Proposed Increase in Title V Air Quality Fees
The federal Clean Air Act of 1990 required the development of a national permit program for major sources of air pollution. This permit program is called the Title V air quality operating permit program. To pay for implementing the permit program, Congress required in the Clean Air Act that air pollution sources subject to the permitting program must pay a fee to cover the reasonable direct and indirect costs associated with administering the program.
Under the Clean Air Act, all states had to develop a permit program and a fee structure to pay for implementing the program and be approved by the U.S. Environmental Protection Agency (EPA). If a state decided not to develop a permit program, the EPA would develop and implement its own program for that state and charge the maximum fee allowed under the Clean Air Act. Currently EPA is charging $50.56 per ton of regulated pollutants emitted into the air from each source permitted.
To decrease the cost of the program and to provide better customer service to businesses and industry in South Dakota, the South Dakota Department of Environment and Natural Resources (DENR) established a Title V air quality operating permit program and a fee structure to pay for implementing the program in 1994. In lieu of the maximum fee allowed under the Clean Air Act that would have been charged under an EPA administered program, DENR set the fee at $6.10 per ton of regulated pollutants emitted from permitted sources in 1994. On June 28, 2010, the fees were revised to $7.50 per ton of regulated pollutants. The air emission fees are established in Administrative Rules of South Dakota Chapter 74:37:01 – Air Emission Fees.
Since 2010, the costs to implement the program have increased and the existing fee structure is no longer sufficient to cover the cost of the program. As a result, the EPA requires the fee structure to be revised to be in compliance with the federal Clean Air Act provision requiring the fee to cover the entire cost of the program. The revisions to Chapter 74:37:01 are being proposed to ensure the department maintains sufficient resources to implement the Title V air quality operating permit program in South Dakota and maintains the state’s approval status from EPA.
The following is a summary of the proposed changes.
- Annual administrative fees for sources emitting less than 50 tons per year of pollutants will increase from $125 to $135. For sources emitting more than 50 tons but less than 100 tons, the annual fee will increase from $600 to $675. For sources emitting 100 tons or more of pollution each year, the fee will increase from $1,250 to $1,350;
- The fee for the actual amount of pollution emitted from each permitted air pollution source will increase from $7.50 per ton to $8.10 per ton;
- The annual minimum fee paid by any permitted source for items number 1 and 2 above will increase from $250 to $270;
- The application fee for a construction permit for a source required to obtain a Title V air quality operating permit, a new Title V air quality operating permit, a modification to a construction or Title V air quality operating permit, and the renewal of a Title V air quality operating permit will increase from $125 to $135;
- The annual fee for rock crushers subject to the Title V air quality operating permit program will increase from $400 to $435. Rock crushers are not subject to the emissions fee in item 1 and 2 above.
- The annual fee for asphalt plants subject to the Title V air quality operating permit program will increase from $300 to $325. Asphalt plants are not subject to the emissions fee in item 1 and 2 above.
- The annual fee for the Big Stone coal-fired power plant will increase from $220,000 to $238,000. The Big Stone coal-fired power plant will not be subject to emissions fees in item 1 and 2 above.
- An annual fee increase based on the Consumer Price Index as allowed under SDCL 34A-1-58 but only if the fee reserve in the previous fiscal year is less than or equal to $50,000. The annual fee increase is proposed to start in state fiscal year 2020.
The above proposed changes do not impact the air fees paid by ethonol plants. DENR is requesting initial input on the proposed draft changes prior to beginning the formal rulemaking process. Attached is a copy of the draft revisions for initial review and comments. In the Appendix of the document, the words that have red and overstrikes represent deletions and blue, bold and underlined represent additions. Please send any comments on the proposed draft changes to Kyrik Rombough either by email at Kyrik.Rombough@state.sd.us or by mail at the following address by August 4, 2017.
South Dakota Department of Environment and Natural Resources
Air Quality Program
Joe Foss Building
523 East Capitol
Pierre, South Dakota 57501
DENR tentatively plans to publish a formal public notice near the end of August 2017, announcing a rule hearing in front of Secretary Steven M. Pirner in September 2017. Thank you for assisting us in this rule making process.