Proposal:

Set Public Hearing December 13, 1996 to Amend Rule 219 -Equipment Not Requiring a Written Permit Pursuant to Regulation II

Synopsis:

Rule 219 identifies equipment and processes which are exempt from AQMD written permits. The proposed amendments focus on implementing the first tier of the 1996 AQMD Regulatory Reform Initiative to "eliminate permits for small businesses" by removing approximately 10,000 permits from the system and reducing the number of expected new applications by 1,000/year. The proposal would also require permits for all equipment subject to state Air Toxic Control Measures (ATCMs) and federal NESHAP.

Committee:

Stationary Source, September 20, 1996, reviewed. Fiscal impact reviewed by the Administrative Committee October 18, 1996.

Recommended Action:

Set Public Hearing December 13, 1996 to Amend Rule 219 - Equipment Not Requiring a Written Permit Pursuant to Regulation II

James M. Lents, Ph.D.
Executive Officer

Background

Rule 219 is an administrative rule which identifies certain equipment categories for exemption from AQMD written permit. This rule has been amended several times, the last on August 12, 1994. This rule amendment was prompted by the adoption of the 1996 AQMD Regulatory Reform Initiative, as well as various changes to state law. For this rule amendment, emphasis was based on achieving the following objectives:

• Implement the first tier of the 1996 AQMD Regulatory Reform Initiative by exempting certain equipment categories with negligible emission potential and those chlorinated fluorinated carbon (CFC) recovery or recycling systems currently subject to EPA’s Refrigerant Certification Program requirements.

• Provide consistency with California Health and Safety Code Section (H&SC) 41753, which preempts local air districts from imposing permitting requirements on portable internal combustion engines participating in the Statewide Registration Program (H&SC 41750~41755).

• Address implementation of state ATCM and federal NESHAP requirements.

Proposal

Revise Rule 219 to:

• Eliminate written permits for approximately 4,400 CFC recovery and recycling systems and approximately 4,400 portable internal combustion engines (ICEs). Through re-evaluation of other equipment categories, staff has identified an additional 2000 permit units that represent a negligible emission potential and propose that these units also be eliminated from the AQMD’s permit system.

• Exclude from exemption any equipment subject to ATCMs or NESHAPs, resulting in the addition of approximately 500 new permits to the system. Due to the nature of the equipment subject to these requirements, and the mandates to ensure compliance with applicable state and federal requirements, a written permit requirement is deemed appropriate for this equipment.

Policy Issues

Staff received various requests from industry to add specific equipment exemptions to the proposed rule, and has worked with various industry representatives to determine the viability of exempting these equipment categories. A public workshop was held on September 5, 1996, where staff received additional comments on the proposed amendments to Rule 219.

Staff has addressed the concerns raised by industry and the public in Appendix A - Response to Comments of the Draft Staff Report for Proposed Amended Rule 219. Remaining unresolved comments dealt with the exemption of additional equipment categories. Staff will continue to work on these requests for possible consideration in a subsequent amendment of this rule. These comments and the responses made by staff are also included in Appendix A of the Draft Staff Report.

AQMP & Legal Mandates

Equipment categories which would be exempt from written permit as a result of this proposed amended rule are either not subject to BACT, or will participate in the Statewide Registration Program. In either instance, no emission impacts are anticipated as a result of this proposed rule. Proposed Rule 219 is not an AQMP measure, and is not amended in response to, or as a result of, any legal mandate.

CEQA & Socioeconomic Analysis

Staff has reviewed the proposed amendments to Rule 219 and has determined that they are exempt from the requirements of CEQA. The amendments are administrative in nature and will not significantly impact the emission levels currently associated with the existing rule. Therefore, a Notice of Exemption will be prepared pursuant to state CEQA Guidelines Section 15002 (k)(1). The Notice of Exemption will be filed with the county clerks immediately following the adoption of the proposed amendments.

The proposed amendments to Rule 219 are not expected to result in cost impacts, overall. The detailed assessment is attached.

Implementation Plan

Due to the substantial number of permits to be eliminated as a result of this rule amendment, affected sources will be contacted by mail and directed to appropriate AQMD personnel for assistance in making the necessary permit changes.

Resource Impact

Implementation of the proposed rule will result in an estimated net reduction in fee revenues of approximately $1.47 million per year comprised of the following:

Equipment with negligible emissions	$465,000 reduction
Equipment regulated by other governmental entities	$409,000 reduction
Equipment exempt pursuant to state law	$754,000 reduction
Equipment subject to NESHAP/ATCM requirements( $157,000) increase	$1,471,000

This information is summarized in the table below. A more detailed breakdown is provided in Appendix B - Emission Inventory and Fee Revenue Data of the Draft Staff Report. The removal of approximately 10,000 permits from the permit system will involve additional work on behalf of AQMD staff in the first year. During this time, existing resources will be utilized to conduct outreach and appropriate permit and billing revisions for those sources affected by the proposed amendments. Since the proposed amendments will realize a net decrease in the number of applications received annually, no additional permitting resources will be necessary.

Permit and Fee Revenue Summary

Equipment/Process Description	Active Permits	Projected New Appl. Rec’d Annually	Total Filling & Renewal Fee Savings ‚
Equipment to be removed from the permit system
:
Equipment with negligible emissions
Emergency Ventilation System	45	6	$9,771
Non-Ammonia Etching, Small H2SO4 Anodizing	105	20	$25,014
Batch Ovens - Powder Coating	13	3	$3,291
Small Spray Booths	50	4	$9,872
Wastewater-Chromium	50	4	$9,872
Wastewater Evaporators	65	4	$12,390
Fuel Oil Storage(<40K gal)	1,490	50	$368,981 „
Crankcase Drainage Oil Storage	144	10	$25,632
Equipment regulated by other governmental entity
CFC Recovery/Recycling	4,370 ƒ	500	$408,618
Equipment exempt pursuant to state law
Portable ICE - Statewide Registration	4,420	408	$753,535
Equipment to be added to the permit system
Equipment subject to NESHAP/ATCM requirements
Small degreasers	500	500 …	<$156,650>
		Total	$1,470,326

 Projected number of applications received annually based on 1994 and 1995 figures.

‚ Based on 96/97 annual operating fees and new construction filing fees for small business.

ƒ 147 CFC recovery/recycling permits are in Title V facilities.

„ Includes $111,540 from an estimated 3300 gasoline retail service station and consumer account permits which have diesel dispensing.

… Based the estimated total inventory of unpermitted equipment. The annual number of applications received will be much less.

Attachments

Summary of Proposed Amendments
Rule Development Process
Key Contacts
Rule Language
Staff Report

ATTACHMENT A

SUMMARY OF PROPOSED AMENDMENTS TO RULE 219

# = Industry Concerns

Italics = AQMD Staff Response

# Small anodizing operations using sulfuric acid emit minimal emissions and should be exempt.

Staff agreed and has incorporated it in paragraph (l)(4).

# There is no equity between solvent processes and radiation curing processes. Six gallons of UV coatings emit much less VOC than one gallon of solvent-based coating or two gallons of graphic art materials.

Staff is examining the issue of equity in terms of exemption levels, not just for the coating operations but also for many other types of operations, such as the combustion equipment. Staff will explore this issue and plans to have recommendations in the next amendment of Rule 219, scheduled to be in mid-1997. Specifically, staff agrees that six gallons of UV coatings contain less VOC than one gallon of solvent-based coating; however, there may be clean-up solvent used in an actual coating operation, and therefore, the total VOC emitted from the two types of coating operations may be comparable. In addition, in a spray coating operation, six gallons of UV coatings would produce more particulate matter emission than one gallon of solvent based coating.

# Request to exempt wastewater evaporators used for dewatering aqueous part washer solutions containing no VOC, air compressor condensate, or machining fluids containing 50 gm/liter VOC or less.

Staff has conditionally agreed with the request and has incorporated it in paragraph (l)(34). As the result of some research and sample analyses, staff proposes to exempt evaporation of wastewater from certain aqueous part washer solutions, air compressor condensate, and a limited amount of machining fluids. Please see the Proposed Amendments, section (II)(11) for more details. Staff will further investigate the machining fluid evaporation and other processes where evaporation of wastewater results is used and will recommend exemptions as appropriate in future amendments to Rule 219.