I Office of Inspector General
Evaluation Report
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EPA and State Progress
In Issuing Title V Permits
Report No. 2002-P-00008
March 29, 2002
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Inspector General Office
Conducting the Evaluation:
Regions Covered:
Program Office Involved:
Office of Program Evaluation
Northern Division
Regions 1, 3, 4, 5, 7, 8
Office of Air and Radiation
Abbreviations
Act
AFS
CFR
EPA
MOA
OAR
OAQPS
OECA
OIG
State and Local
Agencies
Clean Air Act
Aerometric Information Retrieval System Facility Subsystem
Code of Federal Regulations
Environmental Protection Agency
Memorandum of Agreement
Office of Air and Radiation
Office of Air Quality Planning and Standards
Office of Enforcement and Compliance Assurance
Office of Inspector General
State and Local Air Pollution Control Agencies
SIC
Standard Industrial Classification
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UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
OFFICE OF THE INSPECTOR GENERAL
j NORTHERN DIVISION
77 WEST JACKSON BOULEVARD
PHO-(fe^ CHICAGO, IL 60604-3590
March 29, 2002
MEMORANDUM
SUBJECT: Report No. 2002-P-00008
EPA and State Progress in Issuing Title V Permits
FROM: Leah L. Nikaidoh /s/
Audit Manager
Northern Division
TO: Jeffrey R. Holmstead
Assistant Administrator for Air and Radiation
Attached is our final report on EPA and state progress in issuing Title V permits. The
objectives of our evaluation were to identify (1) factors delaying the issuance of Title V permits
by selected state and local agencies, and (2) practices contributing to more timely issuance of
permits by selected state and local agencies.
The report contains findings that describe problems the Office of Inspector General (OIG)
has identified and the corrective actions the OIG recommends. This report represents the opinion
of the OIG and the findings contained in this report do not necessarily represent the final EPA
position. Final determinations on matters in this report will be made by EPA managers in
accordance with established resolution procedures.
ACTION REQUIRED
In accordance with EPA Order 2750, as the action official, you are required to provide
this office with a written response within 90 days of the final report date. The response should
address all recommendations. For corrective actions planned but not completed by the response
date, please describe the actions that are ongoing and provide a timetable for completion. Where
you disagree with the recommendation, please provide alternative actions for addressing the
findings reported. This information will assist us in finalizing the report.
We have no objection to the release of this report to the public. We appreciate the efforts
of your staff, and the staff in the regions and states we visited, in working with us to develop this
report. Should you or your staff have any questions, please contact me at 513-487-2365.
Additional copies of this report may be obtained from us or our website, www.epa.gov/oigearth.
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EPA and State Progress in Issuing Title V Permits
Executive Summary
To reduce violations of air pollution laws and improve the enforcement of those laws, Title V of
the 1990 Clean Air Act (Act) requires that all major stationary sources of air pollutants obtain a
permit to operate.1 Translating and consolidating the applicable air pollution requirements for
major stationary sources into site-specific, legally enforceable permit limits is a complex, time-
consuming, and resource intensive process. Nonetheless, in passing Title V, Congress provided
the statutory authority, fee collection authority, and expectation that all Title V permits would be
issued by November 1997, seven years after it passed the Act. However, over a decade later,
only 70 percent of the sources have been issued Title V permits.
Purpose
The Office of Inspector General (OIG) initiated this evaluation at the request of U.S.
Environmental Protection Agency (EPA) Region 5 management because they were concerned
about the progress state and local air pollution control agencies (state and local agencies) were
making in issuing Title V permits under the Act. In planning the evaluation, we expanded the
scope to include other EPA regions and states because problems in issuing Title V permits were
not isolated to Region 5. The objectives of our evaluation were to identify:
• Factors delaying the issuance of Title V permits by selected state and local agencies, and
• Practices contributing to more timely issuance of permits by selected state and local
agencies.
Results in Brief
Lack of State Resources, Complex EPA Regulations, and
Conflicting Priorities Contributed to Permit Delays
Nationwide, as of December 31, 2001, state and local agencies had issued 70 percent (13,036 of
18,709) of the required Title V permits. Of 112 state and local agencies approved to administer
the Title V program, only 4 state and 17 local agencies had issued all of their Title V permits. In
1A major stationary source is any non-mobile source of air pollution that meets one or more criteria as
defined in the 1990 Clean Air Act. The criteria for major stationary source determinations is listed in appendix 1.
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EPA and State Progress in Issuing Title V Permits
the six states we reviewed, key factors delaying the issuance of Title V permits included
insufficient state resources, complex EPA regulations, and conflicting state priorities.
• Insufficient resources. Of the six state agencies reviewed, three had problems with
resources or staffing. For example, the Massachusetts Department of Environmental
Protection collected $1.3 million in Title V fees in 2000, but program costs were $1.9
million for the year.
• Complex regulations and limited guidance. In each of the six state agencies reviewed,
one or more permit writers reported having difficulty understanding and resolving
questions on EPA's complex air toxics regulations and reported having difficulty using
EPA's limited guidance to establish adequate site-specific monitoring requirements.
Conflicting priorities. In addition to Title V operating permits, each of the state agencies
also issue construction permits to new sources and to sources that are making significant
changes to their operations — permits that they must act on within specified time limits.
Two agencies took deliberate action to ensure that staff were not forced to work on
construction permits rather than Title V operating permits.
As a result, many sources do not have the operating permits that were designed to reduce source
violations, improve regulatory agency enforcement abilities, establish site-specific monitoring
requirements, increase source accountability, and ensure adequate public involvement in the
permitting process.
EPA Oversight And Technical Assistance Had Limited Impact
EPA did not provide adequate oversight and technical assistance to state and local Title V
programs, and did not use the sanctions provided in the Act to foster more timely issuance of
Title V permits.
• Fee reviews of many state and local agencies not performed. From January 1998 to
December 2001, EPA had only evaluated 28 of 112 state and local agencies regarding
how they were assessing and managing Title V fees. These reviews are needed to identify
potential resource issues at state and local agencies.
• Revisions to Title Vregulations not completed. While EPA issued regulations in 1992,
due to concerns about selected provisions, EPA has been working to revise them since
1994. State officials indicated that dealing with repeated draft and proposed revisions to
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EPA and State Progress in Issuing Title V Permits
Title V regulations introduced an element of uncertainty that also contributed to delays in
issuing Title V permits.
• Insufficient data collected. State and local agencies were not required to consistently
provide the information EPA identified as being needed to adequately oversee the Title V
program. EPA collected information from all state and local agencies on the number of
permits issued, but did not maintain an adequate database on specific delays in issuing
individual permits.
• Act's provisions to take action not used. Although most state and local programs did not
issue their permits within three years of EPA approval, EPA has not used the Act's
provisions for issuing notices of deficiency, sanctions, and program withdrawal when state
and local agencies have missed the Act's deadline for issuing initial Title V permits.
As a result, EPA oversight had little impact on the delays experienced by state and local agencies.
The perspective of senior EPA officials is that they face a dilemma in trying to take more stringent
actions, such as sanctions against state and local agencies, while adhering to agency policies to
work with state and local agencies as partners in environmental protection to the maximum extent
possible. Also, they believe that the Title V program has limited incentives for both states and
industries to proactively address the existing permit backlog.
Management Support, Partnerships, and Site Visits
Contributed to More Timely Issuance of Title V Permits
In the six states we reviewed, three practices that contributed to the progress that agencies made
in issuing Title V operating permits were:
State agency management support for the Title V program.
• State agency and industry partnering.
• Permit writer site visits to facilities.
Each of these practices contributed to the writing and issuance of Title V operating permits on a
more timely basis. Employing one or more of these practices, along with sufficient resources,
contributed to Florida and Pennsylvania completing most of their permits before other states.
However, EPA has not taken a leadership role in collecting and disseminating information on
practices that show promise of helping agencies issue permits on a more timely basis.
Recommendations
in
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EPA and State Progress in Issuing Title V Permits
We recommend that the Assistant Administrator for Air and Radiation:
Require EPA regions to conduct fee protocol reviews.
Revive agency efforts to make air toxics standards easier to incorporate into Title V
permits.
• Complete the revisions to the Title V regulations.
Identify and collect information from regions, states, and local agencies to adequately
oversee the Title V program.
• Develop and execute a national plan for addressing implementation deficiencies in
Title V programs, including specifying the actions EPA will take to address missed
milestone dates for issuing the initial permits.
• Develop a plan for identifying, collecting, and disseminating promising practices on the
implementation of Title V programs.
Detailed recommendations are contained at the end of chapters 3 and 4.
Agency Actions
In his March 26, 2002 response to the draft report, the Assistant Administrator stated that while
state and local agencies have made good progress in issuing initial Title V permits, there is still
more work to do. He stated that many of the sources remaining to be permitted are the more
complex facilities and that the problems identified in the report continue to be of concern. The
Assistant Administrator agreed with the conclusion that more can be done to help this effort and
will follow up, within 90 days of issuance of the final report, with an action plan based on the
report's findings and recommendations.
The Assistant Administrator also provided comments to several recommendations, which are
summarized at the end of chapter 3, and some suggested clarifications that were incorporated into
the final report.
IV
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Table of Contents
Executive Summary i
1 Introduction 1
Purpose 1
Background 1
Current Status 4
Permit Process 5
Scope and Methodology 6
2 Lack of State Resources, Complex EPA Regulations, and
Conflicting Priorities Contributed to Permit Delays 8
Insufficient Resources and Staffing Contributed to Delays 8
Complex EPA Regulations and Guidance Contributed to Delays 10
Conflicting Priorities with Other Air Permits Delayed Permits 12
One-time, Non-continuing Delays in Issuing Title V Permits 13
Conclusion 14
3 EPA Oversight and Technical Assistance Had Limited Impact 16
EPA Oversight and Technical Assistance 17
Revisions to Title V Regulations Not Completed 18
Toxics Standards Not Title V "Friendly" 19
Data Collection Limited 20
Regions Not Performing Fee Protocol Reviews 21
Protocol for Other Reviews Not Developed 22
Notices of Deficiency and Sanctions Not Used to
Address Implementation Issues 23
Other Matters 25
Conclusion 27
Recommendations 28
Agency Actions 29
OIG Evaluation 30
4 Management Support, Partnerships, and Site Visits Contributed to More Timely
Issuance of Title V Permits 32
Management Support Helped Build Strong Programs 32
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Agency and Industry Partnering Fostered a Cooperative Program 35
Visits to Sources Saved Time When Writing Permits 35
EPA Could Improve Its Efforts to Promote the Sharing of Good Practices ... 36
Conclusion 36
Recommendation 36
Agency Actions and OIG Evaluation 37
Appendices
1 Definitions of Major Stationary Sources 39
2 Assistant Administrator for Air and Radiation Response to Draft Report 41
3 Background on the Clean Air Act Title V Program 44
4 Status of Title V Permits as of December 31, 2001 47
5 Compliance With Clean Air Act Schedules 51
6 Title V Permit Process, Fees, and Expenses 53
7 Summary of Factors Impacting Title V Permit Issuance 55
8 Details on Scope and Methodology 57
9 Distribution 60
VI
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Chapter 1
Introduction
Purpose
The Office of Inspector General (OIG) initiated this evaluation at
the request of U.S. Environmental Protection Agency (EPA)
Region 5 management. These officials were concerned about the
progress state and local air pollution control agencies (state and
local agencies) were making in issuing Title V permits under the
Clean Air Act (Act). In planning the evaluation, we expanded the
scope to include other EPA regions and states because problems in
issuing Title V permits were not isolated to Region 5. The
objectives of our evaluation were to identify:
• Factors delaying the issuance of Title V permits at selected
state and local agencies, and
Practices contributing to more timely issuance of permits at
selected state and local agencies.
The report presents lessons learned from issuing the initial Title V
permits. The findings and recommendations can benefit:
State and local agencies that have not completed their initial
permits, to help them address roadblocks to permit issuance.
• EPA, to improve its overall management and oversight of
the Title V program.
EPA, state and local agencies, and industries as lessons
learned that can be used in dealing with permit renewals.
Background
Congress' main goal in establishing the Title V program in the Act
was to achieve a broad-based tool to aid effective implementation
of the Act and to enhance enforcement. Title V requires operating
permits for every major source of a regulated air pollutant and any
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EPA and State Progress in Issuing Title V Permits
other source covered by a current permit program. Prior to 1990,
there was no federal requirement that existing sources of air
pollution have a federally enforceable operating permit. Congress
also intended the program to be self sufficient, and included
provisions in the Act for EPA and approved state and local
agencies to assess and collect fees for the permitting program. The
purpose and key requirements of Title V are shown in table 1.1.
PURPOSE: Reduce violations of air pollution laws and improve
enforcement of those laws.
Key
Requirements
• Recording in one document all the air pollution control
requirements that apply to a source.
• Requiring the source to make regular reports on how
it is tracking its emissions and the controls it is using
to limit emissions.
• Requiring monitoring, testing, and record keeping,
where needed, to ensure that the source complies
with its emission limits or other air pollution control
requirements.
• Requiring the source to certify each year whether or
not it had met the air pollution control requirements in
its Title V permit.
• Making terms of the Title V permit federally
enforceable.
Table 1.1: Purpose of the Title V Program and Key Requirements
The Act provided a schedule for EPA, state and local agencies to
develop their Title V programs and issue the initial permits. The
schedule was based on when the amendments were passed, which
was in November 1990. If EPA and the state and local agencies
met the schedule in the Act, all of the initial Title V permits would
have been issued by November 1997, as shown in figure 1.1.
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EPA and State Progress in Issuing Title V Permits
Clean Air Act Implementation Schedule
Renew permits
initial Permits
Issued
Permit Programs
Approved
Submit Permit
Programs
Regulations
issued
Amendments
passed
• 11/O2
* 11/97
• 11/94
* 11/93
• 11/91
* 11/90
1 99O 1 992 1 994 1 996 1 99S 2000 2002 2OO4
Figure 1.1: Clean Air Act Title V Operating Permit Program
Implementation Schedule (assuming all deadlines were met)
EPA, State, and
Local Agency Roles
in Permitting Title V
Sources
As shown in figure 1.1, five years after the state or local agency
issues the initial permit, the Act requires that the source's permit be
renewed. Among other things, such permit renewals allow the
public another opportunity to comment on and influence the
environmental operations of major sources, their permit limits and
controls, and the methods of monitoring and reporting on sources'
emissions.
EPA is responsible for promulgating regulations; establishing the
minimum elements of a Title V permit program; reviewing,
approving, and overseeing permit programs; and reviewing permits
issued by the state and local agencies. EPA is also responsible for
implementing permit programs for any state and local agencies that
do not implement their own programs. As of December 31, 2001,
EPA had approved all 112 state and local agencies to implement the
Title V program.
Once approved by EPA, state and local agencies are responsible for
establishing and implementing their permit programs, issuing
permits to major sources of air pollution, collecting fees to cover
the cost of the programs—including the initial costs of issuing
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EPA and State Progress in Issuing Title V Permits
permits to sources—and ensuring that sources comply with their
permit limits. Under the Act, state and local agencies that do not
adequately implement the Title V permit program may lose their
authorization to continue administering the program.
Additional information on the Title V program is contained in
appendix 3.
Current Status
As of December 31, 2001, state and local agencies had issued 70
percent (13,036 of 18,709) of the required Title V permits. Figure
1.2 below provides an illustration of the permit issuance rate
nationwide and among each EPA region.2
Figure 1.2: Permit issuance as of December 31, 2001 (Source: EPA)
Of 112 state and local agencies approved to administer the Title V
program, 4 state and 17 local agencies had issued all of their Title V
permits, a total of 2,177 permits. Ten local agencies had not
Local agency permit completions are included in state totals.
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issued any permits; however, these 10 agencies only accounted for
35 permits. A detailed description of the permit issuance status of
all 112 state and local agencies is contained in appendix 4.
According to the Act, state and local agencies were to issue the
initial permits within three years of program approval. EPA
approved 110 of 112 of the programs between 1994 and 1997.3 As
such, even considering delays in permit program approval, most
state and local agencies should have completed issuing their initial
Title V permits by December 31, 2000.4 Eighty-nine state and
local agencies still had initial permits to issue as of December 31,
2001. According to an EPA survey of state and local agencies,
some agencies do not expect to complete issuance of the initial
permits until 2004.
Permit Process
The Act's deadline of three years from program approval is the only
guideline as to how long state and local agencies should take to
issue the initial Title V permits. Since few state and local agencies
met that deadline, as part of our evaluation, we analyzed how long
it took for six agencies to issue permits. To obtain perspective
about how long agencies need to issue a Title V permit, we
analyzed a sample of 60 permits to determine how long different
phases of the permit process took in order to identify where the
agencies were spending the most time issuing permits.5
The 6 state agencies had issued permits for 1,744 of 2,686 sources
needing Title V permits, or about 65 percent of the required
permits. As shown in table 1.2, the 6 agencies took, on average,
3One program was approved in 1998, and one program was approved in 2000.
4Analysis of the reasons for delay in approving permit programs was not part of this evaluation. A
summary of EPA, state, and local agency compliance with the schedule for implementing Title V is contained in
appendix 5.
5Details on how we selected the 60 permits are contained in appendix 8. We performed our fieldwork at
the state agencies between May and July 2001.
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EPA and State Progress in Issuing Title V Permits
Scope and
Methodology
3.2 years to issue a Title V permit.6 For the 60 permits we
reviewed, the agencies took, on average, 3.6 years to issue the
permit.
Number of permits
Total elapsed days/years
Application to start of review
Start to draft permit
Draft to final permit
Universe7
1744
1,176 days 73.2 years
7
7
7
OIG Reviewed
60
1,329 days 73.6 years
723 days
391 days
215 days
Table 1.2: Average time to process permits for six state agencies reviewed
Additional information on permit issuance rates for each of the six
state agencies we reviewed is included in appendix 6.
We conducted fieldwork in the states of Colorado, Florida,
Massachusetts, Missouri, Pennsylvania, and Wisconsin; at EPA
Region 5; and at EPA's Headquarters air and enforcement
offices—the Office of Air Quality Planning and Standards
(OAQPS), and the Office of Enforcement and Compliance
Assurance (OECA). We obtained information from other EPA
regions as needed. We also obtained limited information from
Illinois during the planning phase of our evaluation.
We selected these states because of their geographic diversity,
varying number of Title V sources, and the diversity of their
permitting status. For example, permit completions ranged from 28
to 100 percent among the six states we reviewed. We consulted
with OAQPS officials in developing the criteria for selecting the
The 3.2 years represented elapsed days, and does not reflect actual staff time spent on the permit. Most
of the six states we reviewed did not track detailed information on the number of staff days spent on specific
permits.
7The databases for the six state agencies did not have consistent data. Therefore, we were not able to
compute average timeframes on the universe of permits.
6
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EPA and State Progress in Issuing Title V Permits
states. Within each state, we conducted in-depth discussions of the
factors impacting permit issuance with state officials. We also held
a one-day workshop with senior OAQPS officials to (1) obtain their
views on the factors we identified, (2) identify other factors, and (3)
assess the likelihood of these factors also impacting permit
renewals. Our review did not include an analysis of the internal
controls over fee collections or the quality of the permits issued.
The Assistant Administrator for Air and Radiation responded to the
draft report on March 26, 2002. An exit conference was held on
March 27, 2002. Based on the response and exit conference,
revisions were made to the report and a copy of the response
included as appendix 2. A detailed discussion of our scope and
methodology is provided in appendix 8.
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Chapter 2
Lack of State Resources, Complex EPA Regulations, and
Conflicting Priorities Contributed to Permit Delays
Key factors that continue to delay state and local agencies'
issuance of Title V permits include insufficient state resources,
complex EPA regulations, and conflicting state priorities. As a
result, many sources did not have the operating permits that were
designed to reduce source violations, improve regulatory agency
enforcement abilities, establish site-specific monitoring
requirements, increase source accountability, and ensure adequate
public involvement in the permitting process. According to EPA,
many of the continuing problems are also likely to impact permit
renewals.8
Insufficient Resources
and Staffing
Contributed to Delays
The Act requires that permitting authorities assess and collect fees
from permit applicants sufficient to cover the costs of developing
and implementing the permit program. Of the six state agencies
reviewed, officials at three agencies - Massachusetts, Missouri,
and Wisconsin - stated that they have insufficient resources or
staffing to implement the permitting program. We also found that
the three agencies with sufficient resources- Colorado, Florida,
and Pennsylvania-were further along in issuing Title V permits
than the three agencies that had problems with resources or
staffing.
Resources and staff for the Title V program come from fees that
agencies impose on Title V sources. Fees are generally based on a
source's emissions. However, fee collections - and agency
resources to administer the Title V program - are impacted by the
number of sources, tons of emissions, fee rate per ton, other fees
A table summarizing the factors that have adversely impacted permit issuance in the Title V program is
contained in appendix 7.
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imposed by the agency, and external factors.9 The state legislature
provides the authority to assess the fees.
In December 2000, EPA completed a survey of the fees that state
and local agencies assessed. For the 59 state and local agencies
that responded, permit fees ranged from $6 to $81 per ton, with an
average of $28 per ton.10 These fees were to cover all costs of the
Title V program, including:
Preparing regulations and guidance for the permit program.
• Reviewing and acting on permit applications, revisions, and
renewals.
• General administrative costs of running the permit
program.
• Implementing and enforcing the Title V permit, up to the
point of filing the administrative or judicial action.
• Emissions and ambient monitoring for specific Title V
sources.
• Preparing inventories and tracking emissions for specific
Title V sources.
Two of six state agencies reviewed were not collecting sufficient
fees, which contributed to problems in hiring staff needed to
process Title V permits:
According to officials at Wisconsin's Department of
Natural Resources, for the last three biannual budgets, the
state legislature did not provide authority to increase fees.
Insufficient fees resulted in lower collections, causing
Wisconsin to put a freeze on hiring. Wisconsin estimated
there were 12 vacancies because of the freeze. Wisconsin
spent about $10 million in 2000, but estimated for 2002 it
actually needs $12.3 million to fully implement the
program. In May 1999, the EPA Region 5 Regional
Administrator sent a letter to Wisconsin legislature
9Some agencies also charge a minimum processing fee for Title V permits.
10Details on the fees for state agencies we reviewed are included in appendix 6.
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Complex EPA
Regulations and
Guidance
Contributed to
Delays
Understanding
EPA's Air Toxics
Regulations
supporting increased fees necessary for Title V, but the fee
increase was not approved.
Massachusetts' Department of Environmental Protection's
2000 revenue for the Title V program was $1.3 million but
the agency's costs were $1.9 million. Massachusetts' fee
regulation package identified that the agency had 12 less
staff than it needed to fully implement the Title V program.
Even when a state or local agency is collecting sufficient fees, it
may not be able to hire sufficient staff to implement the program.
The Missouri Department of Natural Resources had sufficient
revenue from fees to support the Title V program but, according
to agency officials, was unable to fill a supervisory position
because the level of wages allowed by the state was not sufficient
to attract qualified personnel to accept the position.
According to state officials, obtaining answers from EPA on
writing specific permits can be difficult and not very timely for
state and local agencies. In several instances, resolving state
questions on EPA's complex air toxics regulations added several
months to permit issuance. Similarly, the lack of guidance from
EPA on how to implement the agency's periodic monitoring
requirements led to uncertainty about the type and amount of
monitoring requirements that permit writers should include in Title
V permits, also delaying permit issuance. EPA continues to
promulgate new regulations that state and local agencies need to
incorporate into Title V permits, often resulting in precedent-
setting decisions. EPA needs to ensure that the regulations and
guidance are written to facilitate incorporation into Title V permits
by permit writers at the state and local agencies.
Permit writers told us that they frequently have difficulty
understanding EPA's air toxics regulations, which extended the
time needed to issue Title V operating permits. Air toxics
regulations can be very complex and lengthy (sometimes over
200 pages). As a result, permit writers had difficulty identifying
the portions of the standards to include in a permit. In each of the
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six state agencies reviewed, at least one Title V operating permit
was delayed because the staff had difficulty determining the
portions of the air toxics regulations to be included in a source's
permit. For example:
A Wisconsin Department of Natural Resources permit
engineer had difficulty understanding how to incorporate
air toxics regulations into the permit. The engineer
requested guidance from EPA but had to wait several
months for a response.
In Missouri, determining the appropriate portions of the air
toxics regulation to be included in the permit for an organic
chemical manufacturer added from 7 to 12 months time to
write the permit, according to the permit writer.
Periodic Monitoring Permit writers also told us that the lack of guidance from EPA on
Requirements how to implement the agency's periodic monitoring requirements
led to uncertainty about the type and amount of monitoring
requirements they should include in Title V permits, which also
delayed some permits. Title V added new requirements for major
sources to conduct periodic monitoring of pollutants—monitoring
that had not been required in the past. If the current EPA
regulation (or state or local agency regulations) for a pollutant did
not require adequate monitoring sufficient to assure compliance,
under Title V- for the first time ever - the permit writer would
need to add a requirement to ensure adequate monitoring when
writing the permit. However, the Act did not define "adequate
monitoring," according to EPA staff. As a result, many state and
local agencies independently developed what monitoring was
needed for each permit, sometimes through negotiation with the
permittee. This activity also added to the time needed to write
permits.
Although EPA issued guidance on periodic monitoring in 1998, the
U.S. Court of Appeals for the District of Columbia set aside EPA's
guidance in 2000. The court's decision was that EPA's periodic
monitoring guidance was, in effect, a regulation, and that EPA
could not create regulations through guidance. EPA recognized
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New Regulations
Conflicting Priorities
with Other Air Permits
Delayed Permits
that it needed to further define periodic monitoring requirements,
and plans to include this as part of their planned revisions to the
Title V regulations. However, according to an EPA operating
permit program official, it may be several years before these
revisions are completed.
According to EPA officials, state and local agencies will continue to
face the challenge of incorporating new EPA regulations into Title
V permits in the future. EPA is under statutory mandate to issue
many new air toxics standards. Additionally, EPA's permitting
regulations require that all Title V permits meet stringent new
compliance assurance monitoring regulations when they are
renewed. It is important that EPA ensure that the regulations and
guidance it issues are written to facilitate incorporation into Title V
permits. The following illustrations indicate the magnitude of the
tasks permit writers will face in the future:
• EPA estimated for fiscal years 2001 and 2002 that it would
publish in the Federal Register 40 new air toxics regulations
that will need to be incorporated into existing Title V
operating permits when the permits are renewed.
• The 1990 amendments authorized EPA to develop
regulations requiring sources to monitor the performance of
their emission control equipment. Although EPA issued
these regulations in 1997, in order to reduce the burden on
industry and state and local agencies, EPA decided that
incorporating compliance assurance monitoring into Title V
permits would not be required until permit renewal.
In addition to Title V operating permits, state and local agencies
also issue construction permits to new sources and to sources that
are making significant changes to their operations. By law, state
and local agencies often have a limited amount of time to issue
these permits. Therefore, such construction permits have a higher
priority than operating permits.
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One-time,
Non-continuing
Delays in Issuing
Title V Permits
Several state agencies found that when the same staff were
responsible for issuing both construction and operating permits,
operating permits were not being issued. The Missouri
Department of Natural Resources and one of the Florida
Department of Environmental Protection's district offices resolved
the issue by having different staff responsible for issuing
construction and operating permits. Both agencies found that the
reorganization of responsibilities increased the rate of operating
permit issuance. Conversely, in Wisconsin Department of Natural
Resources district offices, permitting staff had to choose between
working on these higher priority construction permits or working
on their Title V permits. This was a contributing factor to the
length of time required to issue Title V permits in Wisconsin. As
shown in appendix 6, Wisconsin averaged over 3 years (1,135
days) from receipt of the permit application to start of the review
process.
Our review found that some factors had one-time impacts on state
and local agencies' issuance of permits, but generally were no
longer having an impact. These factors included:
• Infrastructure development. State and local agencies had
to develop new laws and regulations to implement their
Title V program, and often obtain the approval of their
state legislature. State and local agencies also had to
develop the organizational structure needed to support
Title V, recruit and train staff on the Title V program, and
carry out myriad other tasks associated with establishing a
new program.
• Volume of permits. There are more than 18,000 sources
subject to Title V nationwide, and all were required to
submit applications within one year of the state or local
agency receiving program approval from EPA. In several
of the states we reviewed, state regulations required
sources to submit applications toward the end of the one
year period for submittals, forcing agencies to prioritize
applications for processing. For a large source, the
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EPA and State Progress in Issuing Title V Permits
application could be as large as one file box, or about 15
inches of paper.
Synthetic minors. In addition to Title V permits, state and
local agencies also had to issue operating permits with
federally enforceable emissions limits to all sources with
sufficient potential to emit to be considered a major source,
as well as those sources that requested them. Known as
"synthetic minors," these sources can opt out of the Title V
program by installing pollution control equipment or
limiting their hours of operation so that their actual
emissions—after controls—would be below the threshold
for needing a Title V permit. About 17,000 sources
nationwide needed such non-Title V operating permits.
According to a 1999 Congressional Research Service
Report, many state and local agencies decided to issue
these permits before starting on the Title V permits.
EPA 's delayed Title Vguidance. EPA issued guidance in
1995 and 1996 on Title V. The guidance, while beneficial,
was issued too late for many states, since about 38 percent
of the state and local agencies already had interim or final
program approval prior to July 1995, when EPA issued the
first guidance document, which was commonly referred to
as a "white paper." Since the Act required industry to
submit applications within 1 year of program approval,
these state and local agencies had already developed their
applications, and some had begun training on the Title V
permit process. In the guidance, according to state agency
officials, EPA changed how it previously interpreted the
Title V regulations. As a result, Colorado's Department of
Public Health and Environment had to change some of its
final permits. In Florida, industry wanted to wait until the
guidance was issued to see if the revised guidance would
provide a more liberal interpretation of the regulations.
Lack of experience. According to a 1998 EPA survey of
state and local agencies, dealing with EPA regional staff
who lacked Title V permitting experience also delayed the
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issuance of some permits. State and local agency staff
found this was a problem during the early years of the Title
V program, but as regional staff gained experience, there
were fewer problems.
Conclusion
State and local agencies encountered many factors that impacted
their ability to issue Title V permits. The primary factors that
continue to impact permit issuance are insufficient resources,
complex regulations, and conflicting priorities. As a result, many
sources did not have the operating permits that were designed to
reduce source violations, improve regulatory agency enforcement
abilities, establish site-specific monitoring requirements, increase
source accountability, and ensure adequate public involvement in
the permitting process. According to EPA, many of the continuing
problems are also likely to impact permit renewals.
Chapter 3 discusses EPA's efforts to work with state and local
agencies to address the problems of insufficient resources and
complex regulations, as well as our recommendations for EPA
actions to improve Title V permit issuance. Chapter 4 discusses
promising practices that state and local agencies might use to
overcome conflicting priorities, and EPA's opportunity to enhance
its leadership role in collecting and disseminating information on
promising practices.
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Chapter 3
EPA Oversight and Technical Assistance
Had Limited Impact
EPA did not provide adequate oversight and technical assistance
to state and local Title V programs, and did not use the sanctions
provided in the Act to foster more timely issuance of Title V
permits. EPA oversight and technical assistance are important
factors in helping state and local agencies follow through on their
commitments to issue Title V permits in a timely manner. As
discussed in Chapter 2, many state and local agencies have not met
the timeframes for issuing their initial Title V permits. EPA has
taken a number of technical assistance and oversight actions to
help state and local agencies, such as conducting a survey of
roadblocks to permit issuance. However, we found that EPA
generally did not provide adequate technical assistance to, nor
oversight of, state and local Title V programs. For example, EPA
did not:
Complete the needed revisions to Title V.
• Continue efforts to make air toxics standards more usable
for permit writers.
• Collect sufficient data on the status of permit issuance.
Conduct fee reviews of many state and local agencies.
• Develop protocols for reviewing other aspects, besides
fees, of Title V programs.
• Use the Act's provisions to take action when state and
local agencies did not issue Title V permits.
As a result, EPA oversight had little impact on state and local
agencies' efforts to make better progress in issuing initial Title V
permits. The perspective of senior EPA officials' is that they face
a dilemma in trying to take more stringent actions, such as
sanctions against state and local agencies, while adhering to EPA
policies to work with these same agencies as partners in
environmental protection to the maximum extent possible. They
also noted that the Title V program has limited incentives for both
states and industries to proactively address the permit backlog.
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Without adequate oversight, state and local agencies' practices can
delay Title V permit issuance. For example, EPA allowed the
Massachusetts Department of Environmental Protection to
suspend permit review efforts if a source said it was considering a
change in any of its operations. Massachusetts had a practice of
putting the application on hold while a source was deciding
whether to make a change in its operations, and did not follow up
to determine whether the changes were actually being made. As of
June 1, 2001, 75 of the 143 sources—or 52 percent—in
Massachusetts still needing a Title V permit were on hold.
EPA Oversight and
Technical Assistance Under the Act, one of EPA's responsibilities is to ensure that state
and local agencies administer and enforce their Title V programs
appropriately. EPA also provides assistance to the state and local
agencies in understanding and implementing its regulations and
guidance through a combination of continuing and specific
activities. Specific actions EPA has taken include the issuance of
regulations and guidance, establishment of a tracking system, and
conducting reviews of state programs. As shown in table 3.1,
EPA has taken a number of actions over the years in an effort to
promote the more timely issuance of Title V permits.
However, as will be discussed next, there are additional actions
EPA needs to take to both facilitate and compel better progress by
state and local agencies in issuing Title V permits.
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Date
1992
1995
1996
1998
1998
1999
2000
2000
2001
Description of EPA Action
Title V regulations published in 40 Code of Federal Regulations
(CFR)Part70.
First guidance document issued— "White Paper for Streamlined
Development of Part 70 Permit Applications."
Second guidance document issued-"White Paper Number 2 for
Improved Implementation of the Part 70 Operating Permit
Program."
Survey conducted of state and local agencies to identify roadblocks
to permit issuance.
Protocol issued for conducting reviews of state fees.
Database established on the status of permit issuance and permit
information published on the EPA web site.
Memorandum issued by Assistant Administrator for Air and
Radiation seeking state and local agency assistance in meeting goal
of getting all permits issued by January 1, 2001.
Request made to state and local agencies to develop plans for
completing the initial permits.
In response to public comment on some Title V programs, EPA
required some state and local agencies to submit a letter detailing
how they will complete their permits by December 2003.
Table 3.1: Summary of EPA actions to promote permit issuance, 1992 to
2001.11
Revisions to
Title V Regulations
Not Completed
EPA first issued regulations for Title V in 1992. Since then, EPA
has issued various proposed revisions, and made draft revisions
available to the public four times. However, according to OAQPS
officials, the revisions may not be completed for several years.
While the proposed and draft revisions did not directly impact
issuance of Title V permits, state officials indicated that dealing
with repeated revisions introduced an element of uncertainty which
can be time consuming for the state and local agencies and hinder
performance of other work.
Table lists major actions EPA took to address the timeliness of permit issuance. It does not identify all
actions EPA has taken in the Title V program.
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The procedures and circumstances under which Title V sources
must revise their permits before changing their operations to
accommodate changing business conditions has been one of the
more controversial provisions of Title V. Known as the
"operational flexibility" provisions, key disagreements have
centered on (1) whether sources could increase emissions above
permitted limits without need of a permit revision, and (2) whether
public notice and/or prior regulatory approval of such changes
would be required. EPA issued the regulations for Title V in July
1992 and was sued by state, environmental, and industry groups in
August 1992. About one-third of the issues in the lawsuit related
to the operational flexibility provisions; i.e., those provisions that
determine when and how a source must revise its permit to
account for changes that could affect emissions. Subsequently,
EPA issued two proposed revisions, and made two draft revisions
available for public comment. These revisions were to primarily
address various stakeholders' concerns that the operational
flexibility provisions were too vague, failed to provide for public
participation, or inadequately provided for state and local agency
review.
No additional draft revisions have been issued in the Federal
Register, as either proposed or final, since 1998. As of February
2002, the package for Part 70 was complete, but, according to
OAQPS officials, with the change in administration and competing
priorities, there has been little progress on sending the revised
package to the Office of Management and Budget for review.
Toxics Standards
Not Title V "Friendly" As described in chapter 2, difficulty in understanding EPA's air
toxics standards delayed the issuance of permits. In 1997, EPA
officials initiated an effort to address the problems permit writers
were having with air toxics standards. OAQPS staff developed a
set of standard drafting principles that included thinking from the
permit writers viewpoint, providing for flexibility, and minimizing
permitting transactions, or revisions. OAQPS officials did not
provide us with an explanation as to why the drafting principles
were not being used when writing air toxics standards. According
to one state official, because EPA was under pressure to issue the
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air toxics standards quickly to meet the Act's deadlines, the agency
did not continue with this effort.12 According to an OAQPS
official, EPA needs to resume its efforts to ensure air toxics
regulations are written so as to facilitate their incorporation into
Title V permits.
Data Collection
Limited In a 1994 memorandum, OAQPS identified the information it
needed to (a) measure the progress state and local agencies had
made and where they were having problems issuing Title V
permits, (b) ensure program consistency, and (c) respond to
reasonable requests for information regarding implementation of
the Title V program. At a minimum, OAQPS needed the
following information from state and local agencies on all Title V
permits:
• Source identification number
• Permit number
• Date regional office received the proposed permit
• Date EPA's 45 day review period ends
• Date permit was issued
State and local agencies were instructed to enter the requested
information into EPA's Aerometric Information Retrieval System
Facility Subsystem (AFS). However, many state and local
agencies generally disregarded EPA's desire for such data because
the AFS database was not user friendly, according to an OAQPS
official. This led to concerns that state and local agencies were
inconsistent in entering their data into AFS, eventually causing
EPA officials to question the reliability of the Title V status reports
generated from AFS. Subsequently, OAQPS developed its own
system to track only the number of sources and permits issued.13
According to OAQPS officials, the information collected on the
number of sources and permits issued provided top management
with sufficient information on the overall status of the program.
12An analysis of EPA's approach to developing air toxics regulations was outside the scope of this review.
13EPA also collects information on the number of synthetic minors and permits issued to these sources.
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Regions
Not Performing
Fee Protocol Reviews
However, it did not provide other managers and staff working in
the Title V program with the information needed to adequately
monitor the progress of specific sources. In our opinion, the
information OAQPS identified in its 1994 policy would allow
managers and staff to adequately oversee the Title V program and
better monitor progress.14
As noted in chapter 1, Congress intended for the Title V program
to be self sufficient, and included provisions in the Act for state
and local agencies to collect the fees needed to carry out the
program. In 1998, OAQPS issued a protocol for EPA regions to
use in conducting reviews of Title V permit fees. The fee protocol
identified a series of questions to determine whether the state or
local agency:
• Could demonstrate that Title V resources are being billed
in accordance with its fee requirements, and that sources
are paying the fees as required.
• Was appropriately classifying expenses between Title V
and non-Title V programs.
Had integrated features into its financial system that would
identify Title V revenue and expenditures.
• Could confirm that the fees collected from sources were
only used to pay for the Title V program.
However, from January 1998 to December 2001, EPA regions had
only performed 28 reviews of state and local agencies, with some
regions not performing any reviews. As a part of the fiscal years
2001-2002 Memorandum of Agreement (MO A) between the Office
of Air and Radiation (OAR) and the regions, most regions
14In February 2002, we found that AFS contained information on a substantial number of specific sources
to which state and local agencies had issued Title V permits about - 14,000 permit records. However, this
information-obtained from OECA officials - still did not comprehensively address the over 18,000 sources
seeking Title V permits. At the time of our review, OAQPS was not relying upon AFS data for tracking specific
permits.
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Protocol for
Other Reviews
Not Developed
committed to fee oversight reviews of at least two of their
permitting authorities. However, there are 112 approved state and
local agency Title V programs, 84 of which have not been
evaluated using the fee protocol. If each of the 10 regions
performed two reviews per year, it would take over 4 years to
conduct fee reviews of the 112 state and local agencies.15
As discussed in chapter 2, our review found that insufficient
resources was a primary contributor to delays in issuing permits.
Fee protocol reviews can be beneficial to EPA and the state or local
agency. The fee protocol provides EPA with one method for
assuring that states have sufficient controls over their resources and
that the resources are devoted to Title V. In addition, in
Massachusetts, a fee review helped the agency to justify the need
for a fee increase, and the fees subsequently were increased.
When OAQPS issued the fee review protocol in 1998, according to
permitting officials, it also intended to develop one or more
protocols to review other aspects of Title V implementation.
OAQPS never developed these additional protocols because, due to
resource constraints, the EPA regions had only conducted the
higher priority fee reviews in a small portion of the state and local
agencies. Consequently, OAQPS officials told us they decided to
defer development of additional protocols. As an illustration of the
need for and benefits of other protocols, Region 5 developed its
own protocol for reviewing other aspects of the Title V program,
which included questions on:
Efficiency of permit issuance.
• Processing of permit modifications.
Inclusion of all applicable requirements in permits.
• Internal review procedures.
• Training.
• Public participation.
Identification of Title V sources.
15,
As shown in appendix 4, some regions have more state and local agencies than others. To review all
state and local agencies in five years, regions with fewer agencies would need to assist regions with more agencies.
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Notices of Deficiency
and Sanctions
Not Used to Address
Implementation Issues
These evaluations would provide EPA and state and local agencies
with valuable information on whether Title V programs are being
adequately implemented. Adequate implementation of Title V
programs contributes to more timely issuance of permits.
While the Act provides EPA with the authority to take action when
state and local agencies do not adequately administer their Title V
program, EPA has rarely used this authority. For example, EPA
did not issue any notices of deficiency when state and local agencies
did not issue their permits within three years of their program being
approved. Although most state and local agency programs were
approved by the end of 1997, and should have completed all their
permits by December 2000, it was not until December 2001 that
EPA issued its first notices of deficiency. In addition, the notices
that EPA issued in December 2001 were for deficiencies in state
and local agencies' Title V regulations, not for delays in issuing
permits. As of February 2002, EPA had yet to issue a notice of
deficiency for a state or local agency's failure to issue the required
Title V permits.
If EPA finds that an approved agency is not adequately
administering its Title V program, the Act provided EPA with the
authority to take further action. According to the implementing
regulations in 40 CFR Part 70.10, the first step is for EPA to
publish in the Federal Register its finding that the state or local
agency is not adequately administering its program, along with the
reasons why. The state or local agency then has (a) 90 days to take
significant action to assure that it will adequately implement the
program in the future, and (b) 18 months to correct the deficiency.
If the state or local agency does not develop an adequate plan
within 90 days, or correct the deficiency within 18 months, EPA
can take one or more of the following actions:
• Withdraw approval of all or part of the program.
Apply sanctions.
• Promulgate, administer, or enforce a federal Title V
program.
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OAQPS officials provided several reasons why they have not used
these provisions to address Title V implementation issues.
Issuing notices of deficiency may harm the agency's
partnering efforts with state and local agencies. EPA
officials perceived a dilemma in trying to take more
stringent actions against state and local agencies that were
not adequately implementing their Title V programs, while
simultaneously adhering to agency policies to work with
state and local agencies as partners in environmental
protection.
• EPA was reluctant to withdraw approval because of the
expense incurred in running the program itself. The Act
provides for EPA to collect fees to cover the cost of a
federal program, but Congress would have to approve the
appropriation of additional funds. Even without the
appropriation from Congress, if EPA withdraws approval,
the agency would have to implement the federal program.
According to the Act, under such circumstances, the fees
EPA collected would be deposited in the U.S. Treasury,
where they would be available for appropriation by
Congress. The fees may not be immediately available for
EPA to use in implementing a federal Title V program. In
addition, even though EPA is implementing all or part of the
Title V program, state and local agencies could still collect
fees from sources, if they chose to do so.
• EPA's Office of General Counsel has interpreted the Act as
requiring that the agency develop regulations using notice-
and-comment rulemaking procedures as a pre-condition to
applying the Act's sanctions. As of January 2002, EPA did
not have the regulations in place to impose such sanctions
on state and local agencies for noncompliance with Title V.
The Act allows EPA to impose sanctions of either (a)
withholding of transportation funds, or (b) requiring
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EPA and State Progress in Issuing Title V Permits
emission offsets.16 According to OAQPS officials, EPA
needs to promulgate a rule identifying the order in which the
two options for sanctions would be imposed. Once this rule
is effective, the sanctions will apply automatically in the
sequence prescribed in the rulemaking in all instances where
EPA determines that the applicable criteria for using the
sanctions has been met.
Recent EPA Actions In 2001, as a result of a lawsuit, EPA requested and received
comments on what the public perceived as deficiencies in the
Title V program. EPA received public comments from 34
stakeholders regarding 21 state and local agencies. Where the
public comments identified problems with the rate that the state or
local agency was issuing permits, EPA required the head of the
agency to commit to a written schedule for issuing the remaining
permits by December 2003. Thirty-nine state and local agencies
provided EPA with commitment letters as of February 2002. The
letters included interim milestones for completing permits, and an
acknowledgment that the state or local agency could be subject to a
notice of deficiency if any of the milestone dates are not met.
The commitment letters from state and local agency management
are a positive step in trying to get state and local agencies working
toward completing the initial Title V permits. However, as of
February 2002, EPA did not have a national plan or approach for
dealing with the 39 state and local agencies should they not meet
their recent commitments, nor the other 50 state and local agencies
that have not issued all the initial Title V permits. In our opinion,
continued delays in meeting commitments to issue Title V permits
may be an indicator that a state or local agency is not properly
administering its program. EPA may find other indications of
implementation deficiencies as it continues to oversee and conduct
reviews of state and local agencies. EPA needs to develop a
national plan for dealing with implementation deficiencies.
16Emissions offset requirements apply to companies wanting to expand, change production processes, or
otherwise increase their emissions. Under offset requirements, such companies must obtain an offset—an emissions
reduction by another source~in an amount greater than the company's planned increase in emissions. For example,
if Title V sanctions are applied to a state or local agency, sources would have to obtain 2-to-l emissions offsets.
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Other Matters
According to EPA officials, one of the impacts on the issuance of
Title V permits is that there is no incentive within the Act for
sources to apply pressure on state and local agencies to issue Title
V permits. Additionally, there are limited incentives for state and
local agencies to issue permits in a timely fashion.17
After the state or local agency receives a permit application, the
agency has 60 days to review the application to determine if it is
complete. Unless the state or local agency notifies the source that
its application is incomplete, the application is deemed to be
complete after 60 days. The Act provides an application shield for
sources that have submitted a complete application. The source is
allowed to continue operating, and the application shield prohibits
affected parties from suing the source for not having a Title V
permit. While the application shield is an incentive to sources to
submit applications that will pass the completeness review, it
provides no incentive for sources to obtain their final permits.
Therefore, according to EPA officials, the application shield created
an environment where there was a lack of incentives for sources to
pressure the state or local agency to issue their Title V permits.
Additionally, a potential disincentive may exist in cases where the
Title V permit would require additional monitoring activities by the
source, which can be costly to the source.
Without pressure from sources for state and local agencies to issue
permits, there were limited incentives for agencies to expeditiously
issue the Title V permits. The agency could continue to collect fees
from sources, no matter what progress the agency was making in
issuing permits. State and local agencies could also continue to
collect Title V fees, even if EPA were to take over all or part of the
Title V program.
Our review of six state agencies did not identify any instances
where sources used the application shield as a way to delay the
agency in issuing the Title V permits. Therefore, we are not
making any recommendation to correct this issue, but are
17This issue was identified to us by EPA, but not by state agencies we reviewed.
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presenting this information in order to provide a balanced view of
the factors surrounding Title V permit issuance.
Conclusion
More than a decade after Congress passed legislation requiring all
major sources of air pollution to obtain an operating permit, over
4,000 sources—nearly 30 percent of all the permits to be issued—
still need to be issued. EPA, state, and local agency officials
acknowledge that translating and consolidating the applicable air
pollution requirements into site-specific, legally enforceable Title V
permit limits is a complex, time-consuming, and resource intensive
process. Nonetheless, in passing Title V, Congress provided both
the statutory authority and the ability to collect fees to pay for the
full cost of the Title V program. Congress also provided that, if
state and local agencies fail to administer the Title V program, EPA
may step in and administer a federal program.
Many factors have delayed the issuance of Title V permits, most of
which can be overcome with more stringent EPA oversight. EPA
staff perceive a dilemma in trying to take more stringent actions,
such as sanctions, against state and local agencies, while adhering
to agency policies to work with state and local agencies as partners
in environmental protection to the maximum extent possible.
Nonetheless, without a national approach that addresses
implementation issues, establishes the expectations and milestones
for issuing the remaining permits, and holds state and local agencies
to these commitments, the benefits that Title V was designed to
achieve - reduced violations, improved enforcement, better
monitoring requirements, increased source accountability, and full
public involvement in the permitting process - will continue to be
delayed. Among other things, EPA also needs to ensure that state
and local agencies are adequately implementing the Title V program
that EPA approved.
Additionally, the longer state and local agencies take to issue the
initial Title V permits, the more likely they will encounter problems
processing permit renewals. The Act requires that permits be
renewed every 5 years, and some of the initial permits are scheduled
for renewal. If the initial permits are not issued, permitting
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EPA and State Progress in Issuing Title V Permits
authorities could be faced with the dilemma of whether to continue
to issue initial permits or to focus on renewing existing permits.
Recommendations
We recommend that the Assistant Administrator for Air and
Radiation:
3-1 Require EPA regions, through the memorandum of
understanding, to expeditiously conduct fee protocol
reviews. Regions should prioritize fee reviews to initially
focus on state and local agencies that have not completed
their initial Title V permits. Regions should ensure that
state and local agencies take action to address the findings
of the fee protocol reviews.
3-2 Revive agency efforts to make air toxics standards easier to
incorporate into Title V permits.
3-3 Complete the revisions to the Title V regulations.
3-4 Identify and collect information from regions, states, and
local agencies sufficient to:
(b) measure the progress of state and local agencies and
determine where they are having problems issuing
permits,
(b) ensure program consistency, and
(c) respond to reasonable requests for information
regarding implementation of the Title V program.
3-5 Develop and implement protocols for reviewing other
aspects of the Title V program, including assessing the level
of state and local management support and priority given to
Title V activities. (See chapter 4 for examples of good
practices in these areas.)
3-6 Develop and execute a national plan for addressing
deficiencies in Title V programs, specifically the action EPA
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will take to address missed milestone dates for issuing the
initial permits. The plan should specify how EPA will use
the provisions of the Act to address continuing Title V
program implementation issues, including:
(a) notices of deficiency that may trigger sanctions and
program withdrawal, and
(b) fee demonstrations.
Agency Actions
The Assistant Administrator for Air and Radiation generally agreed
with the findings and recommendations. He also stated that while
progress has been made in issuing Title V permits, he agreed with
our conclusion that more can be done to help the Title V program.
Specific comments were made regarding three of the six
recommendations in chapter 3:
Recommendation 3-1. While the proper accounting of fees being
collected is an important factor in ensuring sufficient resources for
the Title V program, there were other factors that impacted permit
issuance. The Assistant Administrator believed it would be
appropriate and useful to suggest that regions periodically evaluate
the full range of factors, emphasizing fees where resources appear
to be the primary barrier to permit issuance.
Recommendation 3-3. EPA recognized that state and local
agencies would welcome the completion of the Title V regulations,
but believed the states we reviewed may have overstated the extent
to which this factor impacted issuance of the initial permits. As
such, the Assistant Administrator suggested that the
recommendation be modified to recognize that the revisions to the
Title V regulations were not critical to the initial permits.
Recommendation 3-6. In response to a lawsuit, EPA required 39
state and local agencies to adopt schedules for completing Title V
permits. EPA also required that these 39 state and local agencies
acknowledge the possibility of EPA issuing notices of deficiency for
failure to meet the schedule and/or intermediate milestone dates.
For these agencies, the Assistant Administrator suggested that, in
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lieu of specifically pursuing fee demonstrations, the issue of fee
adequacy would be better addressed as part of the full program
review rather than as a separate requirement.
OIG Evaluation
The Assistant Administrator agreed with the recommendations in
chapter 3, except for the comments summarized above. The OIG
position regarding specific comments follows:
Recommendation 3-1. We agree that EPA should evaluate the full
range of factors that impact permit issuance. However, our review
found a strong relationship between lack of resources and delays in
initial permit issuance. Therefore, we continue to believe that EPA
should implement the fee protocol reviews (recommendation 3-1),
and also develop and implement protocols for reviewing other
aspects of the Title V program (recommendation 3-5).
Recommendation 3-3. We agree that, as stated in the report, a
range of factors impacted permit issuance, including completion of
the revisions to the Title V regulations. While this may not be a
high priority for EPA in relation to addressing other factors
affecting permit issuance, state and local agencies still identified this
as a reason for not completing the initial Title V permits.
Therefore, we continue to believe EPA needs to develop an action
plan for completing the regulations.
Recommendation 3-6. We continue to believe that EPA needs to
develop and execute a national plan for addressing the deficiencies
in Title V programs. This national plan should address all state and
local agencies that have not completed issuing their initial Title V
permits, and not just for the 39 agencies that adopted schedules in
response to the lawsuit. While we agree that EPA needs to conduct
Title V program reviews, EPA also needs to require that state and
local agencies conduct fee demonstrations as part of a national plan
for addressing Title V program deficiencies.
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As agreed in the response to the draft report, the Assistant
Administrator will provide an action plan, with milestone dates, for
addressing each of the recommendations in this chapter.
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Chapter 4
Management Support, Partnerships, and Site Visits
Contributed to More Timely Issuance of Title V Permits
Three practices that contributed to the progress state agencies
made in issuing Title V operating permits were:
Management support for the Title V program.
• Regulatory agency and industry partnering.
Site visits to sources.
Each of these practices contributed to the writing and issuance of
Title V operating permits in each of the six state agencies we
reviewed.
Management Support
Helped Build
Strong Programs
Organizational
Structure and
Dedicated Resources
Implementation of effective Title V permitting programs was built
upon strong management support and commitment to the issuance
of Title V permits. Commitment to and support for the program
were communicated to staff, industry, concerned citizens, and
environmental groups. Our review identified three principles upon
which management built support for a strong and effective Title V
program:
• Organizational structure and dedicated resources.
Accessible reporting system.
• Proactive management.
An effective organizational structure is one where management has
taken action to ensure there are sufficient resources for the Title V
program. We identified examples in three of the six state agencies
we reviewed where management took deliberate actions to ensure
that their Title V programs would have sufficient resources to
administer the program in a timely manner. These actions included
having the right number of staff and ensuring that the staff were
dedicated to issuing Title V permits. For example:
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EPA and State Progress in Issuing Title V Permits
• Missouri's Department of Natural Resources initially had
staff working on both operating and construction permits.
However, since the construction permit program had a
higher priority due to deadlines for issuance, Missouri was
not issuing Title V permits. Management solved this
problem by implementing a reorganization that split the two
functions, and more staff were assigned to the Title V
permit program than to the construction permit program.
This resulted in increased issuance of Title V permits.
• Pennsylvania's Department of Environmental Protection
hired about 180 new employees for implementing the
program. Staff were located in six regional offices and were
dedicated to various aspects of carrying out the program,
such as permit writing, compliance and monitoring
activities, and administrative and management functions.
• Colorado's Department of Public Health and Environment
made Title V a separate program, and provided funding, a
budget, and supervisors for implementing the program.
Making Title V a separate program ensured that staff were
dedicated to and focused on the program.
Accessible To oversee and run an effective program, some states created a
Reporting System reliable database and reporting system that provided management
with timely and accurate information. Using the information,
management was able to identify delaying factors before they
became problems. For example:
• Pennsylvania's Department of Environmental Protection
developed an internal web-based Title V permit tracking
system that is accessible and available to all staff on a real-
time basis. Managers were able to readily determine the
status of any particular Title V permit and monitor the
permit issuance rates for the various regional offices.
• Missouri's Department of Natural Resources reported
monthly to the state's commission on air conservation on
the status of the permits issued. The conservation
commission is an independent organization that also serves
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EPA and State Progress in Issuing Title V Permits
as an appeal board for state decisions. Maintaining an
accessible tracking system in order to report to this
independent group increased accountability for completing
Title V permits.
• Colorado's Department of Public Health and Environment
developed a database system for tracking the status of Title
V permits, allowing management to know its progress in
issuing permits.
Proactive Proactive oversight helped management be aware of and avert
Management issues that could potentially become impediments to implementing
the program and slow the issuance of Title V permits in three
agencies we reviewed. For example:
• Pennsylvania's Department of Environmental Protection
specifically made an effort to nurture good communications
between its own management and staff, as well as between
the state agency, EPA, industry, and other concerned
parties. Quarterly staff meetings were held that addressed
issues and problems dealing with writing permits. Early in
developing the Title V program, Pennsylvania identified
training of staff, industry, and other concerned parties as a
high priority. As a result, Pennsylvania developed its own
expertise and in-house training. Also, Pennsylvania worked
closely with EPA in developing general permit conditions
and language. Consequently, EPA has not objected to any
of Pennsylvania's Title V permits.
• Florida's Department of Environmental Protection
sponsored numerous workshops for communities and
industry designed to answer their concerns and questions
regarding the Title V operating permit process. Topics
included agency regulations, permit content, and
instructions for completing the permit application. Florida
was also more timely in issuing Title V permits.
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EPA and State Progress in Issuing Title V Permits
Agency and Industry
Partnering Fostered a
Cooperative Program
Visits to Sources
Saved Time When
Writing Permits
State or local agency and industry partnering early in the
Title V process built mutual respect, cooperation, and trust, which
were essential to the implementation of a technical and complex
program. Working closely together, agencies and industry were
able to overcome conflicts and problems that could have delayed
the permitting process. For example, agency and industry
partnering helped in the writing and adoption of:
Model permit language.
• Monitoring, reporting, and record keeping requirements.
Legislation affecting the permitting program.
These activities helped in developing effective and comprehensive
Title V programs with less delays or problems with permits. For
example:
• Pennsylvania's Department of Environmental Protection
staff worked closely with facility operators in writing
specific monitoring, reporting and record keeping
requirements for Title V permits.
• Florida's Department of Environmental Protection worked
closed with industry, over a period of three years, initiating
and affecting legislative and regulatory changes
implementing the state's Title V program.
Partly due to these activities, both Pennsylvania and Florida were
more timely in issuing Title V permits.
Each of the six state programs we reviewed benefitted when
permit writers made site visits to sources. For example, the site
visits:
Enabled permit writers to meet with source management
and establish good working relationships. This helped
writers to address source concerns before a final permit was
issued and, in general, enhance cooperation and compliance
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EPA and State Progress in Issuing Title V Permits
EPA Could Improve
Its Efforts to Promote
the Sharing of
Good Practices
Conclusion
and reduce potential source comments to the draft permit.
The visit also provided an opportunity to resolve lingering
issues and concerns with source management, resulting in
better permits.
Increased the writers' knowledge and understanding on how
the sources operate, how the various plant processes work,
and what the various emission sources are. Consequently,
the writers were able to draw up more complete and
comprehensive permits, and the permits were less likely to
be challenged and delayed by sources.
One of EPA's leadership roles in the Title V program is providing
technical assistance to state and local agencies by facilitating the
collection and sharing of promising permitting practices. Promising
practices can be identified through regional reviews of Title V
programs and suggestions from state agency officials. This
information can be disseminated through meetings, written
documents, and EPA's internet site. However, EPA has not
identified and shared the successful permitting practices of state and
local agencies with those behind in issuing Title V permits to
determine if these practices would improve the rate of permit
issuance nationwide. In our opinion, EPA could improve its efforts
to promote sharing information on Title V practices that show
promise of helping agencies issue permits on a more timely basis.
Examples of good practices can be helpful to state and local
agencies as they continue to issue their initial Title V permits, and
start to issue permit renewals. EPA has an opportunity to help
state and local agencies improve permit issuance rates by taking a
leadership role in collecting and disseminating information on
promising practices.
Recommendation
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EPA and State Progress in Issuing Title V Permits
We recommend that the Assistant Administrator for Air and
Radiation:
4-1 Develop a plan for identifying, collecting, and disseminating
good practices on the implementation of Title V programs.
Reviews of state and local programs, recommended in
chapter 3, would be one source of information on good
practices.
Agency Actions and
OIG Evaluation The Assistant Administrator for Air and Radiation agreed with the
findings and recommendation. As agreed in the response to the
draft report, the Assistant Administrator will provide an action plan,
with milestone dates, for addressing the recommendation in this
chapter.
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Appendix 1
Pagel of 2
Definitions of Major Stationary Sources
Passage of the Clean Air Act Amendments of 1990 also brought new definitions of major
stationary sources that varied depending on the type of pollutant, the attainment status of the area
where the pollutant is emitted, the synergistic effects of multiple airborne pollutants, the ability of
some pollutants to travel long distances, and other factors. As a result, simple definitions of what
sources are and are not major sources of air pollution are difficult to find.
Generally, a major source is any source with annual emissions that meet or exceed levels specified
in the Act. For example, a steel drum reconditioner located in an area classified as serious for
nonattainment purposes that applies paint to the steel drums before selling them, and that annually
emits 50 tons or more of volatile organic compound emissions into the air, is a major source. The
table below shows the annual emission levels, in tons of pollution, that define a major source of
any of the National Ambient Air Quality Standard pollutants under the Act:
Attainment Status
of Area Where
Source Is
Located
Attainment Areas
Potential to Emit (Tons/Year)
Carbon
Monoxide
(CO)
100
Lead
(Pb)«
100
Nitrogen
Dioxide
(N02)18
100
Nitrogen
Oxides (NOx)
100
Particulat
Matter
(PM-10)
100
Sulfur
Dioxide
(S02)18
100
Volatile Organic
Compounds
(VOCs)
100
Nonattainment Areas
Marginal19
Moderate
Serious
Severe19
Extreme
Northeast Ozone
Transport Region
100
50
100
100
50
25
10
50 - marginal
100- moderate
100
70
100
100
50
25
10
50 - marginal
100- moderate
18
19
The Act did not establish additional major source classifications for these pollutants based on an area's attainment status.
Nonattainment areas for carbon monoxide (CO) and particulate matter (PM-10) are classified as either moderate or serious.
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EPA and State Progress in Issuing Title V Permits
The 1990 Act also added new definitions for major sources of hazardous air pollutants, generally
referred to as air toxics. The act listed 188 such air toxics, including the airborne emissions of
such things as arsenic, benzene, dioxin, formaldehyde, mercury, and perchloroethylene. By
definition, any source is a major source if it emits 10 or more tons annually of any one of these
188 air toxics, or 25 or more tons of any combination of these 188 air toxics.
In addition to these 188 air toxics, there are other pollutants, such as asbestos, regulated under
the National Emission Standards for Hazardous Air Pollutants, that may cause sources to qualify
as major sources. Additionally, engaging in or undertaking certain activities can cause a source to
become a major source. These generally involve sources that are subject to one or more of the
following:
• EPA's New Source Performance Standards limitations for new sources of pollution.
• Prevention of Significant Deterioration provisions or the nonattainment area New Source
Review provisions for expanding or changing sources.
Selected sources with potential to contribute to acid rain problems.
Solid waste incinerators.
According to EPA, over 35,000 sources in the United States have the potential to emit pollutants
in sufficient amounts to be a major source, and thus be required to obtain a Title V permit.
However, as discussed in chapter 2, about 17,000 sources have chosen to limit their hours of
operation, install pollution control equipment, or take other actions to avoid being subject to the
Title V requirements.
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Appendix 2
Page 1 of3
UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
WASHINGTON, DC 20460
OFFICE OF
AIR AND RADIATION
March 26, 2002
MEMORANDUM
SUBJECT: Revised Draft Report
EPA and State Progress in Issuing Title V Permits
FROM: Jeffrey R. Holmstead
Assistant Administrator
TO: Leah L. Nikaidoh
Audit Manager
Northern Audit Division
Thank you for your memorandum of March 12, 2002, transmitting the subject report. I am
in general agreement with your findings and recommendations other than the minor
exceptions noted in the attached comments. While permitting authorities have made good
progress in issuing initial operating permits (70% of those facilities needing a title V permit now have
them and 84% have either been permitted or have reduced their emissions below the permitting
threshold), there is still work to do. Many of the sources remaining to be permitted
are the more complex facilities and the problems identified in your report (e.g., high staff
turnover, hiring impediments, competing priorities) continue to be of concern. I agree with your
conclusion that more can be done to help this effort and will follow up, within 90 days of
issuance of the final report, with an action plan based on the report's findings and recommendations.
Thank you for the opportunity to provide comments on the subject draft. My contact for this
effort is Scott Voorhees from OAQPS (919-541-5348).
Attachments
cc: John Seitz
Beth Craig
Bill Harnett
Internet Address (URL) • http://www.epa.gov
Recycled/Recyclable • Printed with Vegetable Oil Based Inks on 50% Recycled Paper (20% Postconsumer)
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Appendix 2
Page 2 of 3
Attachment 1
OAR Comments on the Draft Report Recommendations
Recommendation 3-1: This recommendation should be refocused. While the proper accounting
of fees being collected from title V permits is an important factor in ensuring sufficient
resources for this program, a primary focus on the adequacy of fees and the conduct of fee audits
may not represent the solution to permit issuance. As the body of the audit clarifies, there are a
number of factors involved. Fees are just one aspect of a multi-faceted problem that involves
competing priorities, hiring and retention difficulties, and training of permit staff. It would be
more appropriate, and useful, to suggest Regions evaluate the full range of factors, emphasizing
fees where resources appear to be the primary barrier to permit issuance. OAR does agree with
the Office of the Inspector General that the Regions should work with their co-regulators to
ensure that permit fees collected are allocated to the state Title V permit programs.
Recommendation 3-3: OAR does recognize that permitting authorities would welcome the
completion of our current rulemaking on Part 70, but we believe the states may have overstated
the extent to which this has impacted issuance of the initial permits. As noted in the report, the
changes to the regulations focus primarily on the revision of permits rather than on their initial
issuance. As we raised in the cover memorandum, 70% of the title V permits have been issued.
OAR recommends that the recommendation be modified to recognize that these revised changes
are not critical to the original round of permits.
Recommendation 3-6: This recommendation refers to the permit issuance schedules developed
by 39 permitting authorities pursuant to the November 2000 Sierra Club settlement agreement.
These schedules (or associated correspondence) acknowledge the possibility of EPA issuing
Notices of Deficiency (NODs) for failure to meet the schedule and/or intermediate milestones.
The OIG recommends that OAR also pursue fee demonstrations for these programs. Again, as
indicated in earlier comments on Recommendation 3-1, the issue of fee adequacy is better
addressed broadly under the auspices of a full program review rather than as a separate
requirement.
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Appendix 2
Page 3 of 3
Attachment 2
Other OAR Comments on the Draft Report
Pg 2: In the table, the third bullet refers to "adding" monitoring, etc. A more appropriate
description would be "requiring monitoring, testing, and record keeping, where needed...".
Pg 8: In the six bullets identifying the appropriate uses of Title V fees: the 4th bullet should be
clarified at the end with "pre NOV activities". The 5th and 6th bullets should also be clarified by
the addition of "to the extent necessary to determine applicability or to issue the permit".
Pg 17: First paragraph. The wording of the first sentence suggests that there have been
numerous revisions to Part 70 since 1994. A more appropriate wording for this sentence would
be: "EPA first issued regulations for Title V in 1992. Since then, EPA has issued various "
Pg 24: First full paragraph, second sentence. We are unable to reproduce the figures used. (EPA
actually received 34 letters identifying some 350 comments; the 34 letters reflected comments
from 20 state and local agencies). Also, the last sentence in this paragraph is misleading as
written. While we do plan to continue to encourage these programs to issue their remaining
permits, our effort will be based on a broad consideration of Agency and local priorities, rather
than focusing solely on formal commitments for a specific number of permits.
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Appendix 3
Page 1 of 3
Background on the Clean Air Act Title V Program
Title V Program Established in 1990
The 1990 amendments to the Act established the Title V operating permit program. Congress'
main goal in adopting the Title V program was to achieve a broad-based tool to aid effective
implementation of the Act and to enhance enforcement. Title V requires operating permits for
every major source of a regulated air pollutant and any other source covered by a current permit
program.
The purpose of the Title V program was to: (1) bring together in one document all the air
pollution controls for a source; and (2) require sources to certify compliance with the permit (i.e.,
all of their air pollution control requirements) every year. The Title V permit should result in:
• A better understanding of the requirement that a source is subject to.
• A basis for determining whether a source is complying with the requirements.
• Increased accountability and enforcement.
The permits include enforceable emissions limits and standards, plus inspection, monitoring,
compliance certification, and reporting requirements for the source. Title V permits also provide
a ready vehicle for implementing other significant parts of the air program, including efforts to
reduce acid rain.
States, Local Agencies Given Responsibility for Implementing Title V
There are 112 state and local agencies in the United States approved by EPA to administer the
Title V permitting program. In some states, local agencies are responsible for implementing air
pollution control programs, such as Title V. A list of all the state and local agencies is contained
in appendix 4.
Each state and local agency is responsible for developing and implementing Title V operating
permit programs. To have an approvable program, state and local agencies must be able, through
fees, to recoup all reasonable costs of developing and administering the program, including the
reasonable costs of emission and ambient monitoring, modeling, and reviewing and acting on
permit applications. The objective of the fee is to ensure the state or local agency
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EPA and State Progress in Issuing Title V Permits
Appendix 3
Page 2 of 3
has all necessary resources to administer the permit program with a minimum of delay. Other key
provisions that must be part of a Title V program before EPA will approve it include:
Monitoring and reporting requirements.
• Authority to terminate, modify, or revoke and reissue permits for cause.
• Authority to enforce permits, permit fee provisions, and the requirement to obtain a
permit.
• Public notification and opportunity for comment for every new permit and when permits
are renewed or significantly revised.
The requirement that sources provide emission reports to their permitting authorities at
least semi-annually and certify compliance status annually.
A Title V permit contains all air pollution control requirements that a source must meet under the
Act. This includes requirements established by:
• EPA.
State and local agencies as part of a federally approved program.
State and local agencies that are not required by the Act and are not federally enforceable.
The permit will sometimes create new requirements. The Act requires that permits contain
adequate monitoring to determine whether the source is complying with specific requirements. If
the current EPA or state or local agency requirements do not include monitoring, the Title V
permit will create new compliance monitoring activities.
EPA Provides Oversight
While state and local agencies primarily implement the Title V program, EPA has an oversight
role. EPA reviews and approves each state and local agency's operating permits program;
oversees implementation of the program; reviews proposed permits; and, if necessary, objects to
improper permits proposed. In addition to approving state or local agency programs, EPA is
responsible for ensuring that state and local agencies administer and enforce the programs. If
EPA finds a state or local agency is not adequately administering and enforcing a part of the Title
V program, EPA is to notify the state or local agency of its finding. If the deficiencies are not
corrected, EPA can apply sanctions, withdraw the program, or administer a federal program in
that state.
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Appendix 3
Page 3 of 3
Within EPA's Office of Air and Radiation, OAQPS is responsible for developing national
regulations and guidance for Title V and providing technical assistance to EPA regions and the
states. Regions are responsible for reviewing proposed permits, assisting state and local agencies
in getting initial permits issued, and monitoring permit renewal requirements. Every two years,
OAR and the regions negotiate an MOA identifying what activities they will perform. For fiscal
years 2001 and 2002, regions were to, among other things: (1) review progress of state and local
agencies in meeting their strategy for issuing initial Title V permits, and (2) perform fee protocol
reviews on 25 percent of the Title V programs.
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Status of Title V Permits as of December 31, 2001
Appendix 4
Page 1 of 4
20
State/Local Pollution Control Agency
Sources
Permitted
Percent
Region 1
Connecticut
Maine
Massachusetts
New Hampshire
Rhode Island
Vermont
Subtotal - Region 1
111
75
206
56
53
23
524
46
30
66
40
18
17
217
41%
40%
32%
71%
34%
74%
41%
Region 2
New Jersey
New York
Puerto Rico
Virgin Islands
Subtotal - Region 2
384
573
54
7
1018
117
443
17
0
577
30%
77%
31%
0%
57%
Region 3
Delaware
District of Columbia
Maryland
Pennsylvania
Virginia
West Virginia
Subtotal - Region 3
87
34
161
810
314
208
1614
76
34
121
640
166
115
1152
87%
100%
75%
79%
53%
55%
71%
Region 4
Alabama
Jefferson County, AL
City of Huntsville, AL
Florida
Georgia
Kentucky
Jefferson County, KY
Mississippi
North Carolina
Forsyth County, NC
Western, NC
263
44
12
1653
393
308
41
331
396
14
7
226
35
12
1653
269
142
31
308
247
14
7
86%
80%
100%
100%
68%
46%
76%
93%
62%
100%
100%
As of March 2002, the most current information EPA had on permit issuance was as of December 31, 2001.
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Appendix 4
Page 2 of 4
State/Local Pollution Control Agency
Mecklenburg County, NC
South Carolina
Tennessee
Davidson County, TN
Hamilton County, TN
Knox County, TN
Shelby County, TN
Subtotal - Region 4
Sources
14
299
245
14
23
9
38
4104
Permitted
13
280
207
14
23
9
25
3515
Percent
93%
94%
84%
100%
100%
100%
66%
86%
Region 5
Illinois
Indiana
Michigan
Minnesota
Ohio
Wisconsin
Subtotal - Region 5
747
743
487
335
726
610
3648
413
551
357
212
392
293
2218
55%
74%
73%
63%
54%
48%
61%
Region 6
Arkansas
Louisiana
New Mexico
Albuquerque, NM
Oklahoma
Texas
Subtotal - Region 6
281
1047
181
12
469
1707
3697
261
678
126
11
310
1262
2648
93%
65%
70%
92%
66%
74%
72%
Region 7
Iowa
Kansas
Missouri
Nebraska
Lincoln/Lancaster County, NE
City of Omaha, NE
Subtotal - Region 7
294
370
418
95
17
19
1213
183
261
309
29
16
18
816
62%
71%
74%
31%
94%
95%
67%
Region 8
Colorado
Montana
North Dakota
South Dakota
Utah
Wyoming
Subtotal - Region 8
138
59
50
200
92
152
691
120
51
48
200
63
147
629
87%
86%
96%
100%
68%
97%
91%
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Appendix 4
Page 3 of 4
State/Local Pollution Control Agency
Sources
Permitted
Percent
Region 9
Arizona
Maricopa County, AZ
Pima County, AZ
Final County, AZ
Amador County, CA
Bay Area, CA
Butte County, CA
Calaveras County, CA
Colusa County, CA
El Dorado County, CA
Feather River, CA
Glenn County, CA
Great Basin United, CA
Imperial County, CA
Kern County, CA
Lake County, CA
Lassen County, CA
Mariposa County, CA
Mendocino County, CA
Modoc County, CA
Mojave Desert, CA
Monterey Bay Unified, CA
North Coast Unified, CA
Northern Sierra, CA
Northern Sonoma, CA
Placer County, CA
Sacramento County, CA
San Diego, CA
San Joaquin, CA
San Luis Obispo County, CA
Santa Barbara County, CA
Shasta County, CA
Siskyou County, CA
South Coast AQMD, CA
Tehema County, CA
Tuolumne County, CA
Ventura County, CA
Yola/Solano County, CA
47
65
21
10
3
84
5
0
5
2
3
1
7
7
6
5
10
0
2
1
30
18
8
3
12
8
15
27
142
3
20
10
1
800
1
4
25
18
38
4
1
10
3
60
2
0
3
0
0
0
3
5
6
0
5
0
1
1
16
18
8
0
12
0
6
10
98
3
16
8
0
401
0
0
24
4
81%
6%
5%
100%
100%
71%
40%
60%
0%
0%
0%
43%
71%
100%
0%
50%
100%
50%
100%
53%
100%
100%
0%
100%
0%
40%
37%
69%
100%
80%
80%
0%
50%
0%
0%
96%
22%
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Appendix 4
Page 4 of 4
State/Local Pollution Control Agency
Hawaii
Nevada
Clark County, NV
Washoe County, NV
Subtotal - Region 9
Sources
110
27
32
1
1599
Permitted
107
9
6
1
889
Percent
97%
33%
19%
100%
56%
Region 10
Alaska
Idaho
Oregon
Lane Regional, OR
Washington
Benton County, WA
Northwest, WA
Olympic, WA
Puget Sound, WA
Southwest, WA
Spokane County, WA
Yakima, WA
Subtotal -Region 10
256
63
130
20
31
2
15
10
50
9
11
4
601
123
16
130
17
22
1
10
10
24
9
10
3
375
48%
25%
100%
85%
71%
50%
67%
100%
48%
100%
91%
75%
62%
Totals (112 state and local agencies)
18,709
13,036
70%
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EPA and State Progress in Issuing Title V Permits
Appendix 5
Page 1 of 2
Compliance With Clean Air Act Schedules
Title V of the Act included a schedule for implementing the operating permit program. The Act's
dates were based on when the Act was passed, which was in November 1990. Many of the dates
in the schedule were not met. Delays in meeting dates early in the implementation process
impacted EPA and state and local agencies ability to issue Title V permits, as shown in the table
and graph below.
Clean Air Act Schedule
Completion Date If
Act Schedule Was Met
Actual Completion Date
Within 12 months promulgate
regulations on what is required for a
Title V program.
November 1991
July 1992
No later than 3 years after
amendments, states develop and
submit a permit program to EPA.
November 1993
Of 112 state and local agencies, 53
(47 percent) submitted their
programs by the end of November
1993.
No later than 1 year after receiving
state program package, take action to
approve or disapprove.
November 1994
One program was approved by
November 1994. The remaining
number of programs were approved
in the following years:
1994- 9
1995-65
1996-30
1997- 5
1998- 1
1999- 0
2000- 1
12 months from approval date of state
program, sources are to submit
application.
November 1995
Unknown. As discussed in chapter 2,
EPA does not collect national data on
when applications were submitted.
Applications submitted during the first
year after program approval are to be
completed within 3 years of program
approval.
November 1997
Of 112 permitting authorities, only 5
completed their initial Title V permits
within 3 years. The total number of
permits issued by these authorities
was 53, out of 19,000 permits issued
nationwide.
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EPA and State Progress in Issuing Title V Permits
Clean Air Act Implementation Schedule
Initial Permits
Issued
Permit Programs
Approved
Submit Permit
Programs
Regulations
issued
Amendments
passed
1/98 i
11/97
1/94
2/00
• 11/94
111/95
11/93
• 5/92
• 11/91
11/90
Appendix 5
Page 2 of 2
2004
1990 1992 1994 1996 1998 2000 2002 2004
52
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EPA and State Progress in Issuing Title V Permits
Appendix 6
Page 1 of 2
Title V Permit Process, Fees, and Expenses
To gain a better understanding of the processes state agencies used to issue Title V permits, we
evaluated 60 permits that 6 agencies issued. The following table provides the results of our
analysis for the six state agencies we reviewed.
Number of
sources
Number of
permits
Percent issued
as of
December 2001
Average elapsed
days from permit
application to
start of permit
review
Average elapsed
days from start
of review to draft
permit
Average elapsed
days from draft
to final permit
Total Elapsed
Days
Colorado
138
120
87%
623
366
139
1,128
Florida
452
452
100%
484
195
268
947
Massachusetts
206
66
32%
271
1211
150
1,632
Missouri
418
309
74%
506
501
199
1,206
Pennsylvania
810
640
79%
1006
302
268
1,576
Wisconsin
610
293
48%
1135
446
123
1,704
Total
2,634
1,880
71%
723
391
215
1,329
Average
We also obtained information on the fees, revenue, and expenses of the six state programs we
visited. As shown in the following table, for the states we reviewed, the fee per ton of emissions
ranged from about $18 per ton in Colorado to $43 per ton in Pennsylvania.
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EPA and State Progress in Issuing Title V Permits
Appendix 6
Page 2 of 2
Fee per ton of
emissions
2000 Revenue
2000 Expenses
Colorado
$17.97
plus permit
processing
fees
$3,300,000
$2,300,000
Florida
$25.00
$10,369,654
$7,872,668
Massachusetts
$22.00 to
$25.0021
$1,295,150
$1,930,622
Missouri
$25.70
$4,555,000
$6,229,455
Pennsylvania
$43.00
$16,284,893
$15,819,492
Wisconsin
$35.71
$9,833,700
$10,030,455
21
The rate per ton varied based on the total emissions from the source.
54
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EPA and State Progress in Issuing Title V Permits
Appendix 7
Page 1 of 2
Summary of Factors Impacting
Title V Permit Issuance
Various factors impacted the issuance of Title V permits. Some factors impacted the permit
issuance in the past, while others continued to impact permits. Factors that are continuing to
impact initial permit issuance will also likely impact permit renewals. The table below presents
the factors we identified during this review, and those that EPA officials identified.
Issue
Description
One-time
Impact on
Initial
Permits
Continuing
Impact on
Initial
Permits
Potential
Impact on
Permit
Renewals
Report
Page
Impacting Initial Permits Only
Infrastructure
Development
Volume of
permits
Synthetic
Minors
Delayed
Title V
Guidance
EPA regional
staff
experience22
Effort needed to develop the Title V program,
including laws, regulations, and setting up the
organization.
Large number of permits applications received
at one time.
Priority given to issuing permits to sources that
requested enforceable limits in place of a
Title V permit.
Guidance was issued in 1995 and 1996,
causing some state and local agencies to
revise issued permits.
Working with EPA regional staff delayed
issuance of some permits.
X
X
X
X
X
13
13
13
14
14
22-,-
EPA officials identified these three factors (one shown on this page, and two on the next page) during a
survey of state and local agencies in 1998. However, we did not identify these factors in the six states we reviewed.
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EPA and State Progress in Issuing Title V Permits
Appendix 7
Page 2 of 2
Issue
Description
One-time
Impact on
Initial
Permits
Continuing
Impact on
Initial
Permits
Potential
Impact on
Permit
Renewals
Report
Page
Continuing to Impact Initial Permits and Renewals
State/Local
Agency
Resources
Complex EPA
Regulations
and Guidance
Conflicting
Priorities from
other permits
Delay in
Completing
Title V
Regulations
EPA Oversight
and Authority20
Source
Incentives20
Insufficient fees and staffing, high turnover,
and training of staff.
Complexity of other EPA regulations and
guidance, such as air toxics regulations, and
periodic monitoring guidance. Also new
regulations that need to be incorporated into
permits.
Construction permits given priority over
Title V permits because they need to be
issued within specific timeframes.
Revisions to the Title V regulations, initially
proposed in 1994, have not been completed.
EPA's limited oversight of agencies and
perceived difficulties in taking stringent
actions when states do not issue permits in a
timely manner.
Due to permit shield granted at application
stage, sources lack incentives to pressure
regulators for final Title V permit.
X23
X
X
X
X
X
X
X
X
X
X
X
X
8-10
10-12
12-13
18-19
20-25
25-26
23EPA officials believe that the revisions to the Title V regulations may have had an impact on permit
issuance in the past, but should no longer be impacting permit issuance. State agency officials stated that the
uncertainty over the revisions continues to impact the program. The table reflects both points of view.
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EPA and State Progress in Issuing Title V Permits
Appendix 8
Page 1 of 3
Details on Scope and Methodology
EPA OIG conducted field work in the states of Colorado, Florida, Massachusetts, Missouri,
Pennsylvania, and Wisconsin; and at EPA's OAQPS, OECA, and Region 5. We collected
information from other regions as needed.
Evaluation Process
The objectives of our evaluation were to identify the factors delaying the issuance of Title V
permits at selected state and local agencies, and the practices contributing to more timely issuance
of permits at selected state and local agencies. In each of the states, we interviewed:
Program managers regarding how they developed and managed the Title V program and
whether they had sufficient revenue to implement the program.
• Finance staff regarding how they calculated their fees and what controls existed to ensure
that the fees were used only for Title V activities.24
Engineers to discuss the process for issuing specific permits in our sample.
Within EPA, we met with OAQPS and Region 5 staff to gain an understanding of EPA's role in
implementing the Title V program. As part of this review, we did not evaluate the quality of the
Title V permits or the federal (Part 71) Operating Permit Program.
The evaluation was performed in accordance with the Government Auditing Standards issued by
the Comptroller General of the United States as they relate to economy and efficiency and
program results audits. We reviewed internal controls as required by the Government Auditing
Standards. As a part of this evaluation, we assessed compliance with applicable laws and
regulations. Except as noted in this report, we did not identify instances of noncompliance with
the Act.
24We did not test or evaluate the adequacy of the controls over fees because the OIG was evaluating this
issue in selected states as part of other reviews.
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EPA and State Progress in Issuing Title V Permits
Appendix 8
Page 2 of 3
We conducted our fieldwork between January and October 2001. On October 5, 2001, we issued
a draft report to the Assistant Administrator for Air and Radiation. After receiving preliminary
comments to the report, we held a one-day workshop with senior EPA OAQPS officials to (!)
obtain their views on the factors we identified, (2) identify other factors, and (3) assess the
likelihood of these factors also impacting permit renewals. We gathered additional information in
January and February 2002, and issued a second draft report on March 12, 2002. The Assistant
Administrator for Air and Radiation responded to the draft report on March 26, 2002. An exit
conference was held on March 27, 2002. A copy of EPA's response is included as appendix 2.
For EPA's comments contained in attachment 1 of their response, we summarized them and
addressed each comment at the end of chapter 3. For EPA's comments contained in attachment 2
of their response, we made the suggested revisions to the report where indicated.
Sample Selection
Based on information, dated October 2000, from OAQPS, we selected six states to review their
processes for issuing Title V permits.25 We judgmentally selected the six states to get a range of:
EPA regions, number of permits to be issued, and status of permit issuance, as shown in the table
below.
State
Florida
Pennsylvania
Wisconsin
Missouri
Massachusetts
Colorado
Region
4
o
J
5
1
I
8
Permits to be
Issued
1,64926
810
626
418
213
131
Percentage
Completed
100%
65%
41%
58%
28%
82%
We visited Illinois during the planning of the evaluation, but did not perform a detailed review in that state, since
one of the criteria for state selection was only one state per region.
26Based on data from the state of Florida, EPA reported, as of October 2000, 1,649 Title V sources in the state.
However, during our review, we found that 1,197 were general permits for sources such as dry cleaners and chromium
electroplaters. General permits contain standard conditions and are not unique to each source. Florida was the only state in
our review that reported the general permits to EPA as part of the Title V universe. Our review in Florida focused on the 452
(1,649 - 1,197) Title V sources. The data in chapter 1 and appendix 6 on the permit process are based on the 452 Title V
sources. However, for consistency, we used the information reported to EPA in appendix 4.
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EPA and State Progress in Issuing Title V Permits
Appendix 8
Page 3 of 3
Using individual state databases, we selected a sample of permits to review. In the 4 states with
more than 300 permits to issue, we selected 12 permits, and in the other 2 states, we selected 6
permits. We randomly selected the permits to review within six standard industrial classification
(SIC) codes, as shown in the table below. The six SIC codes were chosen based on information
from the OECA that indicated that these industries are the six largest contributors to air pollution,
in terms of pounds of pollution.
SIC Code
1300
2600
2800
2900
3300
4900
Type of Industry
Oil and Gas Extraction
Paper and Allied Products
Chemical and Allied Products
Petroleum and Refining Products
Primary Metal Industries
Electric, Gas and Sanitary Services
We relied on information in state and EPA databases in selecting our sample of states and cases.
However, we did not assess the controls over these systems, since the accuracy of the data
systems was not within the scope of our evaluation.
Prior Audit Coverage
EPA OIG Report No. 2000-1-00416, "Grants Management Practices of Rhode Island
Department of Environmental Management," issued on September 21, 2000, reported that Rhode
Island did not maintain Title V operating permit fee revenue in accordance with the terms of the
Act. The report recommendations included that Rhode Island perform an annual reconciliation of
the Title V operating permit fee revenue and program expenses using the state's official books
and records. The reconciliation should also show how any unused revenue will be utilized.
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EPA and State Progress in Issuing Title V Permits
Appendix 9
Page 1 of 1
Distribution
Headquarters
Assistant Administrator for Air and Radiation (6101 A)
Assistant Administrator for Enforcement and Compliance Assurance (2201 A)
Agency Follow-up Official (2710A)
Agency Follow-up Coordinator (2724A)
Audit Follow-up Coordinator, Office of Air and Radiation (6102A)
Audit Follow-up Coordinator, Office of Enforcement and
Compliance Assurance (2201 A)
Associate Administrator for Congressional and Intergovernmental Relations (1301 A)
Director, Office of Regional Operations (1108A)
Associate Administrator for Communications, Education, and Media Relations (1101 A)
Headquarters (3404)
Regions
Regional Administrators
Regional Air Program Directors
Regional Audit Follow-up Coordinators
Regional Public Affairs Offices
State and Local Air Pollution Control Agencies
Air Program Directors - Colorado, Florida, Massachusetts, Missouri, Pennsylvania,
and Wisconsin
Office of Inspector General
Inspector General (2410)
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