p-ear2-65b

STATE OF MINNESOTA MINNESOTA POLLUTION CONTROL AGENCY

IN THE MATTER OF THE DECISION ON THE NEED FOR AN ENVIRONMENTAL IMPACT STATEMENT FOR THE PROPOSED FLINT HILLS RESOURCES – TIER 3 CLEAN FUELS PROJECTS CITY OF ROSEMOUNT DAKOTA COUNTY, MINNESOTA

FINDINGS OF FACT CONCLUSIONS OF LAW AND ORDER

FINDINGS OF FACT

Pursuant to Minn. ch. 4410, the Minnesota Pollution Control Agency (MPCA) staff prepared and distributed an Environmental Assessment Worksheet (EAW) for the proposed Flint Hills Resources – Tier 3 Clean Fuels Projects. Based on the MPCA staff environmental review, the EAW, comments and information received during the comment period, and other information in the record of the MPCA, the MPCA hereby makes the following Findings of Fact, Conclusions of Law, and Order.

Projects Description

1. The Flint Hills Resources (FHR) Pine Bend Refinery (Refinery) is located at the intersection of StateHighway 55 and U.S. Highway 52 in the city of Rosemount, Dakota County, Minnesota.

2. The Tier 3 Clean Fuels Projects (Projects) involve refinery changes to meet the requirements of theU. S. Environmental Protection Agency (EPA) Tier 3 gasoline sulfur standard, which targetsimprovements in ambient air quality. In order to produce gasoline meeting the Tier 3 standard, theRefinery must remove and recover more sulfur from fuel blends, increasing hydrotreating (aprocess that removes sulfur).

3. FHR also proposes to install a process to convert recovered gas containing sulfur and nitrogen into asalable aqueous liquid fertilizer, ammonium thiosulfate (ATS).

4. FHR is proposing to improve the refinery’s sour water skimming and storage. Sour water is processwater containing sulfur and nitrogen compounds that is skimmed, stripped, and re-used within theRefinery.

5. Lastly, FHR is proposing to switch to a more efficient amine solution, from monoethanolamine(MEA) to diglycolamine (DGA), in the existing amine units. The amine solution is used to captureand transfer hydrogen sulfide (H2S) from the gas oil hydrotreaters and other process units, whichreduces sulfur in Refinery waste gas and other Refinery process streams. DGA has beendemonstrated to be more effective in recovering H2S and other reduced sulfur compounds.

TDD (for hearing and speech impaired only): 651-282-5332 Printed on recycled paper containing at least 30% fibers from paper recycled by consumers

On the Need for an Environmental Impact Statement Findings of Fact Flint Hills Resources – Tier 3 Clean Fuels Projects Conclusions of Law Rosemount, Minnesota And Order

Environmental Review of the Projects 6. These Projects will involve the construction of 1,000,000 gallons or more of hazardous materials

storage. Therefore, Minn. R. 4410.4300, subp. 10(B) requires the preparation of an EAW. The MPCA is the responsible governmental unit (RGU) for preparing the EAW.

7. An EAW is a brief document designed to set out the basic facts necessary to determine whether an

EIS is required for a proposed project or to initiate the scoping process for an EIS. (Minn. R. 4410.0200, subp. 24).

8. The MPCA provided public notice of the Projects as follows:

a) Notice of the availability of the EAW for public comment was published in the EQB Monitor on December 22, 2014, as required by Minn. R. 4410.1500.

b) The EAW was available for review on the MPCA website at http://www.pca.state.mn.us/news/eaw/index.html.

c) The MPCA provided a news release to media, the Twin Cities metro counties, and other interested parties on Dec 22, 2014.

9. During the 30-day comment period, the MPCA received comment letters from the Army Corps of

Engineers, the Minnesota Department of Transportation, the Metropolitan Council, the City of Rosemount, and Dakota County. A list of the comment letters received and copies of the letters are included as Appendix A to these Findings.

10. The MPCA prepared written responses to the comment letters received during the 30-day public

comment period. The responses to the comments are included as Appendix B to these findings.

Standard for Decision on the Need for an EIS 11. The MPCA shall base its decision on the need for an Environmental Impact Statement (EIS) on the

information gathered during the EAW process and the comments received on the EAW (Minn. R. 4410.1700, subp. 3). The agency must order an EIS for projects that have the potential for significant environmental effects (Minn. R. 4410.1700, subp. 1). In deciding whether a project has the potential for significant environmental effects, the MPCA must compare the impacts that may be reasonably expected to occur from the project with the criteria set forth in Minn. R. 4410.1700, subp. 7. These criteria are:

A. Type, extent, and reversibility of environmental effects; B. Cumulative potential effects. The RGU shall consider the following factors: whether the

cumulative potential effect is significant; whether the contribution from the project is significant when viewed in connection with other contributions to the cumulative potential effect; the degree to which the project complies with approved mitigation measures specifically designed to address the cumulative potential effect; and the efforts of the proposer to minimize the contributions from the project;

2

On the Need for an Environmental Impact Statement Findings of Fact Flint Hills Resources – Tier 3 Clean Fuels Projects Conclusions of Law Rosemount, Minnesota And Order

C. The extent to which the environmental effects are subject to mitigation by ongoing public regulatory authority. The RGU may rely only on mitigation measures that are specific and that can be reasonably expected to effectively mitigate the identified environmental impacts of the project; and

D. The extent to which environmental effects can be anticipated and controlled as a result of other

available environmental studies undertaken by public agencies or the project proposer, including other EISs.

Type, Extent, and Reversibility of Environmental Effects 12. The MPCA finds that the types of impacts that may reasonably be expected to occur from the

Projects include impacts from air emissions. 13. Written comments received during the comment period raised traffic issues, impacts to wetlands

and impacts to on-site wells. 14. The MPCA makes the following findings on the extent and reversibility of impacts that are

reasonably expected to occur from the Projects: Air Emissions

15. Air emissions will be generated from the ammonium thiosulfate (ATS) process unit (EU361), new

components in volatile organic compounds (VOC) service at the ATS process unit (FS140), 26 Unit (EU045/047), 45 Unit (EU111-114), and tank farm, sour water storage tanks (TK586-588), and haul road truck traffic (IA060).

16. An air quality modeling analysis was performed on the Projects and reviewed by the MPCA during

its review of FHR’s application for an air emissions permit amendment. The proposed Projects will be governed by an air emissions permit.

17. The air emissions permit for the Projects will include air emissions limits and a requirement to

operate air pollution control equipment (i.e., a demister system for the ATS process unit). The air emissions permit will also require FHR to implement a leak detection and repair (LDAR) program to minimize fugitive emissions from the Projects (i.e., new components in VOC service at the ATS process unit, 26 unit, 45 unit, and tank farm). Fugitive dust emissions from the haul road and truck traffic will be controlled by paving roads and submitting for MPCA approval a dust management plan within 60 days of permit issuance.

18. The Refinery is an existing major source under Title V (Part 70) of the federal Clean Air Act

Amendments because the facility-wide potential to emit (PTE) is currently above major source thresholds (i.e., 100 tons per year (TPY)) for several criteria pollutants. The air emissions from the proposed Projects alone would be below Title V thresholds. The proposed Projects will not change the status of the Refinery as a major source under Title V.

3

On the Need for an Environmental Impact Statement Findings of Fact Flint Hills Resources – Tier 3 Clean Fuels Projects Conclusions of Law Rosemount, Minnesota And Order 19. The Refinery is an existing major source under the federal Prevention of Significant Deterioration

(PSD) Program (40 CFR 52.21) because the facility-wide PTE is greater than the PSD threshold for several criteria pollutants. The proposed Projects will not change the status of the Refinery as a major source under PSD.

20. The Refinery is an existing major source of hazardous air pollutants (HAPs) under the National

Emission Standards for Hazardous Air Pollutants (NESHAP) Program (40 CFR Part 63) because the facility-wide PTE is greater than the NESHAP thresholds (i.e., 10 TPY of any single HAP and 25 TPY of all HAPs combined). The air emissions from the proposed Projects, alone, would be below NESHAP thresholds. The proposed Projects will not change the status of the Refinery as a major source under 40 CFR Part 63.

21. Air dispersion modeling was conducted following an MPCA-approved protocol. The EPA preferred

model, the American Meteorological Society/Environmental Protection Agency Regulatory Model Improvement Committee’s Dispersion Model (AERMOD) was used to conduct the analysis. Worst-case hourly emissions from both the CHP Project and the Tier 3 Projects were included. Also worst-case stack temperatures were input to the model, along with actual local geography.

22. Modeling results were compared to Significant Impact Levels (SILs), provided by the EPA. As long as

representative ambient background concentrations are more than a SIL below the NAAQS, the SIL thresholds can be used to determine whether a source could cause or contribute to a violation of the NAAQS, i.e. a significant deterioration of air quality. The SIL analysis was valid in this case as representative background concentrations were more than a SIL below the NAAQS for all pollutants. The results of the air quality modeling demonstrate that the total ambient pollutant concentrations of the CHP Project and Tier 3 Projects combined are below the EPA Significant Impact Levels (SILs) for each criteria pollutant.

23. Results show the CHP Projects and the Tier 3 projects are not expected to produce a significant

deterioration of air quality. If any of the analysis conducted as part of these projects modeled a pollutant concentration greater than the SILs, the MPCA would have requested additional refined analysis.

24. With respect to the reversibility of air quality impacts that are reasonably expected to occur from the

Projects, air emissions from the Projects will continue while the equipment remains in operation, and would cease only if the equipment were to be temporarily or permanently closed. While in operation, the Projects are expected to meet applicable air quality standards and criteria. If excessive air emissions or violations of the ambient air standards were to occur, air quality impacts are likely to be temporary in nature and corrective measures could be implemented. Such measures could include the initiation of a complaint investigation by the MPCA and requiring the Project proposer to make operation and maintenance changes.

25. The MPCA finds that information presented in the EAW and other information in the environmental

review record are adequate to address the concerns related to air emissions. The impacts on air emissions that are reasonably expected to occur from the proposed Projects have been considered during the review process and appropriate mitigation measures are available and will be required to prevent significant adverse impacts.

4

On the Need for an Environmental Impact Statement Findings of Fact Flint Hills Resources – Tier 3 Clean Fuels Projects Conclusions of Law Rosemount, Minnesota And Order 26. The MPCA finds that the Projects, as they are proposed, do not have the potential for significant

environmental effects based on the type, extent, and reversibility of impacts related to air emissions that are reasonably expected to occur from the Projects.

Public Comments on Impacts Related to Traffic.

27. The proposed Projects will result in an increase in construction-related traffic to and from the

Refinery and ATS terminal site for a period of approximately 18 months.

28. FHR expects to hire approximately five new employees to operate the equipment associated with the Projects. FHR anticipates that no additional parking areas will be needed as part of these Projects.

29. During normal operations, truck traffic will be associated with ATS transport offsite. Based on

expected production rates and capacity of truck loading rack operations to accommodate offsite transport of ATS product, the proposed Projects will generate an estimated average of 40 trucks per day during the high volume fertilizer loading season (with the possibility to reach upwards of 60 trucks per day), and an expected average of approximately 2,000 vehicle trips per year. The maximum peak hourly traffic may be up to 8 trucks per hour based upon the physical design of the loading rack.

30. Traffic associated with the operation of the Projects is expected to contribute primarily to traffic on

State Highway 55 and U.S. Highway 52 adjacent to the plant. Average annual daily traffic volume information available for 2012 from the Minnesota Department of Transportation (MnDOT) indicates that the relevant sections of State Highway 55 and U.S. Highway 52 have average daily traffic volumes of 13,300 and 32,500, respectively.

31. FHR submitted a traffic impact study to MnDOT in 2014 to address the new FHR North Facility

Office Building. Additionally, FHR has been developing a long-term traffic plan to optimize traffic flow near the FHR Pine Bend Refinery. FHR will work with MnDOT and other key municipalities on updates to the 2014 study to reflect the scope of regular work activities and proposed projects including the Tier 3 Clean Fuels projects.

32. The MPCA finds that information presented in the EAW and other information in the environmental

review record is adequate to address the concerns related to traffic. The impacts on traffic that are reasonably expected to occur from the proposed Projects have been considered during the review process and methods to prevent significant adverse impacts have been developed.

33. The MPCA finds that the Projects, as proposed, do not have the potential for significant

environmental effects based on the type, extent, and reversibility of impacts related to traffic that are reasonably expected to occur from the Projects.

Public Comments on Impacts Related to Wetland Impacts.

34. There are no National Wetland Inventory (NWI) wetlands in the main refinery area.

5

On the Need for an Environmental Impact Statement Findings of Fact Flint Hills Resources – Tier 3 Clean Fuels Projects Conclusions of Law Rosemount, Minnesota And Order 35. There are NWI wetlands in the area of the ATS Rail Loading Rack, ATS Load In/Out and along the

proposed New Rail Spur. 36. FHR will acquire a Wetland Conservation Act (WCA) permit to address any wetland impacts or

receive a no loss determination. 37. The MPCA finds that information presented in the EAW and other information in the environmental

review record is adequate to address the concerns related to wetlands. The impacts on wetlands that are reasonably expected to occur from the proposed Projects have been considered during the review process and methods to prevent significant adverse impacts have been developed.

38. The MPCA finds that the Projects, as proposed, do not have the potential for significant

environmental effects based on the type, extent, and reversibility of impacts related to wetlands that are reasonably expected to occur from the Projects.

Public Comments on Impacts Related to On-Site Wells. 39. There may be an unused unsealed monitoring well on the west side of Highway 52 near the

underground pipeline. There may be another unused unsealed monitoring well near the rail line carrying the ATS product. A third party contractor will investigate the potential wells, working with Dakota County. If unused unsealed wells are found, they will be properly sealed by a licensed well contractor, brought back into use, or obtain coverage under an annual Unused Well Permit.

40. The MPCA finds that information presented in the EAW and other information in the environmental

review record is adequate to address the concerns related to on-site wells. The impacts to on-site wells that are reasonably expected to occur from the proposed Projects have been considered during the review process and methods to prevent significant adverse impacts have been developed.

41. The MPCA finds that the Projects, as proposed, do not have the potential for significant

environmental effects based on the type, extent, and reversibility of impacts related to on-site wells that are reasonably expected to occur from the Projects.

Cumulative Potential Effects 42. The second criterion that the MPCA must consider when determining if a project has the potential

for significant environmental effects is the “cumulative potential effects.” In making this determination, the MPCA must consider “whether the cumulative potential effect is significant; whether the contribution from the project is significant when viewed in connection with other contributions to the cumulative potential effect; the degree to which the project complies with approved mitigation measures specifically designed to address the cumulative potential effects; and the efforts of the proposer to minimize the contributions from the project.” Minn. R. 4410.1700 subp.7.b. The MPCA findings with respect to this criterion are set forth below.

6

On the Need for an Environmental Impact Statement Findings of Fact Flint Hills Resources – Tier 3 Clean Fuels Projects Conclusions of Law Rosemount, Minnesota And Order 43. The MPCA considered the cumulative potential effects for the proposed Projects on air quality. This

analysis included consideration of background concentrations for the area and the impacts from both the proposed Tier 3 Projects and another proposed project by FHR known as the Combined Heat and Power (CHP) Cogeneration Project, described in Paragraph 43. The EAW makes the following findings on the cumulative potential effects for the proposed Projects on air quality.

44. FHR is also proposing, in addition to the Tier 3 Clean Fuels Projects, to construct a natural gas based

combined heat and power (CHP Project) cogeneration facility, generating up to a net 49.9 megawatts of electricity to reduced electricity purchases from the grid and improve the efficiency of steam production at the Refinery. This proposed CHP Project will be occurring on a similar time frame as the Tier 3 Clean Fuels Projects. Therefore their air emissions impacts are considered cumulatively.

45. The cumulative potential effects on air quality from these Projects were evaluated by considering

background concentrations for the area and the impacts from both the CHP Project and the Tier 3 Clean Fuels Projects. The combined modeled impacts of both projects were equal or less than the applicable SIL and when added to background values, were below the National Ambient Air Quality Standard (NAAQS). This Project will not contribute significantly to adverse cumulative potential effects on air quality.

46. Based on information on the proposed Projects obtained from air modeling, permit application

processes, a site visit by MPCA staff, information presented in the EAW, and in consideration of potential effects due to related or anticipated future projects, the MPCA finds no potential for significant cumulative effects from the Projects.

The Extent to Which the Environmental Effects Are Subject to Mitigation by Ongoing Public Regulatory Authority 47. The third criterion that the MPCA must consider when determining if a project has the potential for

significant environmental effects is "the extent to which the environmental effects are subject to mitigation by ongoing public regulatory authority. The RGU may rely only on mitigation measures that are specific and that can be reasonably expected to effectively mitigate the identified environmental impacts of the project." Minn. R. 4410.1700, subp. 7.C. The MPCA findings with respect to this criterion are set forth below.

48. The following permits or approvals will be required for the Projects:

Unit of Government Type of Application Minnesota Pollution Control Agency (MPCA)

Air Emission Permit National Pollutant Discharge Elimination System (NPDES)/State Disposal System (SDS) Industrial Stormwater Multi-Sector General Permit Construction Stormwater NPDES/SDS Permit Aboveground Storage Tank (AST) Permit

Minnesota Department of Agriculture (MDA)

Agricultural Fertilizer License Bulk Fertilizer Storage Permit

7

On the Need for an Environmental Impact Statement Findings of Fact Flint Hills Resources – Tier 3 Clean Fuels Projects Conclusions of Law Rosemount, Minnesota And Order

Unit of Government Type of Application Minnesota Board of Water and Soil Resources (BWSR)

Wetland Conservation Act (WCA) Permit

Rosemount Fire Marshall Plan Review and Approval City of Rosemount

Building Permit Excavation and Grading Permit Site Plan Review Stormwater Discharge Permit

49. MPCA Air Emissions Permit Amendment. An Air Emissions Permit Amendment to FHR – Pine Bend’s

existing Federal Part 70 permit must be issued before construction can begin. The Air Emission Permit will contain operational and emission limits, including requirements for use of control equipment, that will help prevent or minimize the potential for significant environmental effects.

50. MPCA NPDES/SDS Industrial Stormwater General Permit. FHR has a NPDES/SDS Industrial

Stormwater General Permit for their main refinery site. A separate NPDES/SDS Industrial Stormwater General Permit will be acquired for the ATS Storage Loadout area site. The NPDES/SDS Industrial Stormwater Permit requires that specific conditions be adhered to for the operation of the Projects, and for overall compliance with water quality requirements. FHR will need to update its existing main refinery site Stormwater Pollution Prevention Plan (SWPPP) and develop a separate SWPPP for the ATS Storage Loadout area.

51. MPCA NPDES/SDS Construction Stormwater General Permit. An NPDES/SDS Construction

Stormwater General Permit is required. A General NPDES Construction Stormwater Permit is required when a project disturbs one or more acres. It provides for the use of best management practices (BMPs) such as silt fences, bale checks, and prompt revegetation to prevent eroded sediment from leaving the construction site. FHR must have a SWPPP that will provide more detail as to the BMPs to be implemented and will also address: phased construction; vehicle tracking of sediment; inspection of erosion control measures implemented; and timeframes in which erosion control measures will be implemented. The general permit also requires adequate stormwater treatment capacity be provided to assure that water quality will not be impacted by runoff once the projects are constructed.

52. MPCA Aboveground Storage Tank (AST) Permit. An AST Permit includes operational limits and

construction requirements that help prevent or minimize the potential for significant environmental effects. Requirements include a secondary containment area, routine monitoring for leaks, corrosion protection for the floor of the tank, overfill prevention equipment, and areas where substances are transferred must be equipped with spill containment.

53. Minnesota Department of Agriculture. An agricultural Fertilizer License and a Bulk Fertilizer Storage

Permit will be required. 54. Minnesota Board of Water and Soil Resources. A Wetland Conservation Act (WCA) Permit will

address wetland impacts. 55. Rosemount Fire Marshal. The Rosemount Fire Marshal will need to review and approve the project

plan.

8

On the Need for an Environmental Impact Statement Findings of Fact Flint Hills Resources – Tier 3 Clean Fuels Projects Conclusions of Law Rosemount, Minnesota And Order 56. City of Rosemount. A Building Permit, Excavation and Grading Permit, Site Plan Review will be

required. Additionally, a stormwater discharge permit may be required. These permits or approvals will ensure compliance with local ordinances, zoning, environmental, regulatory, and other requirements that are needed to avoid adverse effects on adjacent land uses.

57. The above-listed permits include general and specific requirements for mitigation of environmental

effects of the Projects. The MPCA finds that the environmental effects of the Projects are subject to mitigation by ongoing public regulatory authority.

The Extent to Which Environmental Effects can be Anticipated and Controlled as a Result of Other Available Environmental Studies Undertaken by Public Agencies or the Project Proposer, Including Other EISs 58. The fourth criterion that the MPCA must consider is “the extent to which environmental effects can

be anticipated and controlled as a result of other available environmental studies undertaken by public agencies or the project proposer, including other EISs,” Minn. R. 4410.1700, subp. 7. D. The MPCA findings with respect to this criterion are set forth below.

59. The following documents were reviewed by MPCA staff as part of the environmental impact

analysis for the proposed Projects: · data presented in the EAW · FHR’s air permit application · air dispersion modeling report

60. This list is not intended to be exhaustive. The MPCA also relies on information provided by the

project proposer, persons commenting on the EAW, staff experience, and other available information obtained by staff.

61. The environmental effects of the projects have been addressed by the design and permit

development processes, and by ensuring conformance with regional and local plans. There are no elements of the Projects that pose the potential for significant environmental effects.

62. Based on the environmental review, previous environmental studies by public agencies or the

project proposer, and staff expertise and experience on similar projects, the MPCA finds that the environmental effects of the Projects that are reasonably expected to occur can be anticipated and controlled.

63. The MPCA adopts the rationale stated in the attached Response to Comments (Appendix B) as the

basis for response to any issues not specifically addressed in these Findings.

9

APPENDIX A

Minnesota Pollution Control Agency

Flint Hills Resources – Tier 3 Clean Fuels Projects Environmental Assessment Worksheet (EAW)

LIST OF COMMENT LETTERS RECEIVED

1. Ryan Malterud, Army Corps of Engineers. Letter received 1/05/2015.

2. Karen Scheffing, Minnesota Department of Transportation. Electronic communication received1/08/2015.

3. LisaBeth Barajas, Metropolitan Council. Letter received 1/20/15.

4. William H. Droste, City of Rosemount. Electronic communication received 1/21/2015.

5. Steve Mielke, Dakota County. Electronic communication received on 1/21/2015.

1

2

3

ROSENIOLINTCOMMUNITY DEVELOPMENT

January 20, 2015

Kim GYOSenheider

Resource Management and rlssistance Division

Minnesota Pollution Control gency520 Lafayette Road North

St. Paul, MN 55155

RE: Flint Hills Resources Tier 3 Clean Fuels Projects Environmental 1 ssessment Worksheet

Dear Ms. Grosenheider:

The purpose of this letter is to submit comments, questions, and responses to the Minnesota

Pollution Control r gency ( PCA) from the City of Rosemount on the Flint Hills Resources ( FHR)Tier 3 Clean Fuels Projects EnviYOnmental r ssessinent Worksheet (Er'. We have reviewed the

E W and appreciate the opportunity to provide feedback. The City of Rosemount' s comments areas follows:

Page 9, Item 8. Permits and approvals needed: The E W does not identif all the Cit of

Rosemount permits and approvals needed. The Tier 3 Clean Fuels project, particulaYly theammonium thiosulfate (ATF) fertilizer terminal at the former Rosemount Clean Energies ( Yocum

Oil) site, will need at least three additional approvals:

L Site Plan Review

2. Wedand Conservation r ct ( WCl) Permit

3. StoYmwateY Discharge Permit

Page 14, Item 11. a. i. Surface water—wetlands: " I'he EAW stated that the projects do not

coincide with any National Wedand Inventory (NWI) wedands. This statement is coYYect for theTier 3 1 uels projects occurring within the refinery property located vest of US Highway 52, butthere are NWI wedands in the vicinity of the New Rail Loading Rack and Planned r1TS RR LoadIn/ Out Containment at the former Yocum Oil site and there are NWI wedand along the proposedNe v Rail Spur. r WCr permit will be required to be submitted and approved either before or

concuYrendy with the Site Plan Revie v to address any vedand 'unpacts or receive a no lossdetermination.

Page 16, Item 11. B, i. Watsewater: The Er1W states that the sanitary wastewateY will sent to theCity of Rosemount' s publicly owned treatment works ( PO7. This is incorrect. The sanitarywastewateY will be sent to tihe Einpire Wastewater TYeatment Plant operated by the MetropolitanCouncil.

Page 17, Item 11. B. ii. Stormwater: The former Yocum Oil site is not a part of the FHR

Stormwater Pollution Prevention Plan (SWPPP). riny xedevelopment of the former Yocum Oil sitewill need to receive a stormwater dischaYge permit and comply vith Rosemount Surface WaterManagement Plan and other applicable City regulations.

SPIRIT OF PR/ DE1AND PROGRE55

Rosemount City Hall • 2875 145th Street West • Rosemount, MN 55068- 4997651 - 423- 441 1 • TDD/ TTY 651 - 423- 621 9 • Fax 651 - 423- 5203

www. ci. rosemount. mn. us

4

Page 19, Item 11. B. iv. a) Surface Water Wetlands: The EAW states that the projects will not

involve an physical modifications to vetlands. This statement cannot be verified with the

infoYmation provided. r1s stated the comment fox Item 11. r1. i. above, the Er1W does not identifythe NWI wetlands on the former Yocum Oil site and along the proposed New Rail Spur. r1 WCt1pexmit will be xequired to be submitted and approved either before or concurrently with the SitePlan Review to address any wedand impacts or receive a no loss determination. r,ny wedands thatare impacted by these projects will require avoidance or mitigation as Yequired by the RosemountComprehensive Wedand Management Plan.

Page 35, Item 16. Air Health Risk Evaluation: There is a list of five bullets that describe the

incremental risks for this project. These are the same as included u the Combined Heat and Power

CHP) Er1W and seem to be mistakenl placed in the Tier 3 Er1W. The first bullet describes natuxal

gas combustion vhile no combustion is included in the Tier 3 pxojects. The last bullet discusses the

ammonia screening model that seems to describe the aqueous ammonia- based selective catalyticreduction ( SCR) system included in the CHP project. Do these five bullets accurately describe theaix health Yisk of the Tier 3 pxojects?

Page 43, Item 19. c. Cumulative Potential Air Quality Effects: The Er W states that the tableon page 43 is the cumulative air quality effects of both the Tier 3 and the CHP projects, but themaxunized modeled concentration of CO is less that the CHP' s CO concentration sho vn on page

33 of the CHP EAW. r lso, this cumulative air quality table has different CO, NO, SOZ and HZSconcentrations than the cumulative air quality table on page 44 of the CHP Er1W. How can thesedifferences be explained?

We thank ou for the opportunity to comment on the Er1W. We look for vard to working with thePCr and FHR on peYmits needed to install, construct and operate the TieY 3 Clean Tuels projects

and the ATS fertilizer texminal.

Sincerely,n

L l ,/ -t L /

William H. Droste

Mayor

2

5

APPENDIX B

Minnesota Pollution Control Agency

Flint Hills Resources – Tier 3 Clean Fuels Projects Environmental Assessment Worksheet (EAW)

RESPONSES TO COMMENTS ON THE EAW

1. Comments by Ryan Malterud, Army Corps of Engineers. Letter received on 1/05/2015.

Comment 1-1: The Army Corps of Engineers commented that based on available information, a Department of Army (DA) permit will not be required.

Response: The comment is noted.

2. Comments by Karen Scheffing, Minnesota Department of Transportation (MnDOT). Electroniccommunication received on 1/08/2015.

Comment 2-1: The Minnesota Department of Transportation (MnDOT) commented that several projects proposed and/or constructed in the last couple of years will/have increased traffic in the area. MnDOT recommends that Flint Hills Resources conduct a traffic impact study.

Response: Flint Hills Resources (FHR) submitted a traffic impact study to MnDOT in 2014 to address the new FHR North Facility Office Building. Additionally, FHR has been developing a long-term traffic plan to optimize traffic flow near the FHR Pine Bend Refinery. Flint Hills will work with MnDOT and other key municipalities on updates to the 2014 study to reflect the scope of regular work activities and proposed projects including the Tier 3 Clean Fuels Projects.

3. Comments by LisaBeth Barajas, Metropolitan Council. Letter received on 1/20/15.

Comment 3-1: Commenter stated that the EAW was adequate.

Response: The comment is noted.

4. Comments by William H. Droste, City of Rosemount. Electronic communication received on1/21/2015.

Comment 4-1: The city of Rosemount commented that the EAW does not identify all of the city of Rosemount permits and approvals needed. The Tier 3 Clean Fuels Projects, particularly the ammonium thiosulfate fertilizer terminal at the former Rosemount Clean Energies (Yocum Oil) site, will need at least three additional approvals: 1. Site Plan Review, 2. Wetland Conservation Act (WCA) Permit, 3. Stormwater Discharge Permit.

Response: Flint Hills has been made aware of these permits/approvals and will obtain the necessary permit/approvals. The Tier 3 EAW for the permanent record, available on the MPCA website and in the MPCA Environmental Review file, will include these additional permits/approvals.

Flint Hills Resources – Tier 3 Clean Fuels Projects Responses to Comments on the Rosemount, Minnesota Environmental Assessment Worksheet Comment 4-2: The city of Rosemount commented that the EAW stated that the projects do not coincide with any National Wetland Inventory (NWI) wetlands. This statement is correct for the Tier 3 Fuels Projects occurring within the refinery property located west of U.S. Highway 52, but there are NWI wetlands in the vicinity of the New Rail Loading Rack and Planned ATS RR Load In/Out Containment at the former Yocum Oil site and there are NWI wetlands along the proposed New Rail Spur. A WCA permit will be required to be submitted and approved either before or concurrently with the Site Plan Review to address any wetland impacts or receive a no loss determination. Response: The omission of the wetlands was a mistake. Flint Hills will submit a WCA permit application to address the identified wetland, and will work with the city of Rosemount to obtain a WCA permit either before or concurrently with the Site Plan Review. The Tier 3 EAW for the permanent record, available on the MPCA website and in the MPCA Environmental Review file, will include the WCA permit. Comment 4-3: The city of Rosemount pointed out that EAW incorrectly identified that sanitary wastewater will be sent to the city of Rosemount’s publicly owned treatment works (POTW). The correct treatment plant is the Empire Wastewater Treatment Plant operated by the Metropolitan Council. Response: The comment is noted. The Tier 3 EAW for the permanent record, available on the MPCA website and in the MPCA Environmental Review file, lists the correct wastewater treatment plant. Comment 4-4: The city of Rosemount commented that the former Yocum Oil site is not a part of the FHR Stormwater Pollution Prevention Plan (SWPPP). Any redevelopment of the former Yocum Oil site will need to receive a stormwater discharge permit and comply with Rosemount Surface Water Management Plan and other applicable City regulations. Response: Flint Hills will obtain a MPCA National Pollutant Discharge Elimination System (NPDES)/State Disposal System (SDS) Industrial Stormwater Multi-Sector General Permit to regulate stormwater at the ATS storage site. Flint Hills will also obtain a Stormwater Discharge Permit from the city of Rosemount if necessary, and will comply with the Rosemount Surface Water Management Plan and other applicable City regulations. Comment 4-5: The city of Rosemount commented that the EAW states that the projects will not involve any physical modifications to wetlands. This statement cannot be verified with the information provided. As stated the comment for Item 11.A.i above (Comment 4-2), the EAW does not identify the NWI wetlands on the former Yocum Oil site and along the proposed New Rail Spur. A WCA permit will be required to be submitted and approved either before or concurrently with the Site Plan Review to address any wetland impacts or receive a no loss determination. Any wetlands that are impacted by these projects will require avoidance or mitigation as required by the Rosemount Comprehensive Wetland Management Plan. Response: Leaving out the NWI wetland along the proposed New Rail Loading Rack and planned ATS RR Load In/Out Containment was a mistake. Flint Hills will submit a WCA permit either before or concurrently with the Site Plan Review. The Tier 3 EAW for the permanent record, available on the MPCA website and in the MPCA Environmental Review file, will list the WCA permit. Comment 4-6: The city of Rosemount commented that there is a list of five bullets that describe the incremental risks for this project. These are the same as included in the Combined Heat and Power

2

Flint Hills Resources – Tier 3 Clean Fuels Projects Responses to Comments on the Rosemount, Minnesota Environmental Assessment Worksheet (CHP) EAW and seem to be mistakenly placed in the Tier 3 EAW. The first bullet describes natural gas combustion while no combustion is included in the Tier 3 Projects. The last bullet discusses the ammonia screening model that seems to describe the aqueous ammonia-based selective catalytic reduction (SCR) system included in the CHP project. Do these five bullets accurately describe the air health risk of the Tier 3 projects? Response: The five bullets are relevant to both the CHP and Tier 3 projects. The ATS process will have a small amount of natural gas combustion during startup of the ATS process. Additionally, there will be a small quantity of ammonia emissions emitted from the ATS process. Comment 4-7: The city of Rosemount commented that the table on page 43 is the cumulative air quality effects of both the Tier 3 and the CHP projects, but the maximized modeled concentration of CO is less than the CHP’s CO concentration shown on page 33 of the CHP EAW. Also, this cumulative air quality table has different CO, NO2, SO2, and H2S concentrations than the cumulative air quality table on page 44 of the CHP EAW. How can these differences be explained? Response: The city of Rosemount is correct in stating that the CO maximum modeled impacts from the CHP project cannot be larger than the cumulative air quality effects of both the CHP and the Tier 3 projects.The CHP project maximum modeled impacts (page 33 of CHP EAW) incorrectly showed higher CO impacts than for the combined CHP and Tier 3 maximum modeled impacts. During the EAW process, modeling was updated using the latest versions of the modeling software and meteorological processing software as recommended by MPCA’s dispersion modeling guidance. These adjustments resulted in slight changes to the predicted modeled concentrations, including decreases in modeled CO concentrations from the CHP project. Unfortunately, the CHP EAW tables were not updated to show these slight changes. The correct CHP maximum modeled impacts are given below (and have been corrected in the final CHP EAW).

Pollutant Averaging Period Maximum Modeled Concentration (μg/m3)

SIL (μg/m3) Less than SIL? (Y/N)

CO 1-hour 6.95 2000 Y 8-hour 4.33 500 Y

PM10 24-hour .54 5 Y Annual .041 1.0 Y

PM2.5 24-hour .376 1.2 Y Annual .041 0.3 Y

NO2 1-hour 2.27 7.52 Y Annual .066 1.0 Y

SO2 1-hour .349 7.83 Y 3-hour .355 25 Y 24-hour .132 5 Y Annual .010 1 Y

The combined CHP and Tier 3 Projects impacts were correct in the Tier 3 EAW (page 43) and incorrect in the CHP EAW (page 44). The correct combined impacts are given below (and have been corrected in the final CHP EAW). The conclusions of the cumulative effects remain the same.

3

Flint Hills Resources – Tier 3 Clean Fuels Projects Responses to Comments on the Rosemount, Minnesota Environmental Assessment Worksheet

Pollutant Averaging Period Maximum Modeled Concentration (μg/m3)

SIL (μg/m3) Less than SIL? (Y/N)

CO 1-hour 6.97 2000 Y 8-hour 4.33 500 Y

PM10 24-hour 0.54 5 Y Annual 0.07 1.0 Y

PM2.5 24-hour 0.44 1.2 Y Annual 0.07 0.3 Y

NO2 1-hour 6.43 7.52 Y Annual 0.18 1.0 Y

SO2 1-hour 4.63 7.83 Y 3-hour 4.22 25 Y 24-hour 1.24 5 Y Annual 0.12 1 Y

H2S 1-hour 2.08 2.1 Y 5. Comments by Steve Mielke, Dakota County. Electronic communication received on 1/21/2015. Comment 5-1: Dakota County commented that the table of wells listed and Figure 11 in the EAW are inadequate. Response: Leaving out the mentioned wells was a mistake. The Tier 3 EAW for the permanent record, available on the MPCA website and in the MPCA Environmental Review file, has been modified to correctly list all of the well sites and an updated Figure 11. Comment 5-2: Dakota County commented that there are monitoring wells near several of the construction site locations. These wells have been lost for a number of years, and they should be found and dealt with at this time. The wells must either be properly sealed by a licensed well contractor, brought back into use or obtain coverage under an annual Unused Well Permit. Response: Flint Hills has agreed to hire a third party contractor to identify and manage the potential wells. Flint Hills will work with the County as a part of this process.

4