PAV It6e. iENV17-022 cG0t SLO COUNTY] | Air Pollution Control District EGEIVE apc | San Luis Obispo County APR 132017 CERTIFIED MAIL April 7, 2017 S. Heath Wanamaker Refinery Manager Phillips 66 2555 Willow Road ‘Arroyo Grande, CA 93420 SUBJECT: San Luis Obispo County Air Pollution Control District Notice of Violation Number 2943 Dear Mr, Wanamaker: (On May 10, 2016, you were issued a Notice of Violation (copy enclosed) for violations of California Health and Safety Code and the Rules and Regulations of the San Luis Obispo County Air Pollution Control District (District). The violations occurred at 2555 Willow Road in Arroyo Grande. RULE 206 - CONDITIONAL APPROVAL ‘+ Equipment shall be operated consistent with the information provided in the application under which this permit, or previous versions of this permit, and all previous permits issued for this equipment were issued and shall be maintained on-line and in good working order at all times during the operation of their respective process, and in such a manner as to minimize the emission of air contaminants. [SIP Rule 201] ‘+ The APCO shall be notified, in writing, before any changes are made in the design, construction, or method of operation of this equipment, or any modifications are ‘made to process conditions that might increase the emission of air contaminants in excess of existing permit limits, for those emission unit and pollutant combinations with such limits, or those that might increase the potential to emit any air contaminant, for those emission unit and pollutant combinations without current limits. [SIP Rule 201] In this instance, modifications and additions were made to the existing piping to enable tanker truck deliveries of crude oil directly to the refinery and such deliveries were then initiated. The additional equipment installed and initiation of crude oil delivery to the refinery by tanker truck represents a significant change in operations. No notification was given to the District regarding this change and no application for an Authority to Construct + 805.781.5912» 805.781.1002 wslocleansirorg 3433 Roberta Cour, San Luls Obispo, CA 93401Phillips 66 Notice of Violation Number 2943, April 7, 2017 Poge 2 of 3 or Permit to Operate was submitted by Philips 66 until specifically requested by the District upon learning of this new operation. For this level of infraction, California Health and Safety Code Section 42402.b and federal EPA guidelines specify a civil penalty of up to $10,000.00 per day for each day of violation. Under the California Health and Safety Code, the maximum civil penalty for the violations noted above, which occurred for sixty-one (61) days, is significant. The above violations also carry additional requirements to ensure compliance with District rules and regulations and the conditions of your Permit to Operate. In determining the amount of penalty appropriate to this specific case, several factors required by the Health and Safety Code were taken into consideration. These factors include, but are not limited to, the severity and duration of the violation, the frequency of past violations, the degree and speed of corrective action, if any, taken by the violator, and the economic benefit if any, gained as a result of the violation. ‘After reviewing the information available in this matter, the Air Pollution Control District is willing to settle the violation on conditions set forth below: 1, Payment of a civil penalty in the sum of $15,914.44 to the District. 2. Asa Supplemental Environmental Project, deliver a portable solar powered trailer to the District by July 1, 2017 to help support the use of a mobile air monitoring station for performing supplemental air quality monitoring in local communities on the Nipomo Mesa and throughout the region. The trailer shall include all equipment and include a warranty as described in the Mobile Solar quote number 596 dated March 15, 2017. This quote is included as Attachment A. Phillips 66 shall provide the District clear title to the trailer and equipment. 3. Release of the alleged violator(s) from any and all claims for civil or criminal penalties arising out of the incident referred to in the above Notice of Violation. The District reserves the right to rely upon the alleged violation and may offer proof thereof in connection with any petition for a variance, permit revocation, or abatement order before the District Hearing Board or in connection with the determination of the appropriate penalty, in the event similar notices of violation are issued in the future. 4, The settlement shall not constitute an admission of liability nor shall any such admission be inferred in any administrative or judicial proceeding. 5. Phillips 66 will take the following corrective action and observe the following conditions: + All operation of the Temporary Crude Oil Offloading Operation at the Displacement Meters Station shall be conducted in compliance with San Luis Obispo County Air Pollution Control District Start-Up Authorization Number 6384 issued on May 23, 2016 and any subsequent District issued extensions.Phillips 66 ‘Notice of Violation Number 2943, April 7, 2017 Poge 3 of 3. Please sign below your acknowledgment of the settlement as set forth in this letter and return it with the civil penalty of $15,914.44 by June 15, 2017. Upon receipt of said amount, the signed settlement acknowledgment, and completion of any conditions required as part of this settlement, you will be released from liability under the terms as set forth above. If this settlement is not accepted, or if alternate arrangements have not been made with the District within the time period set forth above, the offer will be revoked and the violation will be referred to our enforcement section or legal counsel for further prosecution. Please call Gary Willey or Mark Elliott at 781-5912 if you have any questions or need additional information regarding this matter. Very truly yours, LARRY R. ALLEN Air Pollution Control Officer The foregoing terms and conditions of mutual settlement are hereby agreed and accepted. pater: L1/ 2007S. Wea Nyy S. Heath Wanamaker, Phillips 66 Santa Maria Refinery LRA/MFE/Img Enclosures: NOV Number 2943 cc: Raymond A. Biering, District Counsel aoiseNroRCEWsL45 182 SEPM soce