Office of Transportation                 EPA420-B-04-012
and Air Quality                    July 2004
Companion Guidance for the
July 1, 2004, Final Transportation
Conformity Rule
Conformity Implementation in
Multi-Jurisdictional
Nonattainment and
Maintenance Areas for
Existing and New Air Quality
Standards

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                                            EPA420-B-04-012
                                                  July 2004
                                   July 1,
                            Conformity

Conformity Implementation in Multi-Jurisdictional
   Nonattainment and Maintenance       for
     Existing and New Air Quality
          Transportation and Regional Programs Division
            Office of Transportation and Air Quality
            U.S. Environmental Protection Agency

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                                                                                  page 1
[signed by Suzanne Rudzinski on July 21, 2004]
MEMORANDUM:

From:         Suzanne Rudzinski, Director
              Transportation and Regional Programs Division
              Office of Transportation and Air Quality

To:           EPA Regional Air Directors, Regions I - X

Subject:       Companion Guidance for the July 1, 2004, Final Transportation Conformity Rule:
              Conformity Implementation in Multi-jurisdictional Nonattainment and Maintenance
              Areas for Existing and New Air Quality Standards

Part 1:  Introduction

1.      Q. What is the purpose of this guidance?

       A. The Environmental Protection Agency (EPA) published a final transportation
       conformity rule for the new air quality standards on July 1, 2004 (69 FR 40004)1. The
       final rule describes in general terms how conformity will apply to new nonattainment and
       maintenance areas under the 8-hour ozone and PM2 5  standards, and how nonattainment
       areas for the 8-hour ozone standard will use existing adequate or approved motor vehicle
       emissions budgets ("budgets") in state implementation plans (SIPs) prepared for the 1-
       hour ozone standard.  The transportation conformity rule (40 CFR part 93) outlines the
       procedures for determining whether federally funded or approved highway and transit
       projects are consistent with ("conform" to) state air quality goals.

       Both EPA and the U.S. Department of Transportation (DOT) agree it is necessary to
       provide additional guidance for conformity implementation to accompany the final rule.
       EPA is issuing this guidance to clarify how conformity determinations and the regional
       1 This final rule was signed on June 14, 2004, and was available as of that date, before the
effective date of the 8-hour ozone designations.  However, EPA uses the Federal Register
publication date when referring to a rule, so that readers know in which Federal Register issue to
find it.

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       emissions analyses that support them are completed in existing and new nonattainment and
       maintenance areas, particularly those where multiple agencies or states are involved.

       This guidance covers questions such as:

       >      What geographic area is covered by the conformity determination and regional
              emissions analysis?
       >      How can the regional emissions analysis be implemented?
       >      Who does what to develop the regional emissions analysis?
       >      What regional emissions test or tests apply for 8-hour ozone nonattainment areas
              with 1-hour ozone SIP budgets?

       This guidance covers both existing nonattainment and maintenance areas as well as areas
       that are designated nonattainment under the new standards, and highlights opportunities
       for flexibility wherever possible. It provides examples and interpretations for generic
       scenarios that are  present in the field and that are expected to occur under the new
       standards. It expands on the July 1, 2004, final rule by including additional detail,
       examples, and pictorial representations. However, there may be other cases in the field
       that this guidance does not address. In the event an area's circumstances are not covered
       in this guidance, EPA, together with DOT, will work with implementers on a case-by-case
       basis.

       This guidance also stresses the importance of the interagency consultation in the
       conformity process.  Given the fact that no two areas that implement conformity are
       exactly alike, the interagency consultation process can be used to make the best choices
       for an area's circumstances, where the rule provides flexibility.  The interagency
       consultation provision of the conformity rule, §93.105, requires that general processes be
       established for, and specific decisions be made through, interagency consultation.

       DOT, our federal  partner in developing and implementing the conformity rule, assisted in
       the development of this guidance and concurred on its content.
2.      Q. Who can answer questions related to this guidance?

       A. For specific questions about circumstances in particular nonattainment or maintenance
       areas, the EPA Regional Offices, the FHWA Division Offices, and the FTA Regional
       Offices are the first point of contact. A list of EPA Regional conformity staff can be found
       on the web at: http://www.epa.gov/otaq/transp/conform/contacts.htm .

       General questions about this guidance can be directed to Laura Berry, a member of my
       staff at EPA's Office of Transportation and Air Quality, via her email address:
       berry.laura@epa.gov or phone number: 734-214-4858.

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3.      Q. Does this guidance create new conformity requirements?

       A. No.  This guidance is based on conformity implementation precedent to date and the
       July 1, 2004, final rule.  This document provides guidance to EPA Regional Offices,
       FHWA Divisional Offices, FTA Regional Offices, state and local agencies, and the general
       public on how EPA intends to exercise its discretion in implementing the statutory and
       regulatory provisions for determining conformity in multi-jurisdictional areas. The
       guidance is designed to clarify and transmit national policy on these issues.  The statutory
       provisions and EPA regulations described in this document contain legally binding
       requirements. This document does not substitute for those provisions or regulations, nor
       is it a regulation itself. Thus, it does not impose legally binding requirements on EPA,
       states, or the regulated community, and may not apply to a particular situation based upon
       the circumstances.

       This guidance is based on conformity precedent and interpretations made to date.  EPA is
       issuing this guidance so that the precedents are gathered in one place as a reference for
       conformity implementers. EPA retains the discretion to adopt approaches on a case-by-
       case basis that may differ from this guidance, but still comply with the statute and
       conformity regulations. Any decisions regarding a particular conformity determination
       will be made based on the statute and regulations. This guidance is a living document and
       may be revised periodically without public notice.
4.      Q. What do we mean by multi-jurisdictional nonattainment and maintenance areas?

       A. To answer this question, first it is useful to describe a conformity determination in the
       case where there is a single jurisdiction responsible for transportation planning, and a
       single jurisdiction responsible for air quality planning.  In the simplest case, a
       nonattainment or maintenance area is located entirely within one state, and the boundary
       of the nonattainment/maintenance area is exactly the same as the metropolitan planning
       organization (MPO) boundary, as in Figure 1 below.
                                 Area boundary =
                                 MPO jurisdiction
            Figure 1: A Nonattainment or Maintenance Area With One MPO
                                    in a Single State

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The MPO is the agency that is responsible for preparing metropolitan transportation plans
("plans") and transportation improvement programs (TIPs) and demonstrating that plans
and TIPs conform before they are adopted.  An MPO is established for each metropolitan
area that has an urbanized population of 50,000 or more according to Section 134 of Title
23, United States Code and Section 5303 of Title 49, United States Code.  Section 93.101
of the conformity rule includes the following definition of an MPO:

       "that organization designated as being responsible, together with the state,
       for conducting the continuing, cooperative, and comprehensive planning
       process under 23 U.S.C.  134 and 49 U.S.C. 5303.  It is the forum for
       cooperative transportation decision-making."

In most cases, a conformity determination for a transportation plan, TIP,  or project not
from a plan or TIP includes a regional emissions analysis in which emissions from the
planned transportation system are estimated according to §93.122 of the  conformity rule.
In the case where an MPO's boundaries are the same as the nonattainment (or
maintenance) area's boundaries, the MPO is responsible for the regional emission analysis
in the entire area.

However, the boundaries of an MPO do not always correspond to the nonattainment or
maintenance area boundary, nor does a nonattainment or maintenance area  always contain
one single MPO. Furthermore, a nonattainment or maintenance area boundary may
encompass portions of more than one state. The conformity rule does not dictate how
MPO planning boundaries are established; MPOs are established according  to Titles  23
and 49 of the U.S. Code (as cited above) and DOT's metropolitan planning regulations.
Therefore, there may be more than one MPO responsible for transportation planning, and
thus conformity determinations, in a nonattainment or maintenance area,  as in Figure 2
below.
                                                     = Area boundary
         Figure 2: A Nonattainment or Maintenance Area with Two MPOs,
                                in a Single State

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Or, there may be some portion of the nonattainment or maintenance area that is not
included in an MPO's jurisdiction, also known as a "donut area" under the conformity
rules. According to §93.101 of the conformity rule:

       "Donut areas are geographic areas outside a metropolitan planning area
       boundary, but inside the boundary of a nonattainment or maintenance area
       that contains any part of a metropolitan area(s). These areas are not
       isolated rural nonattainment and maintenance areas."

Though the word "donut" implies that the boundary of the MPO would be entirely within
the nonattainment or maintenance area boundary to form two concentric circles, a
nonattainment or maintenance area's donut area may more typically resemble that in
Figure 3 below.
                                                 = Area boundary
         Figure 3: A Nonattainment or Maintenance Area With a "Donut" Area
                                  in a Single State
There are also cases where a nonattainment or maintenance area's boundary includes parts
of more than one state, as in Figure 4 below.  One MPO may cover the entire multi-state
nonattainment or maintenance area, or MPOs may be established for each state's portion
of the area. In these situations, states may submit SIPs with identical budgets for the
entire nonattainment or maintenance area, or may submit SIPs with budgets that cover
only their state's portion of the area.
                                                     = Area boundary


                                               ^   = State boundaries
         Figure 4: A Multi-State Nonattainment or Maintenance Area
                   (Area Could Have One or More MPOs)

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       Finally, there are some MPOs in the country which are responsible for transportation
       planning in more than one nonattainment area.  This guidance does in general apply to
       such MPOs.  The November 24, 1993, conformity rule addresses the case where an MPO
       is responsible for more than one nonattainment area, which continues to apply:

              "If a metropolitan planning area includes more than one nonattainment
              area, a conformity determination must be made for each nonattainment
              area.  Emissions budgets established in the SIP(s) for the included
              nonattainment areas may not be combined or reallocated.  Build/no-build
              tests must be applied separately in each nonattainment area" (58 FR
              62208).

       Whether a nonattainment or maintenance area contains more than one MPO, a donut, or is
       located within more than one state, the conformity process includes flexibility to
       accommodate many differences in state and local agency roles and planning processes
       across the country.
5.      Q. How is this guidance organized?

       A. The remaining parts of this guidance cover how conformity determinations and
       regional emissions analyses that support them are done in nonattainment and maintenance
       areas ("areas"), in the following circumstances:

       •      Part 2 covers conformity determinations and regional emissions analyses before an
             area has SIP budgets for conformity.  Part 2 applies to all nonattainment areas
             where transportation conformity is required for existing and new air quality
             standards, except 8-hour ozone nonattainment areas with adequate or approved
             SIP budgets for the 1-hour ozone standard ("1-hour budgets");

             Part 3 covers conformity determinations and regional emissions analyses after SIP
             budgets are adequate or approved for the applicable pollutant and  standard, and
             applies to all existing and newly designated areas where transportation conformity
             is required; and

       •      Part 4 covers conformity determinations and regional emissions analyses in 8-hour
             ozone nonattainment areas that have 1-hour budgets, before such areas have
             adequate or approved SIP budgets for the 8-hour ozone standard.

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Part 2:  Conformity Determinations and Regional Emissions Analyses Before SIP Budgets
       Are Adequate or Approved

1.      Q. To what areas does this part of the guidance apply?

       Part 2 of this guidance applies to areas designated nonattainment for a pollutant identified
       in §93.102(b) of the conformity rule that do not yet have budgets for a standard that can
       be used in conformity. Some examples of areas include:

             all PM2 5 nonattainment areas before PM2 5 SIP budgets are found adequate or
             approved;

       •      8-hour ozone  areas without adequate or approved 1-hour ozone SIP budgets,
             before 8-hour ozone SIP budgets are found adequate or approved;

             any  1-hour ozone, carbon monoxide, or PM10 nonattainment area that has no
             adequate or approved budgets for that standard.

       This part of the guidance does not cover:

       •      8-hour ozone  nonattainment areas without adequate or approved 8-hour budgets,
             but with adequate or approved 1-hour budgets; please refer to Part 4 of this
             guidance.

       •      maintenance areas, as these areas by definition have approved SIPs with budgets.2
2.      Q. What tests are used for the regional emissions analysis before a nonattainment area has
       motor vehicle emissions budget(s) that are adequate or approved?

       A. Conformity applies for an air quality standard one year after the effective date of
       EPA's nonattainment designation for that standard. EPA generally believes that
       conformity will apply for a standard before an area is able to submit a SIP for that
       standard containing budgets and those budgets are found adequate. Section 93.119 of the
       conformity rule provides direction for how the regional emissions analysis must be done
       before budgets are available.  During this time period, these areas must use the interim
       emissions test or tests: the build/no-build test, and/or the baseline year test.
       2A maintenance area could have a special type of maintenance plan called a limited
maintenance plan. Please see the July 1, 2004, final rule at 69 FR 40063 and the June 30, 2003,
proposed rule at 68 FR 38983-4 for more information about conformity and limited maintenance
plans.

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3.      Q. What geographic area must be examined in regional emissions analyses and conformity
       determinations before a nonattainment area has adequate or approved budgets?

       A. In this case, a conformity determination for a transportation plan, TIP, or project not
       from a plan or TIP must be based on a regional emissions analysis that covers the entire
       nonattainment area, to satisfy the statute and regulations.  Section 93.122(a)(l) of the
       conformity rule states:

              "the regional emissions analysis required by §§93.118 and 93.119 for the
              transportation plan, TIP, or project not from a conforming plan and TIP
              must include all regionally significant projects expected in the
              nonattainment or maintenance area."

       There must be a regional emissions analysis for the entire nonattainment area, whether the
       nonattainment area includes one MPO or more than one MPO, a donut area, portions of
       more than one state, or any combination of these jurisdictions.  Please see the next Q & A
       for the options in creating a regional emissions analysis for an entire area.

       For all nonattainment areas covered by Part 2 of the guidance, the MPO(s) must
       coordinate their plan/TIP conformity determinations together, pursuant to §93.124(d) of
       the final conformity rule. In the November 24, 1993, final rule, EPA stated:

              "Where  a nonattainment area includes multiple MPOs, the control strategy
              SIP may either allocate emissions budgets to each metropolitan planning
              area, or the MPOs must act together to make a conformity determination
              for the nonattainment area."

       Once DOT receives all plan/TIP conformity determinations for a given nonattainment
       area, DOT will make its conformity determinations at the same time. In order for one
       MPO to update or revise its plan and TIP, a DOT conformity determination for each plan
       and TIP in that nonattainment area must be made at the same time, according to
       §93.124(d)oftherule.

       EPA believes that it is necessary for the conformity determinations and regional emissions
       analysis to include the entire nonattainment area when there are no SIP budgets to ensure
       that the requirements of Clean Air Act section 176(c)(l) are met. That is, before SIP
       budgets are available, in order to determine that transportation activities will not cause a
       new air quality violation, increase the frequency or severity of a violation, or delay timely
       attainment or any other milestone in the nonattainment area, it is necessary to consider
       emissions from the entire area in one regional emissions analysis, and for DOT to make all
       plan/TIP  conformity determinations at the same time.

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4.      Q. How can multiple jurisdictions create a regional emissions analysis for the entire
       nonattainment area?

       A. The agencies involved in the conformity process in a nonattainment area where there is
       more than one MPO or a donut area must use the consultation process required by
       §93.105 of the conformity rule to decide how best to meet this requirement, regardless of
       whether the area is within one state or is a multi-state area.  The consultation process
       would be used to decide which interim emissions tests apply and what analysis years are
       used. MPOs must use the same tests and analysis years for the entire nonattainment area,
       as described in the next Q&A.

       Nonattainment Areas With More Than One MPO. In One or More States:
       In nonattainment areas where there is more than one MPO, the MPOs can develop the
       regional emissions analysis for the area in either one of two ways:
       1.      by separate modeling by each MPO that is combined into one regional analysis; or
       2.      by one modeling analysis for the entire nonattainment area.

       If MPOs in the nonattainment area want to model their emissions separately, each MPO
       would do a regional emissions analysis that includes the existing transportation system in
       its part of the nonattainment area as well as  all new projects in its plan and TIP.  Each
       MPO would  show that the applicable interim emissions test(s) are met for each analysis
       year under the regulations. These results would then be  compiled in one regional
       emissions analysis for the entire nonattainment area that would accompany each plan/TIP
       conformity determination. The MPOs in the nonattainment area can work independently
       to complete the  regional emissions analysis for their own parts of the area, but a single
       analysis would be compiled for the entire nonattainment  area to satisfy conformity
       requirements for an MPO's plan/TIP.

       Alternatively, the regional emissions analysis could be completed by  showing that the
       emissions in each analysis year for the entire nonattainment area meet the applicable
       interim emissions test(s). The MPOs in the  area would work together to carry out a
       regional emissions analysis for the entire nonattainment area that includes all of their plans
       and TIPs. Again, these modeling results would be presented in one regional emissions
       analysis for the entire nonattainment area that would accompany the conformity
       determinations for new or revised plans/TIPs in the nonattainment area.

       As an example, suppose there are multiple MPOs within a nonattainment area and they are
       demonstrating conformity using the build/no-build test. If each MPO has its own travel
       demand model and prefers to run its own analysis, the analysis must  show either that each
       MPO passes  its own build/no-build test; or the "build" scenarios and the "no-build"
       scenarios from each MPO must be aggregated, and the total "build"  emissions from all
       MPOs must be less than the total "no-build" emissions from all MPOs.

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Alternatively, the MPOs could initially create one regional emissions analysis for the entire
nonattainment area that meets the build/no-build test.

In either case, to make the demonstration required by the conformity rule, all MPOs must
use the same test and the same analysis years for the regional emissions analysis. MPOs in
one nonattainment area may want to coordinate their plan and TIP update cycles as well
as the length of their plans, as described in the following bullets.

>      New or revised plans and TIPs, as well as significant changes to projects, could
       require a new regional emissions analysis (see §§93.104 and 93.122(g) of the
       conformity rule). Coordination of plan and TIP update cycles among MPOs in the
       same nonattainment area may minimize the number of new regional emissions
       analyses and conformity determinations that have to be completed.

>      Different transportation plan lengths within one nonattainment area would require
       additional analysis years, because according to §93.119(g), an analysis must be
       performed for the last year of each plan. For example, if one MPO's plan ends in
       2025 and another MPO's plan ends in 2030, both years would have to be analyzed
       in the regional analysis for the entire nonattainment area. Coordination of plan
       lengths may minimize the number of analysis years that have to be examined in any
       one regional emissions analysis.

Nonattainment Areas With a Donut Area:
If there is only one MPO in the nonattainment area conducting conformity determinations,
the conformity rule requires the MPO to include the emissions estimated from the donut
area's existing and proposed transportation system in the regional emissions analysis for
metropolitan transportation plan and TIP conformity determinations. However, either the
MPO or the state transportation agency ("state DOT") could estimate emissions from the
donut area as decided through interagency consultation, as explained in Q&A 7 of this
part.

If there is more than one MPO as well as a donut area in a nonattainment area, the MPOs
must work together and with the state DOT as appropriate to create one regional
emissions analysis for the entire nonattainment area that would accompany each plan/TIP
conformity determination.  The emissions estimated from the entire area must meet the
interim emissions test or tests, according to the requirements of §93.119.  Again, the
consultation process would be used to coordinate the choice of tests and analysis years
when several  agencies are completing emissions analyses, because the same tests and
analysis years must be used as noted above.

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5.      Q. What decisions must be made in the interagency consultation process?

       A. The agencies responsible for the conformity determination and regional emissions
       analysis in a nonattainment area, which are the MPOs and possibly the state DOT(s) for
       donut area in a nonattainment area, should use the interagency consultation process to
       make certain decisions. Under the conformity rule, there are some aspects of conformity
       that must be consistent across the nonattainment area, even when there are more than one
       MPO and they each model their own portion separately, as described above. These
       include:

              timing of plan and TIP conformity determinations, so that DOT can make its
              conformity determinations for all plans and TIPs in a nonattainment  area at the
              same time;

       •       how the regional emissions analysis is  developed, i.e., whether emissions will be
              modeled for each MPO's jurisdiction separately and summed together, or modeled
              for the nonattainment area as a whole;

              the interim emissions test the nonattainment area will meet, in the areas that must
              meet only one test as required by  §93.119 (e.g., PM25 areas  or 8-hour ozone areas
              that are  classified as marginal or designated under Clean Air Act, part D, subpart 1
              that do not have  1-hour budgets).

              EPA believes that for consistency and  in order to satisfy the  conformity rule, the
              same test must be used in all portions of the nonattainment area in areas that have
              the choice of interim emissions tests.  In other words, it would not be acceptable
              for one MPO to use the build/no-build test and another MPO within the same
              nonattainment area to use the baseline year test, because the rule requires that one
              test be met for the entire nonattainment area, according to §§93.119 and
              93.124(d);3

       •       the analysis years for the interim emissions test(s), as required by §93.119(g).

              Again, EPA believes that analysis years must be consistent in all portions of the
              nonattainment area, even if emissions are modeled for each MPO's jurisdiction
              separately, otherwise they cannot be summed together to produce a complete
              analysis to satisfy the test.  Regional emissions analyses for all MPOs must cover
       3In 8-hour and 1-hour ozone areas classified moderate or higher, serious CO, and
moderate CO areas with a design value greater than 12.7 ppm, both interim emissions tests must
be met under §93.119.  Please read Section IV.D. of the preamble of the July 1, 2004, final rule
for further explanation.

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             the same time period and thus need to include the last year of each transportation
             plan.

             As described in the above example, in a nonattainment area with two MPOs where
             one MPO's transportation plan covers a 25-year period from 2005 to 2030, and
             the other MPO's plan covers only a 20-year period from 2005 to 2025, the
             regional emissions analysis for both MPOs must examine emissions in the years
             2025 and 2030; and

       •      the emissions model used for the interim emissions test(s), in the case where there
             is more than  one emissions model version that could be used, per §93.111  of the
             rule.

       In addition, the MPO jurisdictions involved in the conformity determination(s) for the
       nonattainment area should discuss the planning assumptions they will use in the regional
       emissions analysis and the sources of that information.  Section 93.105(c)(l)(i) of the rule
       specifically requires that planning assumptions be discussed in the interagency consultation
       process. Where feasible and appropriate, MPOs and where applicable, state DOTs should
       use consistent planning assumptions for the regional emissions analysis in their
       jurisdictions.
6.      Q. In a nonattainment area that does not have SIP budgets for conformity, if one MPO in
       the area can meet the requirements of §93.119 of the rule, but another MPO or a donut
       area cannot, can the MPO that meets the requirements show that its plan and TIP conform
       and proceed?

       A. No. EPA believes that before budgets are adequate or approved, the whole
       nonattainment area must conform to meet the Clean Air Act 176(c)(l) requirements.
       These requirements are that transportation activities will not:

       >      cause a new air quality violation,
       >      increase the frequency or severity of a violation, or
       >      delay timely attainment or any other milestone in the area for an air quality
              standard.

       It is necessary to estimate emissions from the entire nonattainment area  in all plan/TIP
       conformity determinations and the supporting regional analysis because  separate SIP
       budgets are not yet available. For example, in Figure 2 repeated below, there are two
       MPOs. If they choose to model their emissions separately and West MPO appears to pass
       the applicable test(s) of §93.119 but East MPO does not, West MPO cannot proceed to
       determine conformity alone. It cannot be known for sure that West MPO's transportation
       plan and TIP would not cause a new violation, increase the frequency or severity of a

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       violation, or delay timely attainment (or other milestone) in the area, because East MPO
       cannot also pass the test. Thus, the nonattainment area in this example as a whole cannot
       demonstrate that it will not cause or contribute to violations. To resolve this situation,
             (              (East MPO\             CZ)  = Area boundary
             I  West MPO   V          )             ^^


                       Figure 2: A Nonattainment Area With Two MPOs

       East and West MPOs would consult on what options are available for demonstrating
       conformity, including the option of adding or modeling their emissions together to see if
       they pass the applicable regional emissions test(s).
7.      Q. Who is responsible for estimating emissions in a donut area of a nonattainment or
       maintenance area?

       A. In a nonattainment or maintenance area with a donut area, the lead agency for
       developing the regional emissions analysis that applies to the donut area can be:

              the MPO within the nonattainment  area.  In some cases, an adjacent MPO is better
              suited to conduct such an analysis.  An MPO could run an analysis for the donut
              area's projects, or include the donut area's projects in the regional emissions
              analysis supporting its plan and TIP. An MPO could also include the donut area's
              projects in its plan and TIP, but this practice is not common;

              the state DOT. In some cases, the  state DOT may take the lead in conducting
              regional emissions analysis for the donut area; or

       •       another local planning agency. In limited cases, another local planning agency in
              the donut area (e.g., a county planning commission) may also be the lead agency
              for the donut area.

       Section 93.105(c)(3) of the conformity rule relies on the interagency consultation process
       (including the MPO and state DOT) to determine how best to consider projects that are
       planned for donut areas located outside the metropolitan area and within the
       nonattainment or maintenance area in the conformity process.  Section 93.105 also
       requires that such procedures for demonstrating conformity of donut area projects be
       included in an area's conformity SIP that is approved by EPA according to §51.390 of the
       rule.

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Part 3:  Conformity Determinations and Regional Emissions Analysis Once SIP Budgets
Are Adequate/Approved

General

1.      Q. To what areas does this part of the guidance apply?

       A. Part 3 applies to areas designated nonattainment for any pollutant identified in
       §93.102(b)  of the rule, once the area has adequate or approved budgets from a SIP
       addressing a particular standard for a pollutant.  This part of the guidance applies to:

       •       an 8-hour ozone nonattainment area once it has adequate or approved budgets for
              the 8-hour standard,  regardless of whether or not the area had 1-hour budgets;

              a PM2 5 nonattainment area once it has adequate or approved PM2 5 SIP budgets;

              any  1-hour ozone, carbon monoxide, or PM10 nonattainment area that has
              adequate or approved budgets from a SIP addressing that standard; and

       •       maintenance areas, as these areas by definition have approved SIPs with budgets.4
2.      Q. How do nonattainment and maintenance areas determine conformity for a given
       standard once adequate or approved SIP budgets are available for that standard?

       A. Clean Air Act section 176(c)(l) states that federal activities must conform to the SIP.
       Once a SIP with budgets has been submitted and EPA finds the budgets adequate or
       approves the SIP, the "budget test" using the new budgets must be used for conformity
       determinations according to §§93.109 and 93.118 of the conformity rule. EPA's
       adequacy finding or approval means that the SIP's budgets are an appropriate measure for
       whether transportation activities conform due to many factors, including:

              the budgets are identified and precisely quantified;

              the budgets are consistent with the SIP's purpose of reasonable further progress,
              attainment, or maintenance of an air quality standard; and
       4A maintenance area could have a special type of maintenance plan called a limited
maintenance plan. Please see the July 1, 2004, final rule at 69 FR 40063 and the June 30, 2003,
proposed rule at 68 FR 38983-4 for more information about conformity and limited maintenance
plans.

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                                                                                  page 16

              the budgets are consistent with and clearly related to the emissions inventory and
              the control measures in the SIP.5
       3.      Q. What geographic areas might budgets from a SIP address, and how is
              conformity generally determined in multi-jurisdictional areas with SIP budgets?

       A. In a nonattainment or maintenance area located entirely within one state, the state air
       agency may develop a SIP that establishes either:

              a budget (or budgets) that applies to the entire nonattainment or maintenance area,
              or

       •      a subarea budget (or budgets) for each MPO within the nonattainment or
              maintenance area.

       In a multi-state nonattainment or maintenance area, the state air agencies may decide to
       establish SIPs in each state that contain either:

       •      identical budgets that apply to the entire nonattainment or maintenance area, or

       •      unique budgets that apply only to one state's portion of the nonattainment or
              maintenance area.

       State and local agencies can develop SIPs in many different ways.  Section 93.124(d) of
       the conformity rule acknowledges this fact and covers SIPs developed in areas where
       there is more than one MPO:

              "If a nonattainment area includes more than one MPO, the implementation
              plan may establish motor vehicle emissions budgets for each MPO, or else
              the MPOs must collectively make a conformity determination for the entire
              area."

       Once budgets have been found adequate or approved, the conformity determination(s) and
       regional emissions analysis is done for the geographic area that is addressed by the
       budgets in the  SIP. This general principle applies in all situations, although there is
       flexibility in how the regional emissions analysis is developed, and in coordinating
       conformity determinations, when several MPOs are involved. The table on the next page
       summarizes the general situations. The questions and answers that follow provide further
       detail on the different circumstances that can occur.
       5 There are other criteria that SIP budgets must meet for EPA to find them adequate; for
the full list of adequacy criteria, see §93.118(e) of the conformity rule.

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            Summary Table: How SIPs Affect Geographic Areas Considered in Conformity
For a nonattainment
or maintenance area
located:
within one state
within one state
in multiple states
in multiple states
where SIP budgets
are established for:
the entire area
subareas
the entire area
each state
the geographic area
considered in
regional analysis is:
the entire area*
each subarea
the entire area*
each state
the geographic area
considered in final
conformity
determination(s) is:
the entire area**
each subarea
the entire area**
each state
       * There is flexibility in how the regional emissions analysis is done when there is more
       than one MPO.  See below for more details.

       ** There may be more than one plan/TIP conformity determination in a nonattainment or
       maintenance area because there may be more than one MPO making determinations for
       separate plans and TIPs.  There is flexibility in how these conformity determinations are
       coordinated. See below for more details.
Nonattainment or Maintenance Areas Located in One State. Where Budgets Are Established for
the Entire Area

4.     Q. How is conformity done when budgets are established for an entire nonattainment or
       maintenance area that is within one state?

       One MPO. In the simplest case, an area is located entirely within one state and the MPO
       boundary is the same as the nonattainment/maintenance area boundary (Figure 1).  In
       Figure 1, the nonattainment or maintenance area boundary, the MPO, and the SIP budgets
       all address the same geographic area. In this case, because the SIP establishes budgets for
       the entire area, the MPO will use those budgets in the regional emissions analysis done for
       the MPO's plan/TIP conformity determination for the entire nonattainment or maintenance
       area.

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                                                                         page 18
                          Area boundary =
                          MPO jurisdiction
     Figure 1: A Nonattainment or Maintenance Area With One MPO
                            in a Single State
More than One MPO. When budgets are established for the nonattainment or
maintenance area as a whole, and there is more than one MPO, the MPOs would complete
their respective plan/IIP conformity determinations and submit them to DOT, as
explained in Part 2, Q & A 3.  Once all determinations for a given area are received, DOT
would make its conformity determinations at the same time. The MPOs must collectively
develop a regional emissions analysis for the entire area that meets the requirements of
§93.118 of the rule that would accompany all plan/TIP conformity determinations. For
example, all MPOs would have to use the same analysis years for the regional emissions
analysis. Each MPO would show conformity of its plan and TIP using the regional
emissions analysis done for the entire area.  See Part 2, Q & A 4 for more information.

The MPOs can develop the regional analysis for the area in either  one of two ways:

1.      Each MPO can model emissions for its geographic part of the nonattainment or
       maintenance area separately. For each analysis year, the emissions estimated by
       each MPO would be summed together and compared to the area's applicable
       budgets. EPA believes that the MPOs must all use the same analysis years when
       completing the budget test in accordance with §93.118.

2.      The MPOs could also work together to model the entire nonattainment or
       maintenance area as a whole at the same time. In this case, §93.118 of the
       conformity rule would be met if estimated  emissions in each analysis year are less
       than or equal to the area's applicable budgets.

MPOs in one nonattainment or maintenance area may want to coordinate their plan and
TIP update cycles as well as the length of their plans.

>      New or revised plans and TIPs, as well as  significant changes to projects, could
       require a new regional emissions analysis (see §§93.104  and 93.122(g) of the
       conformity rule). Coordination of plan and TIP update cycles among MPOs in the
       same nonattainment or maintenance area may minimize the number of new regional
       emissions analyses and conformity determinations that have to be completed.

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                                                                                 page 19
       >      Different transportation plan lengths within one nonattainment or maintenance area
              would require additional analysis years, because according to §93.118(d), an
              analysis must be performed for the last year of each plan.  For example, if one
              MPO's plan ends in 2025 and another MPO's plan ends in 2030, both years would
              have to be analyzed in the regional analysis for the entire nonattainment area.
              Coordination of plan lengths may minimize the number of analysis years that have
              to be examined in any one regional emissions analysis.

       One or More MPOs and a Donut Area: If there is only one MPO in the nonattainment
       or maintenance area conducting conformity determinations, the regulations require the
       MPO to include the emissions estimated from the donut area's existing and proposed
       transportation system in the regional emissions analysis for the metropolitan transportation
       plan and TIP conformity determinations.  However, either the MPO or the state
       transportation agency ("state DOT") could estimate emissions from the donut area as
       decided through interagency consultation, as explained in Part 2,  Q&A 7.

       If there is more than one MPO as well as a donut area in a nonattainment or maintenance
       area, the MPOs must work together and with the state DOT or other donut area agency as
       appropriate to create one regional emissions analysis for the entire area that would
       accompany all plan/TIP conformity determinations.  The emissions estimated  from the
       entire area must be less than or equal to the budget(s) established for the entire area,
       according to the requirements of §93.118. The consultation process would be used to
       coordinate the analysis years when several agencies are completing emissions analyses,
       because the same analysis years must be used.
Nonattainment or Maintenance Areas Within One State. Where the SIP Establishes Subarea
Budgets

5.     Q. How do nonattainment or maintenance areas with more than one MPO in a single state
       determine conformity once SIP budgets are adequate or approved, and the SIP establishes
       subarea budgets for each MPO?

       A. When subarea budgets are created for each MPO, the sum of the subarea budgets
       equals the total amount of emissions the area can have from the transportation sector and
       still make progress toward, attain, or maintain the standard. Therefore, if each MPO
       meets its subarea budgets for a pollutant and standard in accordance with the  requirements
       of §93.118, then the entire area meets the total SIP's purpose for that pollutant and
       standard. As EPA noted in the January 11, 1993, conformity proposal,

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                                                                          page 20

       "subarea budgets provide additional assurance that through future
       conformity determinations transportation plans and TIPs will produce
       emission patterns that will achieve attainment" (58 FR 3780).

When the SIP for an area establishes subarea budgets for conformity purposes, these
subarea budgets must be met for plans and TIPs in the area to conform, as required in
§93.124(c) and (d) of the conformity rule.  Section 93.124(c) states:

       "If the applicable implementation plan (or implementation plan submission)
       estimates future emissions by geographic subarea of the nonattainment
       area, the MPO and DOT are not required to consider this to establish
       subarea budgets, unless the applicable implementation plan (or
       implementation plan submission) explicitly indicates an intent to create such
       subarea budgets for the purposes of conformity."

The MPOs can make independent conformity determinations for their plans and TIPs as
long as all of the other subareas in the nonattainment or maintenance area have
conforming transportation plans and TIPs in place at the time of each MPO's and DOT's
plan/TIP determination.  In other words, under the conformity rule in order for an MPO  or
DOT to determine conformity for its subarea, the rest of the area must also be in
conformity. The preamble to the November 24, 1993, conformity rule explains this as
follows:

       "The SIP may specify emissions budgets for subareas of the region,
       provided that the SIP includes a demonstration that the subregional
       emissions budget, when combined with all other portions of the emissions
       inventory, will result in attainment and/or maintenance of the standard.
       The conformity determination must demonstrate consistency with each
       subregional emissions budget in the  SIP" (58 FR 62196).

Thus, when any subarea demonstrates conformity, it must be demonstrated that all
subareas have conforming plans and TIPs.  For example, suppose the subarea budgets in a
SIP have just been found adequate, and one of the MPOs in the area needs to update its
TIP. That MPO can make a conformity determination using its subarea budgets for the
first time without waiting for the other MPOs in the area, as long as the other MPOs have
conforming plans and TIPs in place, even if these plans and TIPs were previously found to
conform using the interim emissions test(s).

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                                                                                 page 21

       Once an area has adequate or approved subarea budgets, if conformity lapses6 for one
       subarea, the other subarea(s) can continue to implement projects in their currently
       conforming plans and TIPs, but they cannot make new plan and TIP conformity
       determinations until the lapse is resolved and conformity is determined in the lapsed
       subarea. In other words, if the conformity status of one subarea lapses, the existing plans
       and TIPs in other subareas continue to be valid and consequences would not apply to any
       other subareas unless the lapse is not resolved by the time other subareas need to make
       new conformity determinations.
6.      Q. Why can't an MPO that has its own subarea budgets determine conformity of its
       transportation plan and TIP when another MPO in the same area is in a lapse?

       A. Section 176(c) of the Clean Air Act clearly states that conformity applies in
       nonattainment and maintenance areas, rather than individual metropolitan planning areas.
       Section 176(c) also states that the federal government and MPOs cannot approve
       transportation activities unless they conform to the SIP and its budgets. Therefore, in a
       nonattainment or maintenance area with more than one MPO, all MPOs must conform
       even if the SIP has established subarea budgets.

       If an individual MPO lapses, it has not demonstrated that it can conform to its subarea
       budgets.  Therefore, there is no way for the other MPOs in the same area to know
       whether their transportation plans and TIPs are consistent with the SIP as a whole. Using
       Figure 2 again as an example (found in Part 2, Q & A 6), if East MPO is  in a conformity
       lapse, it cannot be assured that West MPO's transportation activities still meet the purpose
       of the SIP even if West MPO meets its subarea budgets.  That is, it is unknown whether
       the total amount of emissions in the area from the planned transportation sector would still
       meet the SIP's purpose of progress toward, attainment of, or maintenance of the standard,
       because East MPO cannot meet its subarea budgets.  When one subarea lapses, there is no
       way for the other MPO to show that their planned transportation activities would conform
       to the SIP for the whole area until the lapse is resolved.
       6A lapse is defined in §93.101 of the rule: "Lapse means that the conformity determination
for a transportation plan or TIP has expired, and thus there is no currently conforming
transportation plan or TIP." A lapse occurs when conformity of a plan or TIP is not determined
according to the frequency requirements of §93.104 of the conformity rule.

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                                                                                  page 22

7.      Q. How do I know whether the SIP establishes subarea budgets? Are county-by-county
       emissions projections subarea budgets?

       A. The SIP must specifically state that it creates subarea budgets.  County-by-county
       emissions projections in a SIP inventory are not subarea budgets unless they are
       specifically labeled  as such.  Section 93.124(c) of the conformity rule states,

              "If the applicable implementation plan (or implementation plan submission)
              estimates future emissions by geographic subarea of the nonattainment area, the
              MPO  and DOT are not required to consider this to establish subarea budgets,
              unless the applicable implementation plan (or implementation plan submission)
              explicitly indicates an intent  to create such subarea budgets for the purposes of
              conformity."

       If county level emissions projections are included in a SIP but not explicitly defined as
       subarea budgets for the purposes of conformity, the SIP is considered to have budgets for
       the entire area and MPOs must work together to have plan/TIP conformity determinations
       for the entire nonattainment or maintenance area approved by DOT at the same time, as
       described above in  Q & A 4 of this part and Part 2, Q & A 4. According to §93.124(d),

              "If a nonattainment area includes more than one MPO, the implementation plan
              may establish motor vehicle  emissions budgets for each MPO, or else the MPOs
              must collectively make a conformity determination for the entire nonattainment
              area."

       If MPOs within one nonattainment or maintenance area would prefer to have subarea
       budgets, they should communicate their preference to the state and local air agencies
       within the interagency consultation process during the development of the SIP. Section
       93.105(c) of the conformity rule requires interagency consultation on the development  of
       SIPs,  as well as transportation plans, TIPs, and conformity determinations.
Multi-State Nonattainment/Maintenance Areas:

8.      Q. How do multi-state nonattainment and maintenance areas determine conformity if each
       state submits a SIP that contains the same budgets for the entire multi-state area?

       A. If these multi-state areas have SIPs that contain budgets for the multi-state area as a
       whole, one regional emissions analysis would be completed for the entire area using the
       budget test, according to the requirements in §93.118 of the conformity rule. This
       regional analysis would accompany all plan/TIP conformity determinations in the area that
       would be submitted to DOT. Once all determinations for a given area are received, DOT
       would make its conformity determinations at the same time. The MPOs must collectively

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                                                                                 page 23

       develop a regional emissions analysis for the entire area that meets the requirements of
       §93.118 that would accompany all plan/TIP conformity determinations. For example, all
       MPOs would have to use the same analysis years for the regional emissions analysis.  Each
       MPO would show conformity of its plan and TIP using the regional emissions analysis
       done for the entire area.

       For example, in Figure 4, repeated below, suppose there is one budget for the multi-state
       area, but each state has its own MPO. In this case, one regional emissions analysis would
       be made for the entire oval and the conformity determinations for each MPO's plans and
       TIPs within the area would be based on this regional emissions analysis. DOT would wait
       to make its conformity determinations for the plans and TIPs in the area until it receives all
       of them. This answer is similar to single state areas with SIP budgets that cover the entire
       nonattainment or maintenance area.  See Q & A 4 of the part, and Part 2, Q & A 4, for
       further information.
= Area boundary


= State boundaries
                                                       J
                Figure 4: A Multi- State Nonattainment or Maintenance Area
9.      Q. When would it be likely for state air agencies in a multi-state nonattainment or
       maintenace area to submit SIPs with budgets that apply to the entire area?

       A. This option would most likely be chosen in areas where there is one MPO responsible
       for the transportation planning of the entire multi-state nonattainment or maintenance
       area. However, the option is available to any multi-state nonattainment or maintenance
       area. In areas with more than one MPO,  additional coordination would be necessary for
       plan/TIP conformity determinations and the regional emissions analysis because they
       would need to cover the entire nonattainment or maintenance area pursuant to
       §§93.124(d)and93.118.

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                                                                                  page 24

10.     Q. How is conformity determined for multi-state nonattainment or maintenance areas
       when each state submits a SIP that contains budgets only for its state's portion of the
       area?

       A. States in a multi-state area have the option of submitting SIPs with budgets for just
       their own portion of the area that, when taken together, meet the applicable Clean Air Act
       requirement. Where states have done so and EPA has found such budgets adequate, the
       MPO or MPOs in each state with such budgets can determine conformity completely
       independently of the other states.  EPA concluded that these states can operate
       independently for conformity because the Clean Air Act refers to conformity to a SIP.
       Each state's SIP in these cases includes inventories, control measures and programs, and
       budgets that apply to only that state's portion of the nonattainment or maintenance area.

       States that have SIPs with adequate or approved budgets for only their own portions of a
       multi-state area are distinct from MPOs in a nonattainment or maintenance area that have
       subarea budgets within the same SIP, and also distinct from states that have SIP budgets
       that apply to an entire multi-state nonattainment or maintenance area. Where states have
       their own SIP budgets, if a conformity lapse is occurring in one state's portion of an area,
       the MPO(s) in the other state(s) in the nonattainment or maintenance area can continue to
       make conformity determinations for new or revised transportation plans and TIPs because
       they continue to show  conformity to their SIP's budgets.

       Using Figure 4 above as an example, suppose States A, B, and C each have SIPs with
       adequate or approved budgets that apply only to their own state's portion of the area. If
       State A lapses, States B and C can continue to make new conformity determinations.  In
       contrast, as described previously:

       •       MPOs that have subarea budgets within one SIP are determining conformity to the
              same SIP, therefore when one makes a conformity determination, all other
              subareas must be in conformity as well in order to show conformity to the SIP; and

       •       multi-state areas that have budgets for the entire nonattainment or maintenance
              area are also determining conformity to the same SIP, therefore, there must be one
              regional emissions analysis for this area and conformity determinations for plans
              and TIPs in the area must be made at the same time as described in Q & A 8 of this
              part.

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                                                                                page 25

Part 4:  Conformity Determinations and Regional Emissions Analyses in 8-Hour Ozone
Nonattainment Areas With Adequate or Approved 1-Hour SIP Budgets

Background

1.      Q. To what areas does this part of the guidance apply?

       A. This part of the guidance clarifies the implementation of conformity in nonattainment
       areas for the  8-hour ozone standard that were nonattainment or maintenance areas for the
       1-hour ozone standard and have adequate or approved SIP budgets that address the 1-
       hour ozone standard. However, this part of the guidance applies only until these areas
       have 8-hour budgets that they can use for conformity.  Once an area submits an 8-hour
       SIP with budgets and EPA finds the budgets adequate or approves the 8-hour SIP that
       contains budgets, that area must use the 8-hour budgets for conformity according to
       §93.109(e)(l) of the conformity rule.  At that point, Part 3 of this guidance would apply,
       and Part 4 would no longer be relevant to that area. In Part 4 of the guidance, the terms:

       •      8-hour area means a nonattainment area for the 8-hour  ozone standard, and
             1-hour area means a nonattainment or maintenance area for the 1-hour standard.

       The July 2004 final rule allows 8-hour areas with 1-hour SIPs to implement conformity in
       the same way as they have been under the 1-hour standard, to the extent possible. In
       other words, the 8-hour areas with 1-hour budgets will continue to use them wherever
       possible.  This part of the guidance is intended to assist in understanding how that general
       principle applies in various circumstances.


2.      Q. How is Part 4 organized?

       A. Part 4 is organized under headings for background, boundary scenario, and general
       implementation topics, as follows:

             Background (questions 1 - 8);
             Scenario 1 (questions 9-11);
             Scenario 2 (questions 12 - 13);
             Scenario 3 (questions 14 - 18);
             Scenario 4 (questions 19 - 22); and
             General Implementation of the Final Rule (questions 23 - 25).

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                                                                                  page 26

3.      Q. What are the ways an 8-hour area could be related to a 1-hour area that has adequate
       or approved 1-hour budgets?

       A. As described in the July 1, 2004, conformity rule, there are four generic scenarios for
       how 8-hour area boundaries relate to 1-hour area boundaries, and the conformity rule is
       written with these four scenarios in  mind.

       To determine which scenario appropriately describes an area, it is necessary to consider
       the boundary of the entire 8-hour area. For example, in a multi-state 8-hour area, the 8-
       hour boundary refers to the entire multi-state area, rather than each state's individual
       portion. Figure 5  illustrates the four generic boundary scenarios.
            Scenario 1          Scenario 2            Scenario 3          Scenario 4

                                                                   = 1-hour area boundary
                                                            ^"^  = 8-hour area boundary

                           Figure 5: The Four Boundary Scenarios
              Scenario 1: the 8-hour area boundary and the 1-hour area boundary are identical.
              Scenario 2: the 8-hour area boundary is smaller than the 1-hour area boundary.
              Scenario 3: the 8-hour area boundary is larger than the 1-hour area boundary.
              Scenario 4: the 8-hour area boundary partially overlaps the 1-hour area boundary.
4.      Q. Do 8-hour areas with 1-hour budgets have to use the 1-hour budgets for conformity
       determinations under the 8-hour standard?

       A. Yes, in most cases.  As required in §93.109(e)(2) of the July 2004 final rule, the 1-
       hour budgets must be used for 8-hour conformity determinations, unless the interim
       emissions test(s)  is more appropriate as decided through the interagency consultation
       process (see §93.109(e)(2)(v)).  Section 176(c)  of the Clean Air Act states that
       transportation activities must not cause new violations, increase the frequency or severity

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                                                                                 page 27

       of existing violations, or delay timely attainment.  Using 1-hour budgets where available
       and appropriate ensures that air quality progress to date is maintained, air quality will not
       be worsened and attainment of the 8-hour standard will not be delayed because of
       emissions increases prior to the development of SIPs with 8-hour budgets. Once EPA
       finds a budget adequate or approves the  SIP that includes it, the budget test provides the
       best means to determine whether transportation plans and TIPs meet Clean Air Act
       conformity requirements.  EPA believes this principle applies with respect to the 1-hour
       budgets in 8-hour nonattainment areas as well:  in most cases, the 1-hour budgets are the
       best test for determining conformity to the 8-hour standard before 8-hour budgets are
       available because the 1-hour budgets have led to current air quality improvements.
5.      Q. Are there circumstances under which an 8-hour area with 1-hour budgets would not
       use them?

       As described in the preamble to the July 2004 final rule (69 FR 40025), though EPA
       anticipates that exceptions to the use of the 1-hour budgets will be infrequent, there are
       some cases where using the interim emissions test(s) may be more appropriate to meet
       Clean Air Act requirements. EPA expects such limited cases to be supported and
       documented in the 8-hour conformity determination for a given area. EPA notes that an
       adequate or approved 1-hour SIP budget cannot be considered inappropriate simply
       because it is difficult to pass for 8-hour conformity purposes. In addition, as noted below
       and consistent with past conformity precedent,  1-hour budgets cannot be discarded simply
       because they are based on older planning assumptions or emissions models, unless through
       interagency consultation it is determined that a  different emissions test(s) is more
       appropriate to ensure that air quality  is not worsened for all 8-hour areas and that
       reductions are achieved in certain ozone areas.

       The most likely example of when the 1-hour budgets may not be the most appropriate test
       is where a 1-hour budget is not currently used in conformity determinations for the 1-hour
       standard, and thus is currently not relied upon to measure whether transportation activities
       are consistent with Clean Air Act requirements. Such a case would happen when the 1-
       hour budget year is no longer in the timeframe of the transportation plan and there is no
       requirement to meet the budget test prior to the year in which the  next 1-hour budget is
       established, (e.g., the SIP established a budget for the 1-hour attainment year, but that
       attainment year has passed  and budgets for future years are available). For example,
       suppose a 1-hour maintenance area attained in 1999 and has a maintenance plan with
       budgets for 2009.  If the area has an 8-hour attainment date of 2007, for an 8-hour
       conformity determination it would have to compare emissions in 2007 to the budgets from
       the most recent prior year, which would be the  1-hour attainment budgets for the year
       1999.  In this case, the budgets are not currently in use for the 1-hour standard, and it may
       be more appropriate for an  area to use the  2002 baseline year test  for the 2007 analysis
       year in the 8-hour conformity determination,  since the 2002 baseline could be lower and

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                                                                           page 28

therefore more protective than the 1999 budgets.  However, the maintenance area would
use its 2009 budgets in the 1-hour maintenance plan to show 8-hour conformity for 2009
and all future analysis years.

However, if the budget year has passed but the budgets have continued to be used for
conformity for the 1-hour standard, they would likely continue to apply for 8-hour
conformity. For example, suppose a severe 1-hour nonattainment area has budgets only
for its 2005 attainment year.  Once the 8-hour standard applies and before the area has
adequate or approved  8-hour budgets, the area would likely continue to use its 1-hour
attainment budgets for all analysis years for 8-hour conformity determinations, even after
the year 2005 is no longer in the timeframe of the transportation plan.  Note, although the
2005 budgets would be used after 2005  is no longer in the timeframe of the plan, 2005
would no longer be a required analysis year.

Another example of when the interim emissions test(s) would be more appropriate than
existing adequate or approved 1-hour budgets would be in certain Scenario 4 areas where
it is impossible to determine which portion of a 1-hour budget covers an 8-hour
nonattainment area. In this case,  applying the budget test with 1-hour budgets is not
feasible, and consequently, only the interim emissions test(s) are available for such unique
areas.

As described in Section V. of the  July 1, 2004, preamble (69 FR 40019 - 21), when a SIP
budget is not established a moderate  or above ozone area would need to pass both interim
emissions tests. Areas classified as marginal or designated under Clean Air Act, Part D,
subpart  1 can choose between the two tests when no budgets apply. However, in these
cases where a 1-hour budget is available but the area demonstrates it is not the most
appropriate test, EPA  believes that the no-greater-than-2002 baseline year test would
most likely be used. EPA believes it  is extremely unlikely that the build/no-build test alone
would ever be a more  appropriate test than the budget test with existing 1-hour budgets
that are currently used for conformity purposes. Please refer to the July 1, 2004, rule
preamble on this point (69 FR 40025).

Areas must use the consultation process to decide whether the applicable interim
emissions tests are  more appropriate  to meet Clean Air Act requirements than the budgets
in each 1-hour SIP. As described in the first example above, there may be cases where an
area has multiple 1-hour SIPs, some of which have appropriate budgets while others do
not. In areas where only one interim emissions test may be selected, the rule requires that
areas must also justify selection of the specific test chosen as being more appropriate for
meeting Clean Air Act requirements than the available 1-hour budgets.  This  decision
should be discussed with all interagency consultation parties and documented in the
conformity determination for the  8-hour standard. (Please refer to the preamble of the
July 2004 final conformity rule at 69  FR 40025 for more information.)

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                                                                                  page 29

6.      Q. In 8-hour areas with 1-hour subarea budgets, do all subareas have to use the 1-hour
       budgets for 8-hour conformity determinations? Likewise, in multi-state 8-hour areas
       where each state has separate 1-hour budgets, do all states have to use their 1-hour
       budgets for 8-hour conformity?

       A. In general, each subarea or state can determine conformity independently as long as
       everyone is using 1-hour budgets to determine conformity. However, in the unlikely
       event that one subarea or state determines that its 1-hour budgets are inappropriate, other
       subareas or state budgets may also be inappropriate. See Part 3 of this guidance for
       further rationale for conformity determinations using subarea and multi-state SIP budgets.
       When any subarea or state believes that is inappropriate to use its budgets, all subareas or
       states would consult to determine the impact on future conformity determinations. EPA
       believes that where one subarea or state determines its budgets are inappropriate, it is
       likely that the other budgets are also inappropriate because they are collectively intended
       to address the same Clean Air Act purpose.

       EPA notes, however, that in a Scenario 4 area, the circumstances are different and more
       complex. In these areas, the 8-hour area partially overlaps the 1-hour area. In a multiple
       MPO or multi-state Scenario 4 area, it may be the case that one or more other MPOs or
       states cannot use their  1-hour budgets because it is not possible to determine what portion
       of the budgets apply.   However, other MPOs or states may still be able to use their 1-
       hour budgets for their portions of the 8-hour area. See below for further information on
       the various  scenarios.
7.      Q. In an 8-hour area with a 1-hour SIP that establishes subarea budgets, how should
       MPOs demonstrate conformity for the first time under the 8-hour standard?

       A. As described in Part 3 of this guidance, when an area has subarea budgets, conformity
       for an MPO's plan and TIP can only be determined if all other subareas have conforming
       transportation plans and TIPs in place for a given pollutant and standard.

       To the extent possible, EPA believes that the subarea budgets must be used in the 8-hour
       conformity determination, unless it is determined through consultation that they are not
       appropriate for meeting Clean Air Act conformity requirements.  Subarea budgets in 1-
       hour SIPs must continue to be used under the conformity rule for the 8-hour standard,
       because they ensure that air quality progress to date is maintained.

       In general, where an 8-hour area has multiple MPOs with subarea budgets for the 1-hour
       standard, EPA and DOT believe it is necessary for the first conformity determination
       under the 8-hour standard to be done as follows: each MPO would show its plan and TIP
       conform to its 1-hour subarea budgets independently. All of the MPOs' plan/TIP
       conformity determinations would then be submitted to DOT for its determinations.  DOT

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                                                                                 page 30

       will not make its conformity determination on any of the plans or TIPs from the 8-hour
       area until every MPO in the area has made a conformity determination for its plan and
       TIP. Please note that this answer may differ for Scenario 3 and 4 areas where an
       additional portion of the 8-hour area is not covered by the 1-hour budgets (these
       Scenarios are discussed later in this part, beginning with Q & 14).  All MPOs in the 8-hour
       area must have an initial valid conformity determination for the 8-hour standard by the end
       of the one-year grace period.  If any do not, DOT will be unable to make any 8-hour
       conformity determinations for the 8-hour area, and all of the MPOs' plans and TIPs will
       lapse.
       Q. How are subsequent 8-hour conformity determinations made in an 8-hour area where
       the 1-hour SIP establishes subarea budgets?

       A. In general, once DOT has made its initial 8-hour conformity determination for the area,
       the MPOs will operate as usual:  before any MPO in the area determines  conformity using
       subarea budgets, all other MPOs in the area must have a conforming plan and TIP in
       place. If one subarea is in a conformity lapse, conformity determinations for new or
       revised plans and TIPs cannot be made in other subareas until the lapse ends. This answer
       may differ for Scenario 3 and 4 areas where an additional portion of the 8-hour area is not
       covered by the 1-hour budgets (discussed later in this part, beginning with Q & A 14).
Scenario 1 Areas

9.      Q. How is conformity demonstrated in Scenario 1 areas when the 1-hour SIP budgets
       apply to the entire 1-hour area?

       A. Using 1-hour budgets for 8-hour conformity determinations is straightforward in
       Scenario 1 areas, because the boundaries of the 8-hour area and 1-hour area(s) are exactly
       the same.  The MPO or MPOs must coordinate their plan/TIP conformity determinations
       and submit them to DOT. Once DOT receives all plan/TIP conformity determinations for
       the 8-hour area, DOT will make its conformity determinations at the same time.  If there is
       more than one MPO, the planning agencies will have to work together to  develop one
       regional emissions analysis for the entire 8-hour area under §93.109(e)(2)(i), just as they
       would have been doing for the 1-hour standard.  Please see Part 3 of this guidance for
       further information regarding how a regional emissions analysis could be completed for
       these areas.

       Note that a Scenario 1 8-hour area could be formed from one or  more 1-hour areas with
       adequate or approved 1-hour budgets  for the entire 8-hour area.

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                                                                                  page 31

10.     Q. How is conformity demonstrated in Scenario 1 areas when the 1-hour SIP includes
       subarea budgets?

       A. As discussed in Part 3, Q & A 1, conformity follows the SIP. Therefore, conformity
       and the supporting regional emissions analysis is done for the geographic area that is
       covered by the SIP's budgets, i.e., each subarea's portion of the nonattainment area. See
       Part 3,  Qs & As 5 - 7, and Qs & As 7 and 8 of this part for additional information.
11.     Q. How is conformity demonstrated in multi-state Scenario 1 areas, where each state has
       its own separate 1-hour SIP budgets?

       A. As discussed in Part 3, Q & A 1, conformity follows the SIP.  Therefore, conformity
       and the supporting regional emissions analysis is done for the geographic area that is
       covered by the SIP's budgets, i.e., each state's portion of the nonattainment area.

       Before 8-hour ozone budgets are found adequate or approved, EPA concludes that where
       each state has its own 1-hour budgets, each state can continue to demonstrate conformity
       to its SIP independently for the 8-hour ozone standard.  Therefore, conformity
       determinations for the 8-hour standard can be made in one state of a multi-state 8-hour
       area even if a lapse is occurring in another state in the 8-hour area, or conformity had not
       yet been determined for the 8-hour ozone standard in another state in the area. This
       independence in a multi-state 8-hour area applies as long as all states are using 1-hour
       budgets to determine conformity. Please see Part 3 of this guidance for further
       information regarding how a regional emissions analysis could be completed for these
       areas.
Scenario 2

12.     Q.  How is conformity demonstrated in Scenario 2 areas, when the 1-hour SIP establishes
       budgets that apply to the entire 1-hour area?

       A.  Regardless of whether the area is located entirely within one state, or is a multi-state
       area, the MPO or MPOs must coordinate plan/TIP conformity determinations and submit
       them to DOT to satisfy the conformity rules. Once DOT receives all plan/TIP conformity
       determinations for the 8-hour or 1-hour area (as applicable), DOT will make its
       conformity determinations at the same time.  Please see Part 3 of this guidance for further
       information regarding how a regional emissions analysis could be completed for these
       areas.
                                                              [answer continues next page]

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                                                                          page 32
These areas can choose either of two versions of the budget test, as required by
§93.109(e)(2)(ii):

•      the budget test using the subset or portion of existing adequate or approved 1-hour
       budgets that cover the 8-hour area, where such portion can be appropriately
       identified (§93.109(e)(2)(ii)(A)); or

•      the budget test using the existing adequate or approved 1-hour budgets for the
       entire 1-hour area, however in this case any additional emissions reductions needed
       to pass the budget test must come from within the 8-hour area
       (§93.109(e)(2)(ii)(B)).

The interagency consultation process should be used to determine whether budgets for the
8-hour area can reasonably be derived from the 1-hour budgets. It may be possible to
create budgets for only the 8-hour area, for example if the 1-hour SIP contains estimates
of emissions by county in the years for which budgets are established, and emissions from
the county or counties not included in the 8-hour area can be subtracted from the 1-hour
budgets.

In Figure 6 below:

       Budget for 8-hour area  =    1-hour budget   -   county or counties not in the
                                                      8-hour area
       (Area in the bold line)  =
(emissions in the  -
 gray circle)
(emissions from
the crescent shape)
                            Crescent shape = 1-hour county or counties
                            not included in the 8-hour area

                                      = 1-hour area and budget
                                      = 8-hour area

 Figure 6: A Scenario 2 Area (the 8-Hour Area is Smaller Than the 1-Hour Area)
If is not possible to create budgets that apply to only the 8-hour area, the MPO or MPOs
will have to determine conformity to the 1-hour budgets for 8-hour conformity as they
have for the  1-hour standard, and if reductions are needed to meet the budgets, they must
come from within the 8-hour area (inside the bold line in Figure 6) as required by the
conformity rule.

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                                                                                  page 33

      Note that a Scenario 2 8-hour area could be formed from one 1-hour area as in Figure 6
      above, or more than one 1-hour area with adequate or approved 1-hour budgets for the 8-
      hour area, as depicted in Figure 7, below. In these cases, consultation should be used to
      determine how the 1-hour budgets will apply.
                                                 ii|||: = 1-hour areas with budgets
                                                     = 8-hour area
                 Figure 7: A Scenario 2 Area Composed of Several 1-Hour Areas
13.     Q.  How is conformity demonstrated in multi-state Scenario 2 areas, where each state has
       its own separate 1-hour SIP budgets?

       A. As discussed in Part 3, Q & A 1, conformity follows the SIP. Therefore, conformity is
       determined for the geographic area that is covered by the SIP's budgets, i.e., each state's
       portion of the nonattainment area.

       Before 8-hour ozone budgets are found adequate or approved, EPA concludes that where
       each state has its own 1-hour budgets, each state can continue to demonstrate conformity
       to its SIP independently for the 8-hour ozone standard.  Therefore, conformity
       determinations for the 8-hour standard can be made in one state of a multi-state 8-hour
       area even if a lapse is occurring in another state of the area. This independence in a multi-
       state area applies as long as all states are using 1-hour budgets to determine conformity.

       For these Scenario 2 8-hour areas, each state can choose either of two versions of the
       budget test:

             the budget test using the subset or portion of existing adequate or approved 1-hour
             budgets that cover the 8-hour area within its state, where applicable and when such
             portion can be appropriately identified (§93.109(e)(2)(ii)(A)); or

             the budget test using the existing adequate or approved 1-hour budgets for the
             portion of the  1-hour area within its state, however in this case any additional
             emissions reductions needed to pass the budget test must come from within that
             state's portion of the 8-hour area (§93.109(e)(2)(ii)(B)).

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                                                                                 page 34

Scenario 3 Areas Within One State

14.     Q.  How is conformity demonstrated in a Scenario 3 area located entirely within one state,
       when the 1-hour SIP establishes budgets that apply to the entire 1-hour area?

       A.  In this case,  the conformity rule requires that the MPO or MPOs must work together
       to apply the 1-hour budgets to the portion of the 8-hour area covered by them.  An 8-hour
       area whose boundary is larger than the 1-hour area boundary includes one or more new
       counties that were not  covered by the 1-hour standard. According to §93.109(e)(2)(iii),
       conformity can be determined for the 1-hour area by using the 1-hour budgets for that
       portion of the 8-hour area covered by them, plus the interim emissions test(s) for either:

             the remaining portion of the 8-hour area (the new county or counties), or
       •      the entire 8-hour area.

       In Figure 8 below, the  budget test must be used for the gray portion of the area, and the
       interim emissions test either for the white portion of the 8-hour area, or the entire 8-hour
       area.
                                   Portion of 8-hour area not covered by 1-
                                   hour budgets
                                            = 1-hour area

                                     el   = 8-hour area
                         X'
               Scenario 3
                             Figure 8: A Scenario 3 Area

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                                                                                 page 35

15.     Q. How is conformity demonstrated in a Scenario 3 area located entirely within one state,
       when the  1-hour SIP establishes subarea budgets that apply for each MPO?

       A. As described in Part 3, Q& As 5 - 7, and in Q & As 6 - 8 of this part, each MPO can
       develop its own regional emissions analysis and conformity determination for its plan and
       TIP, as long as all of the other MPOs in the area have a conforming plan and TIP in place
       The twist for a Scenario 3 area is that there is a portion of the 8-hour area that is not
       covered by 1-hour budgets. For this portion of the 8-hour area, a regional emissions
       analysis using the interim emissions test(s) must be done for either:

       >       the part of the 8-hour area not covered by 1-hour budgets, or
       >       the entire 8-hour area.

       As addressed in Q & A 7 of this part, for the initial conformity determinations under the 8-
       hour standard, each MPO can determine conformity for its own plan and TIP and DOT
       will wait to receive a conformity determination for each MPO before making its
       conformity determination for the plans and TIPs in the area.
                                                             = 1-hour area
                                                             = 8-hour area
                                                   A, B, C, D =MPOs with 1-hour
                                                                subarea budgets
                                                            E = new county in
                                                                8-hour area
                        Figure 9: A Scenario 3 Area Within One State
                               With 1-Hour Subarea Budgets
       In Figure 9, above, MPOs A, B, C, and D can develop conformity determinations for just
       their own plans and TIPs using their 1-hour subarea budgets.  The regional emissions
       analysis for Part E must be done using the interim emissions test(s), according to
       §93.109(e)(2)(iii)(B) of the conformity rule.  Part E may be a donut area or may have its
       own MPO.  If Part E is a donut area, per §93.105(c)(3) of the rule, the parties involved in
       interagency consultation must discuss which agency will be responsible for Part E's
       regional emissions analysis, and for what geographic area it will be done. DOT would
       wait until it had conformity determinations for all MPO plans/TIPs and the donut area
       before making its initial  conformity determinations for the 8-hour standard.

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                                                                                   page 36

Scenario 3 Multi-State Areas

16.    Q. How is conformity demonstrated in multi-state Scenario 3 areas, where all of the states
       have their own separate 1-hour SIP budgets?

       A. As described above, conformity determinations can continue to be made independently
       in each state that has separate 1-hour budgets, as long as all states in the area use their
       respective 1-hour budgets for their 8-hour conformity determinations. In addition, if the
       8-hour boundary in a state is larger than the 1-hour boundary in that state, the interim
       emissions test(s) must be  met for either:

       •     the portion outside the 1-hour boundary and inside the 8-hour boundary in that
              state,
       •     that state's entire  portion of the 8-hour nonattainment area, or
             the entire multi-state 8-hour area.7

       The provision of the rule  that requires the interim emissions test(s) in Scenario 3 areas,
       §93.109(e)(2)(iii)(B), could apply to any of these three geographic choices.

       For example, in Figure 10 below, an 8-hour nonattainment area includes parts of three
       states. The 8-hour boundary in States A and B is unchanged from the 1-hour boundary,
       but the 8-hour boundary in State C is larger.  States A, B, and C can continue to
       determine conformity independently from one another for the 8-hour  standard as follows:

              States A and B would determine conformity by meeting their  1-hour budgets.

              State C would determine conformity by meeting its  1-hour budgets, plus the
             interim emissions  test(s) either for:
              >      the portion in State C not covered by the 1-hour budgets (in Figure 10, the
                     white portion inside the bold line),
              >      the entire portion of the 8-hour area in State C, or
              >      the entire multi-state area (see footnote 7).
       7Though the interim emissions test(s) could be done for the entire 8-hour nonattainment
area under the final rule, as explained in the preamble (69 FR 40023), "doing so may not allow
each MPO in this example to develop transportation plans and TIPs and conformity
determinations independently." Please consult with EPA and DOT to discuss the implications for
all states before choosing this option.

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                                                                                page 37

                                    Portion of the 8-hr area not covered by 1-hr budgets

                                                    = 1-hour nonattainment areas

                                                    = 8-hour nonattainment area

                                                \ = state boundaries/ 1-hour SIP
                                                      boundaries

                           Figure 10: A Multi-State Scenario 3 Area
17.     Q.  How is the regional emissions analysis done in multi-state Scenario 3 areas, where only
       one of the states has its own 1-hour SIP budgets?

       A.  Consistent with Clean Air Act section 176(c), EPA interprets §93.109(e)(2)(iii) of the
       conformity rule to mean that a state can determine conformity completely independently,
       even if it is the only state in the 8-hour area that has 1-hour budgets.  If one state has 1-
       hour budgets and the 8-hour area is a two-state area, then both states can determine
       conformity on their own:
       •      the state with the 1-hour budgets would continue to use them for 8-hour
             conformity;
       •      the state without budgets would use the interim emissions test(s).

       In Figure 11 below, each state can determine conformity for its own portion of the 8-hour
       area, even though State B does not have 1-hour budgets.
                                                                 = 1-hour area
                                                                 = 8-hour area
                                                             *X = state boundary
                                                                 *»
                              Figure 11: A Two-State Area
      However, if the 8-hour area was a three-state area and only one state had 1-hour budgets,
      only the state with the budgets could determine conformity on its own.  The other two
      states would determine conformity for the 8-hour standard together using the interim
      emissions test(s).

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                                                                                  page 38

Scenario 3 - General

18.     Q. What are the special issues that the interagency consultation process should consider
       in Scenario 3 areas?

       A. The interagency consultation process is of key importance in these areas.  Because the
       8-hour area is larger than the 1-hour area, one or more planning agencies previously not
       involved in conformity may become part of the interagency process. These planning
       agencies need to be included in the decision-making process for the area.

       Through the interagency consultation process as required by §93.105 of the conformity
       rule, the involved parties must decide:

       •      whether to apply the interim emissions test(s) to the entire 8-hour area (or in a
              multi-state area where one or more of the states have 1-hour budgets, to one
              state's entire portion of the area) or just the portion not covered by the 1-hour
              budgets;
       •      whether it is more appropriate for the state DOT or an MPO to prepare the
              regional emissions analysis for a donut area, if there is one;
       •      which interim emissions test will be used, in areas permitted to select only one test;
              and
       •      analysis years for the budget test and interim emissions test(s). It may be possible
              to choose analysis years that  satisfy both the budget and interim emissions test
              requirements in §§93.118(d)(2) and 93.119(g), as described below.


Scenario 4 Areas Within One State

19.     Q. How is conformity done in a Scenario 4 area, when 1-hour budgets apply to the entire
       1-hour area, that is, the SIP does not establish subarea budgets?

       A. It may be possible to use the budgets from the 1-hour SIP, if the SIP includes
       emissions by county and it is possible to determine which portions of the 1-hour budgets
       apply to the 8-hour area.  In this case, the 8-hour area would show conformity in a manner
       similar to a Scenario 3 area. It would use:

              the relevant portion of the  1-hour budgets for the portion of the 8-hour area where
              it has them, plus
              the interim emissions test(s),  either for:
                     >     the remaining portion of the 8-hour area, or
                     >     the entire 8-hour area.

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                                                                                  page 39

       For example, in Figure 12 below, if it is possible to determine what portion of the 1-hour
       budgets apply for the portion of the 1-hour area that is now inside the 8-hour area
       boundary, the area would use:
       •       the budget test, for that portion of the 8-hour area that has them (as indicated by
              the arrow in Figure 12), and
       •       the interim emissions test(s) must be met for either:
              >      the part of the 8-hour area not covered by budgets - in Figure 12, the
                     portion shaded with the pattern, or
              >      the entire 8-hour area.
                                             = 8-hour area

                                             = 1-hour area - no budgets
                                             = 1-hour area w/budgets
                           Figure 12: A Scenario 4 Area Within One State
       However, it may not be possible for the 8-hour area to use the 1-hour budgets at all.  This
       outcome would occur, for example, if 1-hour SIP does not include an emissions inventory
       by county.  It could also occur if the 8-hour boundary includes and excludes portions of
       counties instead of entire counties. The interagency consultation process would be used
       to discuss use of 1-hour budgets in Scenario 4 areas.  When such cases occur, a Scenario
       4 area would determine conformity using the applicable interim emissions test(s) for the
       entire area.8
Scenario 4 Multi-State Areas

20.    Q. How does a multi-state Scenario 4 area determine conformity when the 1-hour SIPs
       have separate budgets that apply to each state?

       A. As described above, multi-state Scenario 4 areas are a unique case. Where each state
       has separate 1-hour budgets that apply only to its portion of the nonattainment or
       maintenance area, each state in a multi-state Scenario 4 area can operate entirely
       independently. Where a state's portion can use its 1-hour budgets, it must use them
       8  This statement does not preclude agencies from developing a reasonable way to utilize
the 1-hour budgets, via the interagency consultation process where possible. The final conformity
rule requires the use 1-hour budgets where ever it is appropriate and possible.

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                                                                                   page 40

       according to §93.109(e)(2)(iv) of the rule.  Any portion of a state's area not covered by
       the budgets would have to be included in an interim emissions test(s), for:

       •       that part not covered by 1-hour budgets,
              the state's entire portion of the 8-hour area, or
       •       the entire 8-hour area.

       The consultation process would be used to determine which test option is selected in
       Scenario 4 areas.
21.    Q. How is the regional emissions analysis done in a multi-state Scenario 4 area, where
       only one of the states has its own 1-hour SIP budgets?

       A. EPA interprets §93.109(e)(2)(iv) to mean that if any state in the 8-hour area has 1-
       hour budgets, that state can determine conformity completely independently from the
       other states in the 8-hour area. The state or states that have 1-hour budgets would
       continue to use them or portions of them as appropriate, to the extent possible, for their 8-
       hour regional emissions analysis and conformity determination.  The state or states
       without 1-hour SIP budgets would  use the interim emissions test(s) for 8-hour conformity;
       if there is more than one state in the area without 1-hour budgets, these states would
       determine conformity together.
22.    Q. What are special issues that the interagency consultation process should consider in
       Scenario 4 areas?

       A. As in Scenario 3 areas, the interagency consultation process is of key importance in
       Scenario 4 areas. Where an 8-hour area partially overlaps a 1-hour area, one or more
       MPOs may no longer have to determine conformity, and one or more new MPOs may
       become part of the interagency process. All MPOs in the 8-hour area as well as the other
       parties involved in interagency consultation need to be involved in the decision-making
       process  for the area.

       Through the interagency consultation process as required by §93.105 of the conformity
       rule, the involved parties must decide:
             whether to apply the interim emissions test(s) to the entire area (or in a multi-state
              area, to one state's portion of the area) or just the portion not covered by the 1-
             hour budgets;
       •      whether it is more appropriate for the state DOT or an MPO to prepare the
             regional emissions analysis for a donut area, if there is one;
       •      which interim emissions test will be used, in areas permitted to select only one test;
              and

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                                                                                  page 41

              analysis years for the budget test and interim emissions test(s).  It may be possible
              to choose analysis years that satisfy both the budget and interim emissions test
              requirements in §§93.118(d) and 93.119(e) of the rule, as described below.
General Implementation of Final Rule

23.    Q. What precursors must be examined in 8-hour areas with 1-hour budgets?

       A. As described in the preamble to the July 1, 2004, final transportation conformity rule
       the regional emissions analyses for ozone areas must address the ozone precursors
       nitrogen oxides (NOx) and volatile organic compounds (VOC) (§93.102(b)(2)(i)). In
       cases where budgets are used, conformity is demonstrated with the budget test for
       adequate and approved NOx and VOC budgets (§93.118). In all cases where areas use
       the interim emissions test(s), both precursors must be analyzed unless EPA issues a NOx
       waiver for the 8-hour standard for an area under Clean Air Action section 182(f). These
       requirements  are consistent with the  conformity rule to date,  although the July 2004 final
       rule moves these provisions to §93.119(f) due to reorganization of §93.119. Areas must
       also complete the interim emissions test(s) for NOx if the only SIP available is a
       reasonable further progress SIP for either the 1-hour or 8-hour standard that contains a
       budget for VOCs only (e.g., a 15% SIP). See §93.109(e)(3) of the final rule for further
       information.
24.    Q. How is the budget test generally implemented in 8-hour areas with 1-hour budgets?

       A. The budget test requirements in §93.118 for 8-hour areas will be generally
       implemented in the same manner as in 1-hour areas, with a few exceptions. First, as
       described above, the geographic area covered by the 8-hour standard may be different
       than that covered by the 1-hour standard and SIP budgets in some cases.  Second, the
       years for which regional modeling is required (i.e., analysis years) may differ.

       Areas that use 1-hour budgets for their 8-hour conformity determinations will need to
       determine the modeling analysis years that apply for the 8-hour standard per §93.118(d).
       Under this section, a modeling analysis must be completed for:

              the last year of the transportation plan,
       •       the attainment year for the relevant pollutant and standard, and
              an intermediate year(s) such that analysis years are not more than 10 years apart.

       The attainment year analysis is to be for an area's attainment year for the 8-hour standard,
       which probably will be different than the attainment year under the 1-hour standard. The

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                                                                                 page 42

       area must then calculate emissions in the analysis years from the planned transportation
       system.

       Once modeling is completed per §93.118(d)(2), 8-hour areas using 1-hour SIPs will also
       demonstrate consistency with the 1-hour budgets according to §93.118(b), except for
       cases where it is determined that 1-hour budgets are not appropriate through the
       consultation process as described above and in §93.109(e)(2)(v) of the conformity rule.
       According to §93.118(b) the July 1, 2004, final rule, consistency with 1-hour budgets
       must be shown for:

              all  1-hour budget years that are within the timeframe of the transportation plan,
       •       the 8-hour attainment year,
              the last year of the plan, and
       •       an intermediate year(s) so that  all years are not more than 10 years apart.

       Emissions  projected for each analysis year must be within the budgets in the 1-hour SIP
       from the most recent prior year. Interpolation can be used between analysis years for
       demonstrating consistency with budgets, just as has been done under the 1-hour standard.

       For example, suppose an area designated nonattainment for the 8-hour ozone standard
       with an 8-hour attainment date of 2010 has the following 1-hour budgets:

              2005 rate-of-progress (ROP) budgets for NOx and VOCs,
              2007 ROP budgets for NOx and VOCs, and
              2007 attainment budgets for NOx and VOCs.

       By 2005, this area would determine conformity for its 2005-2025 transportation plan and
       its TIP, and the conformity determination would be accomplished as follows:

              2005 budget test, using the  2005 ROP budgets;
              2007 budget test, using both 2007 ROP and attainment budgets;
       •       2010 budget test, using the  2007 attainment budgets9;
              2020 budget test,10 using the 2007 attainment budgets; and
       •       2025 budget test, using the  2007 attainment budgets.

       As described in §93.118(d)(2), emissions for the year 2005 could be generated with a
       regional emissions analysis, or could be interpolated if the area has run a regional
       9EPA has previously interpreted that only attainment budgets apply beyond the attainment
year, in cases where ozone areas also have budgets for ROP SIPs.

       10The year 2020 is chosen for this example, but any year from 2015 through 2019 would
also be acceptable for the interim year analysis.

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       emissions analysis for an earlier year.  Emissions for the year 2007 could also be
       interpolated or the area could choose to model emissions for this year. A regional
       modeling analysis must be done for the year 2010 (the 8-hour attainment year), any year
       between 2015 and 2020 for the intermediate year (in this  example, 2020 is the
       intermediate year), and the year 2025 (the last year of the transportation plan) as required
       by §93.118(d)(2).

       As stated above, once adequate or approved 8-hour budgets are established for a given
       precursor, the budget test would be completed with only  the 8-hour budgets for that
       precursor, rather than the 1-hour budgets.
25.    Q. Where 8-hour areas have to use both the budget test and the interim emissions test(s),
       what analysis years would be chosen?

       A. As described in the July 2004 final rule, there will be cases in Scenario 3 or 4 areas
       where both the budget and interim emissions tests are used.  Sections 93.118 and 93.119
       of the conformity rule cover the criteria and procedures for the budget test and the interim
       emissions tests, respectively. Each of these sections define the analysis years that must be
       examined in the particular test.

       In the budget test, the years that must be analyzed (§93.118(d)(2)) are:
              the 8-hour attainment year,
       •       the last year of the transportation plan, and
              an intermediate year or years as necessary, so that analysis years are no more than
              ten years apart.

       In the interim emissions tests, the years that must be analyzed (§93.119(g)) are:
       •       a year no more than five years in the future (from the year in which the conformity
              determination is made)
              the last year of the transportation plan, and
       •       an intermediate year or years as necessary, so that analysis years are no more than
              ten years apart.

       The interagency consultation process can be used to choose analysis years that meet the
       requirements of both §§93.118 and 93.119 so that the number of analysis years is
       minimized.  For example, consider a Scenario 3 area in one state that is classified as
       moderate for the 8-hour standard that has 1-hour budgets for the years 2005  and 2007.
       This area needs to use both the budget and interim emissions tests to determine conformity
       for the 8-hour standard, because there is a portion of the area that is not covered by the 1-
       hour budgets.  The plan covers the years 2005 through 2025 and the conformity
       determination will be made in the year 2005. This area could examine the following
       analysis years in its 8-hour conformity determination:

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       •       2010. which fulfills the §93.118 requirement to analyze the 8-hour attainment year,
              and the §93.119 requirement to analyze a year no more than five years in the
              future;
       •       2015. which fulfills the requirement in both rule sections to analyze an intermediate
              year so that analysis years are no more than 10 years apart; and
       •       2025. which fulfills the requirement in both rule sections to analyze the last year of
              the plan.

       In addition, the rule requires that the portion of the area covered by the 1-hour budgets
       must also demonstrate consistency with the budgets for the years 2005 and 2007.
       Consistency can be demonstrated using interpolation for a year between two analysis years
       as described in §93.118(d)(2) of the conformity rule.  In this example, the area could do a
       regional emissions analysis for 2005 and interpolate emissions for 2007 using the 2005 and
       2010 analyses.  Alternatively, the area could interpolate 2005 and 2007 emissions by using
       an analysis for  a year before 2005 done for model validation purposes, if such a year is not
       more than 10 years earlier than 2010 (so that analysis years are no more than 10 years
       apart).

       In this example, the budget test and interim emissions test requirements would then be
       satisfied as follows:

              2005:  budget test, using the 2005 budgets
              2007:  budget test, using the 2007 budgets
              2010:  budget test, using the 2007 budgets
                     and interim emissions test(s) for 2010
              2015:  budget test, using the 2007 budgets
                     and interim emissions test(s) for 2015n
              2025:  budget test, using the 2007 budgets
                     and interim emissions test(s) for 2025

       As described in §93.109(e)(2)(iii) of the July 1, 2004, final rule, the regional emissions
       analysis for the budget test in Scenario 3 would cover the 1-hour area portion of the 8-
       hour area (i.e., the portion covered by the 1-hour budgets).  The regional analyses for the
       interim emissions tests in an area located within a single state would cover either the
       portion of the 8-hour area not covered by the 1-hour budgets, or the entire 8-hour area.

                                                        [answer continues on the next page]
       nThe year 2015 is chosen for this example, but any year between 2016 and 2020 would
also be acceptable for the interim year analysis.

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       The regional analyses for the interim emissions tests in a multi-state area would cover
       either the portion of a state's 8-hour area not covered by its 1-hour budgets, or a state's
       entire 8-hour area.12
       12The July 1, 2004, final rule also provides a third interim emissions test option for certain
Scenario 3 multi-state areas:  the regional emissions analysis could cover the entire multi-state
area.  Please consult EPA before choosing this option to discuss its implications.

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