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EPA 452/R-06-004
August 2006
Economic Impact Analysis for the Proposed Review of New Sources and Modifications in
Indian Country
By:
Lillian Bradley
U.S. Environmental Protection Agency.
Air Benefit and Cost Group
Research Triangle Park, North Carolina
Prepared for:
U.S. Environmental Protection Agency.
Air Benefit and Cost Group
Research Triangle Park, North Carolina
Contract No. 68-D-99-024
Task Order No. 9
U.S. Environmental Protection Agency
Office of Air Quality Planning and Standards
Air Quality Strategies and Standards Division
Research Triangle Park, North Carolina
Based upon our evaluation of current Tribal emission inventories and the application of
updated growth rates, we have determined that the analysis has not changed significantly to
date; therefore, the May 2003 analysis for the period 2004-2010 remains valid for the EIA
and the associated ICR supporting statement. This analysis will be updated for the final
rulemaking.
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CONTENTS
Section Page
Acronyms and Abbreviations ix
Executive Summary '. ES-1
1 Introduction ....1-1
1.1 Definitions of Major Source and Minor Source 1-1
1.2 Organization of the Economic Impact Analysis Report 1-2
2 Profile of Baseline Conditions 2-1
2.1 Data Availability and Uncertainties 2-1
2.1.1 Demographic Data Sources 2-1
2.1.2 Economic Data Sources 2-2
2.1.3 Projection Data Sources 2-3
2.2 Definition of Quadrants 2-3
2.2.1 Baseline Conditions in East Quadrant 2-4
2.2.2 Baseline Conditions in East Central Quadrant 2-6
2.2.3 Baseline Conditions in West Central Quadrant 2-11
2.2.4 Baseline Conditions in West Quadrant 2-14
2.3 Baseline Conditions for Affected Minor Source Industries , 2-17
2.3.1 Identification of Affected Industries 2-18
2.3.2 Estimation of Existing Facilities in Indian Country 2-19
2.3.3 Estimation of Baseline Number of New Minor Sources in
Indian Country 2-21
2.3.4 Estimated Baseline Number of Minor Modifications to
Existing Minor Sources 2-24
2.4 Baseline Conditions for Major Source Industries 2-24
2.4.1 Identification of Existing Major Source Facilities in Indian
Country 2-25
2.4.2 Characterization of Tribes with Major Sources in
Nonattainment Areas 2-31
2.4.3 Estimation of Baseline Number of New Major Sources in
Indian Country 2-32
2.4.4 Modifications to Existing Major Sources 2-33
2.4.5 Synthetic Minor Sources 2-33
2.5 Conclusion 2-35
3 Cost Analysis 3-1
3.1 General Approach for Estimating Compliance Costs 3-2
iii
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3.2 Overview of Emissions and Emission Controls for Typical Minor
Sources 3-3
3.2.1 Asphalt Hot Mix Plants 3-5
3.2.2 Dry Cleaning 3-6
3.2.3 Gasoline Stations ..3-6
3.2.4 Industrial, Commercial and Institutional Boilers 3-7
3.2.5 Natural Gas Compressor Stations 3-8
3.2.6 Nonmetallic Mineral Processing 3-8
3.2.7 Painting and Coating Operations.... 3-9
3.2.8 Grain Elevators and Processors 3-10
3.2.9 Solid Waste Landfills 3-12
3.2.10 Concrete Batching Plants 3-14
3.2.11 Gasoline Bulk Plants 3-15
3.2.12 Lumber Saw Mills 3-16
3.2.13 Printing Operations 3-17
3.3 Control Costs for Typical Minor Sources 3-19
3.3.1 Control Costs for New Minor Sources 3-19
3.4 Costs for Major Sources 3-27
3.5 Administrative Costs 3-28
3.6 Summary 3-29
4 Economic Impact Analysis Methods and Results 4-1
4.1 Impacts on Minor Sources 4-1
4.1.1 Qualitative Discussion of Economic Impacts on Markets with
Minor Source Facilities Affected by the Rule 4-2
4.1.2 Qualitative Discussion of Economic Impacts on Markets with
. Existing Minor Source Facilities 4-5
4.1.3 Screening Assessment of the Impacts of the Proposed
MMNSRIC on Minor Sources 4-5
4.2 Impacts on Major Sources 4-12
4.3 Impacts on Tribes Accepting Delegation 4-14
5 Small Entity Impact Analysis 5-1
5.1 Introduction 5-1
5.2 Methods for Identifying Potentially Affected Small Entities and
Conducting a Screening Analysis of the Impacts of the Proposed Rule 5-2
5.3 Screening Analysis of Impacts on Small Businesses in Minor Source
Industries ^ 5-3
5.3.1 Characterizing Typical Small Businesses in Affected Minor
Source Industries 5-3
5.3.2 Estimated Number of New and Modified Minor Sources
Owned by Small Businesses 5-4
5.3.3 Estimated Impacts on Small Companies Owning New Minor <
Source Facilities 5-8
iv
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5.4 Characterizing Typical Small Businesses in Affected Major Source
Industries 5-9
5.4.1 Estimated Impacts on Small Companies Owning New Major
Source Facilities 5-15
5.5 Summary of Screening Analysis Results 5-16
5.6 Conclusions 5-16
References R-l
Appendixes
A: States and Tribes in Each Geographic Quadrant A-l
B: Existing Part 71 Sources in Indian Country (as of August 15, 2002) B-l
C: Estimated Emission Control and Administrative Burden Costs C-1
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LIST OF FIGURES
Number Page
2-1 Geographic Quadrants Used in the Analysis 2-5
2-2 States and Tribes of the East Quadrant 2-7
2-3 States and Tribes of the East Central Quadrant 2-9
2-4 States and Tribes of the West Central Quadrant 2-12
2-5 States and Tribes of the West Quadrant 2-15
2-6 Tribes in Eastern Quadrant with Major Source Facilities... 2-27
2-7 Tribes in East Central Quadrant with Major Source Facilities 2-28
2-8 Tribes in West Central Quadrant with Major Sources 2-29
2-9 Tribes in Western Quadrant with Major Source Facilities 2-30
4-1 A Simple Example of Long-Run Market Equilibrium for a Constant Cost
Industry, as Demand Grows Over Time 4-3
4-2 New Source Requirements Lead to a Reduced Number of New Minor
Source Facilities 4-4
VI
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LIST OF TABLES
Number Page
2-1 Tribal Geographic Distribution: East Quadrant 2-6
2-2 Summary Statistics on Tribal Socioeconomic Status: East Quadrant ($1999) 2-8
2-3 Summary Statistics on Tribal Populations: East Quadrant 2-8
2-4 Tribal Geographic Distribution: East Central Quadrant 2-10
2-5 Summary Statistics on Tribal Socioeconomic Status: East Central Quadrant
($1999) r 2-10
2-6 Summary Statistics on Tribal Populations: East Central Quadrant 2-10
2-7 Tribal Geographic Distribution: West Central Quadrant 2-13
2-8 Summary Statistics on Tribal Populations: West Central Quadrant 2-13
2-9 Summary Statistics on Tribal Socioeconomic Status: West Central
Quadrant ($1999) 2-14
2-10 Tribal Geographic Distribution: West Quadrant 2-16
2-11 Summary Statistics on Tribal Populations: West Quadrant 2-16
2-12 Summary Statistics on Tribal Socioeconomic Status: West Quadrant 2-16
2-13 Industries Expected to be Affected by the Proposed Rule: NAICS Codes for
Minor Source Types Identified from Tribal Inventories 2-20
2-14 Estimated Number of Existing Minor Sources in Indian Country: Estimated
Number of Existing Sources, Allocated based on Tribal Share of State
Income 2-22
2-15 New Minor Sources Projected Based on Tribal Population Growth Rate 2-23
2-16 Estimated Total Number of Minor Modifications to Existing Minor Sources
in Indian Country 2-25
2-17 Estimated Number of Existing Major Sources in Indian Country 2-26
2-18 Estimated Total Number of Minor Modifications to Existing Minor Sources
in Indian Country 2-34
3-1 Air Emission Control Approaches for Typical Minor Sources 3-4
3-2 Compliance Costs for Typical New Minor Sources in Indian Country 3-20
3-3 Compliance Costs for Minor Modifications to Existing Minor Sources in
Indian Country 3-24
3-4 Estimated Total Capital and Annual Compliance Cost to Industry : 3-31
4-1 New and Existing Minor Source Facilities Affected Under the Proposed
Rule 4-6
4-2 Typical Facility Level and Company Level Data for Minor Source Sectors
($2000) 4-7
vii
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4-3 Screening Comparison of Total Annualized Compliance Costs to Facility
and Company Financial Data for Minor Sources 4-9
4-4 Screening Comparison of Total Annualized Compliance Costs to Facility
and Company Financial Data for Existing Minor Sources Requiring Permits 4-11
4-5 Existing Major Source Facilities Expected to Undergo Minor Modifications
Under the Proposed Rule (2000$) 4-13
4-6 , Screening Comparison of Total Annualized Compliance Costs to Facility
and Company Financial Data for Existing Major Sources Undergoing Minor
Modifications 4-13
4-7 Measures of Impact on Tribes Choosing to Administer the NSR Program 4-14
5-1 Small Business Administration Criteria for Selected Industries 5-5
5-2 Share of Sector Companies that are Small or Large and Average Sales Data
by Size of Company 5-6
5-3 Estimated Number of New and Modified Minor Sources Owned by Small
Businesses 5-7
5-4 Estimated Costs of Compliance for Affected Minor Sources 5-10
5-5 Estimated Cost-to-Sales Ratios for Small Businesses Investing in New
Minor Sources 5-11
5-6 Screening Analysis of Impacts due to Modifications of Minor Sources 5-12
5-7 Small Business Administration Criteria for Selected Major Source Industries 5-13
5-8 Estimated Number of Existing Major Sources Owned by Small Businesses 5-14
5-9 Summary of Costs and Affected New and Modified Sources Owned by
Small Businesses 5-16
Vlll
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ACRONYMS AND ABBREVIATIONS
AIA American Indian Area
AI/AN American Indian/Alaskan Native
CTG Control Techniques Guidelines
EIA Economic Impact Analysis
EPA Environmental Protection Agency
FIP Federal Implementation Plan
ICI Industrial, commercial and institutional (boilers)
MMNSR Major and Minor New Source Review
MSCT Minor Source Control Technology
NAICS North American Industrial Classification System
NSPS New Source Performance Standards
OAQPS Office of Air Quality Planning and Standards
OMB Office of Management and Budget
RFA Regulatory Flexibility Act
SBA Small Business Administration
SBREFA Small Business Regulatory Enforcement Fairness Act
SIC Standard Industrial Classification
SISNOSE Significant Impact to a Substantial Number of Small Entities (small
businesses, small organizations, and small governments)
TGA Tribal Geographic Area
TIP Tribal Implementation Plan
IX
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EXECUTIVE SUMMARY
ES.l Introduction
In this document, the U.S. Environmental Protection Agency (EPA) analyzes the
potential economic impacts of the proposed Review of New Sources and Modifications in
Indian Country, hereafter referred to as the proposed rule. The proposed rule potentially
affects new minor sources, modified minor sources, minor modifications to existing major
sources, and sources accepting emissions limitations to become synthetic minor sources. In
addition, the proposed rule establishes nonattainment New Source Review for major sources
and major modifications to major sources in Indian Country. Because the rule affects
sources that have not yet been created, EPA does not have data on what sources or
companies will actually be affected. Instead, EPA estimated the number of each source type
that would be affected over the analysis period (2004 through 2010). EPA's analysis relies
on assumptions that future facilities will resemble existing facilities, and future parent
companies will resemble existing parent companies. Overall, EPA estimates that the total
annualized costs of compliance for industry affected by the proposed rule will be
approximately $6 million per year. These costs do not account for possible cost savings to
firms choosing to limit emissions and become synthetic minors; this flexibility is available
under the proposed rule and would reduce the regulatory compliance costs of such facilities.
Similarly, the analysis does not attempt to quantify or value any potential benefits to human
health or the environment although EPA believes that there will be such benefits.
ES.2 Methods for Estimating Impacts on New Sources and Modifications in Indian
Country
Because the proposed rule affects new and modified sources, EPA must first estimate
the number of affected new and modified sources in Indian Country over a period after
promulgation. EPA analyzes the impacts of the proposed rule over the period 2004 (the year
of promulgation) through 2010. Typically, New Source Performance Standards (NSPS) are
analyzed over a period of 3 to 5 years after promulgation. EPA chose a longer time horizon
for the analysis to provide a slightly longer period over which new sources may be planned,
and impacts analyzed. To coincide with publicly available projections that could be used in
the analysis, EPA chose 2010 as the end point for the analysis. Thus, the projection of new
minor sources is for the period 2004 to 2010.
ES-1
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ES.2.1 Data Sources
Section 2 describes the process of estimating the number of new and modified minor
and major source facilities that would be created in Indian Country in the absence of the rule.
EPA has no information on planned construction of new sources in Indian Country, and thus
must estimate this number using the best data available. Unfortunately, data on minor
sources on Indian Country are limited to fewer than a dozen Tribal emissions inventories.
EPA examined numerous possible sources of information about minor sources, including
EPA databases and data compiled by EPA regions. In addition to encouraging Tribes to be
involved in the rulemaking process, EPA asked if Tribes were aware of any data on minor
sources. The most reliable data found were 11 Tribal emissions inventories maintained by
EPA/OAQPS. EPA used these data to identify the types of minor sources most likely to be
affected, and then used publicly available Census data to estimate how many existing minor
sources of each type are located in Indian Country. To characterize major sources, EPA used
the list of existing sources in Indian Country that have Part 71 permits as indicative of the
types of major sources that would be affected by the rule. EPA then used publicly available
projections of Tribal population growth over the period 2004 to 2010 to project how many
new minor and major sources of each type would be created over the period in the absence of
the proposed rule. EPA also used census data to estimate how many large and small parent
companies would own the new and modified sources. Finally, EPA computed an
administrative burden cost and compared it to data for several representative Tribes to assess
whether the costs of administering the program would be significant for Tribes that choose
delegation.
ES.2.2 Projecting the Number of Affected Sources
EPA has only very limited data on existing minor sources in Indian Country.
Because minor sources are not currently regulated, no minor source data are collected in
EPA databases. EPA searched EPA databases and EPA regional information, and
concluded that the only reliable characterization of the types of minor sources currently
operating in Indian Country was data compiled in 11 Tribal inventories maintained by EPA's
Office of Air Quality Planning and Standards. EPA identified the industries associated with
each type of minor source, and collected state data from the Economic Census (1997) on the
number of facilities in each industry. EPA used Tribal share of state income to estimate the
number of existing establishments in Indian Country, then used the rate of growth of Tribal
populations to estimate the number of new sources hi Indian Country from 2004 through
2010. EPA estimates there are 3,169 existing minor sources in Indian Country (see Table
ES-2
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ES-1), and that 288 new minor sources would be created in Indian Country over the study
period (see Table ES-2).
Table ES-1. Estimated Number of Existing Minor Sources in Indian Country, 1997:
Estimated number of existing sources, allocated based on Tribal share of state income
or population
Allocation Based on Income
Sector
Sand and gravel processing
Lumber saw mill
Printing operation (lithographic)
Asphalt hot mix plant
Natural gas compressor station
Solid waste landfill
Concrete batching plant
Grain elevator
Gasoline bulk plant
Gasoline station (storage tanks, refueling)
Dry cleaner
Automobile refinishing shop
Stone quarrying and processing
Surface coating operations
Industrial, commercial and institutional boiler:
natural gas
Industrial, commercial and institutional boiler:
oil-fired
Total existing sources
East
0
1
2
0
0.
0
0
0
1
15
3
4
0
0
0
0
28
East
Central
2
3
11
1
2
1
2
4
7
88
14
23
1
2
12
0
172
West
Central
28
19
140
13
71
18
22
112
111
1,588
222
311
26
29
12
0
2,721
West
3
9
18
0
2
2
3
12
13
122
22
40
0
2
0
0
248
Grand
Total
33
32
171
14
74
20
• 27
129
132
1,814
261
377
27
33
24
1
3,169
Note: Totals may not equal sum of sectors due to rounding.
Similarly, EPA assumed that 10 percent of existing sources would make a
modification each year, but only 5 percent of those would result in emissions greater than de
minimus. Thus, EPA projects that 112 modified minor sources would incur permitting costs
due to the rule and that half of those sources would also be required to implement emissions
controls.
ES-3
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Table ES-2. Projected Number of New Minor Sources in Indian Country, Based on
Tribal Population Growth Rate
Sector
Sand and gravel processing
Lumber saw mill
Printing operation (lithographic)
Asphalt hot mix plant
Natural gas compressor station
Solid waste landfill
Concrete batching plant
Grain elevator
Gasoline bulk plant
Gasoline station (storage tanks, refueling)
Dry cleaner
Automobile refmishing shop
Stone quarrying and processing
Surface coating operations
Industrial, commercial or institutional boiler:
natural gas fired
Industrial, commercial or institutional boiler:
oil fired
Total projected new minor sources
East
0
0
0
0
0
0
0
0
0
1
0
0
0
0
0
0
1
East
Central
0
0
1
0
0
0
0
0
0
7
1
2
0
0
1
0
12
West
Central
2
2
12
1
6
2
2
11
10
139
19
28
2
3
1
0
240
West
0
1
2
0
0
0
0
2
3
20
2
5
0
0
0
0
35
Grand
Total
2
3
15
1
6
2
2
13
13
167
22
35
2
3
2
0
288
Based on data for 83 existing major source facilities in Indian Country, EPA projects
that seven major sources will make minor modifications over the period, one new major
source will be sited in a nonattainment area in Indian Country, and one existing major source
in a nonattainment area will make a major modification during the period. Existing major
sources may also choose to accept Federally enforceable emissions limits to become
"synthetic minor sources" under the provisions of the proposed rule; EPA believes sources
would make this choice only if this decision would result in cost savings for them. EPA has
not projected the number of major sources that might choose to become synthetic minors.
ES-4
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ES.2.3 Characterizing Affected Companies
EPA has no information on companies planning to invest in new minor sources on
Tribal land; thus, EPA characterized the companies owning projected new and modified
minor source facilities based on typical statistics for existing companies in each industry,
gathered from financial databases. EPA used the small business criteria defined by the Small
Business Administration to define "small business" for each affected industry. Based on
these data, EPA estimated that 164 new minor sources would be owned by 143 small
businesses and 62 modified minor sources in Indian Country would be owned by 51 small
businesses. EPA also gathered data from financial databases to characterize companies
owning existing major sources in Indian Country; because these sources can be identified, the
data collected were for the actual companies that own them. EPA estimates that there are 35
major source facilities owned by 23 small companies in Indian Country. EPA does not know
which of the existing major sources may choose to make a minor modification over the
period of analysis; thus, the assessment of impacts is again based on typical companies in
each affected sector.
Because of the uncertainties involved in these estimates, EPA reports results
aggregated to the level of large multistate quadrants. EPA believes that the projected number
of new minor sources in Indian Country is reasonable and the best estimate available given
the existing data. Nevertheless, it is not sufficiently precise to report estimates for specific
Tribes. Thus, EPA divided the country into four quadrants and computed and reports
numbers of new sources by sector for each quadrant.
ES.3 Estimated Costs of Complying with the Proposed Rule
Since there are no detailed emissions inventories that are universally available for
Tribes, the Agency determined that typical source types would be used to estimate costs on a
geographic basis. These typical source types are considered to have the greatest potential to
be new minor sources located in Indian Country. Costs resulting from the rule are expected
for affected sources, which will incur both capital and MRR costs, and tribal agencies, which
will be charged with administrative tasks associated with the proposed rule.
Section 3 profiles the emissions and controls associated with the typical source type
categories, and the costs of controlling them under the proposed rule. The air pollutants of
concern associated with the selected source types include carbon monoxide (CO), nitrous
oxide (NOX), particulate matter (PM), sulfur dioxide (802), and volatile organic compounds
(VOC). These pollutants can be controlled using a variety of techniques, including process
ES-5
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modification, material substitution, recovery or recycling, work practices and add-on
controls.
To develop the costs associated with controlling these emissions, EPA developed an
approach that estimates compliance costs for a typical facility for each source category.
Process throughput or operating capacities are needed to size and cost air pollution controls
and to estimate emissions. These values were selected to reflect typical minor source sizes
for the source category. These assumptions create uncertainty in the cost analysis.
EPA prepared estimates of the costs to implement Minor Source Control Technology
(MSCT) for each type of affected source. These estimated costs include capital costs and
annualized MSCT costs. Among the affected source categories, printing operations have the
lowest annualized MSCT cost, while largest capital costs are borne by the stone quarrying
and processing facilities. Gas stations have the highest nationwide total annual compliance
costs. Since the agency does not expect any new oil-fired boilers over the analysis period, it
is estimated that this source category will have nationwide total annual compliance costs
equal to $0. Across all 288 new minor sources, the estimated total nationwide annual
compliance cost is $4.9 million. In addition, EPA estimated costs for modifications to
existing minor sources, totaling $1.5 million. Finally, EPA estimated costs for minor
modifications to existing major sources, totaling $0.02 million.
Because the proposed rule results in an administrative change but no change in
compliance requirements for new and modifying major sources, EPA estimates that the costs
for these source types will be zero. In fact, because the proposed rule establishes a
permitting procedure for these sources that may be more predictable than the source-specific
FIPs required at baseline, the rule may reduce the costs for new majors and major
modifications. Finally, because choosing to become a synthetic minor is entirely optional,
EPA believes that companies would only make this choice if it reduced costs. EPA has not
attempted to estimate how many existing major sources might become synthetic minors, and
has not quantified their cost savings.
ES.4 Estimated Impacts on New and Modified Minor and Major Sources in Indian
Country
In Section 4, EPA presents its analysis of impacts on new and modified sources in
Indian Country. EPA analyzed potential impacts on new minor sources and minor
modifications to existing major and minor sources based on a qualitative assessment
augmented by a quantitative screening comparison of the magnitude of costs for typical
minor source facilities in each sector to typical facility and company sales and profits. The
ES-6
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qualitative analysis indicated that the costs associated with the proposed rule have the
potential to reduce investment in new minor source facilities or minor modifications to
existing minor or major sources over the period. However, because the costs are generally
small compared to facility and company sales and profits, EPA estimates that the slowing of
investment will be slight. Companies considering siting new major source facilities or
making major modifications to existing major sources are projected to incur no incremental
costs or impacts, and may experience cost savings and reduced uncertainty as a result of the
rule. Companies owning major source facilities that choose to accept Federally enforceable
emissions limits are expected to experience cost savings. Thus, overall impacts of the
proposed rule are projected to be relatively small. New minor sources and existing sources
making minor modifications are projected to incur (relatively small) costs and impacts, while
facilities becoming synthetic minors are expected to experience cost savings. Depending on
the number of facilities choosing to become synthetic minors, and magnitude of the cost
savings synthetic minors realize (not quantified due to lack of data), the proposed rule may
on balance result in cost savings for industry.
EPA's assessment of the administrative burden on tribes choosing to administer the
program is based on data for several representative tribes currently developing their own air
programs. If Tribes choosing to administer'the program are similar to these Tribes, the costs
of the program will be less than $1 per tribal member per year. Overall, therefore, EPA does
not expect that the proposed rule will impose significant burdens to Tribes choosing to accept
delegation of the program.
EPA also examined, as presented in Section 5, potential impacts on small entities, in
this case small businesses. Looking only at those source types projected to incur costs (new
minor sources and minor modifications), EPA estimates that 143 small businesses will incur
$2.6 million due to construction of new minor sources, 51 small businesses will incur $0.97
million due to modifying minor sources, and 3 small businesses will incur $0.02 million due
to making minor modifications to major sources. Overall, therefore, EPA estimates that the
rule will result in $3.6 million in costs for small businesses in Indian Country. For most
sectors, the estimated costs represent less than 1 percent of small company sales, and thus
will not pose a significant burden to small businesses. For two sectors, solid waste landfills
and natural gas compressor stations, costs exceed 1 percent of typical small company sales.
However, only one new facility of each type owned by a small business is projected over the
analysis period. In addition, three automobile refinishing shops projected to make minor
modifications may incur costs close to 1 percent (0.97 percent) of small parent company
sales. For several sectors, because large companies typically own a large number of
ES-7
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facilities, projected cost-to-sales ratios (CSRs) for large companies exceed those for small
companies, indicating that small companies are not disproportionately burdened by the rule
compared to large companies. Overall, therefore, EPA does not believe that the proposed
rule will impose a significant economic impact on a substantial number of small entities.
ES.5 Conclusions
EPA's proposed rule potentially affects several types of facilities in Indian Country:
new minor sources, minor modifications to existing minor and major sources, new major
sources in nonattainment areas, major modifications to major sources in nonattainment areas,
and sources choosing to become synthetic minors. EPA analyzed costs and impacts on new
minor sources and minor modifications using limited minor source data and assuming that
new minor sources would resemble existing ones. New minor sources and minor
modifications are projected to result in administrative and emissions control costs totaling
approximately $6 million, of which approximately $3.6 will be borne by small businesses.
New major sources and major modifications in nonattainment areas in Indian Country are
projected to incur no incremental costs or impacts because the rule results in an
administrative change that my in fact reduce uncertainty and encourage investment. Major
sources are assumed to choose to become synthetic minors only if the choice results in cost
savings. Tribes choosing to accept delegation and administer the program are estimated to
incur approximately $3,100 per year in costs per source; which is estimated to be less than $1
per affected Tribal member. An assessment of potential impacts on small businesses
indicates that small businesses are not disproportionately affected by the rule compared to
large businesses, and that a very small number will incur costs exceeding 1 percent of parent
company sales. Thus, EPA certifies that the proposed rule will not result in a significant
economic impact to a substantial number of small entities.
ES-8
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SECTION 1
INTRODUCTION
The proposed Review of New Sources and Modifications in Indian Country (hereafter
referred to as the proposed rule) establishes nationally applicable regulations to implement a
permitting program to regulate the construction and modification of stationary sources of air
pollution, and to allow certain new and existing stationary sources to voluntarily accept
federally enforceable emission limits in order to avoid major source regulations. The
proposed rule establishes procedures and terms under which the Administrator will issue
permits for new minor source facilities (new plants that are minor sources, minor
modifications to existing sources, and creation of synthetic minor sources by voluntarily
accepting emissions limitations). In addition, the proposed rule establishes procedures for
permitting new major sources and major modifications in nonattainment areas in Indian
Country. EPA currently issues preconstruction permits in Indian Country for major sources
and major modifications in attainment and unclassifiable areas under the Prevention of
Significant Deterioration (PSD) regulations at 40 CFR Part 52.21. EPA has also issued
preconstruction permits in Indian Country for major sources and major modifications in
nonattainment areas under 40 CFR Part 51, Appendix S. Thus, the rule does not impose any
incremental emissions control requirements on new major sources. It does, however,
establish a regulatory mechanism for permitting new major sources (new facilities and major
modifications at existing facilities) in nonattainment areas in Indian Country. Existing
operations at existing minor and major source facilities in Indian Country will not be affected
by the proposed rule.
1.1 Definitions of Major Source and Minor Source
To clarify the applicability of the proposed rule, EPA provides the following
definitions:
Major Stationary Source means any stationary source that is subject to regulation as a
major stationary source under 40 CFR part 52.10 or 52.21, or under applicable regulations
approved pursuant to 40 CFR part 51 Subpart 1. These include any stationary source that
emits or has the potential to emit 250 tons per year or more of any air pollutant subject to
regulation under the Clean Air Act (CAA), or any of a list of selected source types (in 40
CFR 52, §52.21(b)(l)) that emits or has the potential to emit 100 tons per year or more of any
pollutant subject to regulation under the CAA.
1-1
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Major modification means any physical change in or change in the method of operation of a
major stationary source that would result in a significant net emissions increase of any
pollutant subject to regulation under the CAA.
Minor stationary source means any stationary source that is not a major stationary source
and emits or has the potential to emit any pollutant above de minimus levels.
Minor modification means any modification to a stationary source that is not a major
modification.
Major source of hazardous air pollutants is any stationary source or group of contiguous
sources under common control that emits or has the potential to emit considering control, in
the aggregate, 10 tons per year or more of any hazardous air pollutant (Sec. 112(b)(l) of the
CAA) or 25 tons per year or more of any combination of hazardous air-pollutants.
Area source of hazardous air pollutants is any stationary source or group of contiguous
sources that is not a major source of hazardous air pollutants and emits or has the potential to
emit any hazardous air pollutant or combination of hazardous air pollutants above the de
minimus level.
1.2 Organization of the Economic Impact Analysis Report
This section describes the organization of the analysis to follow.
Section 2 provides a profile of the baseline conditions for the analysis. Baseline
conditions are defined as the expected conditions in the absence of the rule. Characterizing
the baseline requires collecting data on current conditions in Indian Country and using those
data to project conditions after the rule is promulgated (2004 through 2010). Data needed
include per capita income and population of Indian Country, types and numbers of minor
sources existing today in Indian Country, and projected numbers of new sources that would
be created in Indian Country in the absence of the proposed rule.
Because the proposed rule affects new sources and modifications that do not yet exist,
EPA must project future conditions in the absence of the rule. The characterization of
baseline conditions required compiling demographic and economic data on Tribes. In
addition, in order to project the number of new minor sources in Indian Country between the
period of 2004 and 2010, EPA examined several possible sources of data. Data on existing
minor sources in Indian Country are limited. After exploring the availability of data in EPA
databases, from EPA regions, from the Bureau of Indian Affairs, and from the Small
Business Administration, and asking Tribes whether they were aware of any such data, EPA
concluded that the best source of data on minor sources in Indian Country consist of 11
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Tribal emissions inventories maintained by EPA/OAQPS. These inventories were used to
identify the types of minor sources expected to be created, and data from the Census of
Population (2000) and the Economic Census (1997) were used to estimate the number of
existing and new minor sources throughout Indian Country. Insufficient data at the Tribal
level prevented a Tribe-specific analysis for the proposed rule. Therefore, EPA relied on a
limited yet consistent set of alternative data sources, although this increased the uncertainty
of the analysis. Due to these uncertainties, results will be presented at the multi-state
quadrant level. These Quadrants are defined as: East, East Central, West Central, and West.
Quadrant level reporting is designed to mitigate some of the uncertainty about projections for
smaller geographic areas.
An evaluation of baseline conditions indicates the tremendous diversity that exists
among Tribal areas within and across Quadrant boundaries. The West Central quadrant
accounts for a large majority of existing minor sources (86 percent) and estimates of
projected new minor sources between 2004 and 2010 indicate a continuation of this trend.
In Section 3 the Agency estimates the costs and burdens that would typically result
from implementation of the proposed rule. Since there were not detailed emission
inventories available for each Tribe, EPA decided that typical source types would be used to
estimate costs on a geographic basis. These would be the source types that are considered to
have the greatest potential to be new minor sources located in Indian Country. Selection of
these typical minor source types was based on available tribal emission inventories (i.e., in
EPA Regions 8 and 10) and other information gathered from EPA Regional contacts and
other publicly available sources (such as the various Tribal related websites).
After identifying the most common types of emission sources likely to be affected by
the rule, EPA developed an approach that estimates compliance costs for a typical facility for
each source category. Process throughput or operating capacities were selected to reflect
typical minor source sizes for the source category. In some cases they are based on a
national average value; others are based on existing size categories where the lower end
values were selected to characterize minor sources; and in some cases, the values were based
on information contained in the available tribal emission inventories. With the information
discussed above, EPA has what could be considered the minimum information to complete
cost estimates for emission controls for minor source NSR in Indian Country. The resulting
uncertainties are discussed in greater detail in Section 3.
Following the description of the baseline in Section 2 and the expected control costs'
for Tribal entities and new facilities in Indian Country in Section 3, Section 4 gives an
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evaluation of how firms and people may react to changes in market conditions. Typically,
EPA analyzes these responses by developing models that simulate behavioral changes in
response to the rule. In this instance, however, EPA limited its analysis to a qualitative
examination of responses to the rule, supplemented by a quantitative screening of the costs of
the rule in the context of facility and company sales and profits. Section 4 describes the
methods and results of the analysis. In addition, Section 4 examines the possible impacts of
the administrative costs of the program on Tribes choosing to administer the NSR program
on their lands. Overall, EPA's assessment indicated that for typical facilities and companies,
the costs will be relatively low compared to facility and company sales and profits; thus, EPA
estimates that for typical companies and new minor source facilities, the costs of complying
with the proposed rule will not result in significant delays in investment in new facilities.
Similarly, EPA's analysis shows that the administrative burden costs of the rule, when
computed on a per-Tribal member basis and compared to Tribes' per capita income, are
extremely low and should not present an impediment to Tribes wishing to administer the
NSR program.
Section 5 describes the underlying assumptions and computations U.S.
Environmental Protection Agency (EPA) made in estimating the number of affected small
entities (in this case, small businesses), and examines the proposed rule's possible impact on
these entities. EPA estimates that 143 small businesses investing in 164 new minor source
facilities over the period 2004 through 2010 will incur approximately $2.6 million per year to
comply with the proposed rule. In addition, 51 small businesses owning 62 existing minor
sources are projected to make minor modifications to their facilities during the period. These
small businesses are estimated to incur approximately $0.97 million in costs. Finally, as
three small businesses owning existing major facilities are projected to make minor
modifications, incurring approximately $0.02 million. Overall, small businesses are
projected to incur $3.6 million due to the proposed rule. EPA conducted a screening analysis
comparing the typical costs per small business in each sector with the typical small business
sales in each sector, and finds that the proposed rule will not impose significant economic
impacts on a substantial number of small businesses.
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SECTION 2
PROFILE OF BASELINE CONDITIONS
Promulgation of the proposed Review of New Sources and Modifications in Indian
Country (hereafter referred to as the proposed rule) will result in regulation of air emissions
from new minor sources, minor modifications to existing major sources, and sources
accepting emissions limitations to become synthetic minor sources. In addition, the proposed
rule establishes nonattainment New Source Review for major sources and major
modifications to minor sources in Indian Country. To analyze the impacts of the proposed
rule, EPA will compare projected conditions with the rule in place to projected baseline
conditions (projected conditions without the proposed rule). The proposed rule will not
affect existing operations, only new or modified operations. This section provides a profile
of the baseline conditions in each quadrant and describes the underlying assumptions and
computations that were made in support of the analysis.
2.1 Data Availability and Uncertainties
A first step in analyzing the impacts of the proposed rule is characterizing the
baseline conditions in the absence of the rule. Characterizing the baseline requires collecting
data on current conditions in Indian Country and using those data to project conditions after
the rule is promulgated (2004 through 2010). Data needed include per capita income and
population of Indian Country, types and numbers of minor and major sources existing today
in Indian Country, and projected numbers of new sources that would be created in Indian
Country in the absence of the proposed rule.
2.1.1 Demographic Data Sources
To characterize baseline conditions, EPA needed demographic data on Tribes.
However, consistent and reliable income and population data for Tribal entities were not
available from the Tribes themselves. Therefore, the Census of Population and Housing
(2000) was selected as the primary source of demographic data for this analysis. Census
reports data for American Indian Areas (AIAs), which are geographic units that include
federal American Indian reservations and off-reservation trust land, Oklahoma tribal
statistical areas, and Tribal-designated statistical areas. These data represent all inhabitants
of the AIA, Tribal members and nonmembers alike. For the analysis, it was deemed
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appropriate to include all those residing on AIAs (rather than the subset of American Indians)
to best capture the overall level of economic activity on the AIA. In limited instances,
incomplete census data were supplemented with information from the publication "American
Indian reservations and Indian Trust Areas" (U.S. Department of Commerce, 1996) also
known as the "Tiller's Guide." This source provides brief profiles of each Indian
Reservation in the United States, including demographic data, tribal land holdings, culture,
economic infrastructure, and business enterprises. Because of inconsistent coverage for
various data elements, this source was not selected as the primary source of demographic
data for the analysis.
Although there is generally a one-to-one correspondence between Tribal entity and
the Census data, several Tribes inhabit multiple parcels of land. In these instances, the
Census reports data for each AIA independently. Thus, although there are currently 328
federally recognized tribes in the United States (excluding Alaska and Hawaii), the Census
provides data for the 351 geographic areas that are considered AIAs. For the purposes of this
analysis, data were analyzed for each of the distinct AIAs.
2.1.2 Economic Data Sources
Data on existing number of major sources in Indian Country were available from the
EPA database of existing sources with Title V permits. Currently, 83 major sources are
reported in Indian Country, of which eight are located in nonattainment areas. To determine
the number of existing minor sources in Indian Country, EPA examined several potential
sources of data, including
• EPA and other government databases, such as Toxic Release Inventory (TRI) and
NET;
• information from EPA regional offices: even regions that have inventories
(Regions 8 and 10) do not have complete listings of minor sources;
• Small Business Administration (SBA): EPA searched its database for businesses
listed as Native American-owned, and cross-referenced zip codes to see if zip
codes matched Tribal zip codes; if it matched, we assumed that the business was
located on Tribal land. The limitations of this approach are as follows: (1) small
businesses are not required to submit data to the SBA; therefore, the database is
incomplete; (2) zip code boundaries do not coincide with Tribal land boundaries,
so even if the zip codes match, the business may or may not be located on Tribal
land; and (3) we have very limited information on what the businesses are or what
they do; and
• existing EPA/OAQPS inventories for 11 tribes.
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As RTI explored the EPA databases for minor sources, it became evident that,
because minor sources are not currently regulated, data on minor sources are not routinely
collected. National databases have only very limited information about minor sources in
Indian Country. There are 11 completed tribal inventories that the Tribes and regions believe
to be reliable. In addition, EPA Region 10 has information about some minor sources in its
Tribal database. However, the database does not include a complete inventory of minor
sources; for example, it does not list any gas stations or body shops. Region 8 also has a
Tribal database, but it includes all businesses within a 5-mile radius of Indian Country;
therefore, we cannot be sure whether the sources listed are in Indian Country. After
evaluating the available sources of information, EPA concluded that the best characterization
of types of existing minor sources was the data in the Tribal inventories for 11 tribes. In the
absence of Tribe-specific data, these sources are the most reliable and consistent information
available.
2.1.3 Projection Data Sources
To project the number of new minor and major sources in Indian Country between
2004 and 2010, EPA examined several potential growth rates. These included American
Indian/Alaskan Native (AI/AN) population growth rates, total state population growth rates,
and industry-based growth rates. It was determined that state-level AI/AN population growth
rates were the appropriate variable to use because they best reflect the special conditions in
Indian Country and are most likely to estimate the number of affected new minor and major
sources over this time period.
2.2 Definition of Quadrants
Insufficient data at the Tribal level presented considerable obstacles to performing a
Tribe-specific analysis for the proposed rule. Therefore, EPA relied on a limited yet
consistent set of alternative data sources, although this increased the uncertainty of the
analysis. Because of these uncertainties, projections could not be reliably made for
individual AIAs; instead, results are presented at the multistate quadrant level. These
quadrants are defined as East, East Central, West Central, and West.
Determining the quadrant boundaries was a multistage process in which several
factors and various geographic configurations were proposed. Originally, state or EPA
regional boundaries were suggested. However, state or EPA regional boundaries were
considered undesirable because applying federal government designations to Tribal analysis
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is potentially sensitive. Additionally, numerous tribes cross state and EPA regional borders,
complicating the analysis. As a result, it was determined that larger, multistate quadrants
should be constructed. The current quadrant configuration facilitates analysis in several
ways. The existing boundaries minimize the occurrence of multiquadrant tribes. Also, the
quadrants are reasonably uniform in terms of their resource endowments, economic activity,
and potential existing minor sources. For example, saw mills and other logging-related
sources are primarily in the West Quadrant, and natural gas compressor stations are primarily
located in the West Central region. Figure 2-1 presents the multistate quadrants and AIAs
contained within each.
Despite these considerations, several Tribes' lands cross quadrant boundaries. For
Tribes with the vast majority of population and economic activity in one quadrant, the Tribe
was assigned to that quadrant. Four Tribes have significant population and economic activity
in more than one quadrant.1 Their data were distributed proportionally to the quadrants in
which their lands are located. Appendix A provides a list of the states and AIAs in each
quadrant, including those four AIAs that cross quadrant boundaries.
2.2.1 Baseline Conditions in East Quadrant
Of the four quadrants, the East Quadrant has the smallest number of tribes: 30 (see
Table 2-1). These tribes are located across eight states, with New York and Florida each
having nine tribes. Together, these two states contain 60 percent of the federally recognized
AIAs in the East Quadrant. Maine is home to six tribes, or 20 percent of the quadrant's total.
There are two tribes in Connecticut and Massachusetts; North Carolina, Rhode Island, and
South Carolina each have one Tribal area. Figure 2-2 shows the boundaries of the East
Quadrant and the location of individual AIAs.
Table 2-2 provides the socioeconomic conditions of the tribes in the East Quadrant
vary considerably. Summary statistics for per capita income (PCI) of Tribes in the East
Quadrant. The average PCI for Tribes in the quadrant is $11,959. The highest PCI for a
tribe in the quadrant is $40,667, while the lowest is $0. In fact, the average PCI of the
poorest 10 percent of AIAs in the East Quadrant is $0, while the average PCI for the
wealthiest 10 percent of AIAs in the quadrant is $31,462.
'These tribes are the Colorado River Indian Tribes of the Colorado River Indian Reservation, Arizona and
California; Fort Mojave Indian Tribe of Arizona, California and Nevada; Quechan Tribe of the Fort Yuma
Indian Reservation, Arizona and California; and Confederated Tribes of the Goshute Reservation, Nevada
and Utah.
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Federally Recognized Tribes
East
East Central
West Central
Figure 2-1. Geographic Quadrants Used in the Analysis
In terms of population, the East is the smallest of the four quadrants. As shown in
Table 2-3, approximately 49,000 people live in the AIAs of the East Quadrant. Cayuga
Nation in New York has the largest population in the quadrant, with 10,706 people. The
average population of the largest 10 percent of AIAs in the quadrant is 9,313. Five AIAs,
three in Florida and two in Maine, report populations of zero according to the U.S. Census.
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Table 2-1. Tribal Geographic Distribution: East Quadrant
State Number of Tribal Geographic Areas
Connecticut 2
Florida 9
Massachusetts 1
Maine 6
North Carolina . 1
New York 9
Rhode Island 1
South Carolina • 1
Total 30
Source: U.S. Department of Commerce, Bureau of the Census. 2000. Census of Population and Housing.
Washington, DC: U.S. Department of Commerce.
Economic activity in the East Quadrant is mixed. The Mashantucket Pequot Tribe of
Connecticut runs the Foxwoods Casino, a very large and lucrative resort. Tourism and
outdoor recreation are important sources of revenue for other tribes, such as the Wampanoag
Tribe of Tribe. Primary crops include bell peppers, strawberries, and lemon and grapefruit
groves (U.S. Department of Commerce, 1996). Development of gaming facilities in Indian
Country in the quadrant has facilitated other business growth, such as smokeshops, gas
stations, and other small businesses that cater to tourists.
2.2.2 Baseline Conditions in East Central Quadrant
The East Central Quadrant includes Tribes in Alabama, Iowa, Louisiana, Michigan,
Minnesota, Mississippi, and Wisconsin. Figure 2-3 shows the boundaries of the East Central
Quadrant and the location of the AIAs within it. Major geographic features in the region
include the Great Lakes, the Mississippi River, and the Missouri River. The East Central
Quadrant contains 44 AIAs. Eighty-four percent are concentrated in three states: Michigan,
Minnesota, and Wisconsin. Michigan and Wisconsin each contain 12 AIAs, and Minnesota
has 13. Louisiana has four AIAs, and Alabama, Iowa, and Mississippi have one each.
Table 2-4 provides the distribution of AIAs among states in the quadrant.
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Trfbts in Eastern Quadrant Wrth Major Source FadlHtos
.r
N
Federally Recognized Tribe* Wtth Mayor
Source Faculties
j States
Figure 2-2. States and Tribes of the East Quadrant
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Table 2-2. Summary Statistics on Tribal Socioeconomic Status: East Quadrant ($1999)
Average per capita income $11,959
Maximum per capita income $40,667
Per capita income of wealthiest 10% of Tribes $31,462
Minimum per capita income $0
Per capita income of poorest 10% of Tribes $0
Source: U.S. Department of Commerce, Bureau of the Census. 2000. Census of Population and Housing.
Washington, DC: U.S. Department of Commerce.
Table 2-3. Summary Statistics on Tribal Populations: East Quadrant
Total population, all AIAs 49,310
Average population, per AIA 1,644
Maximum AIA population 10,706
Minimum AIA population 0
Population of largest 10% of Tribes 9,313
Population of smallest 10% of Tribes 0
Note: AIAs = American Indian Areas.
Source: U.S. Department of Commerce, Bureau of the Census. 2000. Census of Population and Housing.
Washington, DC: U.S. Department of Commerce.
There are large disparities in the reported socioeconomic status among Tribes in the
East Central Quadrant. Table 2-5 shows the summary statistics for PCI of AIAs in the
quadrant. The average PCI for people in Indian Country in the quadrant is $14,298. One
Tribe in the quadrant has an extremely high level of income. The Shakopee Mdewakanton
Sioux Community of Minnesota (Prior Lake) has an average PCI of $84,517. The average
PCI of the wealthiest 10 percent of AIAs is $37,782, while the average PCI of the poorest 10
percent of AIAs is $2,627. Two AIAs in the quadrant are reported to have a PCI of $0.
The total population in Indian Country in the East Central Quadrant is 207,530.
Table 2-6 provides a summary of the population statistics for the quadrant. In terms of
population, the Jena Band of Choctaw Indians in Louisiana is the largest AIA in the
quadrant, with 59,992 residents. The average population of the top decile in the quadrant is
30,521, while the smallest 10 percent of AIAs have an average population of 41. Two AIAs
report zero population.
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Tribes in East Contra! Quadrant With Major Source Facilities
Federally Recognized Tribes WHh Major
Source Facilities
States
Figure 2-3. States and Tribes of the East Central Quadrant
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Table 2-4. Tribal Geographic Distribution: East Central Quadrant
State Number of Tribal Geographic Areas
Alabama 1
Iowa 1
Louisiana 4
Michigan 12
Minnesota 13
Mississippi 1
Wisconsin 12
Total 44
Note: Certain AIAs cross state boundaries. In order to avoid double counting in these instances, tribes were
assigned to only one state based on land area distribution or population distribution
Source: U.S. Department of Commerce, Bureau of the Census. 2000. Census of Population and Housing.
Washington, DC: U.S. Department of Commerce.
Table 2-5. Summary Statistics on Tribal Socioeconomic Status: East Central
Quadrant ($1999)
Average per capita income $14,928
Maximum per capita income $84,517
Per capita income of wealthiest 10% of Tribes $37,782
Minimum per capita income $0
Per capita income of poorest 10% of Tribes $2,627
Source: U.S. Department of Commerce, Bureau of the Census. 2000. Census of Population and Housing.
Washington, DC: U.S. Department of Commerce.
Table 2-6. Summary Statistics on Tribal Populations: East Central Quadrant
Total population, all AIAs 207,530
Average population, per A1A 4,826
Maximum AIA population 59,992
Minimum AIA population 0
Population of largest 10% of Tribes 30,521
Population of smallest 10% of Tribes 41
Note: AIA = American Indian Area.
Source: U.S. Department of Commerce, Bureau of the Census. 2000. Census of Population and Housing.
Washington, DC: U.S. Department of Commerce.
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The AIAs in the East Central Quadrant have a diverse economy. For instance, the
Iowa Tribe's economy is primarily agriculturally based. The Tribe owns and operates a farm
and a dairy herd. The Tribally owned Winne Vegas Casino is by far the single largest source
of employment for Tribal members on the Winnebago Reservation. On the Chitimacha
Reservation in Louisiana, the Tribally affiliated Chitimacha Seafood Plant processes
primarily crawfish and crab (U.S. Department of Commerce, 1996). Forestry is common in
Indian Country in the Great Lakes region. Agriculture, tourism, gaming, and natural
resource development are all important elements of economic activity for Indian Country in
the quadrant.
2.2.3 Baseline Conditions in West Central Quadrant
Of the four quadrants, the West Central is home to the most AIAs. Many of the
Tribes in the quadrant are extremely large. The quadrant includes AIAs in the Dakotas,
Nebraska, Kansas, Oklahoma, Texas, Utah, Colorado, New Mexico, and Arizona. Figure 2-4
shows the boundaries of the quadrant and the location of AIAs within it. As the figure
shows, there are large concentrations of Indian Country in New Mexico, Arizona, and South
Dakota. Oklahoma has the largest number of AIAs, with 30 out of the 101 AIAs in the
quadrant. New Mexico and Arizona follow with 23 and 20 distinct AIAs, respectively.
Colorado, Kansas, North Dakota, Nebraska, South Dakota, Texas, and Utah all have fewer
than 10 AIAs. Table 2-7 shows the distribution of AIAs by state in the quadrant.
Summary population statistics for the West Central Quadrant are given in Table 2-8.
9
The total population of AIAs in the quadrant is 2,734,638, the largest of the four quadrants.
Seven AIAs report populations over 100,000, the Creek Tribal area in Oklahoma being the
largest with a population of 704,703. The average population of the largest 10 percent of
Tribes in the quadrant is 232,895. The quadrant also includes a number of small AIAs. Four
AIAs report a population of zero, and the average population of the smallest 10 percent of
tribes is 95. The average population for AIAs in the quadrant is 27,346.
Like the other three quadrants, socioeconomic conditions in Indian Country in the
quadrant vary widely. The West Central Quadrant has the lowest PCI of the four quadrants
with an average of $11,048. Four AIAs (the same four reporting a population of zero) report
a PCI of zero. Thirty-seven of the 101 AIAs in the quadrant have PCI less than $10,000.
The average PCI of the poorest 10 percent of Tribes is $3,109. The Peoria Tribe of Indians
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Tribes In West Central Quadrant With Major Sources
,!--iv" "v"T">-> •;•'
--'.. "!". J--..~F^ ^.*^
v / ; i r f'.-t"\ /
i \ iy
N
E
Federally Recognized Tribes with Major
Source Facilities
Figure 2-4. States and Tribes of the West Central Quadrant
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Table 2-7. Tribal Geographic Distribution: West Central Quadrant
State Number of Tribal Geographic Areas
Arizona 20
Colorado 2
Kansas 5
North Dakota 3
Nebraska 4
New Mexico 23
Oklahoma 30
South Dakota 7
Texas 3
Utah 4
Total 101
Note: Certain AIAs cross state boundaries. To avoid double-counting in these instances, Tribes were
assigned to only one state based on land area distribution or population distribution.
Source: U.S. Department of Commerce, Bureau of the Census. 2000. Census of Population and Housing.
Washington, DC: U.S. Department of Commerce.
Table 2-8. Summary Statistics on Tribal Populations: West Central Quadrant
Total population, all AIAs 2,734,638
Average population, per AIA 27,346
Maximum AIA population 704,703
Minimum AIA population 0
Population of largest 10% of Tribes 232,895
Population of smallest 10% of Tribes 95
Note: AIA = American Indian area.
Source: U.S. Department of Commerce, Bureau of the Census. 2000. Census of Population and Housing.
Washington, DC: U.S. Department of Commerce.
of Oklahoma is the wealthiest Tribe in the quadrant with an average PCI of $20,614. The
average PCI of the wealthiest 10 percent of Tribes in the quadrant is $18,177. Table 2-9
presents summary statistics for PCI in the West Central Quadrant.
Economic activity in the West Central Quadrant is diverse but more dependant on
natural resources than in the other three quadrants. Important sources of income for AIAs in
the quadrant include mining, tourism, gaming, and agriculture. Coal deposits are important
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Table 2-9. Summary Statistics on Tribal Socioeconomic Status: West Central
Quadrant ($1999)
Average per capita income $11,048
Maximum per capita income $20,614
Per capita income of wealthiest 10% of Tribes $ 18,177
Minimum per capita income $0
Per capita income of poorest 10% of Tribes $3,109
Source: U.S. Department of Commerce, Bureau of the Census. 2000. Census of Population and Housing.
Washington, DC: U.S. Department of Commerce.
to the Cheyenne River Sioux in South Dakota. Coal mining, plus oil and natural gas
activities, generate royalties for the Navajo government. The Isleta Pueblo in New Mexico
operates the Isleta Gaming Palace, one of the largest casinos in New Mexico. Livestock
production, forestry, mining, gaming, and manufacturing are all important components of the
diverse economy of the Cherokee Nation in Oklahoma (U.S. Department of Commerce,
1996). Many of the Tribes in this quadrant have very large land bases and consequently,
depend on the land for income opportunity. Tourist development for recreation and gaming
has encouraged the growth of many small businesses providing services in Indian Country in
the West Central Quadrant.
2.2.4 Baseline Conditions in West Quadrant
The West Quadrant contains approximately half of all federally recognized AIAs in
the United States. Figure 2-5 depicts the geographic boundaries of this quadrant and
identifies the location of AIAs. Over 50 percent of all AIAs are located in California, while
Nevada and Washington each contain approximately 15 percent. The other four states in this
quadrant contain the remaining 15 percent of AIAs (see Table 2-10). The West Quadrant,
California in particular, is unique from other parts of the country in that it contains a large
number of rancherias and colonias, which are small parcels of land with limited populations.
There is a large degree of diversity among the AIAs in the West Quadrant, in terms of
population size and socioeconomic status. Tables 2-11 and 2-12 provide summary
descriptive statistics of the AIAs. As indicated by Table 2-11, the average population of
AIAs is approximately 2,000, although there is a wide variation. Population size ranges from
a maximum of 41,400 residents on the Puyallup Reservation in Washington to a minimum of
zero reported for several AIAs in California. The largest 10 percent of Tribes have an
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Tribes In Western Quadrant With Major Source Facilities
Federally Recognized THbes With Major
Source Facilities
States
Figure 2-5. States and Tribes of the West Quadrant
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Table 2-10. Tribal Geographic Distribution: West Quadrant
State Number of Tribal Geographic Areas
California 100
Idaho 4
Montana 8
Nevada 25
Oregon 10
Washington 27
Wyoming 2
Total 176
Note: Certain AIAs cross state boundaries. To avoid double-counting in these instances, Tribes were
assigned to only one state based on land area distribution or population distribution.
Source: U.S. Department of Commerce, Bureau of the Census. 2000. Census of Population and Housing.
Washington, DC: U.S. Department of Commerce.
Table 2-11. Summary Statistics on Tribal Populations: West Quadrant
Total population, all AIAs 365,129
Average population, per AIA 2,075
Maximum AIA population 41,402
Minimum AIA population 0
Population of largest 10% of Tribes 16,256
Population of smallest 10% of Tribes 3
Note: AIA = American Indian Area.
Source: U.S. Department of Commerce, Bureau of the Census. 2000. Census of Population and Housing.
Washington, DC: U.S. Department of Commerce.
Table 2-12. Summary Statistics on Tribal Socioeconomic Status: West Quadrant
Average per capita income $ 11,899
Maximum per capita income $146,000
Per capita income of wealthiest 10% of tribes $33,863
Minimum per capita income $0
Per capita income of poorest 10% of tribes $1,212
Note: All figures in $1999.
Source: U.S. Census. 2000.
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average population of nearly 16,200 people. These Tribes are geographically dispersed
throughout the West Quadrant. The smallest Tribal populations are concentrated in
California, which reflects the large number of rancherias that exist in the state. The West
Quadrant contains over 10 percent of the total population on AIAs across the United States.
The average population in Indian Country in this quadrant is less than one-quarter of the
national average.
The diversity that exists between AIAs is also apparent in socioeconomic well-being.
Table 2-12 provides summary statistics of individual income on AIAs in the West Quadrant.
The average PCI is approximately $11,900, although there is significant variation in this
figure.2 The maximum PCI is $146,000 at the Table Mountain Rancheria in California, while
the average PCI among the wealthiest 10 percent of Tribes is $33,863. Among the poorest
decile, the average PCI is $1,212. This figure includes several AIAs that report zero dollars
in PCI. The average PCI in the West Quadrant is within 1 percent of the national average in
Indian Country.
The level of economic activity in Indian Country varies substantially within states and
across the quadrant. Access to natural resources has encouraged some of the larger Tribes in
California, Oregon, and Washington to invest in resource extraction. This includes small-
scale logging and milling operations as well as sand and gravel mining and processing. Such
endeavors have facilitated the establishment of related businesses such as construction.
Some Tribes have elected to develop tourist-oriented economies that center around gaming or
recreational opportunities. The proliferation of high-stakes casinos, bingo parlors, resorts,
and conference facilities reflects this trend. Such development supports additional businesses
including grocery stores, gas stations, and smokeshops that are associated with tourism.
Although some Tribes have undertaken extensive economic development as a means of
attracting outside visitors and enhancing their economic opportunities, this pattern has not
occurred uniformly across all AIAs. The vast majority of Tribes continue to be small,
relatively independent economies that rely primarily on agriculture and small-scale recreation
activities for revenue.
2.3 Baseline Conditions for Affected Minor Source Industries
The following sections provide an analysis of the industries potentially affected under
the proposed rule. Included is an identification of the affected industries, an estimation of
2PCI is measured in $1999.
2-17
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existing facilities in Indian Country, and an estimation of the baseline number of new sources
in Indian Country. The analysis of the existing and projected number of new minor sources
is presented first, followed by the analysis of major sources.
2.3.1 Identification of Affected Industries
The first task in the analysis involved identifying and characterizing the existing
minor sources subject to the proposed rule. Thus, EPA looked for all available data on minor
sources in Indian Country and baseline economic conditions for each Tribe in the United
States, excluding Alaska and Hawaii. This procedure is described in detail in Section 2.1.2.
EPA concluded that the best characterization of types of existing minor sources was the data
in the Tribal inventories for eight tribes. The small number of Tribal inventories creates
uncertainty regarding the representativeness of these data. Aside from the inventories, EPA
has little Tribe-specific information about economic activity in Indian Country to use in
estimating the number of minor sources associated with other Tribes. Nevertheless, EPA
must estimate the total number of minor sources in Indian Country nationwide to use as a
basis for projecting the number of new minor sources in Indian Country. In the absence of
Tribal data, EPA used data from the 2000 Census of Population and the 1997 Economic
Census to estimate these numbers. Resulting estimates of the number of existing minor
sources at the Tribal level are uncertain. Thus, EPA has conducted the analysis at a more
aggregated level and reports the results of its analysis for large multistate regions.
Using the data from the inventories, augmented by information from EPA regions,
EPA identified 12 existing industries containing minor sources most likely to be affected by
the rule:
• dry cleaners;
• gasoline bulk plant;
• gasoline station storage tanks;
• gasoline station refueling;
• industrial, commercial, and institutional boiler, natural gas;
• industrial, commercial, and institutional boiler, oil fired;
• natural gas compressor station;
• asphalt hot mix plant;
• concrete batching plant;
2-18
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• sand and gravel processing;
• stone quarrying and processing;
• grain elevator;
• solid waste landfill;
• lumber sawmill;
• automobile refinishing shop;
• surface coating operations; and
• printing operations.
2.3.2 Estimation of Existing Facilities in Indian Country
To estimate the number of existing minor sources in Indian Country, EPA first
mapped the 15 source categories to an industrial sector using the North American Industrial
Classification System (NAICS) codes (see Table 2-13). Next, we collected establishment
data for each sector and state from the most recent version of the U.S. Census Bureau's
Economic Census (1997). For the remaining two source categories (industrial boilers), we
collected data from EPA's database of Commercial and Industrial Boilers (ICCR Database,
1997). These data provided information on the number of existing sources in each category
in each state in 1997, based on the assumption that each .establishment represents one minor
source.
The next step in the process is to estimate what share of existing minor sources in
each state are located in Indian Country. EPA has very limited Tribe-specific data, including
data about economic activities in Indian Country in each state. In the absence of Tribe-
specific data, EPA used Census information on PCI for Tribal geographic areas within each
state and the state as a whole to estimate the share of economic activity in each sector that
occurs in Indian Country within the state. EPA collected data on PCI for residents of Tribal
land in each state and for the state as a whole. Because income is closely associated with
levels of economic activity, EPA believes that the allocation of existing minor sources based
on Tribes' share of state income is probably an accurate estimate of the number of existing
minor sources in each economic sector in Indian Country. Therefore, EPA then created a
scaling ratio for each state that compared income of Indian Country residents to income of
state residents. To compute income, EPA multiplied PCI times population. Thus, Tribal
income in state j is the product of income per capita (Yi/Pj) times Tribal population:
2-19
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Table 2-13. Industries Expected to be Affected by the Proposed Rule: NAICS Codes
for Minor Source Types Identified from Tribal Inventories
SIC
1422
1423
1442
2295
2396
2421
2752
2951
3411
3479
4922
4953
5032
5153
5171
5541
7216
7532
—
—
NAICS
212312
212313
212321
31332
323113
321113
323110
324121
332431
332812
486210
562212
421320
422510
422710
4471
812320
811121
Description
Stone quarrying and processing
Stone quarrying and processing
Sand and gravel processing
Surface coating operations
Surface coating operations
Lumber saw mill
Printing operation
Asphalt hot mix plant
Surface coating operations
Surface coating operations
Natural gas compressor
Solid waste landfill
Concrete batching plant
Grain elevator
Gasoline bulk pant
Gasoline station storage tanks and refueling
Dry cleaner
Automobile refinishing shop
Boilers (natural gas)
Boilers (oil)
= (Yi/PO* Pi
(2.1)
For each industry in each state, we calculated the number of establishments on Tribal
land (Nj j) within state j by assuming the number was proportional to the share of state
income (Yj) that was in Indian Country: (Yi). InEq. (2.2), the number of establishments in
a sector on Tribal land in state j is the product of the Tribes' share of the state's income times
the number of sources in the sector in the state.
(2.2)
2-20
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The individual estimates of existing minor sources in Indian Country in each state were then
aggregated to larger multistate levels. The results of the computations are shown in
Table 2-14. Using this method, EPA estimates that 3,169 existing minor sources are located
in Indian Country. The West Central Quadrant is estimated to have the largest number of
existing sources, approximately 86 percent of the total number of estimated minor sources in
Indian Country. The West and East Central Quadrants have 8 percent and 5 percent,
respectively, of existing minor sources. Industries with a relatively large share of sources
include gas stations (57 percent), dry cleaning (8.2 percent), automobile body refmishing (12
percent), and printing operations (5 percent). Other sectors, such as Asphalt Hot Mix plants,
are estimated to have fewer than 50 minor sources in Indian Country throughout the United
States.
2.3.3 Estimation of Baseline Number of New Minor Sources in Indian Country
To project conditions in the absence of the proposed rule, EPA next needed to
estimate how many new sources would be created during the period 2004 through 2010. To
make this computation, EPA assumed that growth in new minor sources was proportional to
the growth in AI/AN population, which is available from the Census of Population. For this
analysis, we computed the rate of growth in state AI/AN population. The formula used for
growth rates compounded over discrete time is
Y, = Y0»(l+r)t
where Yt = value of the population variable in year t,
YO = value of the variable in year 0,
r = computed growth rate based on population or output, and
t = year, from 0 through 13 (1997 through 2010).
EPA used this growth rate formula first to solve for the growth rate r embodied in the
population projections. To compute the growth rates, EPA substituted year t's population for
Yt, the base year's population for YO, and solved for the growth rate, r between the base year
and year t.
2-21
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Table 2-14. Estimated Number of Existing Minor Sources in Indian Country:
Estimated Number of Existing Sources, Allocated based on Tribal Share of State
Income
Allocation Based on
Sector
Sand and gravel processing
Lumber saw mill
Printing operation (lithographic)
Asphalt hot mix plant
Natural gas compressor station
Solid waste landfill
, Concrete batching plant
Grain elevator
Gasoline bulk plant
Gasoline station (storage tanks, refueling)
Dry cleaner
Automobile refinishing shop
Stone quarrying and processing
Surface coating operations
Industrial, commercial and institutional
boiler: natural gas
Industrial, commercial and institutional
boiler: oil-fired
Total Existing Sources
East
0
1
2
0
0
0
0
0
1
15
3
4
0
0
0
0
28
East
Central
2
3
11
1
2
1
2
4
7
88
14
23
1
2
12
0
172
West
Central
28
19
140
13
71
18
22
112
111
1,588
222
311
26
29
12
0
2,721
Income
West
3
9
18
0
2
2
3
12
13
122
22
40
0
2
0
0
248
Grand
Total
33
32
171
14
74
21
27
129
132
1^814
261
377
27
33
24
1
3,169
Then, EPA inserted the computed growth rates in the same formula to project the
number of new minor sources. EPA inserted the base year estimate of existing minor sources
in each industry as Y0 in the formula, the computed growth rate r, and solved for Yt, the
projected number of new sources in the industry in year t. EPA used 1997 data for existing
minor sources and projected the number of minor sources through the year 2010. Because
the rule is expected to be promulgated in 2004, minor sources estimated to be created
between 2004 and 2010 are considered new minor sources subject to the rule. The EPA
projections are shown in Table 2-15.
2-22
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Table 2-15. New Minor Sources Projected Based on Tribal Population Growth Rate
Sector
Sand and gravel processing
Lumber sawmill
Printing operation (lithographic)
Asphalt hot mix plant
Natural gas compressor station
Solid waste landfill
Concrete batching plant
Grain elevator
Gasoline bulk plant
Gasoline station (storage tanks,
refueling)
Dry cleaner
Automobile refmishing shop
Stone quarrying and processing
Surface coating operations
Industrial, commercial, or institutional
boiler: natural gas fired
Industrial, commercial, or institutional
boiler: oil fired
Total
East
0
0
0
0
0
0
0
0
0
1
0
0
0
0
0
0
1
East
Central
0
0"
1
0
0
0
0
0
0
7
1
2
0
0,
1
0
12
West
Central
2
2
12
1
6
2
2
11
10
139
19
28
2
3
1
0
240
West
0
1
2
0
0
0
0
2
3
20
2
5
0
0
0
0
35
Grand
Total
2
3
15
1
6
2
2.
13
13
167
22
35
2
3
2
0
288
Table 2-15 projects a total of 288 new minor sources in Indian Country between 2004
and 2010. This is the projected number of new minor sources in the absence of the proposed
rule. As the table illustrates, the majority of new minor sources (83 percent) are estimated to
occur in the West Central Quadrant. The West and East Central Quadrants are estimated to
account for small shares of the total number of new minor sources (12 percent and 4 percent,
respectively). The East Quadrant is estimated to account for less than 1 percent of all new
minor sources during this period. Industries with relatively large shares of sources include
gasoline stations, automobile refmishing shops, and dry cleaners (58 percent, 12 percent, and
2-23
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7.6 percent, respectively.) Because of a lack of Tribe-specific data, EPA believes that Table
2-15 is the most reasonable estimate of the number of affected new minor sources in Indian
Country. Thus, these data will be the basis for the analysis of new minor sources.
2.3.4 Estimated Baseline Number of Minor Modifications to Existing Minor Sources
EPA has estimated that Indian Country includes 3,169 existing minor sources. To
estimate the number of minor modifications to these sources subject to the proposed rule,
EPA assumes that 10 percent of existing minor sources would choose to make changes to
their facilities each year, a total of 317 facilities making changes. However, it is anticipated
that of these minor source process/operational modifications only 5 percent will result in
greater than de minimus emissions increases. This group (16 facilities per year) will be
required to get a minor source NSR permit. As EPA noted in their memorandum on "New
Source Review Year 2000 Adjustments," September 6, 2000, "...industry has been able to
build major new plants or make physical and operational changes at major existing sources
without exceeding the major source and major modification thresholds." The same situation
holds for minor sources. Sources are expected to avoid the minor NSR thresholds for the
same three reasons as EPA noted for major sources: (1) installation of state-of-the-art control
technologies; (2) replacement or better control of old, more polluting processes, and
(3) engaging in effective pollution prevention efforts. All of these actions result in
significant reductions in air emissions beyond the baseline case. Therefore, EPA projects
there will be 112 minor sources requiring permits as a result of minor modifications over the
period 2004 through 2010. The distribution of these minor modifications across existing
minor source types by quadrant is shown in Table 2-16. Of these minor source facilities
undergoing a minor modification, it is estimated that half (8 per year or 56 total over the 7-
year period) will incur control device costs.
2.4 Baseline Conditions for Major Source Industries
The proposed rule affects new major source facilities sited in nonattainment areas in
Indian Country. In addition, it affects major modifications to existing major sources in
nonattainment areas in Indian Country and minor modifications to major sources in Indian
Country. To assess the impact of the proposed rule, EPA first characterized existing sources
throughout Indian Country and in nonattainment areas in Indian Country. The following
section identifies the location of existing major sources and presents an analysis of the
projected number of new major sources, and modifications to existing major sources,
between 2004 and 2010, in the absence of the proposed rule.
2-24
-------
Table 2-16. Estimated Total Number of Minor Modifications to Existing Minor
Sources in Indian Country
Sector
Sand and gravel processing
Lumber saw mill
Printing operation (lithographic)
Asphalt hot mix plant
Natural gas compressor station
Solid waste landfill
Concrete batching plant
Grain elevator
Gasoline bulk plant
Gasoline station (storage tanks,
refueling)
Dry cleaner
Automobile refmishing shop
Stone quarrying and processing
Surface coating operations
Industrial, commercial, and institutional
boiler: oil fired
Total Minor Modification to Existing
Minor Sources
East
0
0
0
0
0
0
0
0
0
1
0
0
0
0
0
1
East
Central
. 0
0
0
0
0
0
0
0
0
3
'
0
1
0
0
0
6
West
Central
1
1
5
0
3
1
1
4
4
56
8
11
1
1
0
96
West
0
0
1
0
0
0
0
0
0
4
1
1
0
0
0
9
Grand
Total
1
1
6
0
3
1
1
5
5
64
9
13
1
1
0
112
Note: Column total may not equal sum of row total due to rounding.
2.4.1 Identification of Existing Major Source Facilities in Indian Country
EPA identified 83 existing major source facilities located in Indian Country, of which
eight (9.64 percent) are in nonattainment areas. Although only those new major source
facilities sited in nonattainment areas will be affected by the proposed rule, we examined the
entire list of existing facilities to characterize the types of major source facilities that might
locate in nonattainment areas in Indian Country. Table 2-17 shows the distribution of
existing major source facilities by type and geographic quadrant. The tables in Appendix B
identify each major source facility, location, and corresponding NAICS and Standard
Industrial Classification (SIC) code.
2-25
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Table 2-17. Estimated Number of Existing Major Sources in Indian Country
Sector
Lumber manufacture support
Coal mining
Sand and gravel production
Furniture manufacture
Medical waste incinerator
Repellent and fertilizer applications
Natural gas plant
Oil and gas production
Fractionation of natural gas liquids
Copper mining and processing
Power plant (coal-fired)
Power plant (biomass-fired)
Power plant (natural gas-fired)
Natural gas pipeline and collection
Lumber sawmill
Window and door molding manufacturer
Elemental phosphorus plant
Sulfuric acid plant
Secondary aluminum production and extrusion
Cobalt and tungsten recycling
Crude oil storage and distribution
Natural gas compressor station
Landfill
Total Existing Sources
East
0
0
0
1
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
1
0
0
2
East
Central
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
2
0
2
West
Central
0
1
1
0
1
0
5
1
1
1
3
0
1
3
1
0
0
0
1
1
0
42
3
66
West
1
0
0
0
0
1
1
0
0
0
0
1
0
0
4
1
1
1
0
0
0
2
0
13
Grand
Total
1
1
1
1
1
1
6
1
1
1
3
1
1
3
5
46
3
83
Natural gas compression stations comprise over half of the facilities currently
recognized as major sources. Natural gas plants, sawmills, coal-fired power plants, and
landfills comprise an additional 20 percent of all major sources. Each of the remaining major
source categories is represented by two or fewer facilities. Figures 2-6 through 2-9 identify,
by quadrant, the location of each of the major sources. Existing major sources are
concentrated in the West Central Quadrant, which contains 80 percent of the total major
sources. The West Quadrant has the second largest number of major sources (16 percent).
The East and East Central Quadrants each contain less than 1 percent of the total existing
major sources in Indian Country.
2-26
-------
Tribes In Eastern Quadrant With Major Source Facilities
V- J.ri V.T
i V ,---J-.—i_v.
' ' '
ra
N
Federally Recognized Tribes With Major
Source Faculties
States
Figure 2-6. Tribes in Eastern Quadrant with Major Source Facilities
2-27
-------
Tribes In East Central Quadrant With Major Source Facilities
Federally Recognized Tribe* With Major
Source FadlWes
Slates
Figure 2-7. Tribes in East Central Quadrant with Major Source Facilities
2-28
-------
Tribes In West Central Quadrant With Major Sources
N
», pr^
-•> i / Icfft' -
J '-~vJ r^i.-,'f
Federally Recognized Tribes with Major
Source Facilities
States
Figure 2-8. Tribes in West Central Quadrant with Major Sources
2-29
-------
Tribes in Western Quadrant With Major Source Facilities
Federally Recognized Tribes With Major
Source Facilities
States
Figure 2-9. Tribes in Western Quadrant with Major Source Facilities
2-30
-------
2.4.2 Characterization of Tribes with Major Sources in Nonattainment Areas
The eight existing major sources in nonattainment areas in Indian Country are located
on four reservations. The eight sources and their location are shown below:
• Philadelphia furniture, Seneca Nation, Salamanca, NY
• Colmac Energy, Inc., Mecca Plan, Cabazon Band of Mission Indians, Mecca, CA
• Pimalco, Gila River Indian Community, Chandler, AZ
• Salt River Landfill; Salt River Pima-Maricopa Indian Community, Scottsdale, AZ
• Salt River Project; Salt River Pima-Maricopa Indian Community, Scottsdale, AZ
• Tri-Cities Landfill, Salt River Pima-Maricopa Indian Community, Scottsdale, AZ
• Salt River Project Landfill; Salt River Pima-Maricopa Indian Community,
Scottsdale, AZ
• Salt River Sand and Rock; Salt River Pima-Maricopa Indian Community,
Scottsdale, AZ
The Seneca Nation of Salamanca, New York, is among the largest Tribes in the
Northeast. The Tribe is engaged in a number of economic activities including agriculture,
forestry, mining, gaming, and tribal administration. Approximately 20 privately owned
Seneca enterprises on the reservation sell motor fuel, cigarettes, food, and Indian crafts or are
involved in professional services or vocational trades. In addition, the Tribe owns a number
of recreational facilities that are open to the public. These businesses, as well as a large
bingo facility, are critical sources of income for the Tribe.
The Cabazon Band of Mission Indians of Mecca, California, inhabits 1,706 acres of
flat, dry land near Palm Springs. The Tribe has invested in limited agriculture and
agribusiness, associated primarily with sesame crops. Many Tribal members are employed
by local produce-packing plants in the nearby cities of Indio and Coachella. Gaming,
industrial development, and tourism are the other major sectors of the Tribe's economy. The
Cabazon Band of Mission Indians was the first of the Tribes to establish high-stakes bingo in
California. In addition to its bingo hall, the Tribe also runs the Desert Oasis Casino. The
reservation also hosts a grocery store and a bar and restaurant complex. As in many Tribal
economies, the service industry represents an important source of individual income, and
many Tribal members are employed in Palm Springs hotels. More recently, the Tribe has
expanded its participation in the tourism and recreation sectors.
2-31
-------
The Gila. River Indian Community located in Chandler, Arizona, comprises
approximately 372,000 acres of land that incorporates a diverse range of economic activities.
The community maintains several industrial parks, considered to be among the most
successful Indian industrial parks in the nation. In the future, the community plans to
develop additional projects, including sports complexes, industry, office buildings, a cargo
airport with related warehousing, and light industry. Agriculture continues to play an
important economic role for the Gila River Reservation. Tourism is also a major part of the
Tribe's economy, which includes museums, jewelry and pottery shops, restaurants, and a
marina complex.
The Salt-River Pima-Maricopa Indian Community is located in south-central Arizona.
Agriculture, tourism, gaming, mining, and the Tribal government are all significant
employers of Tribal members. Twenty-three percent of the reservation comprises farmland
in cultivation. The reservation includes several sand and gravel mining operations operated
by the Tribal-owned Salt River Sand and Gravel Company. The Tribe has three different
areas zoned for industrial purposes and several additional areas zoned for commercial use.
2.4.3 Estimation of Baseline Number of New Major Sources in Indian Country
To project conditions in the absence of the proposed Rule, EPA next needed to
estimate how many new sources would be created during the period 2004 through 2010
throughout Indian Country. To make this computation, EPA assumed that growth in new
major sources was proportional to the growth in AI/AN population. We computed the rate of
growth in AI/AN population by the same method outlined in Section 2.3.3. The growth rate
was then applied to the existing (baseline) number of facilities to project the total number of
new major sources in Indian Country. EPA projected that 23 new major source facilities
would be sited in Indian Country between 2004 and 2010. Because this proposed rule will
only affect new major sources in nonattainment areas, the figure was scaled, based on the
proportion (9.64 percent) of existing major sources in nonattainment areas. Based on this
methodology, EPA projects one new major source will be created in a nonattainment area in
Indian Country between 2004 and 2010. The majority of existing major sources are natural
gas compressor stations, which do not typically occur in nonattainment areas. Thus, the
projection of one new major source in a nonattainment area represents an upper-bound
estimate.
As part of a sensitivity analysis, EPA also applied economic growth projections to
estimate the number of new sources in the absence of the proposed MMNSR. Economic
2-32
-------
sectors are projected to grow slightly faster than AI/AN population over the period, and this
method resulted in a projection of 24 new major source facilities in Indian Country. Scaling
by a factor of 9.64 percent to project the share of these facilities that would be located in
nonattainment areas, the sensitivity analysis also resulted in a projection of one new major
source facility in nonattainment areas in Indian Country during this period. Because of a lack
of Tribe-specific data, EPA believes that applying AI/AN population growth rates is the
acceptable method for estimating the number of affected new major sources in Indian
Country.
2.4.4 Modifications to Existing Major Sources
The proposed Rule also affects major modifications to existing major sources in
nonattainment areas in Indian Country and minor modifications to existing major sources
throughout Indian Country. EPA estimates that at most one of the eight existing major
sources in a nonattainment area in Indian Country will choose to make a major modification
during the period 2004 through 2010. In addition, EPA projects one major facility per year
(seven total during the period 2004 through 2010) will choose to make a minor modification.
Table 2-18 shows the distribution of these minor modifications to existing major sources
across industries and quadrants.
2.4.5 Synthetic Minor Sources
The minor NSR permitting rule will also sallow new and existing stationary sources
in Indian Country to accept federally enforceable limits on their potential to emit any
regulated air pollutant. These enforceable permit limits will enable sources to avoid
regulation as new major stationary sources, and instead to be regulated under this proposed
rule, and other applicable rules, as minor sources or minor modifications. Sources that
voluntarily accept enforceable emission limits to avoid major NSR regulations are often
referred to as "synthetic minor" sources. EPA believes that facilities could choose to do this
to avoid Title V permitting or avoid being classified as a major source under the NSR or
MACT (NESHAP) programs; thus, only the existing 83 major sources would be candidates. _
Because this action is completely optional, EPA believes a facility would only choose to do it
if it resulted in cost savings. Thus, EPA estimates no costs for this type of affected source
but instead expects them to incur a cost savings. EPA has not estimated the number of
existing major stationary sources that would choose to become "synthetic minor" sources
under the proposed rule.
2-33
-------
Table 2-18. Estimated Total Number of Minor Modifications to Existing Minor
Sources in Indian Country
Sector
Lumber manufacture support
Coal mining
Sand and gravel production
Furniture manufacture
Medical waste incinerator
Repellent and fertilizer applications
Oil and gas production
Fractionation of natural gas liquids
Copper mining and processing
Power plant (coal-fired)
Power plant (biomass-fired)
Power plant (natural gas-fired)
Natural gas pipeline and collection
Lumber saw mill
Window and door molding manufacturer
Elemental phosphorus plant
Sulfuric acid plant
Secondary aluminum production and extrusion
Cobalt and tungsten recycling
Crude oil storage and distribution
Natural gas compression station
Landfill
Total Minor Modification to Existing Minor
Sources
East
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
East
Central
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
West
Central
0
0
0
0
0
1
0
0
0
0
0
0
0
0
0
0
0
0
0
0
4
0
6
West
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
1
Note: Column total may not equal sum of row total due to rounding.
2-34
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2.5 Conclusion
This section provides a profile of the baseline conditions in each quadrant and
describes the underlying assumptions and computations made in support of the analysis of
the proposed Rule. Characterizing the baseline requires collecting data on current conditions
in Indian Country and using those data to project conditions in the absence of the proposed
rule. Because of a lack of Tribe-specific data, EPA relied on alternative data sources in its
computations. This created uncertainty in the analysis. Quadrant-level reporting is designed
to mitigate some of this uncertainty. An evaluation of baseline conditions indicates the
tremendous diversity that exists among AIAs within and across quadrant boundaries. The
West Central Quadrant accounts for a large majority of existing minor sources (86 percent).
Estimates of projected new minor sources between 2004 and 2010 indicate a continuation of
this trend, with the West Central region accounting for a similar proportion of the new minor
sources over the projection period. The number of existing major sources in nonattainment
areas is also concentrated in the West Central Quadrant (80 percent). One new major source
and one major modification to an existing major source are projected in nonattainment areas
in Indian Country between the period 2004 and 2010. Seven existing major sources
throughout Indian Country are projected to perform minor modifications to their facilities
during the period. In addition, 288 new minor source facilities are projected to be sited in
Indian Country during the period, and 112 existing minor sources in Indian County are
projected to perform minor modifications during the period. Section 3 describes the
estimated costs and cost savings incurred by these sources as a result of the proposed rule.
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SECTION 3
COST ANALYSIS
The proposed rule will address new minor sources of air pollution, modifications to
existing minor sources, synthetic minor sources, minor modifications to existing major
sources, new major sources in nonattainment areas and major modifications to existing major
sources in nonattainment areas. Minor sources could be either new businesses or existing
businesses that are making changes in equipment or operations that would result in small
increases in emissions. Collectively, these may be a significant source of air quality
problems in Indian Country. In this section the Agency estimates the costs and burdens that
would typically result from implementation of the proposed rule.
Minor sources are not currently regulated and as a result, data for minor sources are
not routinely collected. However, the Agency has identified those most likely to be affected
using a data from existing inventories of minor sources on Indian Country for eight tribes
(see Section 2.1.2). Source types identified are those considered to have the greatest
potential to be new minor sources or make modifications to existing minor sources. The
selection of source types was based on available tribal emission inventories and other
information gathered from EPA regional contacts and other publicly available sources.
As shown in Table 2-6, EPA estimates that there will be 288 new minor sources on
Indian Country between 2004 and 2010 in the absence of the proposed rule. In addition, the
Agency estimates that there 3,169 existing minor sources in Indian Country. As shown in
Table 2-16, the Agency expects that approximately 112 of these facilities will make minor
modifications to their operations that will result in greater than de minimus emissions
increases. Of these 112 minor sources requiring permits, it is estimated that half will incur
control costs.
The proposed rule also has the potential to affect major sources in Indian Country.
EPA estimates that there are currently a total of 83 major sources located throughout Indian
Country, and 7 of these sources would choose to make minor modifications over the study
period. In addition, EPA data show that there are eight existing major sources in
nonattainment areas in Indian Country and EPA projects at most one major modification in a
nonattainment area in Indian Country during the analysis period (i.e., 2004 - 2010). The
Agency also expects that at most one new major source will locate in a nonattainment area in
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Indian Country during the analysis period. As noted in Section 2.4, EPA does not anticipate
synthetic minor sources, new major sources in nonattainment areas or existing major sources
in nonattainment areas to incur costs as a result of the proposed rule.
This section describes the costs incurred by major and minor sources affected by the
proposed rule and the costs borne by agencies charged with administering the proposed rule.
Section 3.1 provides an overview describing the Agency's approach to estimating
compliance costs for each source type. Section 3.2 presents a description of emissions and
emission controls associated with the typical minor source types. This is followed by Section
3.3, which describes the control costs for new minor sources and modifications to existing
minor sources. Section 3.4 presents the cost estimates for major sources. Section 3.5
presents a description of the administrative costs borne by the affected sources and by tribal
agencies that choose to administer the proposed rule. Finally, Section 3.6 provides a
summary of the cost estimates.
3.1 General Approach for Estimating Compliance Costs
EPA estimated compliance costs associated with new minor sources, modifications to
existing minor sources and minor modifications to existing major sources. As noted above
and in Section 2, EPA does not expect costs to result from the proposed rule for new major
sources in nonattainment areas, major modifications to existing sources in nonattainment
areas or synthetic minor sources.
Detailed emission inventories for minor sources were not available for each Tribe.
Consequently, EPA decided that typical source types would be used to estimate costs for new
minor sources and modifications to existing minor sources on a geographic basis. These
would be the minor source types that are considered to have the greatest potential to make
modifications or to be new minor sources located in Indian Country. Selection of these
-typical minor source types was based on available tribal emission inventories (i.e., in EPA
Regions 8 and 10) and other information gathered from EPA Regional contacts and other
publicly available sources (such as the various Tribal related websites).
After identifying the most common types of minor sources likely to be affected by the
proposed rule, EPA developed an approach that estimates compliance costs for a typical new
facility for each source category. Process throughput or operating capacities are needed to
size and cost air pollution controls and to estimate emissions. These values are selected to
reflect typical minor source sizes for the source category. In some cases they are based on a
national average value; others are based on existing size categories where the lower end
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values are selected to characterize minor sources; and in some cases, the values are based on
information contained in the available tribal emission inventories. EPA uses this information
6
to develop estimates of compliance costs for typical new facilities in each minor source
category.
In addition to new minor sources, EPA expects some facilities to incur costs as a
result of modifications to existing minor sources. The EPA estimates that there are 3,169
existing minor sources in Indian Country. Assuming that a minor source makes a
modification every 10 years, each year there would be an estimated 317 facilities making
modifications to their operations. However, it is anticipated that of these minor source
process/operational modifications only 5 percent will result in greater than de minimus
emissions increases. This group (16 facilities per year) will be required to get a minor source
NSR permit. Of these minor source facilities undergoing a minor modification, it is
estimated that half will incur control device costs.
There are currently a total of 83 major sources located throughout Indian Country,
and a portion of these sources would choose to make minor modifications over the study
period. EPA assumes that each major source does a process or operational modification
every 10 years. However, it is anticipated that of these major source process/operational
modifications only 10 percent will result in greater than de minimus emissions increases.
This group (one facility per year) will be required to get a minor source NSR permit. This
would result in an estimated one minor modification to a major source in Indian Country per
year or seven total over the 7-year study period. The burden costs and impacts are based on
sources incurring costs for both one-time capital costs and annual administrative costs.
With the information discussed above, EPA has what could be considered the
minimum information to complete cost estimates for emission controls. However, due to a
lack of data on existing sources in Indian Country, and the uncertainties associated with
projecting the number of new facilities and modifications to existing facilities in the future,
the current data will provide estimates that may have error bounds larger than the typical plus
or minus 30 percent used in the EPA Control Cost Manual (EPA, 2001).
3.2 Overview of Emissions and Emission Controls for Typical Minor Sources
This section presents a profile of the various source categories selected as those that
have the greatest potential to incur costs from modification of existing minor sources or the
creation of new minor sources in Indian Country. Table 3-1 provides a summary of the
emissions and controls associated with each minor source category. The air pollutants of
%
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Table 3-1. Air Emission Control Approaches for Typical Minor Sources
Source Category
Asphalt hot mix plants
Dry cleaners
Gasoline bulk plant
Gasoline stations
Industrial, commercial and
institutional boilers
Natural gas compressor
stations
Grain elevators
Lumber saw mills
Solid waste landfills
Nonmetallic mineral
processing
Painting and coating
operations
Air Pollutant Emissions
Criteria Air
Pollutants
CO, NOX, PM,
SO2, VOC
VOC
VOC
VOC
NOX, PM, SO2
CO, NOX, VOC
PM
PM
VOC
PM
VOC
Hazardous Air
Pollutants
Organic HAPs,
e.g., PAHs
Perchloroethylene
Benzene
Benzene
Mercury
PICs
Metal HAP
MEK, toluene,
xylenes
Air Emission Control Approaches
Process
Modification
V
V
V
Material
Substitution
V
V
Recovery/
Recycling
V
V
V
Work
Practices
V •
V
V
V
V
Add-on
Controls
V
V
V
A/
V
V
V
V
V
V
A/
Note: CO = Carbon monoxide NOX= Nitrogen oxides
PM = Particulate matter VOC = Volatile organic compounds
SO2 = Sulfur dioxide PAH = Polycyclic aromatic hydrocarbon
PICs = Products of incomplete combustion MEK = Methyl ethyl ketone
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concern associated with the selected source types include carbon monoxide (CO), nitrous
oxide (NOX), particulate matter (PM), sulfur dioxide (862), and volatile organic compounds
(VOC). These pollutants can be controlled using a variety of techniques, including process
modification, material substitution, recovery or recycling, work practices and add-on
controls.
3.2.1 Asphalt Hot Mix Plants
Asphalt hot mix plants produce paving materials by mixing size-graded aggregate
with heated liquid asphalt cement in measured quantities. The most significant ducted source
of emissions from asphalt hot mix plants is the rotary drum dryer. Emissions from the drum
consist of PM, NOX, CO, and small amounts of VOC. Other potential process sources
include the hot-side conveying, classifying, and mixing equipment.
Fugitive dust sources include vehicular traffic generating fugitive dust on paved and
unpaved roads, aggregate material handling, and other aggregate processing operations.
Organic vapor and its associated aerosol also are emitted directly to the atmosphere as
process fugitives during truck load-out, from the bed of the truck itself during transport to the
job site, and from the asphalt storage tank.
Process modifications such as burner design, operation, and maintenance can be used
to minimize emissions of NOX, CO, and organic compounds from the rotary drum dryers.
Fugitive dust emissions are controlled by implementing work practice controls. Work
practice control techniques used include suppressant application, paving, covering conveyors,
and wet suppression, windbreaks, enclosure, soil stabilizers, and various methods to reduce
freefall distances (e. g., telescopic chutes, stone ladders, and hinged boom stacker
conveyors).
Practically all plants use primary dust collection equipment such as cyclones,
skimmers, or settling chambers to control PM emissions. For secondary emissions control of
PM, the primary collector is ducted to either a fabric filter or a venturi scrubber. Attempts to
use electrostatic precipitators (ESPs) have met with little success.
Organic vapors from heated asphalt cement storage tanks can be reduced by
condensing the vapors with air-cooled vent pipes. In some cases, tank emissions may be
routed back to combustion units. Organic emissions from heated asphalt storage tanks may
also be controlled with carbon canisters on the vents.
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3.2.2 Dry Cleaning
Dry cleaning involves the cleaning of fabrics with non-aqueous organic solvents.
Two general types of cleaning fluids are in use, petroleum solvents and synthetic solvents.
Perchloroethyene (perc) and trichlorotrifluoroethane are the two synthetic dry cleaning
solvents presently in use. Commercial operations such as small neighborhood or franchise
dry cleaning shops clean soiled apparel for the consumer; industrial cleaners are larger dry
cleaning plants which supply rental service of uniforms, mats, etc. to businesses.
VOC and HAP emissions from the solvent itself are the principal sources of pollution
from dry cleaning operations. Solvent is given off by the washer, dryer, solvent still, as well
as by leaky pipes, flanges, and pumps.
Solvent recovery is necessary in "perc" plants due to the higher cost of the solvent;
recovery is effected through use of condensers, water/solvent separators, and carbon
adsorption units. Some emission control can be obtained by maintaining all equipment (e.g.,
preventing lint accumulation, solvent leakage, etc.) and by using good operating practices
(e.g., not overloading machinery).
Both carbon adsorption and incineration appear to be technically feasible controls for
petroleum plants, but costs are high. Refrigeration systems are used on new dry to dry
machines to recover washer/dryer exhaust gases. "Perc" plants use condensers, water/solvent
separators, and carbon adsorption units for control.
3.2.3 Gasoline Stations
The marketing of petroleum liquids involves a number of distinct operations, each of
which represents a potential source of evaporation loss. VOC and HAP are the major sources
of concern.
A significant source of evaporative emissions at service stations is the filling of
underground gasoline storage tanks. Gasoline is usually delivered to service stations in
8,000-gal tanks trucks or smaller account trucks. Emissions are generated when gasoline
vapors in the underground storage tank are displaced to the atmosphere by the gasoline being
loaded into the tanks. As with other loading losses, the quantity of loss in service station
tanks depends on several variables, including the method and rate of filling, tank
configuration, and the gasoline temperature, vapor pressure and composition. A second
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source of vapor emissions from service stations is underground tank breathing that occur
daily and are attributable to gasoline evaporation and barometric pressure changes.
Service station vehicle refueling activity also produces evaporative emissions.
Vehicle refueling emissions come from vapors displaced from the automobile tank by
dispensed gasoline and from spillage. The quantity of displaced vapors depend on gasoline
temperature, auto tank temperature, gasoline vapor pressure, and dispensing rate. Spillage
loss is made up of contributions from prefill nozzle drip and from spit-back and overflow
from the vehicles' fuel tank filler pipe during filling. The amount of spillage loss can depend
on several variables, including service station business characteristics, tank configuration,
and operator techniques.
Emissions from underground tank filling operations at service stations can be reduced
by the use of a vapor balance system that employs a hose that returns vapors displaced from
the underground tank to the tank truck cargo compartments being emptied. Control methods
for vehicle refueling emissions are based on conveying the vapors displaced from the vehicle
fuel tank to the underground storage tank vapor space through the use of a special hose and
nozzle. In "balance" vapor control systems, the vapors are conveyed by natural pressure
differentials established during refueling. In "vacuum assist" systems, the conveyance of
vapors from the auto fuel tank to the underground storage tank is assisted by a vacuum pump.
3.2.4 Industrial, Commercial and Institutional Boilers
Industrial, commercial, and institutional (ICI) boilers are used in a variety of
applications, ranging from commercial space heating to process steam generation. Industrial
boilers are used to produce process steam in the paper products, chemical, food, and the
petroleum industries. Boilers with smaller heat input capacities are generally classified as
commercial or institutional units. These boilers are used in a wide array of applications (e.g.
office buildings, hotels, restaurants, hospitals, schools, museums, government buildings,
airports) primarily to provide steam and hot water for space heating. Fossil fuels (coal, oil,
or natural gas) are the primary fuels burned in ICI boilers and are the primary sources of
emissions associated with boilers. Some industrial boilers burn industrial, municipal, or
agricultural waste fuels.
Retrofit combustion controls for ICI boilers have targeted principally the replacement
of the original burner with a low-NOx design to lower NOX emissions. Switching the fuel
burned in a boiler will lower emissions in some cases. For example, converting a boiler from
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oil-firing to natural gas firing (by replacing the burners) will reduce PM and, to a lesser
extent, NOX, emissions from the boiler. Switching to burning a lower sulfur content coal will
lower SC>2 emissions from a coal-fired boiler. In addition, it is possible to retrofit ICI boilers
with burners designed to decrease NOX emissions.
Add-on controls can be used on larger size industrial boilers. However, some boiler
designs are not adaptable to combustion controls to reduce NOX. For these units, NOX control
involves the injection of a chemical reducing agent such as ammonia into the flue gas.
Fabric filers or electrostatic precipitators (ESPs) generally are used for PM control. Wet
particle scrubbers can also be used. The most common systems used to reduce SO2
emissions include wet scrubbers and spray dryer absorbers.
3.2.5 Natural Gas Compressor Stations
At pipeline compressor stations in the natural gas industry, reciprocating engines are
used to provide mechanical shaft power for compressors and pumps that move compressed
natural gas in the pipeline. The formation of nitrogen oxides is exponentially related to
combustion temperature in the natural gas-fired engine cylinder. The other pollutants (CO,
VOC, & HAP) are primarily the result of incomplete combustion. Particulate matter
including trace amounts of metals, noncombustible inorganic material, and condensable
semivolatile organics result from volatilized lubricating oil, engine wear, or from products of
incomplete combustion.
Potential controls include process modifications that employ advanced engine
designs, parametric controls (timing and operating at a leaner air-to-fuel ratio), and
postcombustion catalytic controls.
3.2.6 Nonmetallic Mineral Processing
This source category includes facilities involved in the processing of sand, gravel, or
crushed rock as well as stone quarrying and processing. These operations involve the use of
different combinations of washers, screens, and classifiers to segregate particle sizes;
crushers to reduce oversized material; and storage and loading facilities.
Emissions from nonmetallic mineral processing consist primarily of particulate matter
(PM) and particulate matter less than 10 micrometers (PM-10) in aerodynamic diameter. PM
are emitted by many operations at mineral processing plants, such as conveying, screening,
crushing, and storing operations. Most of these emissions are in the form of fugitive dust. If
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the product is dried, emissions from dryers include PM and combustion products CO and
NOX. Dryers also may be sources of volatile organic compounds (VOC) or sulfur dioxide
(SC>2 ) emissions, depending on the type of fuel used to fire the dryer.
Fugitive dust emissions are controlled by implementing work practice controls. Some
successful work practice control techniques used for haul roads are dust suppressant
application, paving, route modifications, and soil stabilization; for conveyors, covering and
wet suppression; for storage piles, wet suppression, windbreaks, enclosure, and soil
stabilizers; for conveyor and batch transfer points, wet suppression and various methods to
reduce freefall distances (e.g., telescopic chutes, stone ladders, and hinged boom stacker
conveyors); and for screening and other size classification, covering and wet suppression.
Some facilities use add-on control devices to reduce emissions of PM and PM-10
from nonmetallic mineral processing operations which can be partially or fully enclosed.
Controls in use include cyclones, wet scrubbers, venturi scrubbers, and fabric filters. These
types of controls are rarely used at construction sand and gravel plants, but are more common
at industrial sand and gravel processing facilities.
3.2.7 Painting and Coating Operations
Surface coating is used widely in a number of production and service industries.
There are many different types of coatings that are used in these industries such as paints,
varnishes, printing inks, polishes, sealers, etc. Surface coating may be performed in a spray
booth or in an open environment. Some previously open operations have been enclosed and
the exhaust vented through a stack. Surface coatings may be applied manually or with
automatic devices such as spray guns. Automobile refinishing is usually a nonmanufacturing
category or surface coating and involves the painting of damaged or worn vehicles.
Refinishing operations may be performed in enclosed, partially enclosed, or open areas.
The majority of emissions that occur during surface coating are volatile organic
compounds that evaporate from the solvents contained in the coatings. The most common
solvents are organic compounds such as ketones, esters, aromatics, and alcohols. Other
ingredients of the coatings, such as metals and particulates, may also be emitted during
operations. Emissions from surface coating operations may be vented directly to the
atmosphere, released as uncaptured emissions, or routed to an air pollution control device or
pollution prevention system.
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Material substitution such as low VOC coatings, such as high-solids and waterborne
coatings, are commonly used to minimize emissions from surface coating operations.
Solvent recovery is a pollution prevention technique that can be used to reduce painting and
coating emissions. Condensation is one such technique capable of recovering a reusable
solvent. Carbon adsorption is another type of solvent recovery technology often used in this
industry.
Capture systems may be used to collect the evaporated VOC emissions by vacuum or
other exhaust mechanism and direct them to a control device. Both carbon adsorption and
both thermal and catalytic incineration are technically feasible controls for coating
operations. PM emissions from spray booths can be controlled with dry filters that capture
particulates before entering the exhaust air. PM emissions from spray booths can also be
controlled with a water curtain or waterwash filtration system. Painting or coating exhaust
air is passed through a water "wall" that traps coating overspray that leads to PM emissions.
3.2.8 Grain Elevators and Processors
Grain elevators are facilities at which grains are received, stored, and then distributed
for direct use, process manufacturing, or export. They can be classified as either "country"
or "terminal" elevators, with terminal elevators further categorized as inland or export types.
Operations other than storage, such as cleaning, drying, and blending, often are performed at
elevators. The principal grains and oilseeds handled include wheat, corn, oats, rice,
soybeans, and sorghum.
The same basic operations take place at country elevators as at terminal elevators,
only on a smaller scale and with a slower rate of grain movement. Country elevators (those
most likely to be located on Indian Country) are generally smaller elevators that receive grain
by truck directly from farms during the harvest season. These elevators sometimes clean or
dry grain before it is transported to terminal elevators or processors. Terminal elevators dry,
clean, blend, and store grain before shipment to other terminals or processors, or for export.
These elevators may receive grain by truck, rail, or barge, and generally have greater grain
handling and storage capacities than do country elevators. Export elevators are terminal
elevators that load grain primarily onto ships for export.
Country and terminal elevators built in recent years have moved away from the
design of the traditional elevators. The basic operations performed at the elevators are the
same; only the elevator design has changed. They employ a more open structural design,
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which includes locating some equipment such as legs, conveyors, cleaners, and scales,
outside of an enclosed structure. In some cases, cleaners and screeners may be located in
separate buildings. The grain is moved from the unloading area using enclosed belt or drag
conveyors and, if feasible, the movable tripper has been replaced with enclosed distributors
or turn-heads for direct spouting into storage bins and tanks.
The main pollutant of concern in grain storage, handling, and processing facilities is
particulate matter (PM). Also, direct fired grain drying operations and product dryers in
grain processing plants may emit small quantities of VOC's and other combustion products;
no data are currently available to quantify the emission of these pollutants.
Emission factors for various grain elevator operations are readily available. In trying
to characterize emissions and evaluate control alternatives, potential PM emissions sources
can be classified into three groups. The first group includes external emission sources (grain
receiving and grain shipping), which are characterized by direct release of PM from the
operations to the atmosphere. These operations are typically conducted outside elevator
enclosures or within partial enclosures, and emissions are quickly dispersed by wind currents
around the elevator. The second group of sources are process emission sources that may or
may not be vented to the atmosphere and include grain cleaning and headhouse and internal
handling operations (e.g., garner and scale bins, elevator legs, and transfer points such as the
distributor and gallery and tunnel belts). These operations are typically located inside the
elevator structure. Dust may be released directly from these operations to the internal
elevator environment, or aspiration systems may be used to collect dust generated from these
operations to improve internal housekeeping. If aspiration systems are used, dust is typically
collected in a cyclone or fabric filter before the air stream is discharged to the atmosphere.
Dust emitted to the internal environment may settle on internal elevator surfaces, but some of
the finer particles may be emitted to the environment through doors and windows. For
operations not equipped with aspiration systems the quantity of PM emitted to the
atmosphere depends on the tightness of the enclosures around the operation and internal
elevator housekeeping practices. The third group of sources includes those process that emit
PM to the atmosphere in a well-defined exhaust stream (grain drying and storage bin vents).
The two principal factors that contribute to dust generation during bulk unloading are
wind currents and dust generated when a falling stream of grain strikes the receiving pit.
Grain unloading is an intermittent source of dust occurring only when a truck or car is
unloaded. The three general types of measures that are available to reduce emissions from
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grain handling and processing operations are process modifications designed to prevent or
inhibit emissions, capture/collection systems, and oil suppression systems that inhibit release
of dust from the grain streams.
The primary preventive measures that facilities have used are construction and
sealing practices that limit the effect of air currents and minimizing grain free fall distances
and grain velocities during handling and transfer. While the preventive measures described
above can minimize emissions, most facilities also require ventilation, or capture/collection, \
systems to reduce emissions to acceptable levels. Almost all grain handling and processing
facilities, except relatively small grain elevators, use capture/collection on the receiving pits,
cleaning operations, and elevator legs. Generally, milling and pelletizing operations at
processing plants are ventilated, and some facilities use hooding systems on all handling and
transfer operations. Grain elevators that rely primarily on aspiration typically duct many of
the individual dust sources to a common dust collector system, particularly for dust sources
in the headhouse.
The control devices typically used in the grain handling and processing industry are
cyclones (or mechanical collectors) and fabric filters. Cyclones are generally used only on
country elevators and small processing plants located in sparsely populated areas. Terminal
elevators and processing plants located in densely populated areas, as well as some country
elevators and small processing plants, normally use fabric filters for control. Both of these
systems can achieve acceptable levels of control for many grain handling and processing
sources.
3.2.9 Solid Waste Landfills
A solid waste landfill unit is a discrete area of land or an excavation that receives
municipal (or household) solid waste, and that, is not a land application unit, surface
impoundment, injection well, or waste pile. A solid waste landfill unit may also receive
other types of wastes, such as commercial solid waste, nonhazardous sludge, and industrial
solid waste.
There are three major designs for municipal and commercial landfills. These are the
area, trench, and ramp methods. All of these methods utilize a three step process, which
includes spreading the waste, compacting the waste, and covering the waste with soil.
Modern landfill design often incorporates liners constructed of soil (i.e., recompacted clay),
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or synthetics (i.e., high density polyethylene), or both to provide and impermeable barrier to
leachate (i.e., water that has passed through the landfill) and gas migration from the landfill.
Methane (CtL|) and COa are the primary constituents of landfill gas (LFG), and are
produced by microorganisms within the landfill under anaerobic conditions.
Transformations of CfLi and CC>2 are mediated by microbial populations that are adapted to
the cycling of materials in anaerobic environments. Typically, LFG also contains a small
amount of non- methane organic compounds (NMOC). This NMOC fraction often contains
various organic hazardous air pollutants (HAP), greenhouse gases (GHG), and compounds
associated with stratospheric ozone depletion. The NMOC fraction also contains volatile
organic compounds. PM emissions can also be generated in the form of fugitive dust created
by mobile sources (i.e., garbage trucks) traveling along paved and unpaved surfaces.
The rate of emissions from a landfill is governed by gas production and transport
mechanisms. Production mechanisms involve the production of the emission constituent in
its vapor phase through vaporization, biological decomposition, or chemical reaction.
Transport mechanisms involve the transportation of a volatile constituent in its vapor phase
to the surface of the landfill, through the air boundary layer above the landfill, and into the
atmosphere. The three major transport mechanisms that enable transport of a volatile
constituent in its vapor phase are diffusion, convection, and displacement.
Emissions from landfills are typically controlled by installing a gas collection system,
and combusting the collected gas through the use of internal combustion engines, flares, or
turbines. Gas collection systems are not 100 percent efficient in collecting landfill gas, so
emissions of CELi and NMOC at a landfill with a gas recovery system still occur. Reported
collection efficiencies typically range from 60 percent to 85 percent, with an average of 75
percent most commonly assumed.
Landfill gas collection systems are either active or passive systems. Active collection
systems provide a pressure gradient in order to extract LFG by use of mechanical blowers or
compressors. Passive systems allow the natural pressure gradient created by the increase in
pressure created by LFG generation within the landfill to mobilize the gas for collection.
LFG control and treatment options include (1) combustion of the LFG, and
(2) purification of the LFG. Combustion techniques include techniques that do not recover
energy (i.e., flares and thermal incinerators), and techniques that recover energy (i.e., gas
turbines and internal combustion engines) and generate electricity from the combustion of the
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LFG. Boilers can also be employed to recover energy from LFG in the form of steam.
Flares involve an open combustion process that requires oxygen for combustion, and can be
open or enclosed. Thermal incinerators heat an organic chemical to a high enough
temperature in the presence of sufficient oxygen to oxidize the chemical to carbon dioxide
(CCh) and water. Purification techniques can also be used to process raw landfill gas to
pipeline quality natural gas by using adsorption, absorption, and membranes.
Controlled emission estimates also need to taken into account the control efficiency
of the control device. Control efficiencies based on test data for the combustion of CFLi,
NMOC, and some speciated organics with differing control devices. Emissions from the
control devices need to be added to the uncollected emissions to estimate total controlled
emissions.
3.2.10 Concrete Batching Plants
Concrete is composed essentially of water, cement, sand (fine aggregate) and coarse
aggregate. Coarse aggregate may consist of gravel, crushed stone or iron blast furnace slag.
Approximately 75 percent of the U.S. concrete manufactured is produced at plants that store,
convey, measure and discharge these constituents into trucks for transport to a job site. At
most of these plants, sand, aggregate, cement and water are all gravity fed from the weigh
hopper into the mixer trucks. The concrete is mixed on the way to the site where the
concrete is poured. At some of these plants, the concrete may also be manufactured in a
central mix drum and transferred to a transport truck. Most of the remaining concrete
manufactured are products cast in a factory setting.
The raw materials for concrete can be delivered to a plant by rail, truck or barge. The
cement is transferred to elevated storage silos pneumatically or by bucket elevator. The sand
and coarse aggregate are transferred to elevated bins by front end loader, clam shell crane,
belt conveyor, or bucket elevator. From these elevated bins, thexonstituents are fed by
gravity or screw conveyor to weigh hoppers, which combine the proper amounts of each
material.
Particulate matter, consisting primarily of cement dust but including some aggregate
and sand dust emissions, is the primary pollutant of concern. In addition, there are emissions
of metals that are associated with this particulate matter. All but one of the emission points
are fugitive in nature. The only point sources are the transfer of cement (and pozzolan)
material to storage silos, and these are usually vented to a fabric filter or "sock." Fugitive
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sources include the transfer of sand and aggregate, truck loading, mixer loading, vehicle
traffic, and wind erosion from sand and aggregate storage piles. The amount of fugitive
emissions generated during the transfer of sand and aggregate depends primarily on the
surface moisture content of these materials. Types of controls used to reduce fugitive dust
emissions include water sprays, enclosures, hoods, curtains, shrouds, movable and
telescoping chutes, and the like. A major source of potential emissions, the movement of
heavy trucks over unpaved or dusty surfaces in and around the plant, can be controlled by
good maintenance and wetting of the road surface.
3,2.11 Gasoline Bulk Plants
Motor gasoline produced at petroleum refineries is transferred primarily by pipeline,
ship, or barge to intermediate storage at bulk gasoline terminals. Various grades of gasoline
are dispensed through loading racks into tank trucks at bulk gasoline terminals. The gasoline
is then transferred by truck from bulk terminals to intermediate storage facilities, known as
bulk gasoline plants or delivered directly to service stations. The gasoline delivered to bulk
plants is again transferred into tank trucks and delivered to service stations and private
accounts, such as farmers.
Emissions from bulk plants occur when gasoline being loaded displaces the vapors
displaced in the tank truck or storage tank and forces the vapors to the atmosphere
(commonly called "working losses"). Temperature induced pressure differentials can expel
vapor-laden air or induce fresh air into storage tanks (breathing losses) and result in air
pollutant emissions. Liquid transfers in and out of storage tanks create loading and draining
losses which combined are called "working losses."
Control technology utilized to minimize emissions during tank truck and storage tank
loading at bulk plants includes: (1) switching from top splash loading to submerged loading,
(2) collecting displaced vapors from the loading of storage tanks and balancing the vapors
back to the truck being unloaded, and (3) collecting displaced vapors from trucks being
loaded and balancing the vapors back to the bulk plant's storage tank. Converting the
loading equipment from top splash to submerged loading will reduce emissions by
approximately 60 percent. Vapor balancing tank truck and storage tank transfers can reduce
working loss emissions by 90 percent to 95 percent. A good maintenance and annual testing
program can reduce leakage from vapor collection equipment on tank trucks to 10 percent.
3-15
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The EPA issued Control Techniques Guidelines (CTG) in 1977 and 1978 to control
emissions from bulk plants and leakage from gasoline tank trucks and vapor collection
systems, respectively. The bulk plant CTG recommends installation of vapor balance
equipment for incoming and outgoing tank truck transfers. However, it does address that
plants below 15,000 liters (about 4,000 gallons) per day of gasoline throughput may not be
cost-effective in some situations.
3.2.12 Lumber Saw Mills
At sawmills, cut logs are either stored in a log pond or stacked on the ground. If logs
are too long to easily handle, they are cut to smaller lengths. This process is called bucking.
The next process is debarking. There are five types of machine used for this: two of the
barkers are dry processes; the other three use water. After debarking the logs are cut to
required lengths and then cut lengthwise into standard sizes. After cutting, the lumber is
dried either by air or in a kiln. After drying, the lumber is transferred to storage or shipped
off-site. At plants processing cut lumber, the lumber may be stacked and air dried or loaded
onto carts and fed into a kiln. The natural moisture is about 60 percent to 70 percent and kiln
drying reduces it to 5 percent to 8 percent. This is necessary in order to prevent warping or
shrinking of furniture.
Sources of fugitive emissions at the sawmill are generally debarking, sawing, and
sawdust handling operations. Log handling and bucking are negligible sources of fugitive
emissions. Most processes such as planing, sanding, and sawing within sawmills that have
secondary processing plants are normally controlled by hoods and various other vacuum
pick-up devices which are ducted to cyclones and/or fabric filters. Emissions which escape
these hoods and pick-up devices are minimal. Insignificant amounts are emitted through the
ventilation system. As a result, fugitive emissions from individual processes are essentially
negligible.
Fugitive particulate emissions from sawmills consists primarily of broken bark
particulate and sawdust from sawing. Dirt and dust that are embedded in the bark also
become airborne when the bark is broken and also during unloading, dragging, debarking,
and storage operations. Very limited data are available concerning the characterization of
fugitive emissions generated during these operations.
Emission factors for saw mills are only presented as potential uncontrolled emission
rates; therefore, the site-specific level of control must be considered for application to a
3-16
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specific sawmill or furniture manufacturing plant when estimating emissions. Fugitive
emission factors are based solely on best engineering judgment and material balance
information. Thus, available emission factors are at best order of magnitude estimates.
Control technology options for sawmills and lumber production sources (except plant
roads) include specific dust control systems for the various handling operations. Since drum
debarkers, bag barkers, and hydraulic barkers are all wet process, they are in themselves a
good method for reducing fugitive emissions during the debarking process. If logs can be
kept in wet storage prior to debarking, fugitive emissions will be minimal during this process.
If wet storage is not possible, enclosure of the debarking operation or fixed hoods with
ventilation to baghouses or cyclones is an alternative.
Fugitive emissions from sawing can be controlled in several ways. Thinner saw
blades will reduce the amount of fugitive emissions generated. This also has an economical
benefit since it results in a more efficient use of lumber. Fixed hoods or building evacuation
to fabric filters will also help control fugitive emissions. Fugitive emissions from sawdust
storage piles can be controlled by wet suppression. However, when it is possible, trucking
the waste away as soon as possible can substantially reduce the fugitive emissions generated
at these storage piles. Additional fugitive control can be attained by directly blowing
sawdust into a boiler or to a particulate board facility.
The wood waste storage bin vent is usually partially controlled by a screen. If this
screen is replaced by a fabric filter, the amount of fugitive emission released can be
significantly reduced. The use of telescopic tubes during loadout from the storage bin to
trucks will reduce freefall distance and thus the amount of fugitive emissions generated. This
coupled with a canvas covered truck and use of side curtains will give additional control
efficiency. Other means of control would be enclosure of the loadout area with the
possibility of also venting to a baghouse or cyclone.
3.2.13 Printing Operations
The major printing processes are lithography, rotogravure, flexography and screen
printing. Minor printing processes include letter press which is declining in market share and
various modem plateless printing processes based on inkjet and photocopy technology.
Lithographic printing is the largest printing sector, both in terms of the value of the output
and the number of facilities. Lithography can be broken down into web heatset, web
nonheatset, sheet-fed, and newspaper. Web operations are large and capital intensive and are
3-17
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unlikely to be located on Indian reservations. There are probably a number of "small town"
newspapers printed on reservations. These are very likely to be printed by lithography.
There are about 9,000 newspapers in the United States; and at least 90 percent of them are
printed by lithography. Some of these are likely to be located on reservations.
The largest segment of the printing industry is commercial lithographic printing. This
includes stationery, advertising, pamphlets, business forms, flyers, newsletters, books,
circulars, and a small amount of packaging. There are about 25,000 print shops in the U.S.
that do commercial lithography. A large city might have as many as 100 print shops. A
small town might have one or two print shops. There will definitely be commercial
lithographic printers on reservations.
The EPA's offset lithographic CTG address air emissions from printing operations.
The printing plants most likely to represent printing facilities on reservations are small and
very small newspapers, and small and very small nonheatset sheet-fed printers. The emission
rates and applicable control technologies are described in the CTG.
Sources of VOC emissions from offset lithographic printing operations are the inks
(heatset), fountain solution, and cleaning solutions used as raw materials in the printing
process. Baseline emission of VOC's from inks for printing plants are calculated from the
amount of ink used, the percent VOC in the ink, and the estimated percent VOC from the ink
retained by the print and substrate. In heatset printing, VOC's from the ink are emitted from
the hot air dryer exhaust. Because VOC's are retained by the substrate, VOC emissions
within the facility limits are much lower from nonheatset inks than from heatset inks. VOC
emissions from the ink in heatset printing operations can be controlled by add-on devices that
destroy or collect the VOC-released from the dryer. Four technologies available to the
lithographic printing industry for controlling VOC's from inks: thermal incinerators,
catalytic incinerators, condenser filters, and condenser filters with carbon. The control
efficiency for thermal and catalytic incinerators was estimated at 95 percent to 100 percent,
with 98 percent control a reasonable estimate of performance. Control efficiency was
estimated at 90 percent for condenser filters and at 95 percent for condenser filters with
carbon.
Isopropyl alcohol is added to offset lithographic fountain solution to decrease the
surface tension of the water used to wet the nonimage areas of the lithographic plate. Some
offset facilities and most of the newspaper industry use nonalcohol additives (containing
3-18
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VOC's) to reduce water surface tension. One method for controlling VOC emissions from
the fountain solution is to reduce the concentration of alcohol in the fountain. Cleaning
compounds used for offset lithographic printing are approximately 100 percent VOC. If the
cleaner is all VOC, the emissions are equal to the amount of cleaning solution used. Lower
VOC inks, fountain solutions and cleaning compounds are available that have VOC contents
ranging from 0 percent to 30 percent (by weight), as used.
3.3 Control Costs for Typical Minor Sources
This section presents the costs associated with controlling pollution for the selected
source categories. Control costs were estimated for both new minor sources and
modifications to existing minor sources. As described above, the Agency used a typical
facility approach to estimating compliance costs.
3.3.1 Control Costs for New Minor Sources
Table 3-2 presents the estimated compliance costs for typical new minor sources on
Indian Country. For each source category, the table shows the estimated capital cost per
source of the Minor Source Control Technology (MSCT), the annualized MSCT cost, and the
number of new minor sources predicted to occur nationwide. This is followed by nationwide
estimates of MSCT capital costs, total capital costs and annualized MSCT costs. Nationwide
total capital costs include the MSCT costs plus the one-time monitoring, compliance testing,
recordkeeping, and reporting (MRR) costs associated with the minor source NSR permit
program. Finally the table presents an estimate of total annual compliance costs, which
include annualized capital costs plus the annualized MRR costs associated with the program.
As shown in Table 3-2, the largest capital costs are borne by the stone quarrying and
processing facilities, which have annualized MSCT costs of $73,800 per source. Surface
coating operations have an expected annualized cost of $66,000 per source. Gasoline
stations have two sets of costs, one for storage tanks and one for refueling. The total
annualized cost for gasoline stations incurring both sets of costs is $3,790. Printing
operations have the. lowest annualized MSCT cost with an estimated $2,200 per source. The
natural gas industrial, commercial and institutional boilers to $61,365 per facility for oil fired
boilers.
3-19
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Table 3-2. Compliance Costs for Typical New Minor Sources in Indian Country
Compliance Costs for Typical New Minor Sources in Indian Country
MSCT Capital
Cost per Source
Source Category (yr 2000 $)
[SIC code] [a]
Dry cleaner [72 16]
Gasoline bulk plant [5171]
Gasoline station
Storage tanks [5541]
. Gasoline station
Refueling [5541]
Industrial, commercial and
institutional boiler:
Natural gas
Industrial, commercial and
institutional boiler:
Oil-fired
Natural gas compressor
station [4922]
Asphalt hot mix plant
[2951]
Concrete batching plant
[5032]
$23,550
$31,400
$1,870
$12,650
$30,590
$361,211
$140,200
$160,800
$147,000
MSCT
Annualized
Cost per Source
(yr 2000 $)
[b]
$3,250
$3,530
$380
$3,410
$6,151
$61,365
$25,970
$50,000
$48,400
Number of
New Minor
Sources
lc]
22
13
167
167
2
0
6
1
2
Nationwide
MSCT Capital
Cost
(yr 2000 $)
[d]
$518,100
$408,200
$312,290
$2,112,550
$61,180
$0
$841,200
$160,800
$294,000
Nationwide
Total Capital
Cost
(yr 2000 $)
[ej
$806,035
$578,344
$2,497,982
$2,112,550
$87,356
$0
$919,728
$173,888
$320,176
Nationwide
MSCT
Annualized
Cost
(yr 2000 $)
m
$71,500
$45,890
$63,460
$569,470
$12,302
$0
$155,820
$50,000
$96,800
Nationwide
Total Annual
Compliance
Cost
(yr 2000 $)
[g]
$238,659
$144,666
$1,332,348
$569,470
$27,498
$0
$201,409
$57,598
$111,996
(continued)
-------
Table 3-2. Compliance Costs for Typical New Minor Sources in Indian Country (continued)
Compliance Costs for Typical New Minor Sources in Indian Country
MSCT
MSCT Capital Annualized
Cost per Source Cost per Source
Source Category (yr 2000 $) (yr 2000 $)
[SIC code] [a] [b]
Sand and gravel
processing [1442]
Stone quarrying and
processing
[1422 and 1423]
Grain elevator [5153]
Solid waste landfill [4953]
Lumber saw mill [2421]
Automobile refinishing
shop [7532]
Surface Coating
operations [2396,3411,
and 3479]
Printing operation
(lithographic) [2752]
Totals
$174,700
$210,700
$135,900
$145,000
$144,000
$52,800
[carbon
adsorption]
$209,000
NA
$57,900
$73,800
$47,100
$26,460
$48,100
$11,000
$66,000
$2,200
Nationwide
Number of MSCT Capital
New Minor Cost
Sources (yr 2000 $)
[c] [d]
2 $349,400
2 $421,400
13 $1,766,700
2 $290,000
3 $432,000
35 $1,848,000
3 $627,000
15 $0
288 $10,442,820
Nationwide
Total Capital
Cost
(yr 2000 $)
le]
$375,576
$447,576
$1,936,844
$316,176
$471,1264
$2,306,079
$666,264
$196,320
$14,212,157
Nationwide
MSCT
Annualized
Cost
(yr 2000 $)
If]
$115,800
$147,600
$612,300
$52,920
$144,300
$385,000
$198,000
$33,000
$2,754,162
Nationwide
Total Annual
Compliance
Cost
(yr 2000 $)
[gl
$130,996
$162,796
$711,076
$68,116
$167,094
$650,935
$220,794
$146,792
$4,942,424
(continued)
-------
Table 3-2. Compliance Costs for Typical New Minor Sources in Indian Country (continued)
Notes: [a]—Capital costs (i.e., total capital investment) includes the purchased equipment cost (including conventional process monitors), direct
installation cost, and indirect installation costs on a per unit or source basis.
[b]—Total annual cost is comprised of direct costs, indirect costs (including capital recovery), and any recovery credits.
[c]—Total number of new minor sources that are expected to commence operation in Indian Country that have authorization to implement the NSR
minor source rule.
[d]—Nationwide MSCT capital cost are the capital costs for each source type multiplied by the number of new source types expected.
[e]—Nationwide total capital costs includes the MSCT capital costs plus the one-time monitoring, compliance testing, recordkeeping, and reporting
costs associated with the minor source NSR permit program which averages $13,088 per affected source.
[f]—Nationwide MSCT annualized costs are MSCT annualized cost for each source type multiplied by the number of new source types expected.
[g]—Nationwide Total Annual Compliance Costs are the MSCT annualized cost plus the annualized costs of monitoring, testing, recordkeeping,
and reporting associated with the minor source NSR permit program which averages $7,598 per year per affected source.
u>
I
K>
-------
Nationwide total annual compliance costs are the MSCT annualized cost plus the
annualized costs of monitoring, testing, recordkeeping, and reporting associated with the
minor source NSR permit program which averages $7,598 per year per affected source. This
estimate is discussed in further detail in Appendix C. With an estimated 167 new sources
nationwide, gas stations have the highest nationwide total annual compliance costs. As
shown in Table 3-2, oil-fired boilers are not expected to have any new sources, and
consequently, have an estimated nationwide compliance cost of $0. Nationwide, among the
remaining source categories, total annual compliance costs range from $27,498 for natural
gas boilers to $711,076 for grain elevators. For a more complete explanation of how these
cost estimates were developed, see Appendix C. Summing the total annual compliance costs
for all 288 affected sources, the estimated total nationwide annual compliance cost is
$4,942,424.
3.3.2 Control Costs for Minor Modifications to Existing Minor Sources
The EPA estimates that there are 3,169 existing minor sources in Indian Country.
Assuming that a minor source makes a modification every 10 years, each year there would be
an estimated 317 facilities making modifications to their operations. However, it is
anticipated that of these minor source process/operational modifications only 5 percent will
result in greater than de minimus emissions increases. This group (16 facilities per year) will
be required to get a minor source NSR permit. Of these minor source facilities undergoing a
minor modification, it is estimated that half will incur control device costs. Over the 7-year
analysis period, the Agency estimates that 112 minor source facilities in Indian Country will
make minor modifications that will require them to seek a permit under the proposed rule.
Table 3-3 presents cost estimates for existing minor sources that make minor
modifications. This table includes eight fields that describe compliance cost estimates for
each minor source category: the number of modifications that require permits, the MSCT
capital cost per source, the annualized MSCT costs per source, the number of sources
incurring control costs, the nationwide MSCT costs, the total nationwide capital costs, the
nationwide annualized MSCT costs, and the total nationwide annual compliance costs.
The MSCT capital costs per source given in Table 3-3 are the same as those in Table
3-2 for new minor sources. The MSCT annualized costs per source are the same as well.
However, as noted earlier, only half of the facilities seeking permits are estimated to actually
incur these control costs. Consequently, the nationwide costs for minor modifications to
minor sources are much lower than those for new minor sources.
3-23
-------
Table 3-3. Compliance Costs for Minor Modifications to Existing Minor Sources in Indian Country
u>
Compliance Costs for Minor Modifications to Minor Sources in Indian Country
Source Category
[SIC code]
Dry cleaner [7216]
Gasoline bulk plant
[5171]
Gasoline station
storage tanks
[5541]
Gasoline station
refueling [5541]
Industrial,
commercial and
institutional boiler:
natural gas
Industrial,
commercial and
institutional boiler:
oil-fired
Natural gas
compressor station
[4922]
Number of
Modifications
to Minor
Sources
Requiring
Permits
[0]
9
5
64
64
1
0
3 .
MSCT
Capital Cost
per Source
(yr 2000 $)
[a]
$23,550
$31,400
$1,870
$12,650
$30,590
$361,211
$140,200
MSCT
Annualized
Cost per
Source
(yr2000$)
[b]
$3,250
$3,530
$380
$3,410
$6,151
$61,365
$25,970
Number of
Minor
Sources
Incurring
Control Costs
[c]
4
2
32
32
0
0
1
Nationwide
MSCT
Capital Cost
(yr 2000 $)
[d]
$94,200
$62,800
$59,840
$404,800
$0
$0
$140,200
Nationwide
Total Capital
Cost
(yr 2000 $)
[e]
$211,992
$128,240
$897,470
$404,800
$13,088
$0
$179,464
Nationwide
MSCT
Annualized
Cost
(yr 2000 $)
m
$13,000
$7,060
$12,160
$109,120
$0
$0
$25,970
Nationwide
Total Annual
Compliance
Cost
(yr 2000 $)
[g]
$81,383
$45,051
$498,440
$109,120
$7,598
$0
$48,764
(continued)
-------
Table 3-3. Compliance Costs for Minor Modifications to Existing Minor Sources in Indian Country (continued)
Compliance Costs for Minor Modifications to Minor Sources in Indian Country
Source Category
[SIC code]
Asphalt hot mix
plant [2951]
Concrete batching
. plant [5032]
Sand and gravel
^j processing [1442]
{^ Stone quarrying and
processing
[1422 and 1423]
Grain elevator
[5153]
Solid waste landfill
[4953]
Lumber saw mill
[2421]
Automobile
refmishing shop
[7532]
Number of
Modifications
to Minor
Sources
Requiring
Permits
[0]
0
1
1
1
5
1
1
13
MSCT
Capital Cost
per Source
(yr 2000 $)
la]
$160,800
$147,000
$174,700
$210,700
$135,900
$145,000
$144,000
$52,800
[carbon
adsorption]
MSCT
Annualized
Cost per
Source
.(yr 2000 $)
[b]
$50,000
$48,400
$57,900
$73,800
$47,100
$26,460
$48,100
$11,000
Number of
Minor
Sources
Incurring
Control Costs
[c]
0
1
1
1
2
0
1
6
Nationwide
MSCT
Capital Cost
(yr 2000 $)
[d]
$0
$147,000
$174,700
$210,700
$271,800
$0
$144,000
$316,800
Nationwide
Total Capital
Cost
(yr 2000 $)
[e]
$0
$160,088
$187,788
$223,788
$337,240
$13,088
$157,088
$486,944
Nationwide
MSCT
Annualized
Cost
(yr 2000 $)
m
$0
$48,400
$57,900
$73,800
$94,200
$0
$48,100
$66,000
Nationwide
Total Annual
Compliance
Cost
(yr 2000 $)
[gl
$0
$55,998
$65,498
$81,398
$132,1901
$7,598
$55,698
$164,776
(continued)
-------
Table 3-3. Compliance Costs for Minor Modifications to Existing Minor Sources in Indian Country (continued)
Os
Compliance Costs for Minor Modifications to Minor Sources in Indian Country
Source Category
[SIC code]
Surface Coating
operations
[2396, 34 11, and
3479]
Printing operation
(lithographic)
[2752]
Totals
Number of
Modifications
to Minor
Sources
Requiring
Permits
[0]
1
6
112
MSCT
Capital Cost
per Source
(yr 2000 $)
[a]
$209,000
NA
MSCT
Annualized
Cost per
Source
(yr2000$)
[b]
$66,000
$2,200
Number of
Minor
Sources
Incurring
Control Costs
[c]
1
3
55
Nationwide
MSCT
Capital Cost
(yr 2000 $)
[d]
$209,000
$0
$2,235,840
Nationwide
Total Capital
Cost
(yr 2000 $)
[e]
$222,088
$78,528
$3,701,693
Nationwide
MSCT
Annualized
Cost
(yr 2000 $)
m
$66,000
$6,600
$628,310
Nationwide
Total Annual
Compliance
Cost
(yr 2000 $)
[g]
$73,598
$52,189
$1,479,301
Notes: [0]—Total number of modifications to existing minor sources expected to commence operation in Indian Country that will be required to obtain a
minor NSR permit.
[a]—Capital costs (i.e., total capital investment) includes the purchased equipment cost (including conventional process monitors), direct
installation cost, and indirect installation costs on a per unit or source basis.
[b]—Total annual cost is comprised of direct costs, indirect costs (including capital recovery), and any recovery credits.
[c]—Total number of minor sources undergoing modifications in Indian Country that will incur a control device cost to reduce emissions to MSCT
levels.
[d]—Nationwide MSCT capital cost are the capital costs for each source type multiplied by the number of new source types expected to incur
control device costs.
[e]—Nationwide total capital costs includes the MSCT capital costs plus the one-time monitoring, compliance testing, recordkeeping, and reporting
costs associated with the minor source NSR permit program which averages $13,088 per affected source.
[f]—Nationwide MSCT annualized costs are MSCT annualized cost for each source type multiplied by the number of new source types expected to
incur control costs.
[g]—Nationwide Total Annual Compliance Costs are the MSCT annualized cost plus the annualized costs of monitoring, testing, recordkeeping,
and reporting associated with the minor source NSR permit program which averages $7,598 per year per affected source.
-------
Total nationwide annual compliance costs include the MSCT annualized cost plus the
annualized costs of monitoring, testing, recordkeeping, and reporting associated with the
minor source NSR permit program which averages $7,598 per year per affected source. Gas
stations are expected to incur the largest costs nationwide, with an estimated 32 facilities
incurring total compliance costs of $498,440 for storage tanks and $109,120 for refueling.
EPA estimates that there will be no minor modifications requiring permits for Oil-fired
boilers and asphalt hot mix plant, and consequently, estimates that these source categories
will have nationwide total annual costs equal to $0. In addition, although natural gas boilers
and solid waste landfills are both expected to have one facility requiring a permit during the
analysis period, neither category is anticipated to include facilities that will incur control
costs.
EPA estimates that across all source categories, the total nationwide annual
compliance cost for the modification of existing minor sources is $1,479,301.
3.4 Costs for Major Sources
The proposed rule establishes regulatory mechanisms for new major source facilities
in nonattainment areas, for major modifications to existing major source facilities in
nonattainment areas and for minor modifications to existing major sources. EPA does not
expect that the rule will result in incremental capital or operating costs for new major sources
or major modifications to existing sources in nonattainment areas, because the Clean Air Act
Amendments of 1990 established nonattainment new source review for major sources.
However, major sources in Indian Country that make minor modifications are expected to
incur costs under the proposed rule. These costs include one-time capital costs associated
with MKR and annual MRR expenditures due to labor costs. Major sources in Indian
Country that make minor modifications are not anticipated to incur costs for installing
emission control devices as a result of the proposed rule.
EPA estimates that there are currently 83 major sources located in Indian country.
Some of these sources would choose to make minor modifications over the analysis period.
The Agency assumes that each major source does a process or operational modification every
10 years. However, it is anticipated that of these major source process/operational
modifications only 10 percent will result in greater than de minimus emissions increases.
This group (one facility per year) will be required to get a minor source NSR permit. This
would result in an estimated one minor modification to a major source in Indian Country per
year or seven total over the 7-year analysis period.
3-27
-------
Each of these seven facilities is expected to incur one-time capital costs associated
with MRR of $13,088 per affected source. Nationwide, costs of this type are expected to be
approximately $91,616. Over a period of 10 years at an interest rate of 7 percent, the
annualized cost of these capital expenses is $1,863 per year per facility. Including annual
labor costs, each facility making a minor modification requiring a permit will incur MRR
costs of $7,598 per year, per affected source. The total nationwide annual compliance costs
for these facilities is $53,186. The development of the estimates for MRR costs is discussed
further in Section 3.5 and in Appendix C.
The proposed rule does provide an implementation mechanism for the nonattainment
new source review in Indian Country. Prior to the proposed rule, new major sources wanting
to locate in nonattainment areas in Indian Country would have to be incorporated into a TIP
or a FlP-essentially establishing facility-specific requirements. The rule will establish a
regulatory mechanism so that permits can be issued for new major source in nonattainment
areas in Indian Country without the necessity of facility-specific requirements in a TIP or a
FIP. This is expected to simplify the process of obtaining a permit and may actually reduce
the costs of investing in a new major source facility. It is also likely to make the timing and
requirements less uncertain than they are at baseline. Reduced cost and uncertainty for siting
new major source facilities in nonattainment areas in Indian Country may result in increased
investment in such facilities under the proposed rule.
3.5 Administrative Costs
This section describes the costs for respondents (affected minor and major sources)
and tribal agencies in charge of administering the new source review program for minor
sources on Indian Country. These costs include labor and capital expenditures associated
with the administration of the program. A full description of the development of these cost
estimates, along with the assumptions used for labor rates and capital outlays, is presented in
Appendix C.
As described above, the average cost per affected source for MRR, for both major and
minor sources, is $7,598 per year. This annualized figure is derived from the estimates of
average capital and labor costs per facility. The average capital costs are $13,088 per
affected source over the analysis period. Over a period of 10 years at an interest rate of 7
percent, the annualized cost of these capital expenses is $1,863 per year per facility. The
remainder of costs per affected source are due to labor expenses associated with MRR
3-28
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activities. Labor rates and associated costs are based on Bureau of Labor Statistics (BLS,
2002) data.
Under the proposed rule, tribal agencies have the option to administer the program
themselves or allow EPA to implement the program. If they choose to administer the
program themselves, tribal agencies will incur administrative costs. The average total tribal
agency burden per affected source, includes.labor for technical, management, legal, and
clerical personnel. The average total annualized cost to the agency per affected source is
calculated by determining the total labor cost for all the various respondent activities and
annualizing those costs that are initial, one-time occurrences. The annualized costs and the
costs for those activities that are recurring are then added to any associated costs (e.g., total
travel expenses for tests attended) to get the average agency burden per facility. The average
total annualized cost to the agency per affected source given in Attachment 2 of Appendix C,
including the cost of labor, capital, operation, and maintenance, is $3,110 per year.
Nationwide, the Agency estimates that 288 (approximately 41 per year) new minor
sources will locate on Indian Country during the analysis period. In addition, EPA estimates
that 112 (16 per year) existing minor sources and 7 (1 per year) existing major sources will
make minor modifications during the analysis period that require permitting under the
proposed rule. In total, approximately 407 sources will require permits during the 7-year
analysis period under the proposed rule. Consequently, EPA estimates that the total cost for
agencies administering the proposed rule is $1,265,770 during the analysis period. The
amount of this burden borne by tribal agencies depends on how many will administer the
program themselves.
3.6 Summary
This section provides a description of emissions, controls and costs associated with
the proposed rule. As a result of the proposed rule, the Agency expects new minor sources,
minor sources making modifications and major sources making minor modifications to incur
costs.
Since there are no detailed emission inventories for minor sources that are universally
available for Tribes, the Agency determined that typical minor source types would be used to
estimate costs on a geographic basis. These typical minor source types are considered those
minor source types most likely to make modifications or to be new minor sources located in
Indian Country.
3-29
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The emissions and controls associated with the typical source type categories
identified above are profiled in this section. The air pollutants of concern associated with the
selected source types include carbon monoxide (CO), nitrous oxide (NOX), particulate matter
(PM), sulfur dioxide (SOa), and volatile organic compounds (VOC). These pollutants can be
controlled using a variety of techniques, including process modification, material
substitution, recovery or recycling, work practices and add-on controls.
To develop the costs associated with controlling these emissions from minor sources,
EPA developed an approach that estimates compliance costs for a typical facility for each
minor source category. Estimates of process throughput or operating capacities are required
to size and cost air pollution controls and to estimate emissions. These values are selected to
reflect typical minor source sizes for the source category. These assumptions create
uncertainty in the cost analysis. A thorough description of how facility level costs are
estimated is presented in Appendix C.
Sections 3.3 and 3.4 describe typical control and administrative burden costs, for
minor and major sources respectively. Table 3-4 summarizes the estimated costs to industry
of compliance with the proposed rule. Across all 288 new minor sources, the estimated total
nationwide annual compliance cost is $4,942,424. For the 112 facilities expected to make
modifications at existing minor sources, the estimated total nationwide compliance cost is
$1,479,309 per year. The Agency does not expect costs to result from the proposed rule for
new major sources or major modifications to major sources in nonattainment areas.
Synthetic minor sources are also not expected to incur costs. EPA estimates that
approximately seven major sources in Indian Country will make minor modifications that
require permitting under the proposed rule. As a result, EPA estimates that the total
nationwide compliance costs for these facilities will be $53,186 per year. The total
nationwide annual cost of the rule to industry across the affected source types is $6,474,911.
Section 3.5 gives an overview of administrative costs, for both respondents (affected
major and minor sources) and tribal agencies. For respondents, the average cost per affected
source for MRR is $7,598 per year. The average total annualized cost to the agency
administering the program per affected source is $3,110 per year. EPA estimates that the
total cost for agencies administering the proposed rule is $1,265,770 during the analysis
period. The amount of this burden borne by tribal agencies depends on how many will
administer the program themselves.
3-30
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Table 3-4. Estimated Total Capital and Annual Compliance Cost to Industry
Affected Source Type
New minor sources
Modifications to minor sources
New major sources in
nonattainment areas
Major modifications to major
sources in nonattainment areas
Minor modifications to major
sources
Synthetic minor sources
Totals
Number of Affected
Sources
288
112
1
1
7
0
409
Nationwide Total
Capital Costs
$14,212,157
$3,701,693
0
0
$91,616 (1)
0
$18,005,466
Nationwide Total
Annual Costs
$4,942,424
$1,479,301
0
0
$53,186(2)
0
$6,474,911
Notes: 1. Capital costs are estimates as the number of affected sources multiplied by the one-time
monitoring, compliance testing, recordkeeping, and reporting costs associated with the minor
source NSR permit program which averages $13,088 per affected source.
2. Annual costs are estimated as the number of affected sources multiplied by the annualized costs of
monitoring, testing, recordkeeping, and reporting associated with the minor source NSR permit
program which averages $7,598 per year per affected source.
3-31
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SECTION 4
ECONOMIC IMPACT ANALYSIS METHODS AND RESULTS
The purpose of the Economic Impact Analysis (EIA) is to evaluate the effect of the
proposed rule on the welfare of affected stakeholders and society as a whole. The
engineering cost analysis presented in Section 3 represents an estimate of the resources
required to comply with the proposed rule under baseline economic conditions. This section
augments the cost analysis with an evaluation of how firms and people may react to changes
in market conditions. Typically, EPA analyzes these responses by developing models that
simulate behavioral changes in response to the rule. In this instance, however, EPA limited
its analysis to a qualitative examination of likely responses to the rule, supplemented by a
quantitative screening of the costs of the rule in the context of facility and company sales and
profits. EPA chose to conduct this type of analysis because data on future market conditions
and creation of new minor source facilities were too limited and uncertain to permit
construction of a simulation model. To inform its assessment of economic impacts, the
Agency developed a qualitative description of potential economic impacts of the rule on
facility construction and market prices. In addition, EPA conducted a simple screening
analysis, described in more detail below, to develop quantitative measures of the potential
impacts of the proposed rule. As described in Section 3, above, EPA expects new minor
source facilities to incur some incremental costs as a result of the proposed rule. New major
source facilities, however, may experience cost savings and reduced uncertainty about the
permitting process under the proposed rule. Existing minor and major sources may incur
compliance costs associated with permitting and emission controls. Because the costs and
impacts are expected to be different for minor sources and major sources, we analyze them
separately.
4.1 Impacts on Minor Sources
In this section, EPA presents its analysis of economic impacts on minor source
facilities. Because minor source facilities are largely unregulated at baseline, EPA estimates
that there will be some incremental costs incurred by companies wishing to site new minor
source facilities in Indian Country. In addition, there will be some incremental costs
associated with permitting and emission control technologies for companies choosing to
make minor modifications to existing minor sources.
4-1
-------
4.1.1 Qualitative Discussion of Economic Impacts on Markets with Minor Source
Facilities Affected by the Rule
The proposed rule could alter economic choices because it may increase the costs of
production for siting some new minor source facilities. As a result of the proposed rule,
firms considering building new facilities will be faced with a decision on whether to commit
to a new facility of a given size. In its analysis, EPA assumes that without the proposed rule,
new minor source facilities in Indian Country are not regulated; thus the rule will increase the
cost of siting such a facility. The Agency recognizes that this may not always be the case,
but this assumption is the most conservative in that it results in the greatest estimated
increase in costs for new sources. To examine the economic intuition of market and welfare
implications of these entry decisions, we use a simple long-run competitive model of a
constant-cost industry.
4.1.1.1 Impact on Facility Construction and Market Prices
How do firms decide whether to construct a facility in Indian country? Economic
theory suggests the answer will depend on the incentives the firm faces. Constructing new
minor source facilities involves investment in land and capital (building and equipment) as
well as incurring costs to operate the new facility. The traditional economic theory of
investment states that an investment should be undertaken if the net present value of the
stream of income from the investment is positive. Companies can gain some insight into the
likelihood of a positive income stream by looking at the experience of existing firms in the
industry. If existing firms are currently making an economic profit, this will encourage new
firms to enter the market. Conversely, if existing firms are suffering losses, firms are
discouraged from entering the market, and existing firms are likely to leave the industry. In
long run equilibrium, there will be no incentives to enter or exit the market because economic
profits3 are zero.
Two figures illustrate a simplified picture of the market for a commodity and the
investment decision. Over time, there is a need for new facilities if the demand for the good
or service they produce is growing. Demand for a commodity may be growing because of
increased population or purchasing power or because tastes and preferences are changing in
its favor. In Figure 4-1, the outward shift of the demand curve from DO to DI shows growing
demand for a commodity. Using the simplifying assumption that there are a large number of
potential entries with identical production costs (in other words, that there is a typical new
3It is important to emphasize the distinction economists make when using the term economic profit.
Economists include all implicit costs (opportunity costs) as well as explicit costs in their profit measure.
Therefore, zero economic profits should not be interpreted that accounting profits are zero.
4-2
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Figure 4-1. A Simple Example of Long-Run Market Equilibrium for a Constant Cost
Industry, as Demand Grows Over Time
facility configuration that would have a given set of associated costs of construction and
operation), the long-run market supply curve is horizontal at a price that is consistent with
zero economic profit. This price is equal to the minimum average total cost of the typical
plant (see Figure 4-1). Using a conventional downward sloping demand curve, the market
equilibrium in baseline is (po*, qo*). As demand grows over time, the price of the
commodity rises to pi*, which increases the profitability of firms producing it and attracts
new firms into the market. After construction of new facilities, the price drops down again to
the long run equilibrium price po*, and the equilibrium quantity is increased by the
production of the new facilities to qi*.
Complying with the proposed rule will require that companies investing in new minor
source facilities undertake compliance activities and perhaps purchase control equipment or
materials. These compliance requirements increase the average or per-unit-of-output cost of
constructing and operating a new minor source facility. To illustrate how the proposed rule
will impact the affected market, we shift the market supply curve upward by the total average
cost of compliance for new minor sources. As demand grows, eventually, the market price
increases to the point that new facilities would be profitable (Pi*). The proposed rule
4-3
-------
increases the cost of production at new minor source facilities, so a higher product price is
needed to provide a normal return to the owners. As new facilities are constructed, the
quantity supplied increases to q\* and price falls to equal the average total cost of the facility,
P2*. Figure 4-2 shows the same growth in demand as Figure 4-1, but because the cost of
constructing and operating a new facility is now higher, the increase in output (produced by
new facilities) is smaller than that shown in Figure 4-1. In other words, increases in the cost
of new facilities due to the proposed rule will slow the rate of investment, and fewer new
facilities would be constructed than in the absence of the rule.
Figure 4-2. New Source Requirements Lead to a Reduced Number of New Minor
Source Facilities
As noted earlier, the Agency concluded that data limitations and uncertainty do not
support the development of precise quantitative estimates of the change in the rate of
investment. However, the Agency can make the following general assessments. First, the
changes in market output and price will be a function of two variables:
• the responsiveness of consumers to changes in price (shown in the slope of the
Demand curve) and
• the size of the per-unit compliance costs (the size of the vertical shift in the long
run supply curve).
4-4
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The economic sectors expected to invest in new minor source facilities in Indian Country
produce a variety of goods and face a demand curves of varying elasticities. Similarly,
different types of new minor source facilities will face different estimated incremental costs.
EPA does not have sufficient data to attempt to quantify all these influences. However, EPA
has undertaken a screening analysis to assess the relative magnitude of the costs of
compliance for each affected economic sector.
4.1.2 Qualitative Discussion of Economic Impacts on Markets with Existing Minor
Source Facilities
In addition to the potential impacts to new minor sources, the proposed rule may also
alter the^economic choices of existing minor source facilities considering minor
modifications. Complying with permitting and emission control technologies increase the
average cost of operating an existing minor source facility. The impact of these costs on the
affected market is similar to that illustrated in Figure 4-2.
The limitations and uncertainty previously identified for new minor source facilities
also pertain to the analysis of modifications to existing minor source facilities. EPA does not
have, sufficient data to attempt to quantify all the influences that will affect market outcomes.
In order to assess the relative magnitude of the costs of compliance for each affected
economic sector, EPA has undertaken a screening analysis.
4.1.3 Screening Assessment of the Impacts of the Proposed MMNSRIC on Minor
Sources
EPA's screening assessment compared the total annualized cost of complying with
the proposed rule for typical facilities in each sector with facility sales and company sales
and profits for typical facilities and companies in each sector. While not accounting for
company choices as reflected in the market for the commodities these firms produce, this
analysis does provide a basis for assessing how significant the costs might be to the firms
considering siting minor source facilities or modifying existing minor source facilities in
Indian Country. EPA identified industrial sectors in Indian Country most likely to be
affected by the proposed rule. Table 4-1 identifies the number of facilities in each sector that
EPA assumes will be affected by the proposed rule. Data on the sales and number of
establishments for these sectors were obtained from Wards Business Directory and the
Economic Census (Bureau of the Census, 1997). EPA computed the typical facility sales
revenues by dividing the sector salesxby the number of establishments in each sector. The
resulting estimates of typical facility sales for each sector are shown in Table 4-2. Similarly,
estimated company sales are computed by dividing sector sales revenues by the number of
4-5
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Table 4-1. New and Existing Minor Source Facilities Affected Under the Proposed Rule
Minor Modifications to Existing Minor
Sources
Sector Description
Sand and gravel processing
Lumber saw mill
Printing operation
Asphalt hot mix plant
Natural gas compressor
< Solid waste landfill
Concrete batching plant
Grain elevator
Gasoline bulk plant
Gasoline station storage tanks and refueling
Dry cleaner
Automobile refinishing shop
Stone quarrying and processing3
Surface coating operations'"
Boilers (NG)
Boilers (oil)
Total
New Minor Source
Facilities
2
3
15.
1
6
2
2
13
13
167
22
35
2
3
2 .
0
288
Modifications
Requiring Permits
and Emission
Controls
1
1
3
0
1
0
1
2
2
32'
4
6
1
1
0
0
55
Modifications
Requiring Permits
Only
0
0
3
0
2
1
0
3
3
32
5
. 7 '
0
0
1
0
57
a Includes NAICS 212312 and 212313.
b Includes NAICS 31332, 323113, 332431 and 332812.
4-6
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Table 4-2. Typical Facility Level and Company Level Data for Minor Source Sectors
($2000)
Sector Description
Sand and gravel processing
Lumber saw mill
Printing operation
Asphalt hot mix plant
Natural gas compressor
Solid waste landfill
Concrete batching plant
Grain elevator
Gasoline bulk plant
Gasoline station storage tanks and refueling
Dry cleaner
Automobile refinishing shop
Stone quarrying and processing (212312)
Stone quarrying and processing (2 1 23 1 3) •
Surface coating operations (31332)
Surface coating operations (323 113)
Surface coating operations (332431)
Surface coating operations (3328 12)
Boilers (NG)
Boilers (Oil)
Typical Company
Sales
66,193,750
103,917,627
22,558,087
146,228,309
17,581,301
24,585,939
18,245,969
227,430,805
76,011,217
515,813,939
22,773,529
16,794,824
23,411,161
28,480,000
26,505,546
43,677,311
533,458,418
26,124,118
27,492,773
27,492,773
Typical Company
Profits
3,773,044
2,597,941
721,859
8,335,014
732,847
848,766
474,395
2,729,170
684,101
7,221,395
313,943
470,255
2,364,527
2,306,880
1,033,716
1,703,415
19,204;503
1,384,578
3,161,131
3,161,131
Typical Facility
Sales
1,426,898
5,869,799
2,011,402
4,934,711
10,368,112
3,930,520
3,094,330
18,421,645
20,046,346
1,719,752
248,457
496,774
2,958,751
4,599,206
2,633,851
2,633,851
42,945,376
3,795,143
2,645,827
2,645,827
companies. These are also shown in Table 4-2. Finally, Table 4-2 shows typical company
profits for each sector. Company profits are estimated by multiplying typical return on sales
(Dun & Bradstreet, 1997) times typical company sales. As shown in Table 4-2, some types
of minor source facilities are represented by several SIC or NAICS codes, with varying sales.
For completeness, the Agency includes all the sectors.
Sales for affected facilities range from only $248,000 for a dry cleaning facility to
$42.9 million for a surface coating facility. The average facility sales across all sectors is
approximately $6.9 million. The final categories of minor sources, oil fired boilers and
natural gas fired boilers, are found in many sectors throughout the economy. Thus, their
estimated revenues represent an average of typical facility sales across all industries.
4-7
-------
Typical company sales also vary widely. They range from approximately $16.8
million for companies owning automobile refinishing shops to more than $510 million for
companies owning gasoline stations. Average company sales across all sectors is
approximately $100 million. Similarly, estimated company profits vary widely. Both return
on sales and company sales vary, and estimated company profits (the product of these two
variables) therefore also varies widely. Profitability (return on sales) ranges from less than 1
percent for companies owning
gasoline bulk plants to more than 10 percent for companies owning some stone quarrying and
processing plants. Estimated profits range from approximately $313,000 for dry cleaning
companies to approximately $19 million for companies owning facilities that perform surface
coating operations on metals (NAICS 332431). To analyze the impacts of complying with
the proposed rule on average facilities and companies in each sector, EPA compares the
estimated cost of compliance (including both emissions control costs and administrative
burden) to each of the variables shown in Table 4-2. The resulting ratios, shown in
Table 4-3, allow EPA to examine the relative magnitude of the costs in the context of facility
and company operations. Costs of compliance for a single new minor source facility in each
sector were estimated by EPA. These costs were then multiplied by the ratio of total
facilities to total companies in each affected sector to determine the total compliance cost for
an affected company. Subsequently, the total company compliance cost was compared with
estimated facility sales and estimated company sales and profits.
Table 4-3 indicates that the compliance costs are generally relatively small compared
to typical facility and company sales. Across all sectors, compliance costs represent less than
5 percent of facility sales revenues. Thus, they are relatively small. If costs and revenues of
new minor source facilities in these sectors are similar in scale to those of existing minor
source facilities, the costs of complying with the proposed rule would be expected to result in
a relatively small upward shift in the supply curve (see Figure 4-2), and a relatively small
reduction in the rate of creation of new facilities.
Similarly, the costs generally represent a small share of typical company revenues
and profits. For most sectors, the costs of complying with the proposed rule are less than half
a percent of company sales. Natural gas compressor stations have the highest share of costs
to sales, which reflects the relatively high ratio of facilities to companies in this sector.
Although costs account for more than 2.5 percent of typical company sales, the proposed rule
is not expected to pose a risk of making typical companies in this sector unprofitable. For
4-8
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Table 4-3. Screening Comparison of Total Annualized Compliance Costs to Facility
and Company Financial Data for Minor Sources
Screening Ratios (percent)
Sector Description
Sand and gravel processing
Lumber saw mill
Printing operation
Asphalt hot mix plant
Natural gas compressor
Solid waste landfill
Concrete batching plant
Grain elevator
Gasoline bulk plant
Gasoline station storage tanks and
refueling
Dry cleaner
Automobile refinishing shop
Stone quarrying and processing
(212312)
Stone quarrying and processing
(212313)
Surface coating operations (31332)
Surface coating operations (3231 13)
Surface coating operations (332431)
Surface coating operations (3328 12)
Boilers (NG)
Boilers (Oil)
Estimated Total
Annualized Cost of
Compliance for
Typical Minor Source
Facility ($2000)
$65,498
$55,698
$9,798
$57,598
$58,498
$60,198
$55,998
$54,698
$11,128
$18,986
$10,848
$18,598
$81,398
$81,398
$73,598
$73,598
$73,598
$73,598
$13,749
$68,963
Ratio of
Costs to
Company
Sales
0.13%
0.06%
0,04%
0.09%
2.67%
0.34%
0.41%
0.04%
0.02%
0.01%
0.05%
0.11%
0.74%
0.69%
0.10%
0.17%
0.03%
5.81%
0.06%
0.31%
Ratio of
Costs to
Company
Profits
2.26%
2.37%
1.40%
1.52%
64.17%
9.95%
15.70%
3.44%
2.37%
0.45%
3.87%
4.04%
7.35%
8.50%
6.58%
4.40%
0.95%
0.31%
0.54%
2.71%
Ratio of
Costs to
Facility Sales
4.59%
0.95%
0.49%
1.17%
0.32%
0.87%
1.81%
0.30%
0.06%
1.10%
4.37%
3.74%
2.75%
1.77%
2.79%
2.79%
0.17%
1.94%
0.52%
2.61%
4-9
-------
most sectors, the compliance costs are less than 5 percent of typical company profits, which
suggests that the companies would have the resources to devote to investing in control
equipment and operating costs to comply with the rule. Costs exceed 10 percent of typical
company profits for the natural gas compressor and concrete batching plant sectors.
However, the costs do not approach the level of profits, so compliance does not pose a risk of
making typical companies in affected sectors unprofitable.
EPA estimates that under the proposed rule, 112 existing minor source facilities will
undergo minor modifications over the course of the study period (see Table 4-1). Half of
these facilities (55) are expected to incur both permitting and emission control costs. The
total annualized costs of compliance for these facilities are the same as those presented in
Table 4-3. As already indicated, the costs of compliance generally represent a small share of
typical company sales and profits, suggesting that typical companies would have the
resources to comply with the rule. The remaining minor source facilities that are expected to
make minor modifications (57), are assumed to incur only permitting costs. Table 4-4
provides the total annualized costs of compliance and computes the ratio of cost-to-sales at
the company and facility levels. Across all sectors, company costs are less than a half of 1
percent of average company sales and less than 4 percent of average profits, while facility
costs are less than 2 percent of average sales.
Overall, the costs of complying with the proposed rule for minor sources are
generally low and unlikely to cause significant reductions in the rate of investment in new
minor source facilities in Indian Country. In addition, EPA's analysis indicates that the
proposed rule is not likely to pose a risk of making typical companies in affected sectors
unprofitable. Although EPA does not have sufficient data to allow it to model the impacts of
the rule quantitatively, a screening assessment comparing costs to average facility and
company financial data shows that costs are small relative to both average facility sales and
average company sales, and are generally a small share of typical company profits. The
analysis is based on estimated costs for typical minor source facilities, compared to estimated
sales for typical facilities and companies, and estimated profits for typical companies.
Within each sector there is likely to be substantial variation in costs, facility sales, and
company sales and profits. Thus, it is possible that individual companies might find that the
costs for a specific project would be sufficient to discourage them from investing. Overall,
however, EPA expects the impacts to be small.
4-10
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Table 4-4. Screening Comparison of Total Annualized Compliance Costs to Facility
and Company Financial Data for Existing Minor Sources Requiring Permits
Screening Ratios (percent)
Estimated Total
Annualized Cost of
Compliance for Typical Ratio of
Minor Source Facility Costs to
Requiring Permitting Company
Sector Description Only ($2000) Sales
Sand and gravel processing
Lumber saw mill
Printing operation
Asphalt hot mix plant
Natural gas compressor
Solid waste landfill
Concrete batching plant
Grain elevator
Gasoline bulk plant
Gasoline station storage tanks and
refueling
Dry cleaner
Automobile refinishing shop
Stone quarrying and processing
(212312)
Stone quarrying and processing
(212313)
Surface coating operations (31332)
Surface coating operations (3231 13)
Surface coating operations (332431)
Surface coating operations (3328 12)
Boilers (NG)
Boilers (Oil)
$7,598
$7,598
$7,598
$7,598
$7,598
$7,598
$7,598
$7,598
$7,598
$7,598
$7,598
$7,598
$7,598
$7,598
$7,598 •
$7,598
$7,598
$7,598
$7,598
$7,598
0.01%
0.01%
0.06%
0.04%
0.09%
0.04%
0.05%
0.01%
0.02%
0.00%
0.05%
0.05%
0.03%
0.03%
0.03%
0.02%
0.00%
0.03%
0.03%
0.03%
Ratio of
Costs to Ratio of
Company Costs to
Profits Facility Sales
0.23%
0.43%
1.81%
0.73%
2.28%
1.91%
2.09%
0.59%
2.68%
0.18%
3.39%
1.78%
0.33%
0.34%
1.81%
0.49%
0.04%
0.57%
0.30%
0.30%
0.53%
0.13%
0.38%
0.15%
0.07%
0.19%
0.25%
0.04%
0.04%
0.44%
3.06%
1.53%
0.26%
0.17%
0.29%
0.29%
0.02%
0.20%
0.29%
0.29%
4-11
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4.2 Impacts on Major Sources
New major sources are already regulated under the Clean Air Act at baseline. New
major source facilities in attainment areas are covered by the Federal Prevention of
Significant Deterioration program and are unaffected by the proposed rule. New major
sources in nonattainment areas, which are affected by the proposed rule, are currently
addressed through a Tribal Implementation Plan or a Federal Implementation Plan. The
proposed rule provides a regulatory mechanism for permitting new major source facilities
and major and minor modifications of major sources in nonattainment areas in Indian
Country. By providing a regulatory mechanism, the proposed rule simplifies the process of
permitting such facilities. The emissions control requirements for such sources are
unchanged. Thus, EPA expects that the costs of permitting a new major source facility in
nonattainment area in Indian Country will, if anything, be reduced by the proposed rule.
In addition, the new permitting arrangements will be more predictable and the timing
and cost less uncertain than without the rule. Economists studying investment under
uncertainty (Dixit and Pindyck, 1994) demonstrate that investors considering a project
consider not only the expected rate of return on the investment, but also the level of
uncertainty about that rate of return. Using a model based on financial options, they show
that uncertainty about an investment makes investors want to delay the investment to gather
more information about the investment's likely rate of return. Thus, uncertainty leads to
delays in investment. Reducing the uncertainty about the timing and cost of permitting new
major source facilities in nonattainment areas in Indian Country will therefore reduce the
need to wait for more information, and will make investors more likely to invest. Thus, both
the reduced cost (increased rate of return) and the reduced uncertainty promote increased
investment in new major source facilities in nonattainment areas in Indian Country,
compared to baseline conditions. While this qualitative assessment suggests the direction of
the changes in costs and uncertainty (decreased), and investment in new major source
facilities (increased), EPA has no information to inform a quantitative estimate of these
effects.
Existing major source facilities that elect to make minor modifications are expected to
incur compliance costs under the proposed rule. EPA estimates that seven facilities will
make minor modifications over the entire study period. Although there is company-specific
data on existing major sources in nonattainment areas, EPA is not able to identify which of
the major source facilities may decide to make minor modifications. Thus, Table 4-5
identifies the industry sectors, rather than specific companies, that it assumes will make
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Table 4-5. Existing Major Source Facilities Expected to Undergo Minor Modifications
Under the Proposed Rule (2000$)
Sector Description
Natural gas plant
Power plant (coal-fired)
Lumber saw mill8
Natural gas compressor3
Total
Number of Facilities
1
1
1
4
7
Average Company Sales
$72,900,000,000
$148,000,000
$2,300,000,000
$524,000,000,000
a Incomplete sales data for all companies in the sector.
minor modifications over the study period. To assess the relative magnitude of the costs of
compliance for each of the affected economic sectors, EPA conducted a screening analysis.
Company sales information were obtained from ReferenceUSA and Hoovers On-line
Directory databases.. EPA computed average company sales revenues by dividing the sector
sales by the number of companies in each sector. The figures are presented in Table 4-5.
The costs-to-sales ratios for companies in each of these sectors is presented in Table 4-6. In
none of these sectors do the compliance costs exceed 0 percent of sales.
Table 4-6. Screening Comparison of Total Annualized Compliance Costs to Facility
and Company Financial Data for Existing Major Sources Undergoing Minor
Modifications
Sector Description
Natural gas plant
Power plant (coal-fired)
Lumber saw mill
Natural gas compressor
Estimated Total Annualized Cost of .
Compliance for Typical Major Source
Facility ($2000)
$7,598
$7,598
$7,598
$7,598
Screening Ratios (percent)
Ratio of Costs to Company
Sales
0.00%
0.00%
0.00%
0.00%
4-13
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4.3 Impacts on Tribes Accepting Delegation
EPA also estimated total annualized permitting and administrative costs for the
agencies administering the NSR program, of $3,110 per new or modified source. Under the
provisions of the proposed rule, Tribes may choose to accept delegation of the NSR program
and would thereby incur these costs. The actual costs incurred by individual Tribes will
depend on how many new or modified sources occur on their reservations, and how complex
those sources are. To assess the possible impacts to Tribes, EPA conducted a screening
analysis based on data for several representative Tribes that have chosen to administer their
own air programs.
EPA estimated the number of new and modified sources that would be sited on the
reservations of these representative Tribes, and compared the associated programmatic costs
per Tribal member with the per capita income of the Tribe (in other words, the ratio of cost
per tribal member to income per tribal member). Table 4-7 shows the results of this
comparison.
Table 4-7. Measures of Impact on Tribes Choosing to Administer the NSR Program
Impact Measure
Number of New and Modified
sources
Cost per Tribe
Cost per Tribal Member
Cost per Tribal Member as a
share of Per Capita Income
Minimum*
1
$4,300
$0.17
0.002%
Average
6
$17,300
$0.46
0.004%
Maximum
10
$30,200
$0.75
0.007%
a Since EPA projects no new or modified sources for some of the representative Tribes, the actual minimum is
0 for each category. Values presented here represent the minimum for Tribes projected to have at least one
new or modified source during the period.
EPA estimates that a total of eight new minor sources will be sited on the reservations
of the representative Tribes, and three existing minor sources will make minor modifications.
Total costs per tribe range from $0 (no new or modified sources on the reservation during the
period) to $30,200 for a tribe projected to have 10 of the 11 projected new or modified
sources on its lands. Total program costs across all the representative tribes is estimated to
be $34,600.
Costs per Tribal member are computed by dividing Tribal costs by the number of
Tribal members. The cost per Tribal member ranges from $0 (again, for Tribes with no
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projected sources) to $0.75 per Tribal member per year. If the Tribes pass the costs of the
NSR program through to their Members, the average Tribal member will incur less than $1
per year in administrative burden costs.
Dividing the estimated cost per Tribal member by the Tribes' per capita income
yields a screening measure of the significance of the per-member costs of administering the
program. For all the representative Tribes, the costs per Tribal member is less than 0.01
percent of Tribal per capita income.
Thus, if Tribes choose to administer the NSR program, EPA does not believe that the
costs of the program will pose an undue burden to them or their members.
4-15
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SECTION 5
SMALL ENTITY IMPACT ANALYSIS
5.1 Introduction
The proposed Review of New Sources and Modifications in Indian Country (hereafter
referred to as the proposed rule) potentially affects the following types of sources in Indian
Country:
• new minor sources,
• modifications to existing minor sources,
• minor modifications to existing major sources,
• sources accepting emissions limitations to become synthetic minor sources,
• new major sources in nonattainment areas, and
• major modifications to existing major sources in nonattainment areas.
Current operations at existing minor and major source facilities in Indian Country will
not be affected by the proposed rule. For three of the source types listed above, EPA
estimates that the rule would result in no incremental costs. For new major sources and
major modifications to existing major sources in nonattainment areas in Indian Country, the
rule provides a permitting mechanism. In the absence of the rule, a source-specific FIP or
TIP would be needed. Thus, EPA expects such sources to experience no change in costs or
lower costs due to the rule. Similarly, the choice to become a synthetic minor by accepting
Federally enforceable emissions limitations is entirely optional; EPA believes firms would
only choose to do so if it resulted in a cost savings. Thus, EPA's screening analysis focuses
on costs associated with new minor sources, modifications to existing minor sources, and
minor modifications to existing major sources.
While all entities owning affected sources are subject to the rule, small entities (small
businesses, governments, or non-profit organizations) may have special problems complying
with regulations because they have fewer financial resources, fewer workers to implement
changes, less engineering and legal expertise, etc. The Regulatory Flexibility Act (RFA) of
1980 as amended in 1996 by the Small Business Regulatory Enforcement Fairness Act
(SBREFA) generally requires an agency to prepare a regulatory flexibility analysis of a rule
unless the agency certifies that the rule will not have a significant economic impact on a
5-1
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substantial number of small entities (small businesses, small governmental jurisdictions, and
small organizations), or SISNOSE.
This document describes the underlying assumptions and computations U.S.
Environmental Protection Agency (EPA) made in estimating the number of affected small
entities (in this case, small businesses), and examines the proposed rule's possible impact on
these entities. The rule is not expected to result in incremental compliance costs for new
major source facilities, major modifications to existing major sources, or facilities choosing
to become synthetic minors. Thus, EPA's analysis of small business impacts focuses entirely
on impacts associated with new minor source facilities and minor modifications to existing
minor and major sources. EPA estimates that small businesses investing in 164 new minor
source facilities, 62 minor modifications to existing minor sources, and 3 minor
modifications to existing major sources over the period 2004 through 2010 will incur
approximately $4.2 million per year to comply with the proposed rule. For most industry
sectors, costs are less than 1 percent of average small company sales revenues, but small
companies choosing to invest in new natural gas compressor stations or new solid waste
landfills have the potential to incur costs exceeding 1 percent of their sales. Because EPA
projects that small businesses in these two sectors would invest in only one new source of
each type over the period, EPA does not believe that the proposed rule will impose
significant economic impacts on a substantial number of small businesses.
5.2 Methods for Identifying Potentially Affected Small Entities and Conducting a
Screening Analysis of the Impacts of the Proposed Rule
Section 2 describes EPA's method and results for estimating the number of new and
modified minor and major sources potentially affected by the Tribal MMNSR. In this
section, EPA must assess the significance of the costs of implementing the rule on potentially
affected small entities. This section describes EPA's data and methods, and presents the
estimated number of potentially affected small entities. To assess impacts on small entities
potentially affected by the rule, the Agency conducted a screening analysis of potential
impacts on small businesses. Section 5.3 describes the data, methods, and results of EPA's
screening analysis for small businesses.
For purposes of assessing the impacts of the proposed rule on small entities, a small
entity is defined as (1) a small business based on criteria established by the SBA;4 (2) a small
governmental jurisdiction, that is a government of a city, county, town, school district, or
special district with a population of less than 50,000; or (3) a small organization, that is any
"http://www.sba. gov/library/cfrs/13cfr 121 .pdf
5-2
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not-for-profit enterprise that is independently owned and operated and is not dominant in its
field. For the proposed Rule, only small businesses are potentially affected.
To estimate how many of the projected affected sources estimated in Section 2 might
potentially be owned by small businesses, EPA collected data on company employment and
sales data in the affected industries from financial databases, Ward's Business Directory
(Information Access Company, 1997) and ReferenceUSA (ReferenceUSA, 2003), and used
the data to calculate the share of companies in each affected industry that would be
considered small according to the SBA criteria. For all the sectors except natural gas
compressors and solid waste landfills, Ward's Business Directory provided data on company
sales. For those two sectors, Ward's reports company assets. Thus, EPA collected sales data
from Reference USA (ReferenceUSA, 2003) to compute typical sales for small and large
companies in those sectors. Financial data from Ward's and ReferenceUSA were adjusted to
2000 dollars using industry-specific producers price indexes from the Bureau of Labor
Statistics (BLS, 2003).
Using these data, EPA conducted a screening analysis to determine if the proposed
Rule is likely to impose significant economic impacts on a substantial number of small
entities. The screening analysis compares the estimated company costs of compliance with
the proposed rule to average company revenues for small and large companies in each
affected industry. Compliance costs per company are computed by multiplying facility costs
by the average number of facilities per company based on data from the 1997 Economic
Census (U.S. DOC, Economic Census, 1997). According to the Census data the average
number of establishments (facilities) per small firm (company) in the affected industries
ranges from 1.0 to 1.5. The average number of facilities per large company in the affected
industries ranges from 1.1 to 110.9.
5.3 Screening Analysis of Impacts on Small Businesses in Minor Source Industries
The first step in conducting a screening analysis of impacts on small businesses for
minor source industries is to estimate the number of potentially affected small businesses and
to characterize those businesses in terms of the average annual sales revenues, which will be
the denominator of EPA's screening measure: the ratio of total annualized cost of
compliance to annual sales (cost-to-sales ratio or CSR).
5.3.1 Characterizing Typical Small Businesses in Affected Minor Source Industries
The proposed Rule affects new and modified minor sources in Indian Country.
Because the rule covers investments that will occur in the future, it is not possible to evaluate
5-3
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potential impacts based on actual sales of actual affected companies. EPA does not have
information allowing it to determine which companies will choose to construct new facilities
or modify existing facilities in Indian Country between 2004 and 2010. Instead, EPA is
evaluating impacts on potentially affected companies based on the sales of typical small and
large companies in the industries identified as existing minor sources based on 11 Tribal
inventories. To characterize typical small and large companies in the affected industries,
EPA collected data from financial databases (Information Access Company, 1997;
ReferenceUSA, 2003) on company employment and sales in the affected industries. Based
on these data, EPA identified small companies according to industry-specific criteria
established by the SB A (shown in Table 5-1), and computed the average company sales
revenues for small companies and large companies in each industry. EPA collected data on
small and large companies so that impacts on small companies could be compared with those
on larger companies. Table 5-2 shows the shares of companies in each industry estimated to
be small and large, and average company sales in each affected industry for small and large
companies.
As Table 5-2 shows, most firms in the affected minor source industries were
considered small. EPA assumes that the ownership pattern of new and modified minor
sources will be the same as the pattern shown in 1997 for these industries as a whole. For
example, EPA assumes that, of projected new sources in sand and gravel processing, 90.6
percent will be owned by small businesses. Because industrial, commercial, and institutional
boilers may be used in virtually any industry, EPA uses the median values for the other
affected industries to represent the share of affected boilers that will be owned by small
businesses, and the typical sales for small and large companies owning new boilers.
5.3.2 Estimated Number of New and Modi/led Minor Sources Owned by Small
Businesses
EPA estimated the number of new and modified minor sources owned by small
businesses by multiplying the share of businesses in each industry that are small times the
projected number of new and modified minor sources in each industry. Table 5-3 presents
EPA's estimated number of new and modified minor sources owned by small businesses,
based on the projected number of new minor sources shown in Table 2-15 and the number of
modified minor sources shown in Table 2-16. To compute the number of small companies
owning these minor sources, EPA divides the estimated number of new and modified sources
owned by small businesses in each industry by the number of facilities per small company in
that industry.
5-4
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Table 5-1. Small Business Administration Criteria for Selected Industries
Sector
Stone quarrying and processing (NAICS 212312)
Stone quarrying and processing (NAICS 212313)
Sand and gravel processing (NAICS 212321)
Surface coating operations (NAICS 31332)
Surface coating operations (NAICS 3231 13)
Lumber saw mill (NAICS 321 1 13)
Printing operation (lithographic) (NAICS 3231 10)
Asphalt hot mix plant (NAICS 324121)
Surface coating operations (NAICS 332431)
Surface coating operations (NAICS 332812)
Natural gas compressor station (NAICS 486210)
Solid waste landfill (NAICS 562212)
Concrete batching plant (NAICS 421320)
Grain elevator (NAICS 422510)
Gasoline bulk plant (NAICS 422710)
Gasoline station (storage tanks, refueling) (NAICS 4471)
Dry cleaner (NAICS 812320)
Automobile refmishing shop (NAICS 811121)
SBA Criteria'
Employment Criterion
500
500
500
1,000
500
500
500
500
1,000
500
_,
100
100
100
Sales Criterion
$5.0
$10.0
$20.0
$3.5
$5.0
a Criteria are defined in terms of numbers of employees or millions of dollars of sales.
Source: http://www.sba.gOv/library/cfrs/l3cfr 121 .pdf
5-5
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Table 5-2. Share of Sector Companies that are Small or Large and Average Sales Data
by Size of Company
Percentage of
Companies
Sector
Stone quarrying and processing (NAICS 212312)
Stone quarrying and processing (NAICS 212313)
Sand and gravel processing
Surface coating operations (NAICS 31332)
Surface coating operations (NAICS 3231 13)
Lumber saw mill
Printing operation (lithographic)
Asphalt hot mix plant
Surface coating operations (NAICS 332431)
Surface coating operations (NAICS 332812)
Natural gas compressor station3
Solid waste landfill3
Concrete batching plant
Grain elevator
Gasoline bulk plant
Gasoline station (storage tanks, refueling)
Dry cleaner
Automobile refinishing shop
Industrial, commercial, institutional boilers: natural gasb
Industrial, commercial, institutional boilers: oilb
Small
97.4%
100.0%
90.6%
97.1%
93.9%
91.9%
96.2%
90.6%
75.9%
95.7%
13.5%
39.5%
88.9%
96.1%
85.9%
46.5%
50.0%
56.0%
90.4%
90.4%
Large
2.6%
0.0%
9.4%
2.9%
6.1%
7.7%
3.8%
9.4%
24.1%
4.3%
97.3%
61.1%
11.1%
3.9%
14.1%
53.5%
50.0%
44.0%
9.6%
9.6%
Typical Company Sales
(106 $2000)
Small
16.0
28.5
18.7
13.4
15.0
18.4
12.4
19.7
20.7
11.4
2.4
-1-.7
9.0
20.2
40.5
10.1
0.7
1.9
14.2
14.2
Large
303.6
—
525.6
471.2
483.4
1,125.6
277.7
1,369.2
2,145.0
355.3
19.7
39.4
92.5
5,323.7
292.0
954.7
44.2
35.7
471.2
471.2
a For SICs 4922 and 4953, Ward's financial data represent total assets. Sales data were collected from
ReferencelJSA for those sectors. All other sectors' sales data were collected from Ward's Business
Directory.
b For industrial, commercial, and institutional boilers, data are the median values for other affected industries.
5-6
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Table 5-3. Estimated Number of New and Modified Minor Sources Owned by Small
Businesses
Sector
Sand and gravel processing
Lumber saw mill
Printing operation (lithographic)
Asphalt hot mix plant
Natural gas compressor station
Solid waste landfill
Concrete batching plant
Grain elevator
Gasoline bulk plant
Gasoline station (storage tanks, refueling)
Dry cleaner
Automobile refinishing shop
Stone quarrying and processing
Surface coating operations
Industrial, commercial or institutional boiler: natural gas
fired
Industrial, commercial or institutional boiler: oil fired
Total
New Minor
Sources
2
3
15
0
1
1
2
13
12 •
77
12
20
•2
2
2
0
164
Modified
Minor
Sources
1
1
6
0
0
0
1
5
4
30
4
7
1
1
1
0
62
Total Minor
Sources
3
4
21
0
1
1
3
18
16
107
16
27
3
3
3
0
226
" Estimated by combining projected new sources from Table 2-15 with small business percentages from
Table 5-2.
Note: Rows or columns may not sum to totals due to rounding.
5-7
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5.3.3 Estimated Impacts on Small Companies Owning New Minor Source Facilities
i EPA estimated the capital and annual costs of controlling emissions at affected new
and modified minor source facilities. These costs are described in detail in Section 3 and
Appendix B. Capital costs are annualized over a period of 15 years (the expected average
lifetime of the capital equipment) at 7 percent interest rate (in compliance with guidance
from the Office of Management and Budget to reflect private cost of capital), to compute the
annualized cost of capital for typical facilities in each sector. The annualized capital costs
are summed with the annual costs for each sector to compute the total annualized costs of
controlling emissions in each sector. These control costs are combined with the estimated
permitting, monitoring, recordkeeping and reporting costs, described in detail in Section 3
and Appendix B, to yield the total annualized costs of complying with the proposed rule for
typical facilities in each sector. New minor source facilities are estimated to incur both
incremental control costs and incremental administrative costs due to the proposed rule. EPA
estimates that approximately half of the minor sources that invest in minor modifications will
incur only permitting and MRR costs, while the rest will incur both control and
permitting/MRR costs.
EPA estimates that the total national costs of the rule for new minor sources is $4.94
million per year. This includes both emissions control costs and administrative burden costs
for the projected 288 affected new minor source facilities. Of this amount, EPA estimates
that $2.63 million per year will be borne by the estimated 164 new minor sources estimated
to be owned by small businesses. The remaining $2.31 million per year is estimated to be
borne by large companies. EPA estimates that the total national costs of minor modifications
to existing minor sources is $1.48 million per year, of which $0.97 will be incurred by small
businesses. Overall, therefore, EPA estimates that small businesses owning new and
modified minor sources will incur approximately $3.6 million per year due to the proposed
rule.
In its screening analysis, EPA assessed the impacts on small businesses by comparing
estimated facility costs to comply with the proposed Rule for typical facilities in each
industry to estimated revenues for typical small companies owning the facilities. To evaluate
the range of possible small business impacts, EPA first estimated the number of sources
owned by small businesses, then computed how many affected small businesses would be
affected using Census data on the average number of facilities per company for companies
with fewer than 500 employees (a proxy for small business).
5-8
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EPA employed criteria (EPA, 1999) widely used in conducting such screening
analyses to assess the severity of potential impacts. Companies incurring costs less than 1
percent of sales are not expected to incur substantial impacts due to the rule. Companies
incurring costs exceeding 3 percent of sales are estimated to incur potentially significant
impacts. Companies with costs between 1 percent and 3 percent may or may not incur
substantial impacts. Estimated costs for affected facilities in each industry are shown in
Table 5-4. Estimated cost-to-sales ratios for new minor sources are shown in Table 5-5.
Two sectors, natural gas compressors and solid waste landfills have estimated costs for new
minor sources that exceed 1 percent of the sales of typical small businesses in those
industries. For small businesses choosing to invest in new sources in these industries,
significant cost impacts can not be ruled out. However, EPA projects only one new minor
source of each type owned by a small business over the period 2004 to 2010. It should also
be noted that large companies in several of the industries, because they are assumed to have a
larger number of affected facilities, sometimes exhibit estimated CSRs exceeding those for
small businesses in the industries. Thus, it appears that small businesses are not
disproportionately affected.
Table 5-6 shows the number of affected small businesses and cost-to-sales ratios for
small businesses projected to perform minor modifications to existing minor source facilities.
5.4 ' Characterizing Typical Small Businesses in Affected Major Source Industries
The proposed rule affects minor modifications to existing major sources and
establishes nonattainment New Source Review for major sources in Indian Country.
Currently, there are 83 major source facilities in Indian Country, 8 of which are located in
nonattainment areas. EPA does not have information allowing it to determine which
companies will choose to construct new facilities in Indian Country between 2004 and 2010.
Instead, EPA is evaluating impacts on potentially affected companies based on the
employment size and sales of typical small companies in the affected industries and
assuming that new major sources will be similar to existing major sources. EPA collected
data from financial databases (ReferenceUSA., 2003 and Hoover's Online Business
Directory, 2003) to characterize existing major sources. Based on these data, EPA identified
small companies according to industry-specific criteria established by the SBA (shown in
Table 5-7).
The total number of existing small businesses in Indian Country is identified in
Table 5-8. In the case where no data for the affected company was available, EPA assumed
that the company was a small business. For five facilities, (NAICS 221112 and 221119), the
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Table 5-4. Estimated Costs of Compliance for Affected Minor Sources
Sector Description
Estimated Total
Annualized
Emissions Control
Cost for Minor
Source Facility
Estimated Estimated Total
Permitting, Annualized Cost of
Monitoring, Compliance for
Recordkeeping, and Typical New Minor
Reporting Cost Source Facility
Sand and gravel processing
Lumber saw mill
Printing operation
Asphalt hot mix plant
Natural gas compressor
Solid waste landfill
Concrete batching plant
Grain elevator
Gasoline bulk plant
Gasoline station storage tanks and refueling
Dry cleaner
Automobile refinishing shop
Stone quarrying and processing" (212312)
Stone quarrying and processing" (2 1 23 1 3)
Surface coating operations8 (31332)
Surface coating operations8 (323 1 1 3)
Surface coating operations" (332431)
Surface coating operations" (332812)
Boilers (NG)
Boilers (Oil)
$57,900
$48,100
$2,200
$50,000
$25,970
$26,460
$48,400
$47,100
$3,530
$3,790
$3,250
$11,000
$73,800
$73,800
$66,000
$66,000
$66,000
$66,000
$6,151
$61,365
$7,598
$7,598
$7,598
$7,598
$7,598
$7,598
$7,598
$7,598
$7,598
$7,598
$7,598
$7,598
$7,598
$7,598
$7,598
$7,598
$7,598
$7,598
$7,598
$7,598
$65,498
$55,698
$9,798
$57,598
$58,498
$60,198
$55,998
'$54,698
$11,128
$18,986
$10,848
$18,598
$81,398
$81,398
$73,598
$73,598
$73,598
$73,598
$13,749
$68,963
8 Computer ratio of Estimated Total Annualized Cost of Compliance to Average Company Sales for Small and
Large Companies, shown in Table 5-2.
b Several industry sectors are represented by more than one NAICS code (shown in parentheses). Costs for
such sectors were compared to average sales for small and large companies in each associated NAICS code.
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Table 5-5. Estimated Cost-to-Sales Ratios for Small Businesses Investing in New Minor
Sources
Small Businesses
Sector Description
Sand and gravel processing
Lumber saw mill
Printing operation
Asphalt hot mix plant
Natural gas compressor
Solid waste landfill
Concrete batching plant
Grain elevator
Gasoline bulk plant
Gasoline station storage tanks and
refueling
Dry cleaner
Automobile refmishing shop
Stone quarrying and processing8
(212312)
Stone quarrying and processing"
(212313)
Surface coating operations3
(31332)
Surface coating operations3
(323113)
Surface coating operations3
(332431)
Surface coating operations3
(332812)
Boilers (NG)
Boilers (Oil)
Total
Estimated Number of
Small Businesses
2
3
15
0
1
1
2
9
10
59
11
20
1
2
2
2
2
2
2
0
143
Cost-to-
Sales Ratio
0.4%
0.3%
0.1%
0.4%
1.7%
2.1%
0.7%
0.4%
0.0%
0.2%
0.9%
1.0%
0.7%
0.3%
0.6%
0.5%
0.4%
0.7%
0.1%
0.5%
Large Businesses
Estimated Number of
Large Businesses
0
0
0
1
1
1
0
0
1
1
1
2
0
0
1
1
1
1
0
0
10
Cost-to-
Sales Ratio
0.1%
0.0%
0.0%
0.0%
3.7%
1.1%
0.6%
0.0%
0.0%
0.2%
2.2%
0.5%
0.3%
0.0%
0.0%
0.0%
0.0%
0.1%
0.2%
1.1%
Several industry sectors are represented by more than one NA1CS code (shown in parentheses). Costs for
such sectors were compared to average sales for small companies in each associated NAICS code.
5-11
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Table 5-6. Screening Analysis of Impacts due to Modifications of Minor Sources
Companies Owning Facilities that Incur Companies Owning Facilities that Incur
TAC only MRR Costs
Small Companies
Sector
Sand and gravel
processing
Lumber saw mill
Printing operation
Asphalt hot mix plant
Natural gas compressor
Solid waste landfill
Concrete batching plant
Grain elevator
Gasoline bulk plant
Gasoline station storage
tanks and refueling
Dry cleaner
Automobile refinishing
shop
Stone quarrying and
processing
Stone quarrying and
processing
Surface coating
operations
Surface coating
operations
Surface coating
operations
Surface coating
operations
Boilers (NG)
Boilers (Oil)
Total
Estimated
Number of
Companies
1
1
3
0
0
0
1
1
11
2
3
1
0
1
0
0
0
0
0
26
CSR
0.4%
0.3%
0.1%
0.4%
1.7%
2.1%
0.7%
0.4%
0.0%
0.2%
0.9%
1.0%
0.7%
0.3%
0.6%
0.5%
0.4%
0.7%
0.1%
0.5%
Large Companies
Estimated
Number of
Companies
0
0
0
0
1
0
0
0
0
1
o
0
0
0
0
0
0
0
0
0
CSR
0.1%
0.0%
0.0%
0.0%
3.7%
1.1%
0.6%
0.0%
0.0%
0.2%
2.2%
0.5%
0.3%
0.0%
0.0%
0.0%
0.1%
0.2%
1.1%
1
Small Companies
Estimated
Number of
Companies
0
0
3
0
0
0
0
2
2
11
2
4
0
0
0
0
0
0
1
0
CSR
0.0%
0.0%
0.1%
0.1%
0.4%
0.5%
0.1%
0.1%
0.0%
0.1%
0.6%
0.4%
0.1%
0.0%
0.1%
0.1%
0.0%
0.1%
0.1%
0.1%
25
Large Companies
Estimated
Number of
Companies
0
0
0
0
2
1
0
0
1
17
3
3
0
0
0
0
0
0
0
0
CSR
0.0%
0.0%
0.0%
0.0%
0.8%
0.3%
0.1%
0.0%
0.0%
0.1%
1.5%
0.2%
0.0%
0.0%
' 0.0%
0.0%
0.0%
0.1%
0.1%
1
5-12
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Table 5-7. Small Business Administration Criteria for Selected Major Source
Industries
SBA Criteria8
Sector
Employment
Criterion
Sales
Criterion
Production
Criterion"
Lumber manufacturer support (NAICS 5614)
Coal mining (NAICS 21211) 500
Sand and gravel production (NAICS 21232) 500
Furniture manufacture (NAICS 33712) 500
Medical waste incinerator (NAICS 56221)
Repellent and fertilizer applications (NAICS 115112)
Natural gas plant (NAICS 211111) 500
Oil and gas production (NAICS 211111) 500
Fractionation of natural gas liquids (N AICS211112) 500
Copper mining and processing (NAICS 212234) 500
Power plant (coal-fired) (NAICS 221112)
Power plant (biomass fueled) (NAICS 221119)
Power plant (landfill gas-fired) (NAICS 221119)
Natural gas pipeline and collection (NAICS 221210) 500
Lumber sawmill (NAICS 321113) 500
Window and door molding manufacturer (NAICS 321911) 500
Elemental phosphorus plant (NAICS 325188) 1,000
Sulfuric acid plant (NAICS 325188) 1,000
Secondary aluminum production and extrusion (NAICS 750
331314)
Cobalt and tungsten recycling (NAICS 331492) 750
Crude oil storage and distribution (NAICS 486110 or 422710) 1,500
Natural gas compression station (NAICS 486210)
Landfill (NAICS 562212)
$6.0
$10.5
$6.0
$6.0
$10.5
4.0
4.0
4.0
Criteria are defined in terms of numbers of employees or millions of dollars of sales.
Criteria are defined in terms total electric output in preceding year of less than 4 million megawatt hours.
5-13
-------
Table 5-8. Estimated Number of Existing Major Sources Owned by Small Businesses
Sector
Lumber manufacturer support (NAICS 5614)
Coal mining (NAICS 21211)
Sand and gravel production (NAICS 21232)
Furniture manufacture (NAICS 33712)
Medical waste incinerator (NAICS 56221)
Repellent and fertilizer applications (NAICS 115112)
Natural gas plant (NAICS 211111)
Oil and gas production (NAICS 211111)
Fractionation of natural gas liquids (NAICS21 1 1 12)
Copper mining and processing (NAICS 212234)
Power plant (coal-fired) (NAICS 221 1 12)"
Power plant (biomass fueled) (NAICS 221 1 19)"
Power plant (landfill gas-fired) (NAICS 221 1 19)a
A
Natural gas pipeline and collection (NAICS 221210)
Lumber sawmill (NAICS 321 1 13)
Window and door molding manufacturer (NAICS 32191 1)
Elemental phosphorus plant (NAICS 325188)
Sulfuric acid plant (NAICS 325188)
Secondary aluminum production and extrusion (NAICS
331314)
Cobalt and tungsten recycling (NAICS 331492)
Crude oil storage and distribution (NAICS 4861 10 or
422710)
Natural gas compression station (NAICS 486210)
Landfill (NAICS 5622 12)
TOTAL
Number of Small
Businesses
1.0
0.0
1.0
1.0
0.0
1.0
2.0
0.0
0.0
0.0
—
—
3.0
4.0
1.0
1.0
1.0
1.0
1.0
1.0
13.0
3.0
35
Percent of Total
Facilities
100.0%
0.0%
100.0%
100.0%
0.0%
100.0%
33.3%
0.0%
0.0%
0.0%
—
—
100.0%
80.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
28.0%
100.0%
• 44.5%
Information on electric production was not available for the five facilities in this sector. Therefore no
determination could be made as to their status as a small business.
5-14
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SBA criterion could not be applied because total electric generation during the preceding
fiscal year was not known. Therefore, of the 78 facilities for which owner company size
could be assessed, (in attainment and nonattainment areas), approximately 45 percent qualify
as small businesses.
5.4.1 Estimated Impacts on Small Companies Owning New Major Source Facilities
EPA's estimated number of new major sources owned by small businesses is based
on the projected number of new major sources identified in Section 2. EPA projects that
only one new major source and one major modification to an existing major source will
occur in nonattainment areas in Indian Country during the period 2004 through 2010.
Because fewer than half of the existing major sources are owned by small businesses, EPA
assumes that neither of these will be owned by a small business. In addition, EPA does not
expect either new major sources or major modifications of existing major sources to result in
incremental permitting or control costs compared to the baseline. For these reasons, EPA
does not expect that either the creation of a new major source nor a major modification of an
existing major source in a nonattainment area in Indian Country will have adverse economic
impacts on small business.
In addition to one new major source and one major modification of an existing major
source in a nonattainment area in Indian Country, EPA also projects that one existing major
source per year will choose to make a minor modification to its facility that results in greater
than de minimus increases in emissions. Major sources performing a minor modification will
be required to get a minor source NSR permit, at a cost of $7,598 per modification. Of the
seven such minor modifications to major sources projected over the period 2004 through
2010, EPA assumes that three will occur at facilities owned by small companies. Because
EPA does not know which of the 35 existing major source facilities owned by small
businesses will choose to make minor modifications, the Agency analyzes small business
impacts by comparing the cost of obtaining a minor NSR permit with sales for the 24 small
businesses owning major source facilities in Indian Country for which sales data are
available. The cost-to-sales ratios range from 0.004 percent to 0.43 percent, with a median
value of 0.20 percent. Based on the estimate of only seven existing major sources
performing a minor modification during the period, and estimated costs that represent at most
0.43 percent of parent company sales for existing small companies, EPA does not believe
that the rule's provisions will result in adverse economic impacts to small businesses owning
major source facilities and initiating a minor modification to their facilities.
5-15
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5.5 Summary of Screening Analysis Results
Table 5-9 summarizes costs and cost to sales ratios for small businesses owning
different types of affected sources. Overall, EPA projects that 164 new minor sources owned
by small businesses, 62 existing minor sources owned by small business making minor
modifications, and three major sources owned by small businesses making minor
modifications will incur approximately $3.7 million in control and administrative costs due
to the rule. Small businesses owning new major source facilities or existing major source
facilities making major modifications or choosing to become synthetic minor sources are
projected to incur no costs due to the proposed rule. Small businesses owning these types of
affected sources are instead expected to realize cost savings.
Table 5-9. Summary of Costs and Affected New and Modified Sources Owned by Small
Businesses
Estimated Number Owned
Source Type by Small Businesses
New minor sources
Modified minor sources
Minor modifications to major
sources
New major sources
Major modification to major
source
Synthetic minor source
Total
164
62
3
At most 1
At most 1
Unknown
At most 231
Estimated Number
of Small Businesses
143
51
3 -
0
0
Unknown
197
Estimated Total
Annualized Costs
$2.68
$0.97
$0.02
$0 or cost savings
$0 or cost savings
Cost savings
$3.67
Among the source types projected to incur costs (new minor sources, modifications to
minor sources, and minor modifications to existing major sources), costs for small businesses
are generally less than 1 percent of typical parent company sales in affected sectors. Two
small businesses that own projected new minor sources, a landfill and a natural gas
compressor station, and three small businesses that own existing automobile refmishing
shops projected to make minor modifications may incur costs at or above 1 percent of sales.
5.6 Conclusions
i
Based on its analysis, EPA certifies that the proposed rule is not likely to result in
significant economic impacts for a substantial number of small companies. This is true
5-16
-------
because the number of small companies affected in most industries is expected to be small,
and because the costs for most industries are expected to be low. Small businesses investing
in new minor sources in two industries, Natural Gas Compressor Stations and Landfills, may
incur costs exceeding 1 percent of their sales to comply with the proposed rule. Similarly,
three small businesses projected to make minor modifications to existing automobile
refinishing facilities are projected to incur costs that are approximately 1 percent of typical
small company sales in that sector. All other small companies projected to invest in new or
modified minor or major sources in Indian Country are projected to incur very low costs or
experience cost savings. Because only five small companies are estimated to experience
costs exceeding 1 percent of sales and no small company is projected to experience costs
exceeding 3 percent of sales, EPA does not believe that a substantial number of small
companies will experience significant economic impacts.
5-17
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REFERENCES
Dixit, A. K. andR. S. Pindyck. 1994. Investment Under Uncertainty. Princeton
University Press: Princeton, NJ.
Dun & Bradstreet, 1997. Industry Norms and Key Business Ratios. Dun & Bradstreet
Information Services: Murray Hill, NJ.
Industrial Combustion Coordinated Rulemaking (ICCR). 1998. Data/Information Submitted
to the Coordinating Committee at the Final Meeting of the Industrial Combustion
Coordinated Rulemaking Federal Advisory Committee. EPA Docket Numbers A-94-
63, II-K-4b2 through-4b5. Research Triangle Park, NC. September 16-17.
Information Access Company. 1997. Ward's Business Directory of U.S. Private and Public
Companies. Ranked by Sales Within 4-digit SIC. Detroit, MI: Gale Research.
ReferenceUSA. 2003.
U.S. Department of Commerce. 1996. American Indian Reservations and Indian Trust
Areas. V. E. V. Tiller, editor. (Also known as "Tiller's Guide").
U.S. Department of Commerce, Bureau of the Census. 1997. Economic Census.
Washington, DC: U.S. Department of Commerce.
U.S. Department of Commerce, Bureau of the Census. 2000. Census of Population and
Housing. Washington, DC: U.S. Department of Commerce.
U.S. Department of Labor. Bureau of Labor Statistics (BLS). 2002. March 2002
Employment Cost Trends, .
U.S. Department of Labor. Bureau of Labor Statistics (BLS). 2003. Producer Price Index
.
U.S. Environmental Protection Agency (EPA). March 1999. Revised Interim Guidance for
EPA Rulewriters: Regulatory Flexibility Act as Amended by the Small Business
Regulatory Enforcement Fairness Act.
.
U.S. Environmental Protection Agency (EPA). 2001. EPA Air Pollution Control Cost
Manual, .
R-l
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APPENDIX A
STATES AND TRIBES IN EACH GEOGRAPHIC QUADRANT
East Quadrant:
Includes Connecticut, Delaware, Florida, Georgia, Maine, Maryland, Massachusetts, New
Hampshire, New Jersey, New York, North Carolina, Pennsylvania, Rhode Island, South
Carolina, Vermont, Virginia, and West Virginia.
Total number of states: 17
Total number of tribes: 19
Number of existing inventories: 0
Tribes States
Mashantucket Pequot Tribe of Connecticut CT
Mohegan Indian Tribe of Connecticut CT
Seminole Tribe of Florida, Dania, Big Cypress, Brighton, Hollywood and Tampa FL
Reservations
Miccosukee Tribe of Indians of Florida FL
Wampanoag Tribe of Gay Head (Aquinnah) of Massachusetts MA
Passamaquoddy Tribe of Maine ' ME
Penobscot Tribe of Maine ME
Houlton Band of Maliseet Indians of Maine ME
Aroostook Band of Micmac Indians of Maine ME
Eastern Band of Cherokee Indians of North Carolina NC
Onondaga Nation of New York NY
St. Regis Band of Mohawk Indians of New York NY
Tonawanda Band of Seneca Indians of New York NY
Tuscarora Nation of New York NY
Oneida Nation of New York NY
Seneca Nation of New York NY
Cayuga Nation of New York NY
Narragansett Indian Tribe of Rhode Island RI
Catawba Indian Nation (aka Catawba Tribe of South Carolina) SC
A-l
-------
East Central Quadrant:
Includes Alabama, Arkansas, Illinois, Indiana, Iowa, Kentucky, Louisiana, Michigan,
Minnesota, Missouri, Mississippi, Ohio, Tennessee, and Wisconsin.
Total number of states: 14
Total number of tribes: 33
Number of existing inventories: 1
Tribes States
Poarch Band of Creek Indians of Alabama AL
Sac and Fox Tribe of the Mississippi in Iowa IA
Jena Band of Choctaw Indians, Louisiana LA
Tunica-Biloxi Indian Tribe of Louisiana LA
Chitimacha Tribe of Louisiana LA
Coushatta Tribe of Louisiana LA
Sault Ste. Marie Tribe of Chippewa Indians of Michigan MI
Bay Mills Indian Community of the Sault Ste. Marie Band of Chippewa Indians, Bay MI
Mills Reservation, Michigan
Hannahville Indian Community of Wisconsin Potawatomie Indians of Michigan MI
Saginaw Chippewa Indian Tribe of Michigan, Isabella Reservation MI
Keweenaw Bay Indian Community of L'Anse and Ontonagon Bands of Chippewa MI
Indians of the L'Anse Reservation, Michigan
Lac Vieux Desert Band of Lake Superior Chippewa Indians of Michigan MI
Pokagon Band of Potawatomi Indians of Michigan MI
Huron Potawatomi, Inc., Michigan MI
Little River Band of Ottawa Indians of Michigan MI
Little Traverse Bay Bands of Odawa Indians of Michigan MI
Minnesota Chippewa Tribe, Minnesota (Six component reservations: Bois Forte Band MN
(Nett Lake); Fond du Lac Band; Grand Portage Band; Leech Lake Band; Mille Lacs
Band; White Earth Band)
Upper Sioux Indian Community of the Upper Sioux Reservation, Minnesota MN
Prairie Island Indian Community of Minnesota Mdewakanton Sioux Indians of the MN
Prairie Island Reservation, Minnesota
Red Lake Band of Chippewa Indians of the Red Lake Reservation, Minnesota MN
Shakopee Mdewakanton Sioux Community of Minnesota (Prior Lake) MN
Lower Sioux Indian Community of Minnesota Mdewakanton Sioux Indians of the MN
Lower Sioux Reservation in Minnesota
Mississippi Band of Choctaw Indians, Mississippi MS
• A-2
-------
Tribes States
Bad Raver Band of the Lake Superior Tribe of Chippewa Indians of the Bad River WI
Reservation, Wisconsin
Lac Courte Oreilles Band of Lake Superior Chippewa Indians of the Lac Courte Oreilles WI
Reservation of Wisconsin
Lac du Flambeau Band of Lake Superior Chippewa Indians of the Lac du Flambeau WI
Reservation of Wisconsin
Oneida Tribe of Wisconsin WI
Red Cliff Band of Lake Superior Chippewa Indians of Wisconsin WI
St. Croix Chippewa Indians of Wisconsin, St. Croix Reservation WI
Sokaogon Chippewa Community of the Mole Lake Band of Chippewa Indians, WI
Wisconsin
Stockbridge-Munsee Community of Mohican Indians of Wisconsin WI
Ho-Chunk Nation of Wisconsin (formerly known as the Wisconsin Winnebago Tribe) WI
Menominee Indian Tribe of Wisconsin WI
West Central Quadrant:
Includes Arizona, Colorado, Kansas, Nebraska, New Mexico, North Dakota, Oklahoma,
South Dakota, Texas, and Utah
Total Number of States: 10
Total Number of Tribes: 105
Number of existing inventories: 4
Tribes States
Yavapai-Apache Nation of the Camp Verde Indian Reservation, Arizona AZ
Cocopah Tribe of Arizona AZ
Havasupai Tribe of the Havasupai Reservation, Arizona AZ
Hualapai Indian Tribe of the Hualapai Indian Reservation, Arizona AZ
White Mountain Apache Tribe of the Fort Apache Reservation, Arizona AZ
Hopi Tribe of Arizona AZ
Tohono O' odham Nation o f Arizona AZ
Ak Chin Indian Community of the Maricopa (Ak Chin) Indian Reservation, Arizona AZ
Fort McDowell Mohave-Apache Community of the Fort McDowell Indian AZ
Reservation, Arizona
Gila River Indian Community of the Gila River Indian Reservation, Arizona AZ
Salt River Pima-Maricopa Indian Community of the Salt River Reservation, Arizona AZ
San Carlos Apache Tribe of the San Carlos Reservation, Arizona AZ
A-3
-------
Tribes States
Kaibab Band of Paiute Indians of the Kaibab Indian Reservation, Arizona AZ
Yavapai-Prescott Tribe of the Yavapai Reservation, Arizona AZ
Pascua Yaqui Tribe of Arizona AZ
Tonto Apache Tribe of Arizona AZ
San Juan Southern Paiute Tribe of Arizona AZ
Southern .Ute Indian Tribe of the Southern Ute Reservation, Colorado CO
Iowa Tribe of Kansas and Nebraska KS/NE
Kickapoo Tribe of Indians of the Kickapoo Reservation in Kansas KS
Prairie Band of Potawatomi Indians, Kansas KS
Sac and Fox Nation of Missouri in Kansas and Nebraska KS/NE
Three Affiliated Tribes of the Fort Berthold Reservation, North Dakota ND
Spirit Lake Tribe, North Dakota (formerly known as the Devils Lake Sioux Tribe) ND
Turtle Mountain Band of Chippewa Indians of North Dakota ND
Standing Rock Sioux Tribe of North and South Dakota ND/SD
Omaha Tribe of Nebraska NE
Ponca Tribe of Nebraska NE
Santee Sioux Tribe of the Santee Reservation of Nebraska NE
Winnebago Tribe of Nebraska NE
Jicarilla Apache Tribe of the Jicarilla Apache Indian Reservation, New Mexico NM
Mescalero Apache Tribe of the Mescalero Reservation, New Mexico NM
Acoma, Pueblo of New Mexico NM
Cochiti, New Mexico, Pueblo of NM
Isleta, New Mexico, Pueblo of . NM
Jemez, New Mexico Pueblo of NM
Laguna, New Mexico, Pueblo of NM
Nambe, New Mexico, Pueblo of NM
Picuris, New Mexico, Pueblo of NM
Pojoaque, New Mexico, Pueblo of NM
Sandia, New Mexico, Pueblo of NM
San Felipe, New Mexico, Pueblo of NM
San Ildefonso, New Mexico, Pueblo of NM
San Juan, New Mexico, Pueblo of NM
Santa Ana, New Mexico, Pueblo of - NM
A-4
-------
Tribes States
Santa Clara, New Mexico, Pueblo of NM
Santo Domingo, New Mexico, Pueblo of NM
Taos, New Mexico, Pueblo of NM
Tesuque, New Mexico, Pueblo of NM
Zia, New Mexico, Pueblo of NM
Zuni Tribe of the Zuni Reservation, New Mexico NM
Cheyenne River Sioux Tribe of the Cheyenne River Reservation, South Dakota SD
Crow Creek Sioux Tribe of the Crow Creek Reservation, South Dakota SD
Lower Brule Sioux Tribe of the Lower Brule Reservation, South Dakota SD
Oglala Sioux Tribe of the Pine Ridge Reservation, South Dakota SD
Rosebud Sioux Tribe of the Rosebud Indian Reservation, South Dakota SD
Yankton Sioux Tribe of South Dakota SD
Sisseton-Wahpeton Sioux Tribe of the Lake Traverse Reservation, South Dakota SD
Ysleta Del Sur Pueblo of Texas TX
Kickapoo Traditional Tribe of Texas TX
Alabama-Coushatta Tribes of Texas TX
Northwestern Band of Shoshoni Nation of Utah (Washakie) UT
Skull Valley Band of Goshute Indians of Utah UT
Ute Indian Tribe of the Uintah and Ouray Reservation, Utah UT
Paiute Indian Tribe of Utah UT
Ute Mountain Tribe of the Ute Mountain Reservation, Colorado, New Mexico and CO/NM/
Utah UT
Navajo Nation of Arizona, New Mexico and Utah AZ/NM/
UT
Creek Nation (Alabama-Quassarte Tribal Town) OK
Creek Nation (Kialegee Tribal Town) OK
Creek Nation (Thlopthlocco Tribal Town) OK
United Kleetoowah Band of Cherokee OK
Cherokee Nation OK
Chickasaw Nation OK
Choctaw Nation OK
Muscogee Creek OK
Seminole Nation OK
Quapaw OK
A-5
-------
Tribes States
Eastern Shawnee OK
Ottawa OK
Seneca-Cayuga OK
Wyandotte OK
Miami OK
Peoria OK
Modoc OK
Osage OK
Cheyenne and Arapaho OK
Kiowa OK
Fort Sill Apache OK
Wichita and Affiliated Tribes OK
Caddo OK
Delaware OK
Cbmanche OK
Apache OK
Kaw Nation OK
Otoe Misouria OK
Pawnee OK
Ponca OK
Tonkawa OK
Delaware OK
Absentee Shawnee OK
Citizen Potawatomi Nation OK
Iowa OK
Kickapoo OK
Sac and Fox Nation OK
A-6
-------
West Quadrant:
Includes California, Idaho, Montana, Nevada, Oregon, Washington, and Wyoming
Total number of states: 7
Total number of tribes: 165
Total number of inventories: 3
Tribes States
Alturas Indian Rancheria, California CA
Scotts Valley Band of Porno Indians of California CA
Berry Creek Rancheria of Maidu Indians of California CA
Big Sandy Rancheria of Mono Indians of California CA
Big Valley Rancheria of Pomo and Pit River Indians of California CA
Buena Vista Rancheria of Me-Wuk Indians of California CA
Lytton Rancheria of California CA
Cloverdale Rancheria of Pomo Indians of California CA
Cold Springs Rancheria of Mono Indians of California CA
Cachil DeHe Band of Wintun Indians of the Colusa Indian Community of the Colusa CA
Rancheria, California
Cortina Indian Rancheria of Wintun Indians of California CA
Dry Creek Rancheria of Pomo Indians of California CA
Robinson Rancheria of Pomo Indians of California CA
Enterprise Rancheria of Maidu Indians of California CA
Fort Bidwell Indian Community of the Fort Bidwell Reservation of California CA
Grindstone Indian Rancheria of Wintun-Wailaki Indians of California CA
Utu Utu Gwaitu Paiute Tribe of the Benton Paiute Reservation, California CA
Hopland Band of Pomo Indians of the Hopland Rancheria, California CA
Jackson Rancheria of Me-Wuk Indians of California CA
Chicken Ranch Rancheria of Me-Wuk Indians of California CA •
Cahto Indian Tribe of the Laytonville Rancheria, California CA
Fort Independence Indian Community of Paiute Indians of the Fort Independence CA
Reservation, California
Manchester Band of Pomo Indians of the Manchester-Point Arena Rancheria, CA
California
Middletown Rancheria of Pomo Indians of California CA
lone Band of Miwok Indians of California CA
Big Pine Band of Owens Valley Paiute Shoshone Indians of the Big Pine Reservation, CA
A-7
-------
Tribes States
California
Mechoopda Indian Tribe of Chico Rancheria, California CA
Northfork Rancheria of Mono Indians of California CA
Paskenta Band of Nomlaki Indians of California CA
Picayune Rancheria of Chukchansi Indians of California CA
Pinoleville Rancheria of Porno Indians of California CA
Pit River Tribe, California (includes Big Bend, Lookout, Montgomery Creek and CA
Roaring Creek Rancherias and XL Ranch)
Potter Valley Rancheria of Pomo Indians of California CA
Redding Rancheria, California CA
Redwood Valley Rancheria of Pomo Indians of California CA
Round Valley Indian Tribes of the Round Valley Reservation, California (formerly CA
known as the Covelo Indian Community)
Rumsey Indian Rancheria of Wintun Indians of California CA
Santa Rosa Indian Community of the Santa Rosa Rancheria, California CA
Greenville Rancheria of Maidu Indians of California CA
Shingle Springs Band of Miwok Indians, Shingle Springs Rancheria (Verona Tract), CA
California
Kashia Band of Pomo Indians of the Stewarts Point Rancheria, California CA
Paiute-Shoshone Indians of the Bishop Community of the Bishop Colony, California CA
Susanville Indian Rancheria, California CA
Table Mountain Rancheria of California CA
Tule River Indian Tribe of the Tule River Reservation, California CA
Big Lagoon Rancheria, California CA
Karuk Tribe of California CA
Resighini Rancheria, California (formerly known as the Coast Indian Community of CA
Yurok Indians of the Resighini Rancheria)
Blue Lake Rancheria, California CA
Elk Valley Rancheria, California CA
Bear River Band of the Rohnerville Rancheria, California CA
Hoopa Valley Tribe, California CA
Quartz Valley Indian Community of the Quartz Valley Reservation of California CA
Smith River Rancheria, California CA
Table Bluff Reservation - Wiyot Tribe, California CA
A-8
-------
Tribes States
Cher-Ae Heights Indian Community of the Trinidad Rancheria, California CA
Augustine Band of Cahuilla Mission Indians of the Augustine Reservation, California CA
Cabazon Band of Cahuilla Mission Indians of the Cabazon Reservation, California CA
Cahuilla Band of Mission Indians of the Cahuilla Reservation, California CA
Campo Band of Diegueno Mission Indians of the Campo Indian Reservation, California CA
Capitan Grande Band of Diegueno Mission Indians of California CA
Barona Group of Capitan Grande Band of Mission Indians of the Barona Reservation, CA
California
Cuyapaipe Community of Diegueno Mission Indians of the Cuyapaipe Reservation, CA
California
Inaja Band of Diegueno Mission Indians of the Inaja and Cosmit Reservation, CA
California
Jamul Indian Village of California CA
La Jolla Band of Luiseno Mission Indians of the La Jolla Reservation, California CA
La Posta Band of Diegueno Mission Indians of the La Posta Indian Reservation, CA
California
Los Coyotes Band of Cahuilla Mission Indians of the Los Coyotes Reservation, CA
California
Manzanita Band of Diegueno Mission Indians of the Manzanita Reservation, California CA
Mesa Grande Band of Diegueno Mission Indians of the Mesa Grande Reservation, CA
California
Morongo Band of Cahuilla Mission Indians of the Morongo Reservation, California CA
Pala Band of Luiseno Mission Indians of the Pala Reservation, California CA
Agua Caliente Band of Cahuilla Indians of the Agua Caliente Indian Reservation, CA
California
Pauma Band of Luiseno Mission Indians of the Pauma and Yuima Reservation, CA
California
Pechanga Band of Luiseno Mission Indians of the Pechanga Reservation, California CA
Rincon Band of Luiseno Mission Indians of the Rincon Reservation, California CA
San Manual Band of Serrano Mission Indians of the San Manual Reservation, CA
California
San Pasqual Band of Diegueno Mission Indians of California CA
Santa Rosa Band of Cahuilla Mission Indians of the Santa Rosa Reservation, California CA
Santa Ynez Band of Chumash Mission Indians of the Santa Ynez Reservation, CA
California
Santa Ysabel Band of Diegueno Mission Indians of the Santa Ysabel Reservation, CA
A-9
-------
Tribes States
California
Soboba Band of Luiseno Mission Indians of the Soboba Reservation, California CA
Sycuan Band of Diegueno Mission Indians of California CA
Torres-Martinez Band of Cahuilla Mission Indians of California CA
Ramona Band or Village of Cahuilla Mission Indians of California CA
Twenty-Nine Palms Band of Luiseno Mission Indians of California CA
Viejas (Baron Long) Group of Capitan Grande Band of Mission Indians of the Viejas CA
Reservation, California
Cedarville Rancheria, California CA
Paiute-Shoshone Indians of the Lone Pine Community of the Lone Pine Reservation, CA
California
Sheep Ranch Rancheria of Me-Wuk Indians of California CA
Sherwood Valley Rancheria of Pomo Indians of California CA
Elem Indian Colony of Pomo Indians of the Sulphur Bank Rancheria, California CA
Tuolumne Band of Me-Wuk Indians of the Tuolumne Rancheria of California CA
Upper Lake Band of Pomo Indians of Upper Lake Rancheria of California CA
United Auburn Indian Community of the Auburn Rancheria of California CA
Coyote Valley Band of Pomo Indians of California CA
Bridgeport Paiute Indian Colony of California CA
Death Valley Timbi-Sha Shoshone Band of California CA
Chemehuevi Indian Tribe of the Chemehuevi Reservation, California CA
Shoshone-Bannock Tribes of the Fort Hall Reservation of Idaho ID
Coeur D'Alene Tribe of the Coeur D'Alene Reservation, Idaho ID
Nez Perce Tribe of Idaho ID
Kootenai Tribe of Idaho ID
Blackfeet Tribe of the Blackfeet Indian Reservation of Montana MT
Crow Tribe of Montana MT
Confederated Salish and Kootenai Tribes of the Flathead Reservation, Montana MT
Fort Belknap Indian Community of the Fort Belknap Reservation of Montana MT
Chippewa-Cree Indians of the Rocky Boy's Reservation, Montana MT
Assiniboine and Sioux Tribes of the Fort Peck Indian Reservation, Montana MT
Northern Cheyenne Tribe of the Northern Cheyenne Indian Reservation, Montana MT
Te-Moak Tribes of Western Shoshone Indians of Nevada (Four constituent bands: NV
Battle Mountain Band; Elko Band; South Fork Band and Wells Band)
A-10
-------
Tribes States
Shoshone-Paiute Tribes of the Duck Valley Reservation, Nevada NV
Duckwater Shoshone Tribe of the Duckwater Reservation, Nevada NV
Ely Shoshone Tribe of Nevada NV
Paiute-Shoshone Tribe of the Fallen Reservation and Colony, Nevada NV
Las Vegas Tribe of Paiute Indians of the Las Vegas Indian Colony, Nevada NV
Lovelock Paiute Tribe of the Lovelock Indian Colony, Nevada NV
Moapa Band of Paiute Indians of the Moapa River Indian Reservation, Nevada NV
Pyramid Lake Paiute Tribe of the Pyramid Lake Reservation, Nevada NV
Reno-Sparks Indian Colony, Nevada NV
Summit Lake Paiute Tribe of Nevada NV
Walker River Paiute Tribe of the Walker River Reservation, Nevada NV
Winnemucca Indian Colony of Nevada NV
Yerington Paiute Tribe of the Yerington Colony and Campbell Ranch, Nevada NV
Yomba Shoshone Tribe of the Yomba Reservation, Nevada NV
Washoe Tribe of Nevada and California (Carson Colony, Dresslerville Colony, NV/CA
Woodfords Community, Stewart Community, and Washoe Ranches)
Fort McDermitt Paiute and Shoshone Tribes of the Fort McDermitt Indian Reservation, NV/OR
Nevada and Oregon
Klamath Indian Tribe of Oregon OR
Confederated Tribes of the Grand Ronde Community of Oregon OR
Confederated Tribes of the Siletz Reservation, Oregon OR
Confederated Tribes of the Umatilla Reservation, Oregon OR
Burns Paiute Tribe of the Burns Paiute Indian Colony of Oregon OR
Confederated Tribes of the Warm Springs Reservation of Oregon OR
Confederated Tribes of the Coos, Lower Umpqua and Siuslaw Indians of Oregon OR
Cow Creek Band of Umpqua Indians of Oregon OR
Coquille Tribe of Oregon OR
Confederated Tribes of the Colville Reservation, Washington WA
Spokane Tribe of the Spokane Reservation, Washington WA
Kalispel Indian Community of the Kalispel Reservation, Washington WA
Confederated Tribes of the Chehalis Reservation, Washington WA •
Hoh Indian Tribe of the Hoh Indian Reservation, Washington WA
Lummi Tribe of the Lummi Reservation, Washington WA
Makah Indian Tribe of the Makah Indian Reservation, Washington WA
A-ll
-------
Tribes States
Muckleshoot Indian Tribe of the Muckleshoot Reservation, Washington WA
Nisqually Indian Tribe of the Nisqually Reservation, Washington WA
Nooksack Indian Tribe of Washington WA
Port Gamble Indian Community of the Port Gamble Reservation, Washington WA
Suquamish Indian Tribe of the Port Madison Reservation, Washington WA
Puyallup Tribe of the Puyallup Reservation, Washington WA
Quileute Tribe of the Quileute Reservation, Washington WA
Quinault Tribe of the Quinault Reservation, Washington WA
Shoalwater Bay Tribe of the Shoalwater Bay Indian Reservation, Washington WA
Sauk-Suiattle Indian Tribe of Washington WA
Skokomish Indian Tribe of the Skokomish Reservation, Washington WA
Squaxin Island Tribe of the Squaxin Island Reservation, Washington WA
Swinomish Indians of the Swinomish Reservation, Washington WA
Tulalip Tribes of the Tulalip Reservation, Washington WA
Confederated Tribes and Bands of the Yakama Indian Nation of the Yakama WA
Reservation, Washington
Lower Elwha Tribal Community of the Lower Elwha Reservation, Washington WA
Jamestown S'Klallam Tribe of Washington WA
Upper Skagit Indian Tribe of Washington WA
Samish Indian Tribe, Washington WA
Stillaguamish Tribe of Washington WA
Arapahoe Tribe of the Wind River Reservation, Wyoming WY
Shoshone Tribe of the Wind River Reservation, Wyoming WY
Tribes with Indian Country in more than one Quadrant:
Tribe States
Colorado River Indian Tribes of the Colorado River Indian Reservation, AZ, CA
Arizona and California
Fort Mojave Indian Tribe of Arizona, California, and Nevada AZ, CA, NV
Quechan Tribe of the Fort Yuma Indian Reservation, Arizona and California AZ, CA
Confederated Tribes of the Goshute Reservation, Nevada and Utah NV, UT
A-12
-------
APPENDIX B
EXISTING PART 71 SOURCES IN INDIAN COUNTRY (AS OF AUGUST 15, 2002)
Table B-l. Existing Part 71 Sources in Indian Country (as of August 15, 2002)
Company Name, EPA Region
. Facility Name (type)
NAICS
Code
Tribal Identifier
Location
Region 2
Philadelphia Furniture
Region 4
Calumet Florida, Inc.
Region 5
Great Lakes Gas Transmission
Company
Great Lakes Gas Transmission
Company
Region 6
El Paso Natural Gas Company
El Paso Natural Gas Company
Transwestem Pipeline Company
Williams Field Service
Region 8
Philadelphia Furniture (furniture
manufacturer)
Devil's Garden Facility (crude
oil storage and distribution)
Deer River Compressor Station
No. 4 (SIC 4922)
Cloquet Compressor Station No.
5 (SIC 4922)
Laguna Compressor Station
Lindrith Compressor Station
Transwestem Compressor
Station
Los Mestenios Compressor
Station
33712 Seneca Nations
486110 MiccosukeeIR
Salamanca, NY
Broward Co., FL
486210
486210
486210
486210
486210
Leech Lake IR
Fond du Lac IR
Laguna IR
Jicarilla Apache IR
Laguna IR
Deer River, MN
Cloquet, MN
Laguna, NM
MM
Laguna, NM
486210 Jicarilla Apache IR
NM
Amoco Production Company
BP America Production Company
BP Amoco, Inc.
BP Amoco, Inc.
Colorado Interstate Gas Company
Conoco
Coyote Gas Treating, L.L.C
(Formerly El Paso Natural Gas)
Deseret Generation and Transmission
Co-operative
Devon SFS Operating, Inc.
El Paso Natural Gas Company
Koch Sulfur Products Company
Northern Border Pipeline Company
Florida River Compression
Facility
Wolf Point Compressor Facility
Four Queens Central Facility
Salvador I/II Central Facility
Natural Buttes Compressor
Station
Sunnyside Compressor Station
Coyote Gulch Treating Plant
Bonanza Power Plant
Riverton Dome Gas Plant
Bondad Compressor Station
Riverton, Wyoming Facility
Compressor Station #2
486210
486210
486210
486210
486210
486210
211111
221112
211111
486210
325188
486210
Southern Ute IR
Southern Ute IR
Southern Ute IR
Southern Ute IR
Uintah and Ouray IR
Southern Ute IR
Southern Ute IR
Uintah and Ouray IR
Wind River IR
Southern Ute IR
Wind River IR
Fort Peck IR
CO
CO
CO
CO
UT
CO
CO
UT
WY
CO
WY
MT
(continued)
B-l
-------
Table B-l. Existing Part 71 Sources in Indian Country (as of August 15,2002)
(continued)
Company Name, EPA Region
Northwest Pipeline
OMG Americas
Plum Creek Northwest Lumber, Inc.
Public Service Company
Questar Pipeline Company
Red Cedar Gathering Company
Red Cedar Gathering Company
Red Cedar Gathering Company
Red Cedar Gathering Company
Red Cedar Gathering Company
Red Cedar Gathering Company
Red Cedar Gathering Company
Red Willow Universal Compression
SEI Gathering and Processing
Company
SG Interests, Ltd
SG Interests, Ltd
Shenandoah Energy, Inc.
Transwestern Pipeline Company
Vastar Resources, Inc.
Vastar Resources, Inc.
Vastar Resources, Inc.
Vastar Resources, Inc.
Vastar Resources, Inc.
Vastar Resources, Inc.
Vastar Resources, Inc.
Vastar Resources, Inc.
Vastar Resources, Inc.
Vastar Resources, Inc.
Williams Field Services Company
Williams Field Services Company
Williston Basin Interstate Pipeline
Company
Region 9
Arizona Public Service Co.
Facility Name (type)
La Plata B Compressor Station
Apex Operations
Pablo Saw Mill Facility
Tiffany Compressor Station
Fidlar Compressor Station
Antler Plant
Arkansas Loop Plant
Bondad Compressor Station
Capote Compressor Station
Diamond Back Compressor
Station
Outlaw Compressor Station
Sidewinder Compressor Station
Coyote Gulch Compressor
Station
Wonsits Compressor Station
Argenta CDP Compressor
Facility
South Ignacio Central Delivery
Red Wash 24B Gas Plant
La Plata A Compressor Station
Treating Site #2
Treating Site #4
Treating Site #6
Treating Site #5
Treating Site #7
Treating Site #9
Treating Site #1
Treating Site #7B
Treating Site #6B
Treating Site #8
PLA-9 Central Delivery Point
Ignacio Plant
Hardin Compressor Station
Four Corners Steam Electric
Station
NAICS
Code
486210
331492
321113
486210
486210
221210
221210
486210
486210
486210 -
486210
486210
486210
486210
486210
221210
211111
486210.
486210
486210
486210
486210
486210
486210
486210
486210
486210
486210
486210
211111
486210
221112
Tribal Identifier
Southern Ute IR
Paiute IR
Flathead IR
Southern Ute IR
Uintah and Ouray IR
Southern Ute IR
Southern Ute IR
Southern Ute IR
Southern Ute IR
Southern Ute IR
Southern Ute IR
Southern Ute IR
Southern Ute IR
Uintah and Ouray IR
Southern Ute IR
Southern Ute IR
Uintah and Ouray IR
Southern Ute IR
Southern Ute IR
Southern Ute IR
Southern Ute IR
Southern Ute IR
Southern Ute IR
Southern Ute IR
Southern Ute IR
Southern Ute IR
Southern Ute IR
Southern Ute IR
Southern Ute IR
Southern Ute IR
Crow IR
Navajo Nation
Location
CO
UT
MT
CO
UT
CO
CO
CO
CO
CO
CO
CO
CO
UT
CO
CO
UT
CO
CO
CO
CO
CO
CO
CO
CO
CO
CO
CO
CO
CO
MT
Near Fuitland, NM
(continued)
B-2
-------
Table B-l. Existing Part 71 Sources in Indian Country (as of August 15, 2002)
(continued)
Company Name, EPA Region
ASARCO
Colmac Energy, Inc.
Conoco,' Inc.
El Paso Natural Gas Co.
El Paso Natural Gas Co.
El Paso Natural Gas Co.
El Paso Natural Gas Co.
El Paso Natural Gas Co.
El Paso Natural Gas Co.
Exxon-Mobil
Fort Apache Timber Co.
Peabody Western Coal Co.
Pimalco
Salt River Landfill
Salt River Project
Salt River Project
Salt River Project
Salt River Sand and Rock
Stericycle, Inc.
Texaco
Facility Name (type)
Mission Mine Complex (copper
mining and processing)
Mecca Plant
Wingate Fractionating Plant
(fractionation of natural gas
liquids)
Dilkon Compressor Station
Leupp Compressor Station
Navajo Compressor Station
Window Rock Compressor
Station
Gallup Compressor Station
White Rock Compressor Station
McElmo Gas Plant and Oilfield
Fort Apache Timber Co.
Black Mesa Complex
Pimalco (secondary aluminum
production and extrusion)
Salt River Landfill
Tri-Cities Landfill Energy
Facility
Tri-Cities Landfill
Navajo Generating Station
Salt River Sand and Rock
Stericycle (medical waste
incinerator)
Aneth Gas Plant
NAICS
Code
212234
221119
211112
486210
486210
486210
486210
486210
211111
321113
21211
331314
562212
221119
562212
221112
21232
56221
211111
Tribal Identifier
Tohono O'odham
Nation
Cabazon Band of
Mission Indians
Navajo Nation
Navajo Nation
Navajo Nation
Navajo Nation
Navajo Nation
• Navajo Nation
Navajo Nation
Navajo Nation
White Mountain
Apache
Navajo Nation and
Hopi Tribe
Gila River Indian
Community
Salt River Pima-
Maricopa Indian
Community
Salt River Pima-
Maricopa Indian
Community
Salt River Pima-
Maricopa Indian
Community
Navajo Nation
Salt River Pima-
Maricopa Indian
Community
Gila River Indian
Community
Navajo Nation
Location
Sahuarita, AZ
Mecca, CA
Near Gallup, NM
Dilkon, AZ
Near Leupp
Trading Post, AZ
Near Chambers,
AZ
AZ, near Gallup,
NM
Near Gallup, NM
NearNewcomb,
NM
Aneth, UT
Whiteriver, AZ
Near Kayenta, AZ
Chandler, AZ
Scottsdale, AZ
Scottsdale, AZ
Scottsdale, AZ
Near Page, AZ
Phoenix, AZ
Chandler, AZ
Aneth and
Montezuma Creek,
UT
(continued)
B-3
-------
Table B-l. Existing Part 71 Sources in Indian Country (as of August 15, 2002)
(continued)
Company Name, EPA Region
Texaco
Transwestern Pipeline Co.
Transwestern Pipeline Co.
Tri-Cities Landfill
Region 10
Clearwater Forest Industries, Inc.
Empire Lumber Company
FMC
Jeld Wen [Fibre] of WA
Pace International
Potlatch, St. Maries
Three Rivers Timber, Inc.
Facility Name (type)
Aneth Unit
Klagetoh Compressor Station
Leupp Compressor Station
Tri-Cities Landfill
Clearwater Forest Industries
(lumbermill)
Kamiah Sawmill
FMC (Elemental phosphorus
plant)
Jeld Wen (window and door
molding manufacturer)
Pace Int'l (repellent and
fertilizer applications)
Potlatch (lumber manufacturer
support facility)
Three Rivers Timber (sawmill)
NAICS
Code
211111
486210
486210
562212
321113
321113
325188
321911
115112
321113
Tribal Identifier
Navajo Nation
Navajo Nation
Navajo Nation
Salt River Pima-
Maricopa Indian
Community
Nez Perce
Nez Perce
Shoshone-Bannock
Tribes, Fort Hall IR
YakamaIR
YakamaIR
Coeur d'Alene
Reservation
Nez Perce
Location
Aneth and
Montezuma Creek,
UT
Near Klagetoh, AZ
Near Leupp, AZ
Scottsdale, AZ
Kooskia, ID
Kamiah, ID
Pocatello, ID
White Swan, WA
Wapatd, WA
St. Maries, ID
Kamiah, ID
Note: Sources with uncertain jurisdictional status, uncertain major source status, or other title V applicability
uncertainties are excluded.
Source: ITPID, 2002.
Table B-2. Industries Expected to be Affected by the Tribal MMNSR Rule: NAICS
Codes for Major Source Types
SIC
0711
1021
1211, 1222,
1231
1311
1311
1321
1442
2421
NAICS
115112
212234
21211
211111
211111
211112
21232
321113
Description
Repellent and fertilizer applications
Copper mining and processing
Coal mining
Natural gas plant
Oil and gas production
Fractionation of natural gas liquids
Sand and gravel production
Sawmill
(continued)
B-4
-------
Table B-2. Industries Expected to be Affected by the Tribal MMNSR Rule: NAICS
Codes for Major Source Types (continued)
SIC
2431
2511
2819
2819
3341
3341
4612
4911
4911
4911
4922
4922
4953
4953
7389
NAICS
321911
33712
325188
325188
331314
331492
486110
221112
221119
221119
221210
486210
56221
562212
5614
Description
Window and door molding manufacturer
Furniture manufacture
Elemental phosphorus plant
Sulfuric acid plant
Secondary aluminum production and extrusion
Cobalt and tungsten recycling
Crude oil storage and distribution (pipeline transportation of crude oil)"
Power plant (coal-fired)
Power plant (biomass-fueled)
Power plant (landfill gas-fired)
Natural gas pipeline and collection
Natural gas compressor
Medical waste incinerator
Landfill
Lumber manufacture support
Facility may also be classified under SIC 5171 and NAICS 422710 as petroleum bulk stations and terminals.
B-5
-------
APPENDIX C
ESTIMATED EMISSION CONTROL AND ADMINISTRATIVE BURDEN COSTS
C.I Estimating the Burden and Cost to the Facilities (Respondents) and Tribal
Agencies
C. L1 Estimating Respondent Burden
C.I. 1.1 Major Sources
The NSR rules will have little impact on existing major stationary sources in Indian
country because they will only affect such sources if they propose a major or minor
modification. EPA data shows that there are eight existing major sources in nonattainment
areas in Indian country. EPA projects at most one major modification in a nonattainment
area in Indian country during the analysis period (i.e., 2004 - 2010); none are expected during
the 3 years following promulgation.
There are currently a total of 83 major sources located throughout Indian country; a
portion of these sources would choose to make minor modifications over the study period; it
is assumed that each major source does a process or operational modification every 10 years.
However, it is anticipated that, of these major source process/operational modifications, only
10 percent will result in greater than de minimus emissions increases. This group (one
facility per year) will be required to get a minor source NSR permit. As EPA noted in their
memorandum on "New Source Review Year 2000 Adjustments," September 6, 2000,
"...industry has been able to build major new plants or make physical and operational
changes at major existing sources without exceeding the major source and major
modification thresholds." The same situation holds for minor modifications to major
sources. Sources avoid the major and minor NSR thresholds for three reasons:
(1) installation of state-of-the-art control technologies; (2) replacement or better control of
older, more polluting processes; and (3) engaging in effective pollution prevention efforts.
All of these actions result in significant reductions in air emissions beyond the baseline case.
This would result in an estimated one minor modification to a major source in Indian country
per year or seven total over the 7-year study period. During the first 3 years following
promulgation, it is estimated that there will be three minor modifications to major sources in
Indian country. The burden costs and impacts are based on sources incurring costs
associated with the respondent activities required by the Federal Minor New Source Review
C-l
-------
Rule and the Federal Major Nonattainment New Source Review Rule. The burden costs and
impacts are identified in Attachment 1 and characterized in Section 6.
The rule will only result in an administrative change for new major sources in Indian
country; this is because, although the regulatory mechanism to issue permits is not yet
available either in the form of a federal nonattainment NSR rule or a TIP, the EPA would be
required to implement the program in Indian country, and would otherwise have to do
source-specific Federal implementation plans. As a result, there would be no new or
additional burden on industry. The EPA estimates that at most one new major source will
locate in a nonattainment area in Indian country during the analysis period (i.e., 2004 to
2010). None are expected during the 3 years following promulgation.
C.I. 1.2 Minor Sources
The minor NSR permitting rule proposed in this action would apply to all new
stationary sources and modifications in Indian country that are not subject to regulation as
new major stationary sources or major modifications under Parts C or D of Title I of the Act,
and are not de minimus as defined in the proposed regulation. The annual burden estimates
are based on an estimated 288 new minor source facilities coming online over the study
period of 2004 to 2010. There are expected to be 123 new minor sources during the first 3
years following promulgation of the rule.
"S
The EPA estimates that there are 3,169 existing minor sources in Indian country.
Assuming that a minor source makes a modification every 10 years, each year there would be
an estimated 317 facilities making modifications to their operations. However, it is
anticipated that of these minor source process/operational modifications only 5 percent will
result in greater than de minimus emissions increases. This group (16 facilities per year) will
be required to get a minor source NSR permit. As previously noted, "...industry has been
able to build major new plants or make physical and operational changes at major existing
sources without exceeding the major source and major modification thresholds." The same
situation holds for minor sources. Sources are expected to avoid the minor NSR thresholds
for same three reasons as noted for major sources: (1) installation of state-of-the-art control
technologies; (2) replacement or better control of older, more polluting processes; and (3)
engaging in effective pollution prevention efforts. All of these actions result in significant
reductions in air emissions beyond the baseline case. Therefore, during the first 3 years, it is
estimated that there will be 48 minor sources requiring permits as a result of minor
modifications. Of these minor source facilities undergoing a minor modification, it is
estimated that half will incur control device costs.
C-2
-------
Table G-l presents the air emissions, controls and costs for typical minor sources in
Indian Country. With regard to the minor NSR permitting rule, the information burden
estimates for monitoring, testing, reporting and recordkeeping are presented in Attachment 1.
These numbers were derived from estimates based on EPA's experience with other
standards. See Section C.2 for the assumptions regarding the frequency of occurrence for the
various respondent activities.
C.I. 1.3 Synthetic Minor Sources
The minor NSR permitting rule will also allow new and existing stationary sources in
Indian country to accept federally enforceable limits on their potential to emit any regulated
air pollutant. These enforceable permit limits will enable sources to avoid regulation as new
major stationary sources, and instead be regulated under this proposed rule, and other
applicable rules, as minor sources or minor modifications. Sources which voluntarily accept
enforceable emission limits in order to avoid major NSR regulations are often referred to as
"synthetic minor" sources. The EPA believes that facilities could choose to do this to avoid
Title V permitting or avoid being classified as a major source under the NSR or MACT
(NESHAP) programs; thus, only the existing 83 major sources would be candidates.
Because this action is completely optional, EPA believes a facility would only choose to do it
if it resulted in cost savings. Thus, EPA estimates no costs for this type of affected source
but instead expects them to incur a cost savings. None are expected during the 3 years
following promulgation; therefore, no burden is projected.
C.1.2 Estimating Respondent Costs
C.I.2.1 Estimating Labor Costs
Labor rates and associated costs are based on Bureau of Labor Statistics (BLS) data.
Technical, management, and clerical average hourly rates for civilian workers were taken
from the March 2002 Employment Cost Trends
(http://stats.bls.gov/news.release/ecec.t02.htm). Wages for civilian workers (white-collar
occupations) are used as the basis for the labor rates with a total compensation of
$28.49/hour for technical, $42.20/hour for managerial and legal, and $18.41/hour for clerical.
These rates represent salaries plus fringe benefits and do not include the cost of overhead.
An overhead rate of 110 percent is used to account for these costs. The fully-burdened wage
rates used to represent respondent labor costs are: technical at $59, management and legal at
$89, and clerical at $39.
C-3
-------
Table C-l. Air Emissions, Controls, and Costs for Typical Minor Sources In Indian Country1
(al)
Source Category
[SIC code]
Dry cleaner
[7216]
Gasoline bulk plant
[5171]
Gasoline station
storage tanks
[5541]
Gasoline station
refueling
[5541]
Industrial, commercial and
institutional boiler:
natural gas^\
Industrial, commercial and
institutional boiler:
oil-fire^
Natural gas compressor
station
[4922]
Asphalt
hot mix plant
[2951]
Process and Air Emission Control Information
Process(bl)
Throughput
Capacity
20 tpy*80
6,500
gallons/day^"
1,200
gal/day011'
1,200
gal/day"1"
<10MM
Btu/hr(ul)
<10MM
Btu/hr(xl)
100 million
scf7yr(a2)(1.8
E+l 1 Btu/yr)
100,000<(2)
(tons/year)
Baseline(cl>
Control
Technology
No control'80
Submerged01"
loading controls
No control'""
No control(ql)
No control(ul)
No control(xl)
No control(a2)
Dry Mechanical
and wet
scrubber"2'
Baseline
Emissions
5.5 tpy VOC01"
18.5tpyVOC(ll)
2.2 tpy VOC(01)
3.0 tpy VOC(rl)
6.7 tpy NOx(vl)
3.0 tpy CO
3.6 tpy SO2(yl)
11.2tpyNOx
1.2 tpy CO
76 tpy NOx032'
50 tpy CO
132tpyTOC
6.0 tpy PM(g2)
0.2 tpy VOC
MSCT(dl)
Refrigeration/
condensation and
carbon adsorption
Vapor balancing
systems
Stage I vapor
balance
Stage II vapor
balance
FOR or low NOx
burners
FGD (SO2)
FRG or low NOx
burners
Post-combustion
catalytic
technologies
Fabric filter
MSCT
Emissions
0.6 tpy
VOC(hl)
1.9tpyVOC(11)
0.1 typ
VOC(ol)
0.15 typ
voc™
3.5tpyNOx(vl)
3.0 tpy CO
(yi)
7.6 tpy NOx(c2)
5.0 tpy CO
13.2 tpy TOC
1.3tpyPM(g2)
0.2 tpy VOC
MSCT(el)
Capital Cost
(2000$)
$23,550(il)
$31,400(ml)
$l,870(pl)
$12,650(sl)
$30,590(wl)
$361,211
-------
Table C-l. Air Emissions, Controls, and Costs for Typical Minor Sources In Indian Country(al) (continued)
Source Category
[SIC code]
Concrete batching plant
[5032]
Sand and gravel processing
[1442]
Stone quarrying and
processing
[1422 and 1423]
Grain elevator
[5153]
Solid waste landfill
[4953] .
Lumber saw mill
[2421]
Process and Air Emission Control Information
Process'"1'
Throughput
Capacity
1 00,000 tpy°2)
1 40,000 ipy^2'
400,000 tpy
0.5 tpy PM10(z2'
6.3 tpy VOC(e3)
1.5typPM°3'
MSCT(el)
Capital Cost
(2000$)
$147,000"2)
$174,700
-------
Table C-l. Air Emissions, Controls, and Costs for Typical Minor Sources In Indian Country(al) (continued)
Source Category
(SIC code]
Automobile refmishing shop
[7532]
Surface Coating operations
[2396, 34 11, and 3479]
Printing operation
(lithographic)
[2752]
Process and Air Emission Control Information
Process0"'
Throughput
Capacity
Medium size
shop(m3>
General
coating
operation (e.g.,
can coating)
48 tpy (ink
use/*
Baseline(cl)
Control
Technology
No control(m3)
No control
No control(r3)
Baseline
Emissions
3.6 tpy VOC(m3)
30 tpy VOC(o3)
6tpyVOC(r3)
MSCT(I|1)
Enclosures and
carbon adsorbers or
incinerators; or low
VOC coatings
Enclosures and
Carbon adsorbers
or incinerators; or
low VOC coatings
Add-on control
devices and P2
measures (low
VOC inks and
cleaning solutions)
MSCT
Emissions
0.7 tpy
VOC(m3)
3 tpy<>3>
3.5 tpy
VOC(r3)
MSCT(cl)
Capital Cost
(yr 2000 $)
$52,800(n3)
[carbon
adsorption]
$209,000(q3)
NA
MSCT(n)
Annualized
Cost
(yr 2000 $)
$n,ooo(n3>
$66,000(q3)
$2,200(r3)
o
ON
Note: CO = Carbon monoxide NOX= Nitrogen oxides
PM = Paniculate matter VOC = Volatile organic compounds
SO2 = Sulfur dioxide Tpy = Short tons per year
PMio = Particulate matter less than 10 microns
-------
Table C-l. Air Emissions, Controls, and Costs for Typical Minor Sources in Indian
Country(al) (continued)
Notes:
al. Source types listed are those considered to have the greatest potential to be new minor sources located
on Indian Country; selection was based on available tribal emission inventories (i.e., Regions 8 and 10)
and other information gathered from EPA regional contacts and other publicly available sources.
bl. Process throughput or operating capacities are selected to reflect typical minor source sizes for the
source category. In some cases they are based on a national average value; others are based on existing
size categories where the lower end values were selected to characterize minor sources; and in some
cases the values were based on information contained in the available tribal emission inventories.
cl. Baseline control is a characterization of the control level that would likely be applied to the source type
in the absence of any minor source regulation.
dl. MSCT is the technology selected to represent "best available control technology" for the source type.
These are for the most part based on review of the EPA's RACT/MSCT/LEAR Clearinghouse website
database and other documents such as the South Coast APCD MSCT Guidelines.
el. Costs are in year 2000 dollars. Capital costs (i.e., total capital investment) includes the purchased
equipment cost, direct installation cost, and indirect installation costs.
fl. Total annual cost is comprised of direct costs, indirect costs, and any recovery credits.
gl. Average size commercial facility; 11-B.l, EPA-310/R-95-001.
hi. Emission factors from Section4.1 of AP-42.
i 1. Costs based on installing a recovery dryer; 4-192, EPA-453/R-92-018.
j 1. Operating cost and annual charges; no credit for solvent recovery.
kl. Typical bulkplant throughput, Section 4.2.6(F); EPA 453/R-92-018.
11. Section 4.2.6(B); EPA 453/R-92-018.
ml. . Section 4.2.6(F); EPA 453/R-92-018.
nl. Section 4.2.8(F); EPA 453/R-92-018.
ol. Sections 4.2.7(B and C); EPA 453/R-92-018.
pi. Section 4.2.7(F); EPA 453/R-92-018.
ql. Section 4.2.8(F); EPA 453/R-92-018.
rl. Sections 4.2.8(B and C); EPA 453/R-92-018.
si. Section 4.2.8(F); EPA 453/R-92-018.
tl. This source category would include boilers and heaters located at casinos on Indian Country.
ul. Assumed cut-off value based on EPA NSPS/NESHAP regulations
vl. Section 1.4, Tablel.4-1 of AP-42.
wl. Costs based on NOx controls.
xl. Assumed cut-off value based on EPA NSPS/NESHAP regulations
yl. Section 1.3, Tablel.3-1 of AP-42.
(continued)
C-7
-------
Table C-l. Air Emissions, Controls, and Costs for Typical Minor Sources in Indian
Country(al) (continued)
Notes:
zl. Sulfur dioxide control accounts for the majority of costs; alternative is low sulfur fuel.
a2. Based on an average value calculated from the natural gas compressor station data reported in the
available tribal inventories.
b2. Based on uncontrolled emission factors for 4-stroke lean-bum engines from Table 3.2-2 in Section 3.2
ofAP-42.
c2. 90 percent control using catalytic reduction and oxidation technologies.
d2. Capital costs based on catalytic reduction and oxidation technologies.
e2. Annual costs based on catalytic reduction and oxidation technologies.
f2. Assumed valued selected to represent small to medium size unit, based on calculated national average
value of 151,500 tpy of hot mix asphalt produced in 1996.
g2. Emission factors from Table 11.1-land Table 11.1-9 of Section 1 l.lof AP-42.
h2. Fugitive dust suppression cost based on range of prices collected as part of environmental technology
Verification Program. Fabric filter costs are based on EPA air Pollution Control Cost Manual,
EPA/452/B-02-001.
i2. NA (no applicable comment)
j2. Assumed valued selected to represent small to medium size unit, based on calculated national average
value.
k2. Emission factors from Table 11.12-3 in Section 11.12 of AP-42.
12. NA
m2. NA
n2. National average value calculated from information "Sand and Gravel Processing," Chapter 15 of in
AWMA Air Pollution Engineering Manual, 1992.
o2. Emission factor from Table 1 of "Sand and Gravel Processing," Chapter 15 of AWMA Air Pollution
Engineering Manual, 1992.
p2. Based on 80 percent control.
q2. NA
r2. NA
s2. National average value calculated from information "Stone and Quarrying Processing," Chapter 15 of
in AWMA Air Pollution Engineering Manual, 1992.
t2. Emission factor from Table 11.19.2-2 in Section 11.19.2 of AP-42.
u2. Based on 90 percent control of PM10.
v2. NA
w2. NA
x2. Calculated value based on reported emissions in tribal inventories.
y2. . Emission factor from Table 9.9.1-1 of AP-42.
(continued)
C-8
-------
Table C-l. Air Emissions, Controls, and Costs for Typical Minor Sources in Indian
Country(al) (continued)
Notes:
z2. Based on 90 percent control of PM10.
a3. NA
b3. NA
c3. Assumed small design capacity and median USA waste acceptance rate, from Chapter 19 of AWMA
Air Pollution Engineering Manual, 1992.
d3. Based on average emission factor from Chapter 19 of AWMA Air Pollution Engineering Manual,
1992, applied to the total design capacity of waste. For new facilities, actual emissions would increase
each year as waste is added based on acceptance rates.
e3. Based on 75 percent control of VOC.
f3. Based on 500,000 tons capacity; flare costs are based on EPA Control Cost Manual.
g3. Based on 20,000 tpy fill rate.
h3. Assumed capacity to characterize small mill based on model plant information contained in Section
2.12 "Lumber and Furniture Industry" of EPA-450/3-77-010, 1977.
i3. Emission factors from Table 2-59 in Section 2.12 "Lumber and Furniture Industry" of EPA-450/3-77-
010, 1977.
j3. Based on 95 percent control.
k3. NA
13. NA
m3. From Table 12 in Chapter 10"surface Coating" in AWMA Air Pollution Engineering Manual, 1992.
n3. Activated carbon canister costs adapted from Handbook, Control Techniques for Hazardous Air
Pollutants, EPA/625/6-91/014. Note that catalytic controls costs for auto refinishers are also presented
. in Section 4.6.1.17(F); EPA 453/R-92-018.
o3. Small scale can coating operation derived from Table 4.2.2.2-1 of Section 4.2.2.2 of AP-42.
p3. Based on 90 percent control.
q3. Section 4.5.1.4 (F); EPA 453/R-92-018.
r3. Based on information and data contained in Chapter 5 (see Tables 5-1 through 5-4) of the EPA
document "Control of Volatile Organic Compound Emissions from Offset Lithographic Printing"
1993, OAQPS Guideline Series.
C-9
-------
C.I.2.2 Estimating Capital/Startup Costs
Several of the monitoring, testing, recordkeeping, and reporting (MRR) activities
associated with the proposed rule occur one-time only. These costs are considered as capital
cost in this analysis. The estimate of facility capital/startup costs associated with the NSR
permit program is shown in Attachment 1. The average capital cost per facility is estimated
over the analysis period as $13,088 per affected source.
There are no capital costs associated with the NSR rule for MRR activities for new
major sources in nonattainment areas. During the 3 years following promulgation, no new
major sources in nonattainment areas in Indian country are expected. In addition, there are
no MRR costs estimated for major modifications to existing major sources in nonattainment
areas, because none are expected. The minor modifications to existing major sources in
attainment and nonattainment areas, which are impacted by the NSR rule, would incur the
same MRR cost associated with the NSR permit program as shown in Attachment 1. The
average capital cost per facility is estimated over the analysis period as $13,088 per affected
source.
C. 1.2.3 Estimating Annual Costs
The annualized cost of capital for the capital costs and one-time activities (i.e.,
$13,088) shown in Attachment 1 is $1,863 per year. This is based on a payment period of
10 years and an interest rate of 7 percent. The annual and reoccurring costs as shown in
Attachment amount to a burden cost of $5,735; the total annual burden cost is estimated at
$7,598 per year per affected source.
C. 1.3 Estimating Agency Burden and Cost
The only costs that the Federal government will incur as a result of this action are
user costs associated with the analysis of the reported information, as presented in
Attachment 2. This action imposes no direct burden on State, local, or Tribal agencies.
However, should a Tribal agency choose to accept delegated authority for the minor NSR
rule, the only costs that the Tribal agency or government will incur are user costs associated
with the analysis of the reported information, as presented in Attachment 2. Labor rates and
associated costs for the agency are assumed to be the same as the respondent's hourly rates
rather than the U.S. Government labor rates and associated costs, such as those based on
labor rates from the U.S. Office of Personnel Management (OPM). These rates are
considered more appropriate, assuming Tribal agencies may adopt the rules. Therefore,
agency labor rates are estimated as follows: technical at $59, management and legal at $89,
C-10
-------
and clerical at $39. The occurrence of agency-related activities is based on the same
frequency of occurrence as used for respondent activities. The average total agency burden
per affected source, provided in Attachment 2, is 48 hours per affected source including
technical, management, legal, and clerical hours. The average total annualized cost to the
agency per affected source is calculated by determining the total labor cost for all the various
respondent activities and annualizing those costs that are initial, one-time occurrences. The
annualized costs and the costs for those activities that are reoccurring are then added to any
associated costs (e.g., total travel expenses for tests attended) to get the average agency
burden per facility. The average total annualized cost to the agency per affected source given
in Attachment 2, including the cost of labor, capital, operation, and maintenance, is $3,110
per year.
C.I.4 Estimating the Respondent Universe and Total Burden and Costs
Stationary sources subject to this rulemaking will be required to file a NSR
construction permit, install the required monitoring equipment, and provide the various one-
time notifications required by the rules. Compliance reports also must be submitted. In
addition, some of these minor sources will be required to install the minor source MSCT
equipment; conduct initial performance tests; conduct air impacts modeling; prepare startup,
shutdown, and malfunction plans, and operation and maintenance plans; and provide the
various notifications on a routine basis. Costs also will be incurred for inspections of control
devices and continuous monitoring systems. Details on the number and percentage of
respondents affected by each individual burden activity/item are provided in assumptions
listed below in Section 6. The weighted average total burden per affected source provided in
Attachment 2 is 296 hours per affected source including technical, management, legal, and
clerical hours. The weighted average total annualized cost per affected source given in
Attachment 1, including the cost of labor, capital, operation, and maintenance, is $7,598 per
year.
The EPA estimates that 288 new minor sources of varying types will be constructed
in Indian country during the analysis period, with 123 new minor sources during the first 3
years of the rule (41/yr). It is estimated that 111 existing minor sources will require permits
as a result of minor modifications; during the first 3 years, there will be 48 (16/yr) existing
minor sources requiring permits as a result of minor modifications. The EPA estimates that
at most one new major source will locate in a nonattamment area in Indian country during the
analysis period; none are expected during the 3 years following promulgation. During the
first 3 years following promulgation, it is estimated that there will be three (1/yr) minor -
modifications to major sources in Indian country, with a total of eight minor modifications
C-ll
-------
over the entire study period. In addition, EPA projects at most one major modification in a
nonartainment area in Indian country during the analysis period; none are expected during the
3 years following promulgation. No synthetic minors are expected to be processed under the
rule during the 3 years following promulgation.
C.I.5 Bottom Line Burden Hours and Cost Tables
C.I.5.1 Respondent Tally
The bottom line respondent burden capital costs, presented in Table C-2, are
calculated by taking the capital cost for the one-time monitoring, compliance testing,
recordkeeping, and reporting costs associated with the minor source NSR permit program for
each affected source type and then multiplying that value by the number of affected sources
of that type that are expected to occur in Indian country each year for the first 3 years
following promulgation of the rule. The totals for each source type are then added to get the
nationwide total capital costs shown in Table C-2. Total capital costs are $759,104 per year
for a 3-year total of $2,277,312.
Table C-2. Estimated Total Capital Cost Burden to Industry to Implement Reporting
and Recordkeeping Requirements During Years 1, 2, and 3
Affected Source Type
New minor sources
Modifications to minor sources
New major sources in nonattainment areas
Major modifications to major sources in
nonattainment areas
Minor modifications to major sources
Synthetic minor sources
Totals
Number of
Affected Sources
per Year
41
16
0
0
1
0
58
Average Capital
Cost per Source
$13,088
$13,088
$13,088
$13,088
$13,088
$13,088
Total Capital Costs
$536,608
$209,408
$0
$0
$13,088
$0
$759,104
Notes: The capital costs and one-time activities (i.e., the sum of all one-time costs shown in Attachment 1) is
$13,088.
The nationwide total annual compliance costs are the annualized costs of monitoring,
testing, recordkeeping, and reporting associated with the NSR rule multiplied by the number
of affected source types that are expected to occur in Indian country each year for the first 3
years following promulgation of the rule. The totals for each source type are then added to
get the nationwide total annual recordkeeping and reporting burden costs shown in
Table C-3. The total annual costs are $440,684 per year for a 3-year total of $1,322,052.
C-12
-------
Table C-3. Estimated Total Annual Cost Burden to Industry to Implement Reporting
and Recordkeeping Requirements During Years 1, 2, and 3
Affected Source
Type
New minor sources
Modifications to
minor sources
New major sources in
nonattainment areas
Major modifications
to major sources in _/
nonattainment areas
Minor modifications
to major sources
Synthetic minor
sources
Totals
Number of
Affected
Sources per
Year
41
16
0
0
1
0
58
Average Total
Hours per
Source per
Year
296
296
296
296
296
296
Total Hours
per Year
12,136
4,736
0
0
296
0
17,168
Average
Annual Cost
per Source'
$7,598
$7,598
$7,598
$7,598
$7,598
$7,598
Total Annual
Costs
$311,518
$121,568
0
0
$7,598
0
$440,684
Notes: The annualized cost of capital for the capital costs and one-time activities (i.e., $13,088, the sum of all
one-time costs shown in Attachment 1) is $1,863 per year. This is based on a payment period of
10 years and an interest rate of 7 percent. The annual and reoccurring costs as shown in Attachment 1
amount to a burden cost of $5,735; the total annual burden cost is estimated at $7,598 per year per
affected source.
C.I.5.2 The Agency Tally
The bottom line Agency total annual burden costs are calculated by taking the
average cost to the Agency per facility ($3,110) and multiplying by the number of affected
sources in Indian country during the first 3 years following promulgation. The nationwide
total annual cost to the EPA or Tribal agencies as shown in Table C-4 is $180,380 per year
for a 3-year total of $541,140.
C.1.6 Litigation
Although not typically included directly in the agency burden estimates, it is possible
that Tribal agencies will be involved in periodic litigation related to the minor source NSR
permit program. To characterize these costs, it is assumed that each agency will be involved
with a facility litigation on average of once every 3 years. The estimated annual cost of these
activities is 73 hours and $4,885 per year per Tribal agency.
C-13
-------
Table C-4. Estimated Recurrent Burden and Cost to the Agency to Implement
Reporting and Recordkeeping Requirements During Years 1, 2, and 3
Affected Source
Type
New minor sources
Modifications to
minor sources
New major sources in
nonattainment areas
Major modifications
Number of
Affected
Sources per
Year
41
16
0
0
Average Total
Hours per
Source per
Year
48
48
48
48
Total Hours
per Year
1,968
768
0
0
Average
Annual Cost
per Source
$3,110
$3,110
$3,110
$3,110
Total Annual
Costs
$127,510
$49,760
$0
$0
to major sources in
nonattainment areas
Minor modifications
to major sources
Synthetic minor
sources
Totals
1
0
58
48
48
48
0
2,784
$3,110
$3,110
$3,110
$0
$180,380
Notes: The average total annualized cost to the agency per affected source given in Attachment 2, including
the cost of labor, capital, operation, and maintenance, is $3,110 per year.
C.1.7 Burden Statement
The average annual respondent burden per facility is estimated at 296 hours and
$7,598. Burden means the total time, effort, or financial resources expended by persons to
generate, maintain, retain, or disclose or provide information to or for a Federal agency. This
includes the time needed to review instructions; develop, acquire, install, and utilize
technology and systems for the purposes of collecting, validating, and verifying information,
processing and maintaining information, and disclosing and providing information; adjust the
existing ways to comply with any previously applicable instructions and requirements; train
personnel to be able to respond to a collection of information requirement; search data
sources; complete and review the collection of information; and transmit or otherwise
disclose the information.
C-14
-------
C.2 Assumptions Made in Estimating the Burden and Cost to the Facilities
(Respondents) and Tribal Agencies
The burden and cost estimates are based on the following assumptions:
a. All minor sources will incur preparation and planning costs.
b. One in 50 facilities will be required to conduct ambient air modeling.
c. One in 20 facilities will be required to hold a public hearing.
d. One in five facilities will make revisions to their permits following submittal.
e. One in 20 facilities will be required to acquire and install an emission parameter
monitoring system.
f. One in 50 facilities will be required to conduct a control device performance test
and develop a site test plan.
g. One in 20 facilities will request special compliance requirements.
h. One in 10 facilities will request a compliance extension.
i. All facilities must submit an initial compliance report.
j. One in 10 facilities will report at least one deviation from the established
monitoring values during the year.
k. One in 50 facilities will be required to develop a startup/shutdown/malfunction
plan and only half of these will experience an event during the year.
1. One in 20 facilities will be required to develop a control device maintenance plan.
m. One in 10 facilities will include minor sources that are exempt from the control
requirements.
n. All facilities will be required to keep records of some type and to periodically
enter data into the files.
o. One in 10 facilities will train personnel and conduct audits of their source during
the year.
p. One in 10 facilities are inspected by the agency annually and 10 percent of the
inspected facilities are found in noncompliance with one or more provisions of the
rule.
q. Each Tribal agency will be involved in litigation of a facility on average of one
per 3 years.
C-15
-------
Attachment 1. Tribal Minor Source NSR Respondent (Facility) Burden and Cost
Facility NSR Program Activity
1. Preparation and Planning
a. Determination of compliance
requirements (#)
b. Obtain guidance on data needs (#)
c. Preparation of MSCT engineering
analysis (#)
2. Data Collection and Analysis (Surveys
and Studies)
a. Conduct ambient air modeling (#)
3. Permit Application
a. Preparation and submittal of permit
application (#)
b. Public hearing (#)
c. Revisions to permit (#)
4. Acquisition, Installation, and Use of
Technology and Systems
a. Control device operating parameter
(emission) monitoring system (#)
5. Reporting Requirements
a. Read instructions (#)
b. Required activities (#)
. c. Create information
i. Conduct control device
performance test (#)
d. Gather existing information (#)
c. Write reports
i. Initial notification of intent to
constr/modify (#)
ii. Notification of anticipated
startup (#)
iii. Notification of actual startup (#)
iv. Notification of special
compliance requirements (#)
(A)
Labor Hours per Activity per Labor
Category
Legal
0
0
0
0
2
4
1
0
0
0
0
1
0
0
2
Managerial
2
0
4
2
4
4
1
4
2
8
0
2
1
0
4
Technical
8
2
16
40
40
16
4
20
4
40
8
4
2
1
16
Clerical
0
0
2
4
16
8
2
2
0
8
2
2
1
1
4
(B)
Activities per
Respondent
per Year
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
(C)
Total Number
of
Respondents
1
1
1
0.02
1
0.05
0.2
0.05
1
0.02
1
1
1
1
0.05
(D)
Total
Hours
10
2
22
1
62
2
2
1
6
1
10
9
4
2
1
(E)
Labor Costs per Labor Category
(A x B x C x Rate)
Legal
$89
SO
$0
$0
$0
$177
$18
$18
$0
$0
$0
$0
$89
$0
$0
$9
Managerial
$89
$177
SO
$354
$4
$354
$18
$18
$18
$177
$14
$0
$177
$89
$0
$18
Technical
$59
$471
$118
S941
$47
$2,353
$47
$47
$59
S235
$47
$471
$235
$118 ,,
$59
$47
Clerical
$39
SO
SO
S77
$3
$619
$15
$15
S4
$0
. $6
$77
$77
$39
$39
$8
(F)
Total
Labor
Costs
$648
$118
$1,373
$54
$3,503
$98
$98
$80
$413
$67
$548
$579
$245
$97
$81
(G)
Associated
Costs
$0
$0
$0
$200
$25.00
$1.25
$5.00
$0
$0
$1,000
$0
$25.00
$25.00
$25.00
$1.25
(H)
Total
Costs
(F-K3)
$648
$118
$1,373
$254
$3,528
$99
$103
$80
$413
$1,067
$548
$604 '
$270
$122
$83
(continued)
-------
Attachment 1. Tribal Minor Source NSR Respondent (Facility) Burden and Cost (continued)
Facility NSR Program
Activity
v. Compliance extension request (#)
vi. Performance test notification (#)
vii. Site-specific test plan (#)
viii. Initial compliance status
determination (#)
ix. Performance test reports (#)
x. Compliance report (#)
xi. Deviation report (##)
xii. Startup/ shutdown/malfunction
reports (##)
6. Recordkeeping Requirements
a. Read instructions (##)
b. Plan activities (##)
c. Implement activities
i. Prepare startup/shutdown/
malfunction plan (#)
ii. Prepare maintenance plan (#)
iii. Prepare documentation for
exempted sources (#)
iv. Monitor control device
parameters (##)
v. Inspect control device (##)
d. Develop record system (#)
e. Time to enter information (##)
f. Time to train personnel (#)
g. Time to perform audits (##)
TOTAL
(A)
Labor Hours per Activity per Labor
Category
Legal
2
0
0
1
0
1
1
0
1
0
0
0
4
0
0
0
0
0
0
Managerial
2
0
1
4
4
2
2
1
2
2
2
2
2
0
0
2
0
0
2
Technical
8
2
16
g
16
8
4
8
8 .
g
16
16
20
1
1
4
1
40
20
Clerical
2
1
8
4
4
4
. 2
1
0
2
8
8
g
0
0
16
0
4
0
(B)
Activities per
Respondent
per Year
1
1
1
1
1
1
1
1
1
1
1
1
1
52
12
1
52
1
1
(C)
Total Number
of
Respondents
0.1
0.02
0.02
1
0.02
1
.0.1
0.01
1
1
0.02
0.05
0.1
0.1
1
1
1
0.1
0.1
(D)
Total
Hours
1
0
1
17
0
15
1
0
11
12
1
1
3
5
12
22
52
4
2
296
(E)
Labor Costs per Labor Category
(A x B x C x Rate)
Legal
$89
$18
$0
$0
$89
$0
$89
$9
$0
$89
$0
$0
$0
$35
$0
$0
$0
$0
$0
$0
Managerial
$89
$18
$0
$2
$354
$7
$177
$18
$1
$177
$177
$4
$9
$18
$0
$0
$177
$0
$0
$18
Technical
$59
$47
$2
$19
$471
$19
$471
$24
$5
$471
$471
$19
$47
$118
$306
$706
$235
$3,059
$235
$118
Clerical
$39
$8
$1
$6
$155
$3
$155
$8
$0
$0
$77
$6
$15
$31
$0
$0
$619
$0
$15
$0
(F)
Total
Labor
Costs
$90
$3
$27
$1,068
$29
$891
$58
$6
$737
$725
$29
$71
$202
$306
$706
$1,031
$3,059
$251
$135
(G)
Associated
Costs
$2.50
$0.50
$0.50
$25.00
$0.50
$25.00
$2.50
$0.25
$0
$0
0.5
1.25
2.5
$0
$0
25
$0
2.5
$0
(H)
Total
Costs
(F+G)
$93
$4
$27
$1,093
$30
$916
$60
$6
$737
$725
$29
.$73
$204
S306
$706
$1,056
$3,059
$253
$135
Notes: # = One-time costs that are incurred and treated as capital costs.
## = Annual or reoccurring cost included as an annual cost.
Totals may equal sum of columns precisely due to rounding. For example, numbers in Column (D) add to 295 due to rounding, but actual value is 296. For
Paperwork Reduction Act Submission, we used the actual value, 296. (Item 6 Recordkeeping Requirements adds to 125 due to rounding, but is actually 126).
Based on the above costs, the average capital cost per facility for the one-time activities is $13,088 per source (i.e., the sum of those items identified as one-
time costs [#]); annualized this cost is $1,863 per year per source. The total of the various annual and reoccurring costs (##) plus the annualized capital
cost is an average of $7,598 (i.e., $1,863 + $5,735) per year per source.
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Attachment 2. Tribal Minor Source NSR Agency Burden and Cost
Facility NSR Program Activity
1. Permit Review
a. Initial permit review
b. Public Hearing
c. Permit Revisions
2. Report review
a Initial notification of intent to
constr/modify
b. Notification of anticipated startup
c. Notification of actual startup
d. Notification of special compliance
requirements
e. Compliance extension request
f Performance test notification
g. Site-specific test plan
h. Initial compliance determination
i. Performance test reports
j. Compliance report
j. Deviation report
k. Startup/shutdown/mal function reports
3. Site compliance inspections (a,b)
a Pre-inspection review of facility
information
b. Travel to and from facility (b)
c. Inspection of air control equipment
used to comply with rule requirements
d. Review site records
e. Prepare inspection report
d. Review site records
e. Prepare inspection report
4. Enforcement actions (c,d)
a Inform facility of noncompliance
b. Follow-up site inspection
TOTAL ANNUAL COST PER SOURCE
5. Litigation Cost per Tribal Agency
TOTAL
6. EPA Overview of Tribal Agency
(A)
Labor Hours per Activity per Labor
Category
Legal
0
0
1
0
0
0
0
1
0
0
0
0
0
0
0
0
0
0
0
0
0
0
4
0
40
8
Managerial
1
1
1
'
1
1
1
1
1
1
1
2
2
2
1
1
0
0
0
4
0
4
4
4
40
8
Technical
8
8
4
4
2
2
4
4
2
8
8
16
8
4
4
8
8
4
4
16
4
16
20
20
100
*"•
40
Clerical
0
8
0
0
0
0
0
0
0
0
0
0
0
0
0
1
0
0
0
4
0
4
8
4
40
8
(B)
Activities per
Respondent
per Year
1
1
'
1
1
1
1
1
1
1
1
1
1
1
1
1
'
1
1
1
1
1
1
1
1
(C)
Total Number
of Respondents
1
0.05
0.2
'
1
1
0.05
0.1
0.02
0.02
1
0.02
1
0.1
0.1
0.10
0.10
0.10
0.10
0.10
0.10
0.10
0.01
0.01
0.33
1
(D)
Total
Hours
9
1
0
5
3
3
0
1
0
0
9
0
10
1
1
1
1
0
0
2
0
2
0
0
48
73
121
64
(E)
Labor Costs per Labor Category
(A * B \ C i Rate)
Legal
S89
$0
$0
$0
so
$0
$0
$0
$9
$0
$0
$0
$0
$0
. $0
so
$0
$0
so
so
so
so
so
$4
so
SI, 180
$709
Managerial
S89
$89
$4
$0
$89
$89
$89
$4
$9
$2
$2
S89
$4
$177
$18
$9
$9
$0
$0
$0
$35
SO
$35
$4
$4
$1,180
$709
Technical
$59
$479
$24
$0
$239
$120
$120
$12
$24
$2
$10
$479
$19
$479
$24
$24
$48
$48
$24
$24
$96
$24
$96
$12
$12
$1,992
$2,393
Clerical
$39
$0
$15
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$4
$0
$0
$0
$15
$0
$15
$3
$2
$515
$309
(F)
Total
Labor
Costs
$567
$44
$0
$328
$208
$208
$16
$42
$4
$11
$567
$23
$656
$42
$33
$61
$48
$24
$24
$147
$24
$147
$22
$17
$3,092
$4,868
$4,120
(G)
Associated
Costs
$0
$5
$0
$0
$0
$0
$0
$0
so
$0
$0
$0
$0
so
so
$0
$10
so
$0
$3
$0
$3
$0
$1
$19
$17
$100
(H)
Total
Costs
(F+C)
$567
$49
$0
$328
$208
$208
$16
$42
$4
$11
$567
$23
$656
$42
$33
$61
$58
$24
$24
$149
$24
$149
$22
$18
$3,110 ~~
$4,885
$4,220
Totals may equal sum of columns precisely due to rounding. For example, numbers in Column (D) add to 47 due to rounding, but actual value is 48. For
Paperwork Reduction Act Submission, we used the actual value, 48.
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