BOARD MEETING DATE: July 10, 1998 AGENDA NO. 41




PROPOSAL:

Amend Rule 1401 - New Source Review of Toxic Air Contaminants

SYNOPSIS:

The proposed amended rule will implement part of Environmental Justice Initiative No. 10, to reopen for public comment Rule 1401 – New Source Review of Carcinogenic Air Contaminants. The proposed amendments will add Toxic Air Contaminants (TAC) to the list of compounds covered by the rule, add requirements for the protection of public health from the noncancer effects of the TACs, and propose specific exemptions. In addition, the proposed amended rule will implement Section 112(g) of the Federal Clean Air Act.

COMMITTEE:

Technology Advancement and Stationary Source Committees, monthly updates November through April, reviewed and discussed.

RECOMMENDED ACTION:

  1. Adopt the attached resolution: certifying the Final Environmental Assessment for Proposed Amended Rule 1401 - New Source Review of Toxic Air Contaminants; and

  2. Amending Rule 1401 - New Source Review of Toxic Air Contaminants, as proposed, in accordance with the attached Resolution; and

  3. Adopting the Statement of Findings, Statement of Overriding Considerations, and Mitigation Monitoring Plan; and

  4. Continue the hearing for consideration of adding more nickel compounds, sodium hydroxide, and hydrochloric acid to the list of toxic air contaminants in Rule 1401 to the September 11, 1998 Governing Board meeting.

Barry R. Wallerstein, D. Env.
Acting Executive Officer

Background

In October 1997, the South Coast Air Quality Management District (AQMD) Governing Board adopted ten environmental justice initiatives. This rule development effort partially implements environmental justice initiative number ten - "to reopen for public comment the toxics significance thresholds for cancer and noncancer impacts contained in Rule 1402 - Control of Toxic Air Contaminants from Existing Sources, and consideration of adding additional compounds and non-carcinogenic impact prevention into Rule 1401 - New Source Review of Carcinogenic Air Contaminants." This rule development concentrates on the second objective of the initiative. Changes are being proposed to Rule 1401 to add compounds and address noncancer impacts, which is an important first step in fulfilling this environmental justice initiative. Evaluation of the risk thresholds and how to address cumulative impacts will be part of a subsequent rule development effort.

Rule 1401 was adopted in June 1990, and amended in December 1990. The rule applies to new, modified or relocated permit units and establishes risk-based thresholds for about 40 chemicals which can cause cancer. The rule is an important preconstruction review that may result in extra controls to reduce risks. This rule amendment will strengthen public health protection by adding more carcinogenic compounds to be reviewed and adding requirements for review and establishment of risk levels for compounds which do not cause cancer, but can cause other serious health impacts.

Public input was initiated with a Board Air Toxics Workshop in December 1997. Several noted experts presented information on current regulatory programs, health effects of air toxics, the air toxic inventory in the South Coast, risk assessment, research needs, and a regulatory discussion. Additional public input has been obtained through regular updates at the Board Technology and Stationary Source committee meetings, five working group meetings, a series of five public workshops and two public consultation meetings at various locations throughout the basin, including one weekend and two evening, and meetings with several industry groups.

Proposal

In the last seven years since Rule 1401 was amended, several additional compounds have been identified as carcinogens. AQMD has not had a mechanism to require analysis and possible additional controls for those compounds that could pose unacceptable risks to local communities. The proposal will add 14 carcinogens to the rule and will help protect public health.

In addition, the proposal includes adding compounds which can cause noncancer impacts, such as reproductive or liver damage. Twenty-five compounds which can cause short-term (acute) impacts are proposed for addition. Ninety-nine and one compounds are proposed for protection from long-term (chronic) health impacts. The proposal would allow permits to be issued only when a hazard index, which is an estimate of the risk from the use of the chemical, is less than 1.0. These changes to the rule will be effective 60 days from the date of adoption (i.e., September 11, 1998) to allow a smoother implementation transition.

Staff initially proposed adding compounds which currently do not have risk factors. In response to industry comments that this automatic update would not provide an adequate process to review potential impacts, this element of the proposal has been changed. The proposed rule will add only compounds for which a risk value has been finalized. However, to let industry have notice of pending additions so they can make informed decisions, a table of additional compounds for which draft risk factors have been proposed is included in the rule. The table, which includes approximately 81 compounds, is for information purposes and will not affect permitting. The rule also includes a requirement for staff to propose changes within 150 days after risk factors for chemicals not on Table I are finalized. When a full environmental assessment is not needed, the proposed changes will take substantially less than 150 days.

The rule includes language to implement section 112 (g) of the federal Clean Air Act. This is primarily an administrative requirement only, since this will apply only to very large new sources or major reconstruction at existing sources that do not have a technology based federal rule in place.

An exemption for emergency internal combustion engines is proposed, consistent with similar exemptions in Regulation XIII - New Source Review, which covers criteria pollutants. Due to their limited use and essential need, an exemption is proposed.

Based on concerns raised by the regulated community, staff conducted technology assessments for wood furniture stripping, motion picture film processing, aerospace chemical maskants, and nickel plating. In addition, an independent engineering firm conducted a cost assessment on control technologies for the nickel plating industry. Based on these assessments, an exemption is proposed for wood furniture stripping. The exemption will be for 18 months or less if technology is available that will enable Rule 1401 limits to be met. This exemption will allow time for completion of a study to determine optimum operational and control requirements that will enable this type of operation to meet the risk limits in Rule 1401. Existing technology can reduce emissions for motion picture film processing and aerospace chemical maskants.

The metal finishers association has raised two types of concerns about the impacts of the proposed amendments to Rule 1401 on their industry. First, they contend that the soluble form of nickel used in plating is not a strong carcinogen like other forms of nickel. Nickel compounds were identified in the 1990 Clean Air Act Amendments as hazardous pollutants. ARB listed these compounds as toxic air contaminants in 1991. The Office of Environmental Health Hazard Assessment (OEHHA), a branch of Cal EPA, is responsible for developing risk factors, and has adopted risk factors for more forms of nickel than has the federal EPA. The metal finishers association, in cooperation with EPA and other organizations is conducting a literature review study which is scheduled for completion for peer review in September 1998. The metal finishers will petition OEHHA to review this information and reevaluate the potency of soluble nickel compounds. This process will take at least two years.

The second area of concern relates to emission factors for nickel, sodium hydroxide, and hydrochloric acid tanks, commonly used equipment in metal plating. The current factors may overestimate emissions from these operations. Calculation of risk is dependent on many factors, including the emissions from the equipment. Better characterization of emission factors may avoid the need to add controls and significantly reduce economic impacts of the rule.

Determination of cancer and other risk values is not AQMD’s primary area of expertise. However, we can help with better characterization of emissions from industrial processes, such as those listed above.

Staff recommends adoption of the proposed amended rule, except that the hearing be continued until September 1998 to consider adding more nickel compounds, sodium hydroxide and hydrochloric acid to the list of toxic air contaminants. That will provide time for source tests to be conducted which will enable better characterization of emissions and economic impacts on the metal plating industry. Staff will return at the September Board hearing to report on the source test reports and make recommendations at that time about adding those compounds to Rule 1401. In addition, staff will continue to seek additional input from experts in metal carcinogenicity to provide more input to the Board relative to the potency and toxicity of nickel used in plating operations. The delay in adding these compounds will primarily affect the metal plating industry and electronics industry.

Additional amendments will clarify the relationship with permitting requirements, clarify or add definitions, and procedures.

AQMP and Legal Mandates

Rule 1401 is a program that is in part mandated by state and federal requirements. Changes to Rule 1401 will be consistent with California Air Resources Board (ARB) guidelines for toxic new source review.

CEQA & Socioeconomic Analysis

In accordance with the California Environmental Quality Act (CEQA), the AQMD, as lead agency, has reviewed proposed amended Rule 1401 pursuant to state CEQA Guidelines § 15002(k). The proposed amended rule has the potential to generate significant adverse air quality and cumulative water quality impacts. Therefore, a Draft Environmental Assessment (EA) was prepared pursuant to AQMD’s certified regulatory program (Rule 110) and released on March 20, 1998, for a 45-day public review and comment period. Three comment letters received on the Draft EA. Responses to all comments received have been prepared and incorporated into the Final EA for the proposed project.

A final Socioeconomic Assessment is included as an addendum to the staff report.

Implementation Plan

Impacts from additional carcinogens and noncancer compounds added to the rule will be analyzed for all complete permit applications received on or after 60 days from the date of adoption. This future effective date will enable staff to work closely with industry to finalize Guidance documents. A draft Guidance document - Risk Assessment Procedures for Rules 1401 and 212 - was released in late April 1998 for industry review. The document contains de minimis levels by chemical and also for certain industries. Emissions below these levels will not require any analysis under Rule 1401, since staff has determined that even with conservative assumptions, emissions at these levels will not result in impacts above the thresholds in the rule.

The future effective date will also allow time for AQMD to make changes to its permitting procedures and data base for better information handling. Engineering staff will be trained on the changes to the rule.

AQMD staff will work with industry groups in outreach efforts and to simplify permitting as much as possible.

Attachments (1,038 KB)

Summary of Proposal

Key Issues and Responses

Rule Development Process

Key Contacts List

Resolution

Proposed Rule Language

Final Staff Report

Final Socioeconomic Assessment

Final Environmental Assessment

ATTACHMENT A

SUMMARY OF PROPOSAL

Proposed Amended Rule 1401 - New Source Review of Carcinogenic Air Contaminants

• The proposed amendments will add 14 cancer compounds to the list of compounds that must be considered during new source review. The existing requirements for Maximum Individual Cancer Risk (MICR) and excess cancer cases will apply to the expanded list.

• The proposed amendments will also add noncancer acute impact analysis for 25 compounds and noncancer chronic impact analysis for ninety-nine compounds. Permits can be issued when both the acute and chronic hazard index (HI) are less than 1.0.

• The proposed rule will add compounds for which a risk value has been finalized. However, to provide notice of pending additions so industry can make informed decisions, a table of additional compounds for which draft risk factors have been proposed is included in the rule. Rule changes will be proposed within 150 days as risk factors are finalized for additional compounds.

• The rule includes language to implement section 112 (g) of the federal Clean Air Act. This is primarily an administrative requirement only, since this will apply only to very large new sources or major reconstruction at existing sources that do not have a technology based federal rule in place.

• An exemption for emergency internal combustion engines is proposed, consistent with similar exemptions in Regulation XIII - New Source Review, which covers criteria pollutants. Due to their limited use and essential need, an exemption is proposed.

• An eighteen-month exemption is proposed for wood furniture stripping. This exemption will allow time for completion of a study to determine optimum operational and control requirements that will enable this type of operation to meet the risk limits in Rule 1401.

• Staff recommends that the hearing be continued until September 1998 to consider adding more nickel compounds, sodium hydroxide and hydrochloric acid to the list of toxic air contaminants. That will provide time for source tests to be conducted which will enable better characterization of emissions and economic impacts for the metal plating industry. Staff will return at the September Board hearing to report on the source test reports and make recommendations at that time about adding those compounds to Rule 1401.

• Additional amendments will clarify the relationship with permitting requirements, clarify or add definitions, and other changes to clarify procedures.

ATTACHMENT B

KEY ISSUES AND RESPONSES
Proposed Amended Rule 1401 - New Source Review of Carcinogenic Air Contaminants

• Industry requests more time to review the documents, especially the socioeconomic impact report and guidance documents, in order to better understand impacts. Environmental groups would like progress as quickly as possible.

Proposed changes to Rule 1401 were set for hearing in May for a July public hearing. This provided a 60-day review to accommodate the request to review the proposal and still allow substantive progress on an important environmental justice initiative. Since Rule 1401 was amended in December 1990, 14 additional compounds have been identified as carcinogens. There has not been a mechanism in place to review these chemicals during permitting or to require additional controls to reduce risks. The current rule also does not address any noncancer impacts.

The draft socioeconomic report was available to the public in the set hearing package on May 8, 1998. Draft guidance documents were released in late April for review and revised drafts were available in May and June. These documents provide de minimis levels, explain risk calculations, and provide worksheets and examples. Revised PAR 1401 now has an implementation date of 60 days after rule adoption to allow more time to work with industry to finalize the guidance documents.

• The rule will add too many compounds, making it difficult for businesses and cumbersome for the permitting process.

The proposal has been revised to include only compounds with risk values that have been finalized by OEHHA. 14 carcinogens, 25 compounds for acute impacts, and ninety-nine compounds for chronic impacts are proposed to be added. AQMD staff will do everything it can to ensure that the PAR 1401 requirements do not hinder the permitting process. For example, the relationship with Rule 219 permitting requirements are being tied to de minimis levels to avoid a large increase in new permit applications. The guidance documents will be also helpful to both customers and permitting engineers. De minimis levels and simplified calculations are provided by compounds and for some equipment and industry categories.

• The rule should not include an automatic update mechanism to add compounds when risk factors are finalized.

The proposed rule reflects this request. The language to automatically add new compounds has been deleted. Consistent with the current rule and existing practice, when risk values are changed by the Office of Environmental Health Hazard Assessment (OEHHA), they will be incorporated into revised Guidelines.

The proposed rule will add compounds for which a risk value has been finalized. However, to provide notice of pending additions so industry can make informed decisions, a table of additional compounds for which draft risk factors have been proposed is included in the rule. Rule changes will be proposed within 150 days as risk factors are finalized.

• There should be a process to evaluate potential economic impacts when a risk value for a compound changes.

The Board resolution includes a direction to staff to report to the Board when a change in a risk value may cause a significant economic impact.

• No exemptions should be provided since the rule is a risk-based approach.

The proposed exemptions are limited in nature and duration to only those circumstances that require special consideration to allow permitting. An eighteen-month exemption is proposed for wood product stripping. These operations are on the verge of having T-BACT defined. The proposed exemption will allow for T-BACT to be finalized. Emergency internal combustion engines, which play a vital role and have limited hours of operation and emissions, are proposed for exemption, consistent with Regulation XIII - New Source Review.

• A two-year exemption is requested for nickel plating. The metal plating industry has asked for a limited exemption because they feel that the addition of several key substances to PAR 1401 (nickel, sodium hydroxide and hydrochloric acid) and the risk values for nickel will place a large financial burden on the industry when permitting new, modified, or relocated sources. The temporary exemption would give the industry time to request consideration of an alternative health risk value for nickel.

Determination of cancer and other risk values is not AQMD’s primary area of expertise. However, we can help with better characterization of emissions from industrial processes, such as those listed above. Staff recommends that the hearing be continued until September 1998 to consider adding more nickel compounds, sodium hydroxide and hydrochloric acid to the list of toxic air contaminants. That will provide time for source tests to be conducted which will enable better characterization of emissions and economic impacts for the metal plating industry. Staff will return at the September Board hearing to report on the source test reports and make recommendations at that time about adding those compounds to Rule 1401. Current factors may overestimate emissions from these operations. Calculation of risk is dependent on many factors, including the emissions from the equipment. Better characterization of emission factors may avoid the need to add controls and significantly reduce economic impacts of the rule.

• A two-year exemption is requested for perchloroethylene (perc) motion picture film processing. Proposed alternative materials are inadequate for the process and pose a risk to employees. An exemption is proposed for film processing machines that use perc as the cleaning solvent, provided that the machine uses T-BACT, risk increases due to the emissions from the equipment and all other permit units located within 100 meters owned or operated by the applicant for which applications were submitted on or after the date of adoption will not exceed 100 in one million risk or a total acute or chronic hazard index of 5.0 at any receptor location, and the owner or operator will investigate potential methods to control or reduce TAC emissions, including but not limited to source reduction, innovative control techniques and material or process substitution.

The AQMD recognizes that finding alternatives to perc for film cleaning has been a significant effort for many years. A technology assessment was conducted by AQMD staff to evaluate the film cleaning and printing processes, including a review of alternative materials and technologies, as well as an evaluation of potential emission controls. This technology assessment indicated that use of chilled condensing coils and activated carbon can reduce the risk from film cleaning equipment to a level below 10 in 1 million.

Chemical and/or technological alternatives exist for reducing risks to acceptable levels for the film cleaning and printing processes. Therefore, no special provisions in PAR 1401 are recommended for motion picture film processing.

• An exemption is requested for perchloroethylene (perc) use in the aerospace chemical maskant operations: chemical milling and chemical processing. Some potentially affected industry members have expressed concerns regarding the potential lack of alternative solvent materials that would allow them to switch to a lower-toxic, non-perc chemical maskant and reduce their perc emissions.

The AQMD conducted a technology assessment to evaluate the availability of alternative chemical maskants for the aerospace industry, as well as an evaluation of potential emission controls. This technical assessment found commercially available alternatives to perc in chemical maskants that are in use at aerospace facilities. As a result, it has been determined that alternatives exist for aerospace chemical maskants and any associated risk can be reduced to acceptable levels using emission controls. Therefore, no exemption or other special provisions are recommended for this industry.

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URL: http://www.aqmd.gov/hb/1998/980741a.html