parts:
     the higher "severe!" class gets 2 more years in which to
     attain air quality standards.  We have one extreme area, Los
     Angeles; 3 "severe2" areas, 5 "severe!" areas; 16 serious
     areas; 32 moderate areas and 39 marginal areas.

o    For CO and PM-10, there are two classes: moderate and
     serious (although the CO moderate class really has 2
     subclasses, with tigher pollution controls required for the
     second subclass).

o    EPA may adjust ozone and CO classifications that are close
     to the border of another classified area.  Ozone and CO
     areas may   receive an extension of up to 2 years from the
     attainment date if they have met all requirements of the
     Act, such as the percent reduction requirement and any
     prescribed measures, and if they are close to meeting air
     quality standards.

o    Serious PM-10 areas may get an extension for up to 5 years
     if they can demonstrate that attainment by 2001 is not
     practical and if they adopt stringent measures.

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SLIDE 7:  OZONE NONATTAINMENT AREA REQUIREMENTS
     Marginal Areas

        These areas are close to meeting air quality standards
     today and therefore have the least stringent requirements.

        EPA expects most marginal areas will have clean air in
     several years because of reductions from motor vehicle
     emissions due to Federal programs and from stationary
     sources covered by coorected "RACT" rules.

     - Marginal areas must obtain 1.1  to 1 offsets for new (100
     ton) sources.  Offsets or emission reductions of a source
     must apply to compensate for emission increases caused by
     new and large modification to existing sources.
     Moderate Areas

        These areas must adopt the marginal area requirements.

        They must also make progress by reducing VOC emissions
     over the first 6 years: however,  a waiver is possible if
     very stringent measures are adopted.

        They must install Stage II vapor recovery controls on
     gasoline service stations and RACT on certain existing
     sources and demonstrate attainment.

        Finally, new sources must obtain an additional 15%
     offsets for 100 ton sources.

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Slide 8: OZONE NONATTAINMENT AREA REQUIREMENTS (CONT)

o    Serious Areas

        These areas must adopt marginal and moderate area
     requirements.

        They must also reduce hydrocarbon emissions 3% per year
     (on average over a 3-year period) until the air quality
     standard is achieved:  however,  1) a waiver is possible if
     3% reduction is infeasible and 2) NOx control can be
     substituted if an equivalent ozone reduction can be
     demonstrated.

     -  They must also:

               start an enhanced vehicle inspection program,
               install controls on moderate size (50 ton) sources
               of hydrocarbons (and nitrogen oxides unless
               controls do not reduce ozone),

               adopt any additional measures necessary to
               demonstrate that the ozone standard will be
               attained by the deadline,
               adopt a clean fuel program for fleet vehicles.
               adopt an employer ridership program for employers
               of CO of 100 or more employees.

        New sources must offset pollution by an additional 20%
     for moderate size (50 ton) sources.

        Finally, control requirements must apply within the
     metropolitan boundary, unless the State and EPA agree to a
     smaller area.
     Severe Areas

        All severe areas must adopt the marginal,  moderate and
     serious area requirements and continue the 3% progress
     requirement until attainment

        The 3% progress requirement can be waived

        Areas may substitute NOx for (VOC) if progress is not
     feasible.

     Also:

          all gasoline must be reformulated for cleaner burning,

          areas must adopt additional transportation measures as
          needed to offset growth in vehicle usage, and

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     areas must install controls on small (25 ton)
     stationary sources of hydrocarbons (and nitrogen oxides
     unless controls do  not reduce ozone).

     Finally, new sources must offset pollution by an
     additional 30%; applies to smaller size (25 ton)
     sources.

Extreme Areas

   Today, Los Angeles is the only area designated extreme,
   These areas must adopt marginal, moderate, serious
and severe area requirements.

   They must also continue the progress requirements until
attainment:  however, extreme areas cannot get a technology
waiver or substitute NOx reductions for VOC reductions.

   They must also use low polluting fuel or install NOx
controls on utilities/boilers and install controls on very
small (10 ton) stationary sources of hydrocarbons (and
nitrogen oxides unless controls do not reduce ozone).

   New sources of 10 tpy or greater must offset pollution by
an additional 50%;

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SLIDE 9:  OZONE CONTROL REQUIREMENTS - HIGHLIGHTS
     Progress Requirement

        A key feature of the ozone control amendments is a
     requirement that all areas except marginal areas make
     progress early and then maintain progress toward attainment
     until attainment is achieved.

        The Act does this by requiring States to achieve a 15%
     reduction over the first 6 years and 9% for each 3-year
     period thereafter.

        There are many technical features of this requirement:
     the reduction must reflect an average over a period of time,
     it is from an adjusted base,  some measures do not count
     toward the % reduction, and there is a waiver based on
     available technology, although the hurdles for this waiver
     are high.

        Tracking whether the reductions are actually achieved
     will be critical to the success of the progress requirement.
     To do this, the new law requires states to meet milestones
     that demonstrate progress was made.  If the milestone is not
     met, the state must adopt additional measures sufficient to
     make up the shortfall.  Sanctions can also be imposed for
     failure to meet milestones.
     RACT and NSR for major NOx sources

        The new law requires major NOx sources to meet the same
     requirements that apply to major VOC sources.

        For new sources in nonattainment areas this means offsets
     and lowest achievable emission rate (LAER) are required.

        For existing sources in moderate and higher
     classifications and in transport regions it means reasonably
     available control technology (RACT) must be installed.

        However,  sources such as major power plants or all
     sources in the area as a whole can be exempted from this
     requirement if the area can show that control of NOx sources
     is not beneficial.

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Transport Regions

- The bill creates an ozone transport region for 11
northeast states plus the Washington, DC metro area.

   All areas, including attainment areas and marginal
nonattainment areas in this region, have special
requirements.  These include:

     1)  RACT on all VOC sources for which EPA has issued
     guidance (CTGs),

     2)  RACT on all 50 ton VOC sources where EPA has not
     issued guidance and

     3)  enhanced I/M in metro areas with a population above
     100,000.

   RACT is also required on 50 ton NOx sources unless the
area chooses to opt-out by showing NOx control is not
beneficial.

   These transport requirements are in addition to any other
requirements which apply to nonattainment areas.
Tighter New Source Requirements

   Under the old law, any major new source of hydrocarbons
wanting to locate in a nonattainment area must have met
requirements that are tougher than those for sources located
where the air is clean.

   These requirements include offsetting the emissions from
the new source with reductions from existing sources, and
installing the "lowest achievable emission rate" (LAER),
which is the tightest control used by any plant of that
type.

   The new law tightens these requirements in three areas:

          it changes the definition of "major" source to
          include smaller sources:

               - 50 tpy in serious areas
               - 25 tpy in severe areas
               - 10 tpy in extreme areas (Los Angeles)

          it increases offset ratios to require more
          emissions reductions, and
          it tightens "netting", or the ability of a source
          to offset emission increases with reductions
          elsewhere on its property so as to avoid
          triggering more stringent requirements

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Slide 10:  OZONE CONTROL REQUIREMENTS (CONT)
o    Federal Measures

        EPA must identify 11  categories of VOC emissions for
     which it will develop technical guidance.  To date EPA has
     issued guidance on 29 categories.

     - EPA also must issue guidance for aerospace and
     shipbuilding industries.

     - This guidance will set presumptive limits on emissions
     which EPA interprets to represent "reasonably available
     control technology" (RACT) on existing sources.  In areas
     where "RACT" is required, states must adopt rules requiring
     sources to apply "RACT"  on the source categories covered by
     the guidance.

     - EPA must also develop rules for consumer and commercial
     products (paints and solvents, cleaning fluids, pesticides,
     etc.) over an 8 year period which begins after a 3-year
     study.


     - EPA must issue an "alternate control techniques" (ACT)
     guideline for all 25 ton sources of VOC and NOx.  The "ACT"
     identifies levels of emission reduction which can be
     achieved by various control technologies. States may use the
     ACT guideline to develop rules for source categories not
     covered in the EPA "RACT" guidelines.

     - In addition, EPA must issue rules to limit emissions from
     marine vessels.

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SLIDE 11:  CARBON MONOXIDE
o    CO areas are classified as moderate and serious.  Moderate
     area requirements apply in three stages:

        Moderate areas must correct any current I/M program.

        Moderate areas must start a wintertime oxygenated fuels
     program if necessary for attainment.

        Areas above 12.7 ppm must adopt an enhanced I/M program
     regardless of whether I/M is now required and perform an
     attainment demonstration.
o    Serious CO areas must adopt a transportation control program
     to offset increased vehicle miles travelled and other
     measures, and if they fail to meet the deadline they must
     achieve a 5% reduction in CO emissions per year.



o    CO areas where cars are not the problem can be exempted from
     any mobile source control measures.  Areas in which
     stationary sources are a significant problem must adopt
     "RACT" on 50 ton sources.

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SLIDE 12:  PM-10

o    Moderate PM-10 areas, which were designated non-attainment
     at enactment, must attain the air quality standard by the
     end 1994 and adopt reasonably available measures for
     particulate  sources such as woodstoves, urban road dust and
     agricultural burning.

o    Serious areas, which would be designated non-attainment at
     enactment, must attain by 2001 and adopt best available
     control measures.  Serious areas which fail to attain must
     achieve 5% reduction in PM-10 emissions per year.


o    Serious areas where the PM-10 problems are caused by nature,
     rather than human activity, can be exempted from any of
     these measures if EPA determines that human-induced sources
     of pollution do not contribute significantly to a violation
     of the PM-10 standard.

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Clean Air Act Amendments of 1990
Mobile Source Provisions
Talking Points
Slide 14: What Are We Up Against?








o Today, the U.S. has the most stringent motor vehicle emission
control program in the world.
o Compared to uncontrolled cars of the 1960s, current
produce :
80% less HC and
60% less NOx during their lifetimes.
o But, much of the impressive "per vehicle" reduction has

cars



been
offset by growth in the number of vehicles, and by growth in
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miles driven (VMT) .
o VMT doubled in last 20 years
o The new law requires:
more controls on vehicles and;
- cleaner burning fuels in cities with the worst
quality problems













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Slide 15:  Tailpipe Standards

o    The current passenger car standards are:

          HC—0.41 Grams per mile (gpm)
          CO--3.4 Gpm
          NOx—1.0 Gpm



o    Passenger car  standards  have  not changed since  1981;  so by
     1994, standards will have been stable through 13 model years.



o    Meanwhile control technology and reliability have
     advanced greatly:

         specifically,  there  are more precise fuel  and  emission
     controls possible because of refinements in computer control
     and the proliferation of fuel injection.



o    In response,  the new law  tightens auto tailpipe standards, as
     indicated on the overhead.
o    The law requires EPA to study the need,  cost and feasibility
     of tier II standards for  2004 and later model cars and report
     its findings in 1997 and decide whether by 1999 more stringent
     standards will be required.



o    The  new law  also tightens  standards for  trucks  (large  &
     small).   These reductions are  roughly  proportional  to  car
     standard reductions.
     Taken together,  the new  tailpipe standards reduce tailpipe HC
     about 40% and tailpipe NOx about 60%.
     Useful life requirements are also extended by the new law

     -  useful life means that portion of vehicle life during which
     the manufacturer is responsible for emissions compliance and
     component durability

        current useful life is 5 years/50,000 miles for passenger
     cars

        amendments extend useful life to 10 years/100,000 miles

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Slide 16:  Cold Temperature CO Tailpipe Standard



o    In the past, tailpipe standards have only been applicable at
     75 degrees f.; and manufacturers optimized emission controls
     for these temperatures.

o    Cold  weather  reduces   the   effectiveness  of   catalytic
     converters, hindering fuel vaporization and allowing emissions
     to increase drastically.

o    Therefore, a  large proportion  of  CO emissions are generated
     when  a  car  is first  started; with  the highest  emissions
     occurring in  cold weather.  For example  a car started at 20
     degrees emits over 10 times more CO  than  the same car started
     at 75 degrees.

o    The new law  responds to this by  establishing a  CO tailpipe
     standard for cars  and light duty trucks of 10.0 GPM beginning
     with 1994 models

o    Having a cold  temperature CO standard  will  greatly help the
     41 cities,  that currently are not attaining the CO ambient air
     quality standard,  succeed in doing it.

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Slide 17: Reformulated Gasoline"

o    The new law requires reformulated gasoline to be sold in the
     9 worst ozone cities beginning in 1995.

o    These cities are:

     Los Angeles
     Baltimore
     Chicago
     Houston
     Milwaukee
     New York City
     Philadelphia
     San Diego
     Hartford

o    Reformulated   gas   contains   oxygen   carrying   additives
     (oxygenates) to  enhance the combustion process resulting in
     lower HC  and CO  emissions  from  engines and  more efficient
     oxidation in the catalyst

o    As the overhead shows,  the  new law requires that reformulated
     gasoline:

          contain at least a 2.0% oxygen (averaging allowed)

          results in  15%  less  VOC  and air  toxics  emissions from
          1990 conventional fuel;

          by 2000, results in 25% less VOC and air toxics, unless
          EPA determines this to be infeasible,  in which case the
          reduction must be 20%;

          contain no more than 1.0% Benzene (averaging allowed)

          contain no  more than  the amount  of aromatics necessary
          to meet the air toxics reduction requirements but no more
          than 25% by volume

o    Since  the  combustion  of  reformulated gasoline can  cause
     increased emissions  of  NOx,  the new law prohibits  vehicles
     burning reformulated gasoline from  increasing NOx emissions
     beyond  levels  associated  with  vehicles using conventional
     gasolines.

o    The  new  law  also  allows  refiners  to  comply  with  the
     reformulation requirements any way they want,  but they can't
     "dump" compounds  into the  fuel going to cities that are not
     subject to these requirements.

o    Finally,  anti-deposit  detergents,  which   control  engine
     deposits  that  can  cause  combustion  problems and  emission
     increases, must be added to all gasoline nationwide.

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Slide 18:  Oxygenated Fuels CO Program


o    The new law requires all gasoline in the 41 CO nonattainment
     areas to be oxygenated during the winter months beginning in
     1992.

o    Oxygenates promote better oxidation of hydrocarbons. By adding
     small amounts of  oxygenates  to gasoline,  the  engine  can be
     made to burn  more efficiently, reducing CO  emissions  by as
     much as 20%.

o    Oxygenates include ethanol, methanol, ETBE and MTBE.  ETBE and
     MTBE are ethers  made from ethanol and methanol, respectively.
     All the oxygenates are high octane ingredients.

o    Several cities,  including Denver and Phoenix, already require
     oxygenated  fuels  to be  used  in cars  in  the  wintertime.   In
     Denver, CO levels have decreased dramatically.

o    The new legislation  is,  in  part, a response to this and other
     successes, which cities have voluntarily undertaken.

o    As the overhead  indicates, the new law requires the wintertime
     oxygen level  to be  2.7%;  and provides a 1  pound per  square
     inch  exemption  for  ethanol  blends   from  existing  RVP
     requirements.

o    The  law  also  allows EPA to  delay program  initiation  on an
     area-by-area basis up to 2 years if the Agency determines that
     there  is  insufficient  domestic  supply  and  distribution
     capabilities.

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Slide 19: Clean Fuels for Fleets


o    "Clean fuels" include:

          compressed natural gas (cng)
          ethanol
          methanol
          liquified petroleum gas (Ipg)
          electricity
          reformulated gasoline
          and possibly other fuels

o    The new law, which  applies  to  centrally  fueled fleets of at
     least 10 vehicles, requires 30% of new fleet vehicle purchases
     to  meet the California  LEV standards,  beginning  in 1998,
     unless cars meeting  these  standards are not yet being offered
     for sale in California, in which  case the requirement applies
     by 2001.

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     fueled at central terminals and  do not  venture far from the
     city limits and location of the fuel  pumps.

o    Ultimately,  the new  law  will  require  70%   of  new  fleet
     purchases to meet the  California  standards; either by 2000 or
     2003, depending on whether the program begins in 1998 or 2001 .

o    The California low emitting vehicle (LEV) standards are:

          0.075 NMHC
          3.4 CO
          0.2 NOx

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Slide 20 - California Clean Car Pilot Program



o    Because of California's severe air pollution problems, the new
     law  requires  a  California  Clean  Car  pilot  program  to
     demonstrate whether vehicles and fuels can meet standards more
     stringent than those applicable in the other 49 states.


o    The law establishes emission standards and requires the auto
     and  fuel  industries  to  figure  out  whether  to  meet  the
     standards by vehicle controls,  new fuels, or a combination of
     each.


o    California  will   ascertain   in   advance   what   the   fuel
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     fuel is available.


o    States may voluntarily opt-in to the Federal pilot program for
     California through the inclusion  of incentives  in  their SIP
     for the  sale  and use  of California vehicles and any unique
     fuels they require.

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Slide 21:   Urban Buses
o    The new law requires regulations  for urban buses:  large city
     transit buses; not school buses or Greyhound-type inter-city
     buses.

o    The  new  law's  urban  bus  control program  has  three  key
     elements:

        a  stringent diesel particulate  standard of  0.1  grams per
     horsepower-hour beginning  in 1993.   This represents  a 90%
     reduction in particulate emissions from uncontrolled levels.

        a requirement  that all urban buses meet a 0.05 particulate
     matter standard beginning  in 1994, (which EPA  can  raise to
     0.07 grams) unless EPA finds  that  level  is not feasible; in
     that case the standard will be 0.07.  If EPA finds that buses
     in-use are not meeting the 1994 standard, EPA must implement
     a low polluting fuels program for new buses in large cities

     -  buses in large  cities which have their engines replaced or
     rebuilt in 1995 or later must meet emission standards set by
     EPA reflecting the best retrofit technology achievable

o    In  the  event  that  the  low  polluting  fuel  program  is
     implemented,  EPA  believes  the  fuel  could  be methanol  or
     compressed natural gas.   In fact, the major manufacturers of
     bus  engines  will offer  methanol and  CNG engines  for sale
     beginning in 1991.

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Slide 22:  Non-Road Engines



o    The previous Clean Air Act gave EPA no authority to regulate
     emissions from non-road vehicles or engines.

o    These include boats, locomotives, farm equipment, bulldozers,
     and lawn and garden equipment, etc.

o    The  new  law gives  EPA  authority  to regulate these  air
     pollution  sources  but  requires  the  Agency first  to  study
     emissions from non-road  engines within 12 months of enactment.

o    Using  the  results  of  this  study,  EPA  must  promulgate
     regulations controlling emissions from those non-road engines
     contributing   significantly   to  urban   pollution;   such
     regulations  would  require  the  greatest degree  of  emission
     reduction achievable.


o    While California and other states are  prohibited from enacting
     standards  for construction  and farm  equipment  engines less
     than 175 hp, California may require more stringent standards
     for other  non-road engines and  other states may adopt the
     standards  that   California   adopts.     This  is  to  prevent
     manufacturers from having to produce three configurations of
     engines or vehicles.

o    Standards for new locomotives are required within 5 years.

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Slide 23:  Additional Fuel and Auto Requirements

o    The new  law requires onboard  refueling controls  to  reduce
     volatile hydrocarbons that  escape into the  atmosphere when
     gasoline vehicles are fueled.

o    These controls will be applied through regulations after EPA
     consults with DOT about the safety issues.

o    On  board  controls will be  phased in over  a 3  year  period
     beginning  with   the   4th  model  after  a   regulation  is
     promulgated.

o    Currently, gasoline  vehicles are  equipped  with  devices  to
     catch evaporative hydrocarbons when parked  in hot weather—
     but not to catch refueling losses.

o    Except where "stage II" vapor recovery is required, these
     vapors are released into the atmosphere.

o    "Onboard" control  vehicles  will carry  collection equipment
     (simple charcoal canisters)  to capture refueling vapors, and
     store them to be burned in the engine as fuel.

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                Clean Air Act Amendments of  1990
                      Air Toxics Provisions
                         Talking Points


Slide 25: INTRODUCTION - WHY IS NEW AIR TOXICS LEGISLATION
          NEEDED?

o    The way the 1977 Clean Air Act addressed air toxics has
     failed. Only seven chemicals have been listed as hazardous.

o    The burdensome findings within the 1977 law are the root of
     EPA's difficulty in controlling air toxics.  EPA had to
     prove that air toxics regulations protect public health with
     an ample margin of safety.   Although this test does not
     sound unreasonable, the current risk assessment procedures
     have proven in most cases to be unable to demonstrate an
     ample margin of safety with the certainty needed to develop
     and defend a regulatory action.

o    The new law restructures the decision making process for
     developing air toxics regulations.  Instead of having to
     prove an ample margin of safety, EPA will simply apply the
     controls and techniques demonstrated to have been most
     effective and efficient at facilities within the same
     industry.

o    Another significant change is that EPA no longer has to list
     pollutants as hazardous. The new bill provides a list of
     about 190 pollutants which are automatically considered to
     be air toxics.

o    Also the air toxics regulations under the new bill will be
     directed at industries rather than at specific toxic
     pollutants.  This means  rather than regulating facilities
     multiple times for each toxic pollutant they emit, EPA will
     regulate an entire source category (industry) simultaneously
     addressing all of the toxics emissions at one time.

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Slide 26:  MAJOR NEW PROVISIONS

o    These are the major elements of the new air toxics
     provisions.

o    The list of hazardous air pollutants in the new law and the
     list of source categories, or industries, which emit one or
     more of these pollutants.

o    The technology based regulations will be applied to    the
     listed industries.  These standards are called Maximum
     Achievable Control Technology standards or "MACT."

o    There are specific provisions of the new law which address
     small sources that emit air toxics.  These small sources are
     called area sources and can be a serious health problem in
     urban areas.

o    The second phase of air toxics regulation is called the
     residual risk phase and is directed at lowering the risk
     remaining after MACT has been applied to acceptable levels.

o    Finally, I will discuss the portion of the new law which
     addresses accidental releases of toxics pollutants.

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Slide 27:  POLLUTANT AND SOURCE CATEGORY LISTS

o    Chemicals

        The new law establishes a list of 189 pollutants which
     are designated as hazardous.  The list includes some
     chemical classes that are actually groups of chemicals that
     have a common feature.


        For example, chromium compounds.  These are chemicals
     which contain chromium and, although we do not fully
     understand the toxicity of each of these chemicals, all are
     considered to be toxic because they contain chromium which
     is a suspected human carcinogen.


o    Petitions

        EPA can, administratively or in response to a petition,
     add or remove substances from this list.  If EPA receives a
     petition on a certain chemical, there is an 18 month review
     period to respond to the petitioner.  The burden of proof
     for listing or delisting a chemical is on the petitioner.

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Slide 28:  POLLUTANT AND SOURCE CATEGORY LISTS (CONT)

o    List of Categories

        Within 1 year of enactment,  EPA will publish a list of
     source categories which emit one or more of the listed
     compounds.  Both major sources and area sources must be
     included on this list.

        EPA can also be petitioned to remove source categories
     from the source category list.   Upon showing by a petitioner
     that all of the sources within a source category pose less
     than a 1 in 1 million risk of cancer to the most exposed
     individual and an ample margin of safety for non cancer
     effects, EPA is required to remove the source category form
     the list.

o    This list essentially determines EPA's regulatory agenda.
     EPA must promulgate regulations for all of the
     source categories on this list within 10 years after
     enactment.

o    Major Sources

        A major source is a facility which emits more than 10
     tons  of any single listed pollutant or more than 25 tons of
     a combination of listed pollutants per year.

        Because the toxicity of the listed compounds varies
     widely, a lesser quantity for the major source threshold can
     be defined for very toxic pollutants.

o    Area Sources

        Any source which emits listed pollutants below this
     threshold is defined as an area source. As mentioned, area
     sources must be included on the list.

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Slide 29: MACT AND EARLY REDUCTIONS

o    MACT

        The standards applied to the source categories on the
     list discussed on the previous slide are subject to
     technology based standards called MACT, or the maximum
     achievable control technology.

        These standards are defined based on the best control
     technology and practices which have been demonstrated by
     sources within the same source category.

     -  For new sources, MACT is defined as the controls achieved
     in practice by the best controlled similar source.

        For existing sources, MACT is defined as the control
     achieved in practice by the best performing 12% of similar
     sources for large source categories (30 sources or more) and
     the average of the best performing 5 source for smaller
     source categories.

             Compliance with all of these standards must be
          achieved within 3 years of promulgation and sources may
          receive an additional year if EPA deems it necessary.



o    Early Reductions

        Provision were included in the new law that create an
     incentive for facilities subject to air toxics regulations
     to achieve early reductions.

        Facilities which reduce their plant-wide annual emissions
     of all listed toxics by 90% for organics and 95% for
     particulates will receive a 6 year extension in addition to
     the 3 years already allowed to comply with MACT standards.

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Slide 30 - AREA SOURCES

o    Again, area sources are smaller sources which emit less
     than 10 or 25 tons of listed pollutants.  Examples of these
     sources are dry cleaners,  gas stations and chrome
     electroplaters.

o    The new law incorporates some special provisions for area
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          EPA is required to carry out studies of the  emissions
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          In addition, EPA must develop a strategy to reduce the
          emissions and risk from these sources.

          The goal of this strategy is to reduce the cancer
          incidence attributable to  these sources by 75%.

o    In addition to the study and strategy, EPA must list enough
     area source categories on the source category list to
     account for 90% of the nationwide area source emissions of
     30 selected pollutants.  These pollutants will be the most
     hazardous from an area source perspective and will be
     selected as part of the area source strategy.

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Slide 31:  SCHEDULE FOR STANDARDS

o    The new law contains a schedule which EPA must follow for
     promulgating the MACT standards.  All standards must be
     promulgated based on the hazard associated with the source
     category being regulated and the efficiency of grouping
     source categories.

o    EPA must promulgate MACT standards for 40 source categories
     plus coke ovens within 2 years after enactment.  Standards
     for 25% of the remaining source category list are due in 4
     years.  The standards for the next 25% are due in 7 years
     and all of the source categories must be regulated within 10
     years of enactment.

o    If EPA misses this schedule, the bill includes a "hammer"
     provision:

          All sources that would have been subject to a standard
          which EPA failed to promulgate on time must be
          permitted at a level of control, certified by an
          independent engineer as the best control, within 18
          months of when the promulgation was scheduled.

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Slide 32: RESIDUAL RISK

o    The purpose of the residual risk phase is to evaluate the
     public health and environmental risks remaining after MACT
     has been applied and to determine whether additional
     standards are warranted.

o    The new law contains a risk "trigger" for setting standards.
     In cases where at least one source in the source category
     exceeds 1 in 1 million risk for the most exposed individual,
     standards must be promulgated.

o    Once the standard setting trigger has been exceeded,
     however, EPA is not required to set standards which reduce
     the risks to below 1 in 1 million cancer risk for the most
     exposed individual.   The guidelines for setting these
     standards are based on law in the 1977 Act which requires
     that emissions standards protect public health with " an
     ample margin of safety".

o    In interpreting the 1977 language on ample margin of safety,
     EPA has established a set of decision rules.

          In a nutshell, these decision rules say that EPA will
          establish standards to protect the most exposed
          individual in the population to a risk of cancer below
          1 in 10,000 and the majority of the exposed population
          to a risk of less than 1 in 1 million.

          These are not bright line risk levels, but risk targets
          which may occasionally be exceeded given the specifics
          of the risk assessment and the source category to be
          regulated.

o    There are also two studies of risk assessment method and a
     Risk Commission to review risk assessment and its use in
     regulatory decision making included in the bill.

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Slide 33:  ACCIDENTAL RELEASES

o    In addition to routine releases of air toxics, the Congress
     and EPA are also very concerned about sudden accidental
     releases of toxic materials such as the accident in Bhopal,
     India.

o    The bill contains a special section to address the problem
     of accidental releases:

          EPA is required to list at least 100 chemicals which
          are extremely toxic in accidental releases and
          promulgate regulations for the prevention of accidental
          releases.

o    As part of these regulations, all facilities which handle
     one or more of the listed substances will be required to
     prepare and file a hazard assessment and a risk management
     plan.  The purpose of the hazard assessment and risk
     management plan is to identify hazards at a facility and to
     plan for the contingency of a chemical accident.

o    This section also creates a chemical safety board similar to
     the national transportation safety board which will
     investigate major chemical accidents.

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Slide 34 - SPECIAL PROVISIONS (Optional)

o    There are numerous special provisions within the air toxics
     title.  In a short talk it is impossible to cover all of
     these provisions.  Some of the major special provisions and
     studies are listed on this slide.

o    I have already mentioned the risk assessment studies.  There
     is also a study on atmospheric deposition of air toxics to
     the Great Lakes.  Following this study EPA is required to
     promulgate regulations within 5 years of enactment.

o    There are also special provisions for coke oven batteries
     and utilities.  Coke ovens can receive a waiver of the
     health based residual risk standards until 2020 in exchange
     for compliance with fairly stringent standards soon after
     enactment.  The study of utility toxics emissions will
     determine if regulation of air toxics emissions from
     utilities is warranted.

o    There are a host of additional studies which I will not go
     into but I would be glad to take your questions.

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                Clean Air Act Amendments of  1990
                      Acid Rain Provisions
                         Talking Points



Slide 37:  ACID RAIN PROGRAM (INTRODUCTION)

o    The Clean Air Act Amendments of 1990 include an ambitious new
     program to control deposition of acidic compounds.

o    This new program calls for significant reductions in S02 and
     NOx, the pollutants primarily responsible for acid deposition.

o    The centerpiece of  the acid  rain  program is  an innovative
     market-based  emission  allowance  program which  will provide
     affected  sources  flexibility  in meeting  the  mandated  S02
     reductions.

o    Compliance with  the  program  requirements  will  be assured
     through permits and  compliance  plans,  continuous emissions
     monitors,   compliance  certification   requirements,  excess
     emission fees and emission offset requirments.

o    The new law provides specific  incentives  for use of renewable
     energy   sources,   clean   coal  technologies   and  energy
     conservation  measures.    Also,  the market based allowance
     program provides significant incentives for the use of least
     cost control  options which are likely to include conservation

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Slide 38: EMISSION REDUCTIONS

o    SO2 Reductions

          The  acid rain  provisions  require  a  ten million  ton
     reduction of sulfur dioxide emissions from 1980 levels.

         To  give affected  units maximum  flexibility  in reducing
     these emissions,  the new law authorizes the use of a variety
     of compliance mechanisms,  including  an  innovative system of
     marketable emission allowances.

        As will be discussed in more detail shortly, an allowance
     is what  is  commonly referred  to as  an emission  permit,  or
     marketable emission reduction credit.
     -  An allowance provides "affected sources" with the authority
     to emit 1 ton of S02, and affected sources must not emit more
     sulfur dioxide than they hold allowances for.
        The  10  million ton reduction of S02 will be accomplished
     in two phases:

          - In the first phase of S02 reductions, which begins in
          1995, large, high-emitting coal fired utility units will
          be affected.

             Each  unit  (roughly  265  units  in 110 plants) have an
          output capacity  greater than  or  equal  to 100 megawatts
          and emit at  a rate  greater than  or equal to 2.5 Ibs/mm
          Btu.

              These units  will  receive  allowances equal  to 2.5
          Ibs/mm Btu times the unit's "baseline", which is defined
          as its 1985-1987 fuel  consumption - an  average of 40%
          reduction at these plants.
          -  In the second phase of S02 reductions, which begins in
          2000,  about 2000  utility  units  with output  capacity
          greater than or equal to 25 megawatts are included in the
          allowance system.  Those with 75 megawatts  and with rates
          greater than or equal to 1.2 Ibs/mm Btu will be allocated
          allowances  equal  to 1.2  Ibs/mm  Btu times the  units'
          baseline  -  roughly  a  65%  reduction  in  forecasted
          emissions at these plants.
     SO2 Cap

         An  essential  provision,  one  that guarantees  lasting,
     permanent S02 reductions, is the so-called S02 cap

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   The legislation establishes a permanent cap on  S02 utility
emissions of 8.95 million tons which becomes fully effective
in the year 2000.

     This  is  to be  accomplished by limiting allowances  to
existing  sources  (as  described above)   and  in  allowance
allocations to even clean sources roughly  equivalent to a 20%
increase above current levels.  All new sources are required
to buy into the allowance system, i.e., new sources will not
be  allocated   allowances but  will  have   to  purchase  them
starting in Phase II.

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Slide 39:  Emission Reductions (CONT.)

o    NOx Reductions

        The entire legislation will  also  achieve  a 2 million ton
     reduction in NOx,  a significant portion of  which  will come
     from utilities under Title IV.

        This is to be  accomplished  by  requiring utility boilers to
     meet  tough  new  emission requirements.   Specifically,  the
     legislation  sets  stringent  new NOx  emissions  rates  for
     existing tangentially-fired  and  dry bottom wall-fired utility
     boilers.

         The rates  are set  at a  level expected to be achievable
     through the use of low NOx burner technology.   Phase I boilers
     of these types must comply  by January  1,  1995;   Phase II by
     January 1, 2000.

        EPA must  also  set new  rates for other utility boiler types
     by January 1.  1997.  These are to be set taking into account
     available technology,  energy  impacts and  the costs incurred
     by compliance with the NOx controls required above.

        To  ensure that NOx  emissions  are  kept  in  check,  EPA must
     promulgate revised New Source Performance Standards  for NOx
     emissions from new fossil fuel-fired steam generating units.

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Slide 40:  INNOVATIVE MARKET-BASED ALLOWANCE PROGRAM

o    As  noted earlier,  allowances will  be  issued annually  to
     affected utility sources based on  their baseline fuel use and
     the emission rate required by the legislation.

o    An allowance authorizes  the  affected  source  to emit one ton
     of S02.   Once  allocated, an  allowance  is  fully marketable.
     The fundamental allowance rule is that an affected source must
     hold enough allowances to cover its emissions.

o    Sources  can  comply  with this  rule  through one of  several
     methods:

          by  reducing  emissions   (through the  installation  of
          pollution   control   equipment,    fuel    switching   or
          conservation) to the level of allowances it holds; or,
          by obtaining additional allowances to cover its emissions

o    Sources can also elect to:

          substitute alternative plants in Phase I
          pool emissions reduction  requirements across  2 or more
          affected units, or
          craft compliance strategies using limited time extension
          provisions found in the legislation.

o    As noted above,  a source can comply by obtaining additional
     allowances,   sufficient  to  cover  its  emissions.    These
     allowances can be obtained in a number of ways:

     1)   A source  can obtain allowances  through  transfers from
     other units within its utility system;

     2)  A source can buy additional allowances on  the open market
     from  another  source.    That other  source  may have  spare
     allowances  for a  number of  reasons -  perhaps because  it
     exceeded its control requirements, thus freeing up allowances
     for sale permanently or for a limited period of time.

     3)  A source can obtain allowances from an industrial source
     that has cost effective reductions and elects  to opt  in to the
     allowance system.

     4)   Sources will be  able  to obtain  allowances  through the
     required EPA allowance auctions and sales.

o    We believe that the allowance trading system provides numerous
     benefits over  the traditional command  and control  type  of
     regulation:

         First,  by  not demanding  a specific  control  option,  the
     legislation provides sources with the flexibility to develop
     the most cost  effective control  strategy.    We believe that

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              this  flexibility  will  yield  significant  compliance  cost
              reductions.

I             -  In addition,  the allowance trading system incorporates an
'             incentive for energy conservation and technology innovation,
              both of  which can  lower  the cost  of compliance  and  yield
              pollution prevention benefits.
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Slide 41:   ASSURED COMPLIANCE

o Emission Monitoring

         To  ensure that  the legislation's  objectives are  met,
     continuous  emissions  monitoring  or equivalent  alternative
     methods  are required  on all  sources  subject  to Title  IV
     requirements.    Emissions  data  will  be  used  to  ensure
     compliance and monitor the progress of the program.

        Monitoring will be  required for S02,  NOX/  opacity,  and
     volumetric  flow  rate.    Phase  I  units  must  comply  with
     monitoring  requirements within  three  years  of  enactment.
     Phase II  units  must comply with monitoring  requirements  by
     January 1, 1995.


o Permits and Compliance Plans

        As with  other  CAA requirements, the  basic  implementing
     vehicle for  the acid  rain  program  will  be operating permits
     and compliance plans.

         All  affected  sources  must  prepare  and  submit  permit
     applications and compliance plans.

        In the case of NOx, permits would state that a source may
     not emit  in excess of  the applicable  emissions limitation.
     In the case of S02,  the  permits would state that a source may
     not emit in excess of the allowances it holds.

        EPA will issue  Phase  I permits.   Permits for Phase II will
     be issued by States with EPA-approved permit programs.

        One key component of  the permit will be  a compliance plan.
     Compliance plans specify which of the alternative methods of
     compliance the source has chosen as a compliance strategy.
     Emission and Allowance Tracking

         As  compliance with  S02  requirements will  necessitate a
     comparison  of  emissions  and allowances,  EPA will  develop
     automated tracking systems for each.  The allowance tracking
     system will keep records  of  allowance  holdings,  and will be
     constantly updated to record  the status of allowances traded.
     An automated permit information system is also contemplated.

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o    Excess Emission Fee and Offset Requirements


          Finally,  the  flexible  allowance  trading  system  is
     complemented by an automatic compliance technique:


              Any  unit which  exceeds its  annual S02  allowance
          holdings or NOx emission  limitation  will  be subject to
          an automatic fee of $2000 per excess ton with regard to
          S02,  such exceeding  sources  will  also be  subject  to a
          requirement  to  offset  those excess  tons  the following
          year.   In  the  case of S02,  the fact that  this certain
          sanction  substantially exceeds  the  expected cost  of
          compliance  through the purchase  of  allowances  should
          prove  a strong  incentive  which  will  help  to  assure
          voluntary compliance.

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Slide  42:  RENEWABLE  ENERGY,  CLEAN  COAL  TECHNOLOGY AND  ENERGY
          CONSERVATION INCENTIVES
o    The  legislation allocates  additional  bonus  allowances  to
     sources which undertake the  development of renewable energy
     projects, use conservation techniques.


o    In addition  to providing  a four  year delay in  compliance
     requirements for sources which  use clean coal technologies,
     certain  clean   coal  technology  demonstration projects  are
     exempt from NSPS and New Source Review requirements.


o    Finally,  the allowance system creates an inherent incentive
     to engage in conservation and promote  efficiency, since a ton
     of emissions reduced through these  activities  is one  less
     allowance a source will have to purchase or use  in order for
     it to meet its  allowable level of emissions.

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Slide 43:   Clean Air Employment Transition Assistance
o    PROGRAM PURPOSE


          This program reflects  a  Congressional  & Administration
          compromise for mitigating the  impacts on workers who are
          dislocated from the Clean Air Act amendments.


          The Acid  Rain  Title was  the  impetus for  this program
          because those persons anticipated to lose their jobs due
          to CAA are high sulfur coal miners.


          Specifically,  these  provisions  amend Title  III  of the
          Job Partnership Training Act


o    KEY ELEMENTS


          The program provides  additional assistance to dislocated
          workers in the  form of  job extended monetary assistance,
          job search allowances and relocation assistance.


          It  is not  an  entitlement  but   a limited  enrollment
          program.


          $250 million will  be allocated to operate the program,
          $50 million for each year for years 1991 through 1995.

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              The Clean Air Act Amendments of  1990
                        Operating Permits
                         Talking  Points


Slide 45:  Why Are Operating Permits Needed?


o    We need an operating permits program because we have
     insufficient tools for managing compliance with the Clean
     Air Act and for enforcing the law.

o    With the new,  more far-reaching law, this deficiency would
     have become even more evident.

o    The Clean Air Act Amendments of 1990 include an entirely new
     program requiring all large and certain smaller pollution
     sources to have a permit that lists each source's operating
     or pollution control requirements.

o    This new program creates a more effective process for
     defining the obligations that a pollution source has under
     the Act.   It also enhances EPA's ability to enforce the
     Act, provides greater certainty to industry, and generates
     essential revenues sufficient for the State to recover the
     reasonable costs of developing and administering the permit
     program.

o    This program should be looked upon as step toward better
     government administration of air quality control programs; a
     step leading to indirect benefits to air quality.  It should
     not be considered yet another construction permit program
     for achieving direct air quality benefits.   We have those
     programs and they do the initial job of ensuring that new
     and modified sources build their facilities in accordance
     with the law.

o    The success of the program depends very heavily upon the
     clarity of the regulations which EPA must develop and a
     common sense approach to implementing the program.  Without
     this, we will only present bottlenecks in the system, thus
     hindering efforts toward better air quality.

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Slide 46:  Major Elements

o    To offer an understandable perspective of this program's key
     requirements, we have divided this presentation into five
     areas.

o    The breadth or scope of the program offers important insight
     into who is affected and how extensive the role of EPA and
     the States will be in administering the program.

o    How the program is developed and when certain milestones
     have to be met also provides a key perspective.

o    What authorities States must have to administer its share of
     the program and the actual role of the States in the program
     are also important.

o    Finally, we must understand what has to be in a permit and
     how permits are actually issued.

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Slide 47: Program Scope

o    The operating permit program applies to pollutants regulated
     under the Act that are emitted from:

          All Major Sources:  "Major sources" refers to those
          source with the potential to emit 100 tpy or more or
          any regulated pollutant, but also include:

o    sources emitting 50 tpy of VOC in serious ozone
     nonattainment areas;

          o  25 tpy in severe areas, and 10 tpy in extreme areas
          as defined in Title I;

          o  sources emitting 70 tpy of PM-10 in serious PM-10
          nonattainment areas;

          o  and sources of certain hazardous pollutants ranging
          down to 10 tpy under Title III of the Act.

               Other Sources.  Other sources would include
               sources subject to regulation under the following
               EPA programs:

               o  new source performance standards,
               o  national emission standards for hazardous air
               pollutants,
               o  prevention of significant deterioration,
               o  new source review,
               o  and acid precipitation.



o    Geographic Coverage.  The program applies to all geographic
     areas within each State, regardless of the attainment status
     of such areas.

o    Exemptions/Additions.  EPA may not exempt a major air
     pollution source, but the Agency may exempt a source
     category if it determines that permits for that category are
     "impracticable, infeasible, or unnecessarily burdensome."
     The Agency can add sources through rulemaking.

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Slide 48:  Program Development

o  EPA Regulations.

             EPA is responsible for issuing program regulations
          within 1 year of the date the new law is enacted.

             These regulations must define the minimum elements
          of an acceptable State operating permit program.



o  State Program.

             Each State must submit a permit program to EPA
          within 3 years of enactment.

             States that receive interim rather than full
          approval must submit any changes necessary to obtain
          full EPA approval within 2 years of the date interim
          approval was received.

o  EPA Review and Sanctions.

             EPA has up to 1 year to approve or disapprove the
          initial State program submittal.

             A State has 180 days to revise its submittal in
          response to EPA identified deficiencies.

             Long term failure of a State to develop and
          implement an acceptable program will result in the
          imposition of certain sanctions

             Ultimately, EPA could be required to implement a
          federal permit program.

o  Initial Permit Applications.

             Complete permit applications from individual sources
          are required to be submitted to EPA within 1 year of
          the effective date (i.e., date of EPA approval) of
          their program.

             The permitting authority must establish a schedule
          for acting on initial permit applications which assures
          that at least one-third of the initial permit
          applications submitted will be acted upon annually over
          a period of no more than 3 years from the effective
          date of the program.

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Slide 49:  State's Role

o  Statement of Adequate Authority.

The submittal must contain a statement that the reviewing
authority has adequate statutory authority to implement and
enforce the program.  This includes the ability to:

             issue fixed term permits (not to exceed 5 years)
          that assure compliance with all applicable Act
          requirements,

             prevent permit issuance if EPA objects in a timely
          fashion,

             terminate, modify, or revoke and reissue permits for
          cause, and to recover civil penalties of not less than
          $10,000 per day for each violation and appropriate
          criminal penalties.

o  Standard Application Form.

The submittal must contain a standard application form which
addresses the minimum data elements (to be defined by EPA) that
define a complete application.

o  Demonstration of Adequate Permit Fees.

             The submittal must contain a demonstration of
          resource adequacy (including a fee schedule sufficient
          to offset all reasonable direct and indirect costs
          required to develop and administer the permit program),


             a summary of the personnel involved, and a
          description of how the State agency will accomplish the
          transition from its current situation.

             The fee schedule must presumptively collect at least
          $25 per ton per year (tpy) of regulated pollutants
          (except CO)    up to 4,000 tpy, unless the State
          demonstrates that a lesser amount adequately reflects
          the reasonable costs of the program.

o  Regulatory Provisions.

             The submittal must contain regulations to ensure
          that each source obtains an appropriate permit pursuant
          to an expeditious and reasonable permit issuance
          process.

             The subsequent two slides on regulatory provisions
          will cover the requirements for permit issuance and
          permit content in more detail.

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Slide 50: Permit Issuing

o  Expeditious, Reasonable Procedures.

        The regulatory provisions must ensure that adequate,
     streamlined, and reasonable procedures exist for:

          o  expeditiously determining when applications are
          complete,

          o  processing such applications,

          o  adequate public participation (including opportunity
          for public comment and a hearing),

          o  expeditious review of permit actions, allowing for
          judicial review in State court.

o  Timing of Permit Application, Review, and Issuance.

          Sources required to have a permit under Title IV must
     submit a complete permit application to the permitting
     authority within 12 months of the effective date of the
     program (i.e., date of EPA approval).

        The permitting authority must then issue or deny the
     permit within 18 months, except during the initial phase-in
     period where more time is potentially needed to avoid a
     backlog.

        If an applicant has submitted a timely and complete
     application but final action has not been taken on the
     permit, the applicant can not be found to be operating
     without a valid permit.



o  Copies, Availability.

        States must make copies of each permit application,
     compliance plan, emissions or compliance monitoring report,
     certification, and each permit issued under this Title
     available to the public.

        Confidential business information including permits will
     be protected.

o  Notification to EPA and Affected States.

        Copies of each permit application and compliance plan,
     not subject to protection from disclosure, are to be made
     available to the public.

     o  In addition, permitting authorities must provide copies
     of each application and compliance plan to the EPA for

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     review,  and notify the appropriate agency within all States
     whose air quality may be affected by emissions from a
     particular source, including contiguous States and other
     States within 50 miles of the source.

o  EPA Review and Public Petition.

        If the EPA determines that a permit contains provisions
     not in compliance with the applicable requirements of the
     Act,  the EPA can prevent the permit from being issued by
     providing the applicant and permitting authority written
     reasons for objecting to the permit within 45 days of EPA's
     receipt of the proposed permit.

        If EPA fails to object to a permit that violates the Act,
     affected parties may petition EPA within 60 days after the
     expiration of EPA's 45-day review period.

        Once the objection has been filed with EPA, the
     Administrator must grant or deny the petition within 60
     days.

        Judicial review of the Administrator's decision on a
     petition from a citizen will be held in the appropriate
     Federal court of appeals.

 o  Reopening.

        In general, permits can be reopened for cause.  Permits
     with a term of 3 years or more must include a provision that
     allows the permitting authority to require revisions to the
     permit to incorporate applicable standards promulgated under
     the Act after the permit is issued.

        Such revisions must be made within 18 months of the
     promulgation of new Act standards.

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Slide 51:   Permit Contents

o  Shield.

          Compliance with the permit is deemed to be compliance
          with the Act if certain conditions are met [section
          404(f)(1) and (2)], unless EPA narrows this through
          rulemaking.

o  Required Provisions.

        The State regulations required under this program must
     ensure that permits issued include the following provisions:

     -  A schedule of remedial measures,  including an
     enforceable sequence of actions or operations, leading to
     compliance with an applicable SIP, emission standard,
     emission limitation, or emission prohibition.

        A fixed permit term, not to exceed 5 years.

        Any necessary requirements for inspection, monitoring,
     compliance, certifications, and reporting to assure
     compliance with the permit terms.

        A compliance certification by a responsible corporate
     official.

        A provision describing conditions under which any permit
     with a fixed term of 3 or more years can be reopened to
     incorporate any new standard or regulation promulgated under
     the Act.

        Provisions under which the permit can be terminated,
     modified, or reissued for cause.

        Provisions ensuring that a source making anticipated
     changes in its operation can do so without modifying its
     operating permit, as long as the changes do not involve a
     modification under Title I and do not exceed permit
     conditions.

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                Clean Air Act Amendments of  1990
                     Enforcement Provisions
                         Talking Points


Slide 53: Summary


o    The Amendments modernize enforcement provisions:


        They adopt features of other more recently revised
     environmental statutes (Clean Water Act, Superfund, TSCA).
     For example,  the administrative penalty authority is
     modelled after the Clean Water Act.


        The new enforcement measures also bring CAA into accord
     with other environmental statutes.  For instance, they
     provide for civil penalties in citizen suits, as in Clean
     Water Act and RCRA.
     The new Act changes the mix of enforcement actions,
     increasing criminal and administrative actions


        Currently, most enforcement consists of civil judicial
     actions in district court
     New clear standards will enhance enforceability of Act


          The new permit program will necessitate clearly
          expressed emission and other operating limitations
     So will the requirement for sources to provide more
     performance information to EPA.

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Slide 54:  New Criminal Features
     Knowing violations of the Act are raised from misdemeanors
     to felonies

          Knowing substantive violations become felonies, with
          maximum imprisonment increased from 1 to 5 years.

          Monetary penalties will be based on the sentencing
          guidelines which cover the entire body of federal
          criminal law.
     New categories of crimes are also created

     1)    For violators who knowingly release hazardous air
          pollutants and thereby endanger the life of another
          person—authorizes felony-level sanctions with maximum
          imprisonment of 15 years and fines according the
          criminal code.

          For violators who negligently release such pollutants
          and endanger someone else (the Bhopal scenario), a
          misdemeanor prosecution may be pursued.

     2)    For knowing recordkeeping violations (felony) and fee
          violations (misdemeanor)

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Slide 55:  New Administrative Features



o    Authority for EPA to levy administrative penalties


               $200,000 maximum


               Opportunity for Administrative Procedures Act
               hearing upon request within 30 days



o    Authority for EPA to issue field citations for minor
     violations of regulations


               $5,000/violation; $25,000/in a six month period


               Opportunity for informal hearing


o    Expanded administrative compliance order authority


               Compliance schedules may last up to 12 months
     Contractor listing - Expands authority for EPA to bar whole
     company, not just single facility that was involved in the
     violation.  May extend bar to subdivision of the entity
     which owns or operates the facility.

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Slide 56:  Other Measures

Compliance Monitoring

o    Compliance certification

          EPA has authority to require enhanced monitoring and
          submission of compliance certifications of owners of
          major stationary sources

          Administrative subpoenas

          Authority expanded beyond subpoenas in support of
          rulemaking.  Gives EPA authority to issue subpoenas in
          support of enforcement activities as well.


o    Presumption of continuing violation

          Shifts burden of proof to source to prove compliance
          once EPA proves violation, and makes prima facie
          showing that the violation is likely to have continued,
Citizen Enforcement

o    Citizens are authorized to sue for penalties and injunctive
     relief.

               Penalties go to U.S. Treasury

               U.S. has right to intervene, to receive pleadings,
               and to review draft settlements
     Monetary awards to citizens for providing information in aid
     of enforcement

               Awards of up to $10,000 to individuals
Person Operator Definition

o    New definitions are designed to limit civil and criminal
     actions against individuals to senior managers except for
     knowing and willful violations.

     1) "Operator" includes "senior management personnel or a
     corporate officer."

     2)  Except for knowing and willful violations in criminal
     cases, "person" does not include employees who carry out
     their normal activities and who are not a part of senior

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management or a corporate officer, for cases involving
negligent endangerment

3)  For other offenses, an employee carrying out his normal
activities and who is acting under orders from the employer
is also not considered a person for these purposes.

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                Clean Air Act Amendments of  1990
                 Stratospheric Ozone Provisions
                         Talking Points
Slide 58:  Major Sections
          o    The Clean Air Act Amendments of 1990 include new provisions
tt             for protecting stratospheric ozone.


          o    The provisions have been organized into these major subject
I               areas:
                              Controls
                              Emission Reductions and Recycling
^                       -    Labeling
•                       -    Nonessential Uses
™                       -    Safe Alternatives
                              Methane
                         -    Procurement

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Slide 59:  Controls
o    The controls on fully halogenated compounds (ozone depleting
     substances) require a phase-out of production and
     consumption.


o    The two classes of ozone depleters are specified.  Class I:
     CFCs,  halons, carbon tetrachloride and methyl chloroform.
     Class II: hydrochlorofluorocarbons (HCFCs).


          For Class I substances,  interim reductions are
          specified for the next 5 years.   CFCs, halons and
          carbon tetrachloride are to be phased out by 2000;
          methyl chloroform by 2002.


          Restrictions on the uses of Class II substances take
          effect in 2015 and are phased out by 2030.


o    Limited exceptions to phase-out requirements will be
     authorized consistent with the Montreal Protocol.

o    EPA promulgated a final rule on August 12, 1988 implementing
     its Stratospheric Ozone Protection Program:


               Based on the Montreal Protocol, an international
               treaty, the program limits the production and
               importation of chlorofluorocarbons (CFCs) and
               halons.


               The Protocol was revised in June, 1990 to require
               a complete phase-out of CFCs and halons by 2000,
               and of methyl chloroform by 2005.

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Slide 60:  Emission Reductions and Recycling


o    Requires the Administrator to reduce use and emission of the
     Class I substances to the "lowest achievable level" and
     maximize their recapture and recycling:

               The first set of regulation, required by January
               1, 1992, must cover air conditioning and
               refrigeration sectors.

               Within four years of CAA enactment, the Agency
               must promulgate additional regulations on use and
               disposal of all Class II substances and the use of
               Class I substances not already covered, such as
               foam blowing and solvent use.

o    Requires the Administrator to establish standards for the
     safe disposal of Class I and Class II substances in
     appliances, machines or other goods by 1/1/92:

               This includes requirements for removal before
               disposal, servicing apertures, and reduction, to
               the "maximum extent practicable", of releases into
               the environment.

o    Makes it unlawful to knowingly vent or otherwise knowingly
     release or dispose of Class I or Class II substances in a
     manner which permits the substance to enter the environment.

               The venting ban is effective July 1, 1992.  "De
               minimis" releases are exempted.


o    The new law also requires the Administrator to promulgate
     regulations establishing standards and requirements for the
     recapture and recycling of refrigerant during the servicing
     of motor vehicle air conditioners (MACs) by January 1, 1992:


               The regulations must set up a system for the
               certification of persons performing service and
               the certification of refrigerant recycling
               equipment.

o    It also bans the sale to persons other than MAC servicers of
     refrigerant in containers of less than 20 pounds.
     Effective in two years.

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Slide 61:  Labeling (of Products using Ozone-Depleting Chemicals)



o    Requires mandatory warning labels on all containers of Class
     I substances or Class II substances, as well as on all
     products containing class I substances:

               Products manufactured with class I substances must
               have a warning label unless substitutes are not
               available.

               In addition, products made with or containing
               class II substances must have a warning label if
               safe substitutes are available.

               All products made with or containing Class I or
               Class II substances must be labeled by 2015.

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Slide 62:  Other Provisions

o    Nonessential Products Containing Chlorofluorocarbons

          Requires a ban of non-essential consumer products that
          result in the release Class I substances into the
          environment.

          Specifically banned products include party streamers,
          photographic cleaner and noise horns.  EPA may ban
          additional products.

          Aerosols and non-insulating foam products containing or
          manufactured with Class II substances (HCFCs) are also
          banned, with some exceptions for flammability or worker
          safety, beginning in 1994.


o    Safe Alternatives

          Requires the Administrator to recommend Federal
          research programs, coordinate Federal procurement
          practices and recommend measures to promote the
          transition of the Federal government to safe
          substitutes.

          Requires the Administrator to promulgate regulations
          that make it unlawful to replace any Class I or Class
          II substance with any substitute which EPA has found
          that may present an adverse effect to human health or
          the environment, if EPA has identified alternative safe
          substitutes are available.

          The Agency must publish a list of substitutes
          prohibited for specific uses and safe alternatives
          identified for those uses.

          In addition, all producers of substitutes for Class I
          chemicals must provide to the Agency unpublished health
          and safety studies on substitutes.

          Producers must notify the Administrator not less than
          90 days before new or existing chemicals are introduced
          for significant new uses for Class I chemicals.

          Regulations due within 2 years of enactment.
     Federal Procurement

          Requires EPA to work with GSA and DOD to develop
          procurement requirements for each department and agency

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          of the U.S. to conform its procurement regulations to
          maximize the substitution of safe alternatives to
          ozone-depleting substances.  Rule due in 18 months.
o    Methane Reports
          Requires EPA to produce five reports on methane within
          two years and one follow-up report within four years.


          The reports will identify the sources of domestic and
          international methane emissions and will analyze the
          potential for preventing the increase of emissions.


          The report due in four years will identify and evaluate
          technical options to stop or reduce the growth in
          methane emissions.

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                Clean Air Act Amendments of  1990
                       Research Provisions
                         Talking Points
Slide 64:  Overview
o    We believe  Congress'  intention in developing  this  research
     provision was to renew  the  existing  research authorities in
     the CAA to reflect current and future air pollution issues.

o    Much  of  the  existing  research  authority  dates  from  the
     original federal air pollution statute  in  1955.   The nature
     of air pollution problems has changed over these years.

o    The new law updates existing sections 103 and 104 of the Clean
     Air Act.

o    The original sections 103 and 104 of the  Clean Air Act require
     EPA to establish a national research and development program
     for the prevention and control of  air pollution.  Section 104
     relates to the combustion of fuels.

o    The key  research  areas  include:    health,  ecology,  welfare,
     technology and monitoring/modeling.

o    The new law  builds  on  these research  areas and  includes
     additional  issues  such  as  acid  precipitation,  alternative
     fuels and accidental releases.

o    Throughout  the  new law,  there is emphasis on  appropriate
     coordination with other  Federal agencies.  Many other Federal
     agencies  conduct  air pollution   research.   This  provision
     establishes  several  mechanisms  to  prevent duplication  of
     efforts and ensure adequate coordination.

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Slide 65:  Key Research Areas



o    The new  law  specifies  a number of key  research  areas which
     EPA and others must address

Air Pollutant Monitoring and Inventories

o    First,  it  requires EPA  to conduct  a program of  research,
     testing  and  development  of  new  methods  for  monitoring,
     modeling and sampling of pollutants.



Health Effects

o    The new law also reaffirms EPA existing authority to conduct
     basic environmental health research on the short and long term
     health effects of air pollutants.

o    It requires EPA to develop health risk assessment methods and
     techniques for accidental and routine exposures.



Ecosystem Research

o    EPA is also required to conduct a research program to improve
     our understanding  of the  short term and long term causes,
     effects and trends of ecosystems damage from air pollutants.
Accidental Releases

o    EPA  is  required to  oversee  an experimental  and analytical
     research  effort  on  modeling  and  controlling  accidental
     releases, with  the experimental work  to be  carried  out at
     DOE's Liquefied Gaseous Fuels Spill Test Facility.


Pollution Prevention and Emissions Control

o    EPA must conduct a basic engineering research and technology
     program to develop,  evaluate  and  demonstrate strategies and
     technologies for air pollution prevention.


National Acid Precipitation Assessment Program

o    The new law calls  for  an  acid precipitation task force that
     consists of  the Administrator of  EPA  and  heads  of several
     other agencies.   This provision continues the acid deposition
     research program established in 1980.

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          Acid Deposition Research

          Io    This provision  requires  EPA  to  conduct  specialized  acid
               deposition research.


 g        Clean Alternative Fuels

 _        o    EPA is required to  conduct a research program  to identify,
 •             characterize and predict air emissions for alternative fuels
 ™             and to determine the risks and benefits of alternative fuels
               relative to those  from gasoline.





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                Clean Air Act Amendments of  1990
                        KEY MISCELLANEOUS
                           PROVISIONS

SLIDE 67:  Outer Continental Shelf

o    Emissions from air  pollution  sources on the Outer Continental
     Shelf can contribute to air pollution problems on shore.

o    The new law recognizes this,  and  requires  EPA to promulgate
     a  rule  controlling such sources.   EPA  has  two  years  from
     enactment to do this.

o    The rule must apply to sources off the short of the Pacific,
     Arctic,  and  Atlantic  Coasts  & the Gulf Coast  of  Florida,
     including vessels servicing or associated with OCS sources.

o    It also requires sources located within 25 miles of the coast
     to  comply  with the same requirements as those  for  sources
     located in the adjacent or shore area.

o    The  Administrator   may  exempt a  source  from  a  specific
     requirement based  on  technical infeasibility or  health and
     safety concerns, but any resulting excess  emissions  must be
     offset.

o    The Administrator may delegate implementation and enforcement
     authority to the states.

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Slide 68: Mandatory Class I Areas

o    The visibility  provisions  essentially expand  provisions  in
     current law  under Section  169A (Visibility protection  for
     Class  I  areas)  and  Section  165 (Prevention of  Significant
     Deterioration).

o    Current law requires  remedying existing and preventing future
     impairment of visibility from man-made air pollution in Class
     I Federal Areas.  We have 156 class  I  areas   (e.g.  National
     Parks, Wilderness  Areas) where  visibility  is an  important
     value, about two thirds of which are in the  West.

o    EPA rules to date have  focused  on  monitoring  the impacts  of
     impairment readily attributable  to single sources.   The  new
     provisions are intended  to emphasize control of regional haze,
     impairment from  multiple sources that degrades visibility over
     large areas.

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Slide 69: Visibility Provisions

o    Studies

        These studies will be conducted by EPA,  the Park Service,
     and other  appropriate  Federal  agencies to provide  a firmer
     foundation for developing control programs.  They would expand
     current monitoring  and extend  our regional  modeling  tools
     developed for  ozone  and acid rain to visibility,  especially
     in the West.

        EPA must summarize the interim results of these studies 3
     after enactment.
o    Impacts of other CAA provisions

        Using available assessment tools, the impact of other CAA
     provisions  including,  for  example,  acid  rain,  ozone  non-
     attainment, PM  non-attainment,  and mobile sources  would be
     assessed.  We believe acid rain reductions may produce major
     reductions in haze in the Eastern U.S.  and that control of PM,
     VOC, and NOx in  Titles I and II may  provide some regional haze
     benefits.

o    Commissions

        The Act  provides  procedures for establishing "Visibility
     Transport Regions"  and corresponding  "Visibility  Transport
     Commissions."  In addition,  EPA must establish a Grand Canyon
     Visibility Transport Region with a Commission, patterned after
     the ozone transport commission required under Title I.

        A Commission  would consist  of, at a minimum, the Governors
     of  each   state  in   the  transport  region,  EPA,   and  a
     representative  of each Federal agency  managing  each class I
     area in the Region.

     -  A Commission  would be required  to evaluate earlier research
     and available information regarding visibility  impacts and,
     within 4 years  of its  establishment,  recommend  policies and
     strategies for addressing regional  haze.  The recommendations
     must  address   protecting   visibility   through   "clean  air
     corridors," areas where additional restrictions on emissions
     may apply,  and must address  the promulgation of regional haze
     regulations.

         EPA  shall receive the recommendations of  the Commission
     and within 18 months  carry out its  responsibilities under the
     statute's  original  visibility  provisions   Section  169A,
     including requirements  for making reasonable further progress
     towards the visibility goal.

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