On December 20, 2017, Kentucky and other states were notified by EPA of the areas that the Agency intends to designate as nonattainment for the 2015 Ozone National Ambient Air Quality Standard (Ozone NAAQS).  These nonattainment designations are EPA’s preliminary response to the 2016 area recommendations submitted by states and are not final.  Kentucky and other states have until February 28, 2018 to submit certified, quality assured 2015-2017 ambient air monitoring data or additional information for EPA to consider prior to the promulgation of final ozone designations possibly by the spring of 2018.  The EPA intends to complete designations for all of the areas addressed in the responses to the states and tribes no later than April 30, 2018.

In accordance with the CAA section 107(d), EPA intends to designate areas with monitors that are violating the Ozone NAAQS as nonattainment including nearby areas with emissions sources (i.e., stationary, mobile and/or area sources) that cause or contribute to monitored NAAQS violations. Consistent with Agency guidance issued on February 25, 2016, EPA’s intends to designate the following Northern Kentucky areas as nonattainment: Boone County (partial), Campbell County (partial) and Kenton County (partial).  For the Louisville Metro area, EPA intends to designate Bullitt County, Jefferson County and Oldham County as nonattainment.  Each proposed nonattainment area in Kentucky is part of a larger metropolitan area which encompass counties in Indiana (Louisville nonattainment area only) and Ohio (Northern Kentucky nonattainment area only) which were also designated nonattainment based on monitored violations observed throughout the metropolitan area.

The procedural requirements to designate ozone nonattainment areas and develop nonattainment area State Implementation Plans (SIPs) takes time. It is important for the public and the regulated community to track this issue, participate in stakeholder work groups, and provide public comments at different milestones during the process. Being an active participant that is prepared to interact with the Kentucky Division for Air Quality (KDAQ) or the Louisville Metro Air Pollution Control District (District) provides your regulated facility more time to plan and adapt future regulatory actions.

There are at least two groups that should begin to gather information and develop strategies.  Existing PSD Minor/Title V Major Stationary sources, and local planning agencies, especially those who receive highway funding.

For Title V permit holders, it is important to understand that emission thresholds which trigger nonattainment new source review (NA NSR) are much lower than normal emission thresholds established by the EPA Prevention of Significant Deterioration (PSD) program for un-named sources. Sources required to undergo NA NSR permitting must install emissions controls which provide the Lowest Achievable Emission Rate (LAER). Thus, NA NSR requires an applicant to demonstrate that benefits of the proposed source (or major modification at an existing source) significantly outweigh the environmental and social costs imposed as a result of its location, construction, or modification (See Kentucky Administrative Regulation 401 KAR 51:052). Because these proposed areas have not been formally designated yet and won’t be until after February 28, there may be a window to submit permit applications before the nonattainment area designations are finalized and ratchet up permit review requirements.

Local governments in the proposed areas may want to confer with their highway funding counterparts to ensure that their highway project funding will not be affected.  Information on Transportation Conformity can be found at https://www.epa.gov/state-and-local-transportation/transportation-conformity-chronological-list-rulemakings.For additional information on funding for highway projects in ozone non-attainment areas see https://www.fhwa.dot.gov/environment/air_quality/cmaq/.

We will do our best to provide timely updates and relevant information on this issue.

Smith Management Group Ozone Contacts:

Scott R. Smith, scottr.smith@smithmanage.com  or Stewart McCollam, stewartm@smithmanage.com