1712ss09

SUPPORTING STATEMENT

ENVIRONMENTAL PROTECTION AGENCY

NESHAP for Shipbuilding and Ship Repair Facilities - Surface Coating (40 CFR Part 63, Subpart II) (Renewal)

1. Identification of the Information Collection

1(a) Title of the Information Collection

NESHAP for Shipbuilding and Ship Repair Facilities - Surface Coating (40 CFR Part 63, Subpart II) (Renewal), EPA ICR Number 1712.09, OMB Control Number 2060-0330.

1(b) Short Characterization/Abstract

The National Emission Standards for Hazardous Air Pollutants (NESHAP) for Shipbuilding and Ship Repair Facilities - Surface Coating were proposed on December 6, 1994 and promulgated on December 15, 1995. This standard was most recently amended on November 21, 2011; this amendment finalized the residual risk and technology review by re-adopting existing MACT standards, eliminated the startup, shutdown, and malfunction (SSM) exemption, removed SSM plan requirement, and revised SSM-associated recordkeeping and reporting requirements for periods of malfunctions. The shipbuilding and ship repair industry consists of establishments that build, repair, repaint, convert and alter ships which are marine or fresh-water vessels used for military or commercial operations. These regulations apply to only the shipbuilding and repair surface coating operations that occur at facilities that are major sources of hazardous air pollutants (HAPs). New facilities include those that commenced construction or reconstruction after the date of proposal. This information is being collected to assure compliance with 40 CFR Part 63, Subpart II.

In general, all NESHAP standards require initial notifications, performance tests, and periodic reports by the owners/operators of the affected facilities. They are also required to maintain records of the occurrence and duration of any startup, shutdown, or malfunction in the operation of an affected facility, or any period during which the monitoring system is inoperative. These notifications, reports, and records are essential in determining compliance, and are required of all affected facilities subject to NESHAP.

Any owner/operator subject to the provisions of this part shall maintain a file of these measurements, and retain the file for at least five years following the date of such measurements, maintenance reports, and records. All reports are sent to the delegated state or local authority. In the event that there is no such delegated authority, the reports are sent directly to the United States Environmental Protection Agency (EPA) regional office.

Over the next three years, an average of 56 respondents per year will be subject to the standard, and no additional respondents per year will become subject to the standard.

The previous ICR had the following Terms of Clearance (TOC):

In accordance with 5 CFR 1320, the information collection is approved for 3 years. Upon resubmission, the agency should continue to assess the actual burden imposed by the collection relative to the agency's estimated burden. Also, the agency should briefly summarize in the supporting statement public comments received and responses to the information collection in addition to providing a link to the rulemaking docket. Finally, the agency shall update labor cost estimates with the most recent available labor cost reference (it is noted that though submitted in late 2011, this collection utilized 2002 data).

The EPA has addressed each item of concern in the TOC by consulting with industry, indentifying and addressing any comments received, and updating labor rates used in the burden calculations. EPA did not receive any public comments associated with this ICR renewal.

The burden to the “Affected Public” may be found in Table 1: Annual Respondent Burden and Cost – NESHAP for Shipbuilding and Ship Repair Facilities - Surface Coating (40 CFR Part 63, Subpart II) (Renewal). The “Federal Government” burden is attributed entirely to work performed by federal employees or government contractors and may be found in Table 2: Average Annual EPA Burden and Cost – NESHAP for Shipbuilding and Ship Repair Facilities - Surface Coating (40 CFR Part 63, Subpart II) (Renewal).

2. Need for and Use of the Collection

2(a) Need/Authority for the Collection

The EPA is charged under Section 112 of the Clean Air Act, as amended, to establish standards of performance for each category or subcategory of major sources and area sources of hazardous air pollutants. These standards are applicable to new or existing sources of hazardous air pollutants and shall require the maximum degree of emission reduction. In addition, section 114(a) states that the Administrator may require any owner/operator subject to any requirement of this Act to:

(A) Establish and maintain such records; (B) make such reports; (C) install, use, and maintain such monitoring equipment, and use such audit procedures, or methods; (D) sample such emissions (in accordance with such procedures or methods, at such locations, at such intervals, during such periods, and in such manner as the Administrator shall prescribe); (E) keep records on control equipment parameters, production variables or other indirect data when direct monitoring of emissions is impractical; (F) submit compliance certifications in accordance with Section 114(a)(3); and (G) provide such other information as the Administrator may reasonably require.

In the Administrator's judgment, HAP emissions from surface coating operations at shipbuilding and repair facilities cause or contribute to air pollution that may reasonably be anticipated to endanger public health or welfare. Therefore, the NESHAP were promulgated for this source category at 40 CFR Part 63, Subpart II.

2(b) Practical Utility/Users of the Data

The recordkeeping and reporting requirements in the standard ensure compliance with the applicable regulations which were promulgated in accordance with the Clean Air Act. The collected information is also used for targeting inspections and as evidence in legal proceedings.

Performance tests are required in order to determine an affected facility’s initial capability to comply with the emission standard. Continuous emission monitors are used to ensure compliance with the standard at all times. During the performance test a record of the operating parameters under which compliance was achieved may be recorded and used to determine compliance in place of a continuous emission monitor.

The notifications required in the standard are used to inform the Agency or delegated authority when a source becomes subject to the requirements of the regulations. The reviewing authority may then inspect the source to check if the pollution control devices are properly installed and operated, leaks are being detected and repaired, and the standard is being met. The performance test may also be observed.

The required semiannual reports are used to determine periods of excess emissions, identify problems at the facility, verify operation/maintenance procedures and for compliance determinations.

3. Nonduplication, Consultations, and Other Collection Criteria

3(a) Nonduplication

If the subject standards have not been delegated, the information is sent directly to the appropriate EPA regional office. Otherwise, the information is sent directly to the delegated state or local agency. If a state or local agency has adopted its own similar standards to implement the Federal standards, a copy of the report submitted to the state or local agency can be sent to the Administrator in lieu of the report required by the Federal standards. Therefore, no duplication exists.

3(b) Public Notice Required Prior to ICR Submission to OMB

An announcement of a public comment period for the renewal of this ICR was published in the Federal Register (79 FR 30117) on May 27, 2014. No comments were received on the burden published in the Federal Register.

3(c) Consultations

The Agency’s industry experts have been consulted, and the Agency’s internal data sources and projections of industry growth over the next three years have been considered. The primary source of information as reported by industry, in compliance with the recordkeeping and reporting provisions in the standard, is the Online Tracking Information System (OTIS) which is operated and maintained by the EPA Office of Compliance. OTIS is the EPA database for the collection, maintenance, and retrieval of all compliance data. The growth rate for the industry is based on our consultations with the Agency’s internal industry experts.

Industry trade associations and other interested parties were provided an opportunity to comment on the burden associated with the standard as it was being developed. In developing this ICR, we contacted both BAE Systems Ship Repair at (757) 419-9615 and Northrop Grumman Corporation at (703) 280-2900.

It is our policy to respond after a thorough review of comments received since the last ICR renewal as well as those submitted in response to the first Federal Register notice. In this case, no comments were received.

3(d) Effects of Less Frequent Collection

Less frequent information collection would decrease the margin of assurance that facilities are continuing to meet the standards. Requirements for information gathering and recordkeeping are useful techniques to ensure that good operation and maintenance practices are applied and emission limitations are met. If the information required by these standards was collected less frequently, the proper operation and maintenance of control equipment and the possibility of detecting violations would be less likely.

3(e) General Guidelines

These reporting or recordkeeping requirements do not violate any of the regulations promulgated by OMB under 5 CFR Part 1320, Section 1320.5.

These standards require the respondents to maintain all records, including reports and notifications for at least five years. This is consistent with the General Provisions as applied to the standards. EPA believes that the five year records retention requirement is consistent with the Part 70 permit program and the five year statute of limitations on which the permit program is based. The retention of records for five years allows EPA to establish the compliance history of a source, any pattern of non-compliance and to determine the appropriate level of enforcement action. EPA has found that the most flagrant violators have violations extending beyond five years. In addition, EPA would be prevented from pursuing the violators due to the destruction or nonexistence of essential records.

3(f) Confidentiality

Any information submitted to the Agency for which a claim of confidentiality is made will be safeguarded according to the Agency policies set forth in Title 40, chapter 1, part 2, subpart B - Confidentiality of Business Information (see 40 CFR 2; 41 FR 36902, September 1, 1976; amended by 43 FR 40000, September 8, 1978; 43 FR 42251, September 20, 1978; 44 FR 17674, March 23, 1979).

3(g) Sensitive Questions

The reporting or recordkeeping requirements in the standard do not include sensitive questions.

4. The Respondents and the Information Requested

4(a) Respondents/SIC Codes

The respondents to the recordkeeping and reporting requirements are shipbuilding and repair facilities. The United States Standard Industrial Classification (SIC) code for the respondents affected by the standards is SIC 3731, which corresponds to the North American Industry Classification System (NAICS) code 336611 for Ship Building and Repairing.

4(b) Information Requested

(i) Data Items

In this ICR, all the data that is recorded or reported is required by the NESHAP for Shipbuilding and Ship Repair Facilities - Surface Coating (40 CFR Part 63, Subpart II).

A source must make the following reports:

Notifications
Construction/reconstruction	63.5
Initial notifications	63.9(b), 63.787(a)
Report of performance test results	63.10(d)(2), 63.788(a)
Initial performance test	63.7(b), 63.9(e)
Rescheduled initial performance test	63.7(b)(2)
Continuous monitoring system notifications	63.9(g)
Request for extension of compliance, adjustments in time periods, and changes in information	63.9(c), (i), and (j), 63.787(a)
Special compliance requirements	63.9(d), 63.787(a)
Compliance status	63.9(h)
Opacity or visible emissions	63.10(d)(3), 63.788(a)
Startup, shutdown, malfunction reports	63.10(d)(5), 63.788(a)
Progress reports	63.10(d)(4), 63.788(a)
Additional reports for sources with continuous monitoring systems	63.10(e), 63.788(a)
Implementation plan	63.787(b)
Semiannual report of coating and thinner usage	63.788(c)
Request for waiver of recordkeeping or reporting requirements	63.10(f), 63.788(a)

A source must keep the following records:

Recordkeeping
Startups, shutdowns, malfunctions, periods where the continuous monitoring system is inoperative	63.10(b)(2), 63.788(a)
All reports and notifications	63.10(a), 63.10(b), 63.788(a), 63.788(b)
Record of applicability	63.10(b)(3), 63.788(a)
Records for sources with continuous monitoring systems	63.10(c), 63.788(a)
Records of coating applied	63.788(b)(1)
Records related to initial notification and implementation plan	63.788(b)(2)
Records related to coatings and containers used	63.788(b)(2)
Records related to coatings and thinners used	63.788(b)(3)
Records are required to be retained for five years. The first 2 years of records must be retained at the facility.	63.788(b)

Electronic Reporting

This collection does not make use of automated, mechanical, or other technical collection techniques. Respondents will most likely submit hard copy reports, although some may submit electronic versions. The rule allows records to be maintained in hard copy or electronic format to allow flexibility and minimize burden.

(ii) Respondent Activities

Respondent Activities

Read instructions.

Install, calibrate, maintain, and operate CMS for opacity, or for pressure drop and liquid supply pressure for control device, if approved and used.

Perform initial performance test, Reference Method 24 test, and repeat performance tests if necessary.

Write the notifications and reports listed above.

Enter information required to be recorded above.

Submit the required reports developing, acquiring, installing, and utilizing technology and systems for the purpose of collecting, validating, and verifying information.

Develop, acquire, install, and utilize technology and systems for the purpose of processing and maintaining information.

Develop, acquire, install, and utilize technology and systems for the purpose of disclosing and providing information.

Train personnel to be able to respond to a collection of information.

Transmit, or otherwise disclose the information.

5. The Information Collected: Agency Activities, Collection Methodology, and Information Management

5(a) Agency Activities

EPA conducts the following activities in connection with the acquisition, analysis, storage, and distribution of the required information.

Agency Activities

Review notifications and reports, including performance test reports, and excess emissions reports, required to be submitted by industry.

Audit facility records.

Input, analyze, and maintain data in the Online Tracking Information System (OTIS).

5(b) Collection Methodology and Management

Following notification of startup, the reviewing authority could inspect the source to determine whether the pollution control devices are properly installed and operated. Performance test reports are used by the Agency to discern a source’s initial capability to comply with the emission standard, and to note the operating conditions under which compliance was achieved. Data and records maintained by the respondents are tabulated and published for use in compliance and enforcement programs. The semiannual reports are used for problem identification, as a check on source operation and maintenance, and for compliance determinations.

Information contained in the reports is entered into OTIS which is operated and maintained by EPA's Office of Compliance. OTIS is EPA’s database for the collection, maintenance, and retrieval of compliance data for approximately 125,000 industrial and government-owned facilities. EPA uses the OTIS for tracking air pollution compliance and enforcement by local and state regulatory agencies, EPA regional offices and EPA headquarters. EPA and its delegated Authorities can edit, store, retrieve and analyze the data.

The records required by this regulation must be retained by the owner/operator for five years.

5(c) Small Entity Flexibility

The recordkeeping and reporting requirements were selected within the context of this specific subpart and the specific process equipment and pollutants. The requirements reflect the burden on small businesses. To the extent that larger businesses can use economies of scale to reduce their burden, the overall burden will be reduced. Although the recordkeeping and reporting requirements are the same for small and larger businesses, the Agency considers these requirements the minimum needed to ensure compliance and, therefore, cannot reduce them further for small businesses. However, there is a “low usage” exemption, which may reduce the recordkeeping and reporting burden for some small businesses. This “low usage” exemption stipulates that the provisions of the regulation do not apply to coatings used in volumes of less than 200 liters per year.

5(d) Collection Schedule

The specific frequency for each information collection activity within this request is shown in below Table 1: Annual Respondent Burden and Cost – NESHAP for Shipbuilding and Ship Repair Facilities - Surface Coating (40 CFR Part 63, Subpart II) (Renewal).

6. Estimating the Burden and Cost of the Collection

Table 1 documents the computation of individual burdens for the recordkeeping and reporting requirements applicable to the industry for the subpart included in this ICR. The individual burdens are expressed under standardized headings believed to be consistent with the concept of burden under the Paperwork Reduction Act. Where appropriate, specific tasks and major assumptions have been identified. Responses to this information collection are mandatory.

6(a) Estimating Respondent Burden

The average annual burden to industry over the next three years from these recordkeeping and reporting requirements is estimated to be 28,594 (Total Labor Hours from Table 1). These hours are based on Agency studies and background documents from the development of the regulation, Agency knowledge and experience with the NESHAP program, the previously approved ICR, and any comments received.

6(b) Estimating Respondent Costs

(i) Estimating Labor Costs

This ICR uses the following labor rates:

Managerial $128.02 ($60.98 + 110%)

Technical $101.05 ($48.12 + 110%)

Clerical $51.37 ($24.46 + 110%)

These rates are from the United States Department of Labor, Bureau of Labor Statistics, March 2014, “Table 2. Civilian Workers, by occupational and industry group.” The rates are from column 1, “Total compensation.” The rates have been increased by 110 percent to account for the benefit packages available to those employed by private industry.

(ii) Estimating Capital/Startup and Operation and Maintenance Costs

The only costs to the regulated industry resulting from information collection activities required by the subject standard are labor costs. There are no capital/startup or operation and maintenance costs.

(iii) Capital/Startup vs. Operation and Maintenance (O&M) Costs

The only type of industry costs associated with the information collection activity in the regulations is labor costs. There are no capital/startup or operation and maintenance costs.

6(c) Estimating Agency Burden and Cost

The only costs to the Agency are those costs associated with analysis of the reported information. EPA's overall compliance and enforcement program includes activities such as the examination of records maintained by the respondents, periodic inspection of sources of emissions, and the publication and distribution of collected information.

The average annual Agency cost during the three years of the ICR is estimated to be $11,724.

This cost is based on the average hourly labor rate as follows:

Managerial $62.90 (GS-13, Step 5, $39.31 + 60%)

Technical $46.67 (GS-12, Step 1, $29.17 + 60%)

Clerical $25.25 (GS-6, Step 3, $15.78 + 60%)

These rates are from the Office of Personnel Management (OPM), 2014 General Schedule, which excludes locality rates of pay. The rates have been increased by 60 percent to account for the benefit packages available to government employees. Details upon which this estimate is based appear below in Table 2: Average Annual EPA Burden and Cost – NESHAP for Shipbuilding and Ship Repair Facilities - Surface Coating (40 CFR Part 63, Subpart II) (Renewal).

6(d) Estimating the Respondent Universe and Total Burden and Costs

Based on our research for this ICR, on average over the next three years, approximately 56 existing respondents will be subject to the standard. It is estimated that no additional respondents per year will become subject. The overall average number of respondents, as shown in the table below, is 56 per year.

The number of respondents is calculated using the following table that addresses the three years covered by this ICR.

Number of Respondents
	Respondents That Submit Reports		Respondents That Do Not Submit Any Reports
Year	(A) Number of New Respondents 1	(B) Number of Existing Respondents	(C) Number of Existing Respondents that keep records but do not submit reports	(D) Number of Existing Respondents That Are Also New Respondents	(E) Number of Respondents (E=A+B+C-D)
1	0	56	0	0	56
2	0	56	0	0	56
3	0	56	0	0	56
Average	0	56	0	0	56

¹ New respondents include sources with constructed, reconstructed and modified affected facilities.

Column D is subtracted to avoid double-counting respondents. As shown above, the average Number of Respondents over the three year period of this ICR is 56.

The total number of annual responses per year is calculated using the following table:

Total Annual Responses
(A) Information Collection Activity	(B) Number of Respondents	(C) Number of Responses	(D) Number of Existing Respondents That Keep Records But Do Not Submit Reports	(E) Total Annual Responses E=(BxC)+D
Semiannual Report/Notification	56	2	0	112

The number of Total Annual Responses is 112.

The total annual labor costs are $2,799,388. Details regarding these estimates may be found below in Table 1: Annual Respondent Burden and Cost – NESHAP for Shipbuilding and Ship Repair Facilities - Surface Coating (40 CFR Part 63, Subpart II) (Renewal).

6(e) Bottom Line Burden Hours and Cost Tables

The detailed bottom line burden hours and cost calculations for the respondents and the Agency are shown in Tables 1 and 2, respectively, and summarized below.

(i) Respondent Tally

The total annual labor hours are 28,594. Details regarding these estimates may be found in Table 1: Annual Respondent Burden and Cost – NESHAP for Shipbuilding and Ship Repair Facilities - Surface Coating (40 CFR Part 63, Subpart II) (Renewal).

Furthermore, the annual public reporting and recordkeeping burden for this collection of information is estimated to average 255 hours per response.

The total annual capital/startup and O&M costs to the regulated entity are $0. The cost calculations are detailed in Section 6(b)(iii), Capital/Startup vs. Operation and Maintenance (O&M) Costs.

(ii) The Agency Tally

The average annual Agency burden and cost over next three years is estimated to be 258 labor hours at a cost of $11,724. See Table 2: Average Annual EPA Burden and Cost – NESHAP for Shipbuilding and Ship Repair Facilities - Surface Coating (40 CFR Part 63, Subpart II) (Renewal).

6(f) Reasons for Change in Burden

There is an increase of $1,059,007.46 in respondent burden costs from the most recently approved ICR. This is due to an adjustment in the labor rates and an adjustment in the burden calculation method. The previous ICR did not estimate management and clerical burden hours, which were added to this ICR to maintain consistency in burden calculation methodology.

6(g) Burden Statement

The annual public reporting and recordkeeping burden for this collection of information is estimated to average 255 hours per response. Burden means the total time, effort, or financial resources expended by persons to generate, maintain, retain, or disclose or provide information to or for a Federal agency. This includes the time needed to review instructions; develop, acquire, install, and utilize technology and systems for the purposes of collecting, validating, and verifying information, processing and maintaining information, and disclosing and providing information; adjust the existing ways to comply with any previously applicable instructions and requirements; train personnel to be able to respond to a collection of information; search data sources; complete and review the collection of information; and transmit or otherwise disclose the information.

An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless it displays a valid OMB Control Number. The OMB Control Numbers for EPA regulations are listed at 40 CFR Part 9 and 48 CFR Chapter 15.

To comment on the Agency's need for this information, the accuracy of the provided burden estimates, and any suggested methods for minimizing respondent burden, including the use of automated collection techniques, EPA has established a public docket for this ICR under Docket ID Number EPA-HQ-OECA-2014-0056. An electronic version of the public docket is available at http://www.regulations.gov/ which may be used to obtain a copy of the draft collection of information, submit or view public comments, access the index listing of the contents of the docket, and to access those documents in the public docket that are available electronically. When in the system, select “search,” then key in the docket ID number identified in this document. The documents are also available for public viewing at the Enforcement and Compliance Docket and Information Center in the EPA Docket Center (EPA/DC), EPA West, Room 3334, 1301 Constitution Ave., NW, Washington, DC. The EPA Docket Center Public Reading Room is open from 8:30 a.m. to 4:30 p.m., Monday through Friday, excluding legal holidays. The telephone number for the Reading Room is (202) 566-1744, and the telephone number for the docket center is (202) 566-1927. Also, you can send comments to the Office of Information and Regulatory Affairs, Office of Management and Budget, 725 17th Street, NW, Washington, DC 20503, Attention: Desk Officer for EPA. Please include the EPA Docket ID Number EPA-HQ-OECA-2014-0056 and OMB Control Number 2060-0330 in any correspondence.

Part B of the Supporting Statement

This part is not applicable because no statistical methods were used in collecting this information.

Table 1: Annual Respondent Burden and Cost – NESHAP for Shipbuilding and Ship Repair Facilities - Surface Coating (40 CFR Part 63, Subpart II) (Renewal)

Burden item	(A) Person hours per occurrence	(B) No. of occurrences per respondent per year	(C) Person hours per respondent per year (C=AxB)	(D) Respondents per year a	(E) Technical person- hours per year (E=CxD)	(F) Management person hours per year (Ex0.05)	(G) Clerical person hours per year (Ex0.1)	(H) Total Cost per year b
1. Applications	N/A
2. Survey and Studies	N/A
3. Reporting Requirements
a. Read Instructions	1	1	1	0	0	0	0	$0
b. Required Activities	See 3e
c. Create Information	See 3e
d. Gather Existing Information	See 3e
e. Write Report
Notification of Construction/Reconstruction	2	1	2	0	0	0	0	$0
Notification of Demonstration of CMS	N/A
Report of Performance Test	N/A
Initial Notification and Implementation	14	1	14	0	0	0	0	$0
Semiannual Notification	8	2	16	56	896	44.8	89.6	$100,878.85
Subtotal for Reporting Requirements					1,030.4			$100,878.85
4. Recordkeeping Requirements
a. Read Instructions	See 3a
b. Plan Activities	N/A
c. Implement Activities	8	50	400	56	22,400	1,120	2,240	$2,521,971.20
d. Develop Record System	8	1	8	0	0	0	0	$0
e. Train Personnel	28	1	28	56	1,568	78.4	156.8	$176,537.98
g. Audits	N/A
Subtotal for Recordkeeping Requirements					27,563.2			$2,698,509.18
TOTAL ANNUAL BURDEN (rounded)					28,594			$2,799,388

Assumptions:

^a Number of affected facilities per year is 56.

^b Costs assume a rate of $101.05 for technical, $128.02 for management, and $51.37 for clerical.

Table 2: Average Annual EPA Burden and Cost – NESHAP for Shipbuilding and Ship Repair Facilities - Surface Coating (40 CFR Part 63, Subpart II) (Renewal)

Activity	(A) EPA person-hours per occurrence	(B) No. of occurrences per plant per year	(C) EPA person hours per plant per year (AxB)	(D) Plants per year a	(E) Technical person-hours per year (CxD)	(F) Management person-hours per year (Ex0.05)	(G) Clerical person-hours per year (Ex0.1)	(H) Cost, $ b
INITIAL PERFORMANCE TESTS	N/A
REPEAT PERFORMANCE TEST	N/A
REPORT REVIEW
Notification of Construction	2	1	2	0	0	0	0	$0
Review of Initial Notification and Implementation Plan	2	1	2	0	0	0	0	$0
Review of Semiannual/Notification of Compliance Status	2	2	4	56	224	11.2	22.4	$11,724.16
TOTAL ANNUAL HOURS (rounded)					258			$11,724

Assumptions:

^a Number of affected facilities per year is 56.

^b Costs assume a rate of $46.67 for technical, $62.90 for management, and $25.25 for clerical.