By Allen                                              H.B. No. 2504
         76R7003 JJT-D                           
                                A BILL TO BE ENTITLED
 1-1                                   AN ACT
 1-2     relating to the issuance of certain permits for the emission of air
 1-3     contaminants.
 1-4           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
 1-5           SECTION 1.  Section 382.003(9), Health and Safety Code, is
 1-6     amended to read as follows:
 1-7                 (9)  "Modification of existing facility" means any
 1-8     physical change in, or change in the method of operation of, a
 1-9     facility in a manner that increases the amount of any air
1-10     contaminant emitted by the facility into the atmosphere or that
1-11     results in the emission of any air contaminant not previously
1-12     emitted.  The term does not include:
1-13                       (A)  insignificant increases in the amount of any
1-14     air contaminant emitted that is authorized by one or more
1-15     commission exemptions;
1-16                       (B)  insignificant increases at a permitted
1-17     facility;
1-18                       (C)  maintenance or replacement of equipment
1-19     components that do not increase or tend to increase the amount or
1-20     change the characteristics of the air contaminants emitted into the
1-21     atmosphere;
1-22                       (D)  an increase in the annual hours of operation
1-23     unless the existing facility has received a preconstruction permit
1-24     or has been exempted, pursuant to Section 382.057, from
 2-1     preconstruction permit requirements;
 2-2                       (E)  a physical change in, or change in the
 2-3     method of operation of, a facility that does not result in a net
 2-4     increase in allowable emissions of any air contaminant and that
 2-5     does not result in the emission of any air contaminant not
 2-6     previously emitted, provided that the facility:
 2-7                             (i)  has received a preconstruction permit
 2-8     or permit amendment or has been exempted pursuant to Section
 2-9     382.057 from preconstruction permit requirements no earlier than
2-10     120 months before the change will occur; or
2-11                             (ii)  uses, regardless of whether the
2-12     facility has received a permit, an air pollution control method
2-13     that is at least as effective as the best available control
2-14     technology, considering technical practicability and economic
2-15     reasonableness, that the commission required or would have required
2-16     for a facility of the same class or type as a condition of issuing
2-17     a permit or permit amendment 120 months before the change will
2-18     occur;
2-19                       (F)  a physical change in, or change in the
2-20     method of operation of, a facility where the change is within the
2-21     scope of a flexible permit, a multiple plant permit, or a standard
2-22     permit; or
2-23                       (G)  a change in the method of operation of a
2-24     natural gas processing, treating, or compression facility connected
2-25     to or part of a natural gas gathering or transmission pipeline
2-26     which does not result in an annual emission rate of a pollutant in
2-27     excess of the volume emitted at the maximum designed capacity,
 3-1     provided that the facility is one for which:
 3-2                             (i)  construction or operation started on
 3-3     or before September 1, 1971, and at which either no modification
 3-4     has occurred after September 1, 1971, or at which modifications
 3-5     have occurred only pursuant to standard exemptions; or
 3-6                             (ii)  construction started after September
 3-7     1, 1971, and before March 1, 1972, and which registered in
 3-8     accordance with Section 382.060 as that section existed prior to
 3-9     September 1, 1991.
3-10           SECTION 2.  Sections 382.051(a) and (b), Health and Safety
3-11     Code, are amended to read as follows:
3-12           (a)  The commission may issue a permit:
3-13                 (1)  to construct a new facility or modify an existing
3-14     facility that may emit air contaminants; [or]
3-15                 (2)  to operate an existing facility pursuant to a
3-16     voluntary emissions reduction permit; or
3-17                 (3)  to operate a federal source.
3-18           (b)  To assist in fulfilling its authorization provided by
3-19     Subsection (a), the commission may issue:
3-20                 (1)  special permits for certain facilities;
3-21                 (2)  a general permit [developed by rule] for numerous
3-22     similar sources subject to Section 382.054;
3-23                 (3)  a standard permit [developed by rule] for
3-24     [numerous] similar facilities subject to Section 382.0518,
3-25     382.0519, or 382.05195;
3-26                 (4)  a permit by rule for types of facilities that will
3-27     not significantly contribute air contaminants to the atmosphere;
 4-1                 (5)  a single federal operating permit or
 4-2     preconstruction permit for multiple federal sources or facilities
 4-3     located at the same site;
 4-4                 (6)  a multiple plant permit for existing facilities at
 4-5     multiple locations subject to Section 382.0518 or 382.0519; or
 4-6                 (7) [(5)]  other permits as necessary.
 4-7           SECTION 3.  Subchapter C, Chapter 382, Health and Safety
 4-8     Code, is amended by adding Section 382.05101 to read as follows:
 4-9           Sec. 382.05101.  DE MINIMIS AIR CONTAMINANTS.  The commission
4-10     may develop by rule the criteria to establish a de minimis level of
4-11     air contaminants for facilities or groups of facilities below which
4-12     no permit under Section 382.0518 or 382.0519, standard permit under
4-13     Section 382.05195, or permit by rule under Section 382.05196 will
4-14     be required.
4-15           SECTION 4.  Sections 382.0511(a) and (c), Health and Safety
4-16     Code, are amended to read as follows:
4-17           (a)  The commission may consolidate into a single permit[:]
4-18                 [(1)]  any permits, special permits, standard permits,
4-19     permits by rule, or exemptions for a facility or federal source
4-20     [issued by the commission before December 1, 1991; or]
4-21                 [(2)  any permit issued by the commission on or after
4-22     December 1, 1991, with any permits, special permits, or exemptions
4-23     issued or qualified for by that date].
4-24           (c)  The commission [by rule] may authorize changes in a
4-25     federal source to proceed before the owner or operator obtains a
4-26     federal operating permit or revisions to a federal operating permit
4-27     if the changes are de minimis under Section 382.05101 or the owner
 5-1     or operator has obtained a preconstruction permit or permit
 5-2     amendment required by Section 382.0518 or an exemption allowed
 5-3     under Section 382.057.
 5-4           SECTION 5.  Subchapter C, Chapter 382, Health and Safety
 5-5     Code, is amended by adding Sections 382.0519, 382.05191, 382.05192,
 5-6     382.05193, 382.05194, 382.05195, and 382.05196 to read as follows:
 5-7           Sec. 382.0519.  VOLUNTARY EMISSION REDUCTION PERMIT.  (a)
 5-8     Before September 1, 2001, the owner or operator of an unpermitted
 5-9     facility that, under Section 382.0518(g), is not subject to the
5-10     requirement to obtain a permit may apply for a permit to operate
5-11     the facility under this section.
5-12           (b)  Within a reasonable time after the commission receives
5-13     an application under this section, the commission shall grant the
5-14     permit if, from the information available to the commission,
5-15     including information presented at any public hearing or through
5-16     written comment, the commission finds that the facility will use an
5-17     air pollution control method at least as beneficial as that
5-18     described in Section 382.003(9)(E)(ii), considering the age and
5-19     remaining useful life of the facility.
5-20           (c)  If the commission finds that the emissions from the
5-21     facility will contravene the standards under Subsection (b) or the
5-22     intent of this chapter, including protection of the public's health
5-23     and physical property, the commission may not grant the permit
5-24     under this section.
5-25           (d)  A person must comply with Section 382.0518 before work
5-26     may begin on the modification of a facility previously permitted
5-27     under this section.
 6-1           Sec. 382.05191.  VOLUNTARY EMISSION REDUCTION PERMIT:  NOTICE
 6-2     AND HEARING.  (a)  An applicant for a permit under Section 382.0519
 6-3     shall publish notice of intent to obtain the permit in accordance
 6-4     with Section 382.056.
 6-5           (b)  The commission may authorize an applicant for a permit
 6-6     for a facility which constitutes or is part of a small business
 6-7     stationary source as defined in Section 382.0365(g)(2) to provide
 6-8     notice using an alternative means if the commission finds that the
 6-9     proposed method will result in equal or better communication with
6-10     the public, considering the effectiveness of the notice in reaching
6-11     potentially affected persons, cost, and consistency with federal
6-12     requirements.
6-13           (c)  The commission shall afford an opportunity for a public
6-14     hearing and the submission of public comment and send notice of a
6-15     decision on an application for a permit under Section 382.0519 in
6-16     the same manner as provided by Sections 382.0561 and 382.0562.
6-17           (d)  A person affected by a decision of the commission to
6-18     issue or deny a voluntary emission reduction permit may move for
6-19     rehearing and is entitled to judicial review under Section 382.032.
6-20           Sec. 382.05192.  VOLUNTARY EMISSION REDUCTION PERMITS:
6-21     REVIEW AND RENEWAL.  Review and renewal of permits issued under
6-22     Section 382.0519 shall be conducted in accordance with Section
6-23     382.055.
6-24           Sec. 382.05193.  EMISSIONS PERMITS THROUGH ENVIRONMENTAL
6-25     MITIGATION PROJECT.  (a)  The commission may issue a permit under
6-26     Section 382.0519 for a facility:
6-27                 (1)  that makes a good faith effort to make equipment
 7-1     improvements and emissions reductions necessary to meet the
 7-2     requirements of that section;
 7-3                 (2)  that, in spite of the effort, cannot reduce the
 7-4     facility's emissions to the degree necessary for the issuance of
 7-5     the permit; and
 7-6                 (3)  the owner or operator of which acquires a
 7-7     sufficient number of emissions reduction credits to offset the
 7-8     facility's excessive emissions under the program established under
 7-9     Subsection (b).
7-10           (b)  The commission by rule shall establish a program to
7-11     grant emissions reduction credits to a facility if the owner or
7-12     operator conducts a special environmental project to offset the
7-13     facility's excessive emissions.  The rules must establish two
7-14     categories of projects eligible for credits under the program
7-15     including:
7-16                 (1)  emissions reduction projects; and
7-17                 (2)  environmental protection projects.
7-18           (c)  A project included in the emissions reduction projects
7-19     category must reduce net emissions from one or more sources in this
7-20     state in an amount and type sufficient to prevent air pollution to
7-21     a degree comparable to the amount of the reduction in the
7-22     facility's emissions that would be necessary to meet the permit
7-23     requirement.  The emissions reduction projects category must
7-24     include:
7-25                 (1)  generation of electric energy by a low-emission
7-26     method including:
7-27                       (A)  wind power;
 8-1                       (B)  biomass gasification power; and
 8-2                       (C)  solar power;
 8-3                 (2)  the purchase and destruction of high-emission
 8-4     automobiles or other mobile sources; and
 8-5                 (3)  reducing emissions from a permitted facility that
 8-6     emits air contaminants to a level significantly below the levels
 8-7     necessary under the facility's permit.
 8-8           (d)  A project included in the environmental protection
 8-9     projects category must benefit, preserve, or protect environmental
8-10     quality in this state to a degree that the value of the project to
8-11     the status of the state's environment is comparable to the value to
8-12     the environment of reducing the facility's emissions to the extent
8-13     necessary to meet the permit requirements.  The environmental
8-14     protection projects category must include:
8-15                 (1)  the creation of a wildlife or plant preserve;
8-16                 (2)  the creation of an environmental easement;
8-17                 (3)  surface or ground water or soil pollution
8-18     prevention or remediation;
8-19                 (4)  wetlands enhancement, remediation, or
8-20     preservation; and
8-21                 (5)  environmental education.
8-22           (e)  A permit issued under Section 382.0519 for a facility
8-23     participating in the program established under this section must be
8-24     conditioned on the successful and timely completion of the project
8-25     or projects for which the facility owner or operator acquires the
8-26     credits.
8-27           (f)  To renew the permit of a facility permitted under
 9-1     Section 382.0519 with credits acquired under the program
 9-2     established under this section, the commission shall require the
 9-3     owner or operator of the facility to have:
 9-4                 (1)  made equipment improvements and emissions
 9-5     reductions necessary to meet the permit requirements under that
 9-6     chapter for a new permit; or
 9-7                 (2)  acquired additional credits under the program as
 9-8     necessary to meet the permit requirements under that section for a
 9-9     new permit.
9-10           (g)  Emissions reduction credits acquired under the program
9-11     established under this section are not transferrable.
9-12           Sec. 382.05194.  MULTIPLE PLANT PERMIT.  (a)  The commission
9-13     may issue a multiple plant permit for multiple existing facilities
9-14     owned or operated by the same person if the commission finds that:
9-15                 (1)  the aggregate rate of emission of air contaminants
9-16     to be authorized under the permit does not exceed:
9-17                       (A)  the rate that would be authorized under
9-18     Section 382.0518 for a previously permitted facility; or
9-19                       (B)  the rate that would be authorized under
9-20     Section 382.0519 for:
9-21                             (i)  an unpermitted facility that, under
9-22     Section 382.0518(g), is not subject to the requirement to obtain a
9-23     preconstruction authorization; or
9-24                             (ii)  a facility permitted under Section
9-25     382.0519; and
9-26                 (2)  there is no indication that the emissions from the
9-27     facilities will contravene the intent of this chapter, including
 10-1    protection of the public's health and physical property.
 10-2          (b)  A permit issued under this section shall provide that
 10-3    the emissions from any of the facilities authorized under the
 10-4    permit shall not exceed that facility's highest historic annual
 10-5    rate.  In the absence of records extending back to the original
 10-6    construction of the facility, best engineering judgment shall be
 10-7    used to demonstrate the facility's highest historic annual rate to
 10-8    the commission.
 10-9          (c)  Emissions control equipment previously installed at a
10-10    facility permitted under this section may not be removed or
10-11    disabled unless the action is undertaken to maintain or upgrade the
10-12    control equipment.
10-13          Sec. 382.05195.  STANDARD PERMIT.  (a)  The commission may
10-14    issue a standard permit for similar facilities if the commission
10-15    finds that:
10-16                (1)  the standard permit can be readily enforced;
10-17                (2)  the commission can adequately monitor compliance
10-18    with the terms of the standard permit; and
10-19                (3)  for facilities subject to Section 382.0518(a)-(d),
10-20    the facility will use control technology at least as effective as
10-21    that described in Section 382.0518(b).
10-22          (b)  The commission shall publish notice of a proposed
10-23    standard permit in the Texas Register and in one or more statewide
10-24    or regional newspapers, designated by the commission by rule, that
10-25    will, in the commission's judgment, provide reasonable notice
10-26    throughout the state.  If the standard permit will be effective for
10-27    only part of the state, the notice shall be published in a
 11-1    newspaper of general circulation in the area to be affected.  The
 11-2    commission may by rule require additional notice to be given.  The
 11-3    notice must include an invitation for written comments by the
 11-4    public to the commission regarding the proposed standard permit and
 11-5    shall be published not later than the 30th day before the
 11-6    commission issues the standard permit.
 11-7          (c)  The commission shall hold a public meeting to provide an
 11-8    additional opportunity for public comment.  The commission shall
 11-9    give notice of a public meeting under this subsection as part of
11-10    the notice described in Subsection (b) not later than the 30th day
11-11    before the date of the meeting.
11-12          (d)  If the commission receives public comment relating to
11-13    issuance of a standard permit, the commission shall issue a written
11-14    response to comments on the permit at the same time that the
11-15    commission issues or denies the permit.  The response is available
11-16    to the public and shall be mailed to each person who made a
11-17    comment.
11-18          (e)  The commission shall establish, by rule, the procedures
11-19    for application and approval for the use of a standard permit.
11-20          (f)  The issuance, amendment, or revocation of a standard
11-21    permit by the commission is not subject to Chapter 2001, Government
11-22    Code.
11-23          (g)  The commission may adopt rules as necessary to implement
11-24    and administer this section and may delegate to the executive
11-25    director the authority to issue, amend, or revoke a standard permit
11-26    as provided by Section 382.061.
11-27          Sec. 382.05196.  PERMITS BY RULE.  (a)  Consistent with
 12-1    Section 382.051, the commission may adopt permits by rule for
 12-2    certain types of facilities if it is found on investigation that
 12-3    such types of facilities will not make a significant contribution
 12-4    of air contaminants to the atmosphere.  The commission may not
 12-5    adopt a permit by rule authorizing any facility defined as "major"
 12-6    under the federal Clean Air Act (42 U.S.C. Section 7401 et seq.) or
 12-7    regulations adopted under that Act.  Nothing in this subsection
 12-8    shall be construed to limit the commission's general power to
 12-9    control the state's air quality under Section 382.011(a).
12-10          (b)  The commission shall adopt rules specifically defining
12-11    the terms and conditions for a permit by rule under this section in
12-12    a nonattainment area as defined by Title I of the federal Clean Air
12-13    Act (42 U.S.C. Section 7401 et seq.).
12-14          SECTION 6.  Section 382.057(a), Health and Safety Code, is
12-15    amended to read as follows:
12-16          (a)  Consistent with Section 382.0511, the commission by rule
12-17    may exempt from the requirements of Section 382.0518 changes within
12-18    any facility [and certain types of facilities] if it is found on
12-19    investigation that such changes [or types of facilities] will not
12-20    make a significant contribution of air contaminants to the
12-21    atmosphere.  The commission by rule shall exempt from the
12-22    requirements of Section 382.0518 or issue a standard permit for the
12-23    installation of emission control equipment that constitutes a
12-24    modification or a new facility, subject to such conditions
12-25    restricting the applicability of such exemption or standard permit
12-26    that the commission deems necessary to accomplish the intent of
12-27    this chapter.  The commission may not exempt [any facility or] any
 13-1    modification of an existing facility defined as "major" under the
 13-2    federal Clean Air Act or regulations adopted under that Act.
 13-3    Nothing in this subsection shall be construed to limit the
 13-4    commission's general power to control the state's air quality under
 13-5    Section 382.011(a).
 13-6          SECTION 7.  Section 382.058, Health and Safety Code, is
 13-7    amended to read as follows:
 13-8          Sec. 382.058.  LIMITATION ON COMMISSION PERMITS BY RULE OR
 13-9    STANDARD PERMITS [EXEMPTION] FOR CONSTRUCTION OF CERTAIN CONCRETE
13-10    PLANTS.  (a)  A person may not begin construction on any concrete
13-11    plant that performs wet batching, dry batching, or central mixing
13-12    under a standard permit under Section 382.05195 or a permit by rule
13-13    [an exemption] adopted by the commission under Section 382.05196
13-14    [382.057] unless the person has complied with the notice and
13-15    opportunity for hearing provisions under Section 382.056.
13-16          (b)  This section does not apply to a concrete plant located
13-17    temporarily in the right-of-way, or contiguous to the right-of-way,
13-18    of a public works project.
13-19          (c)  For purposes of this section, only those persons
13-20    actually residing in a permanent residence within 440 yards of the
13-21    proposed plant may request a hearing under Section 382.056(d) as a
13-22    person who may be affected.
13-23          SECTION 8.  Section 382.062(b), Health and Safety Code, is
13-24    amended to read as follows:
13-25          (b)  The commission may adopt rules relating to charging and
13-26    collecting a fee for an exemption, a voluntary emissions reduction
13-27    permit, [from] a permit by rule, a multiple plant permit, or [for]
 14-1    a standard permit [authorized by commission rule] and for a
 14-2    variance.
 14-3          SECTION 9.  The Texas Natural Resource Conservation
 14-4    Commission shall adopt, as soon as practicable after the effective
 14-5    date of this Act, any rules necessary to implement the changes in
 14-6    law made by this Act.
 14-7          SECTION 10.  Not later than January 15, 2001, the Texas
 14-8    Natural Resource Conservation Commission shall prepare and
 14-9    distribute to the governor, the lieutenant governor, the speaker of
14-10    the house of representatives, the chairman of the Senate Committee
14-11    on Natural Resources, and the chairman of the House Committee on
14-12    Environmental Regulation a report on the number of companies that
14-13    have obtained or applied for a permit under Section 382.0519,
14-14    Health and Safety Code, as added by this Act, and the reductions in
14-15    emissions anticipated to result from issuance of such permits.
14-16          SECTION 11.  (a)  In accordance with Section 311.031(c),
14-17    Government Code, which gives effect to a substantive amendment
14-18    enacted by the same legislature that codifies the amended statute,
14-19    the text of Section 382.003(9), Health and Safety Code, as set out
14-20    in Section 1 of this Act, gives effect to changes made by Chapter
14-21    3, Acts of the 72nd Legislature, 1st Called Session, 1991, and
14-22    Chapter 76, Acts of the 74th Legislature, Regular Session, 1995.
14-23          (b)  To the extent of any conflict, this Act prevails over
14-24    another Act of the 76th Legislature, Regular Session, 1999,
14-25    relating to nonsubstantive additions and corrections in enacted
14-26    codes.
14-27          SECTION 12.  The importance of this legislation and the
 15-1    crowded condition of the calendars in both houses create an
 15-2    emergency and an imperative public necessity that the
 15-3    constitutional rule requiring bills to be read on three several
 15-4    days in each house be suspended, and this rule is hereby suspended,
 15-5    and that this Act take effect and be in force from and after its
 15-6    passage, and it is so enacted.