The federal government may soon lift a penalty that’s been freezing funds for some transportation projects in the Fairbanks area over the last year.
That penalty was a consequence of the Environmental Protection Agency (EPA) disapproving of Alaska’s plan to improve air quality in the Fairbanks North Star Borough (FNSB).
But a notice published in the federal register Wednesday says the EPA intends to OK a revised version of that plan, which the state submitted in December.
Air quality has vexed the Fairbanks area for at least two decades, and in 2017, the EPA classified urban portions of FNSB as a “serious nonattainment area” because the density of air pollutants well exceeded federal standards, in violation of the Clean Air Act.
The EPA then required the Alaska Department of Environmental Conservation (DEC) to amend its State Implementation Plan (SIP). The amended SIP was supposed to outline how the state would clean up the air and reduce the amount of particulate matter of 2.5 microns or less, also known as PM2.5, which is particularly harmful to human health.
But the EPA considered that amended plan inadequate. So, in late 2023, the federal agency partially rejected the plan, which sent the conservation department back to the drawing board. As a penalty, the 2023 decision also kickstarted a so-called “conformity freeze” that limited the way transportation planners could shift around federal funds or change plans for projects within the serious nonattainment area.
But now, the EPA has signaled through an interim final action that it will grant full approval of the new, revised plan. The agency says the updated document includes refined regulations on home-heating devices and particulate emissions for power plants, among other changes.
State officials had expressed optimism in the leadup to EPA’s decision. In December, DEC’s Air Quality Division Director Jason Olds told the policy board at Fairbanks Area Surface Transportation (FAST) Planning that state officials had resubmitted the SIP and were hoping for approval within a month.
“We’re sort of confirming that timeline, but would anticipate that we could see some of those projects move forward for the construction season this coming summer,” he said, referring to a potential lift of the conformity freeze.
The state air quality division didn’t respond to a request for additional comment in time for this story.
According to FAST Planning Executive Director Jackson Fox, the federally-imposed penalty has been locking up about $150 million in total. In a Wednesday interview, he said that’s affected the timeline for a handful of large projects, such as the addition of an interchange at the intersection of the Steese and Johansen highways.
“We’re really excited that we can get these going again as soon as the freeze is lifted,” he said.
However, the EPA’s approval of the state’s revised air quality plan does not immediately undo the restrictions. The federal register posting starts a public comment period, and Fox said the EPA still has to OK motor vehicle emission budgets submitted by the state.
But he expects those hurdles will be cleared, and that the funds will soon be unfrozen.
“In my mind, it’s imminent. We’re a month or more away from getting there,” he said.
But that still wouldn’t mean the serious nonattainment area has reached the end of the road for the threat of funding restrictions. Even with the approval of the state's plan, to avoid future sanctions, the Fairbanks area must meet the bar for PM2.5.
Patrice Lee, a coordinator with Citizens for Clean Air, told KUAC Wednesday she’s not convinced that’s going to happen.
“It’s doubtful to me that we’re going to improve the situation. In 15 years, we cut our pollution in half. We have another half to go,” she said.
Data from monitoring sites in Fairbanks indicates air quality at those locations tends to hover closer to the attainment level. But 2023 data from the monitoring site in North Pole shows the Hurst Road location was still logging double the standard for PM2.5.
Wood-fired stoves are often cited as the main culprit for generating the particulate matter in borough air, but Lee said she’s also discouraged by Interior Alaska’s continued reliance on fossil fuels for local power generation.
And she said while the state plan offers models for improving air quality, those models could prove inaccurate, or regulatory enforcement could come up short.
“The state is going to spin it as a big win, and look at [the conformity freeze being] lifted – which what that means is they feel like they’ve skirted any responsibility whatsoever for clean air and our health,” she said.
If PM2.5 levels are not rectified, new sanctions that could begin as early as 2027 would go a step further by withholding federal funds from state and local transportation projects, rather than freezing project plans in place.
As that possibility looms, Fox, the FAST Planning executive director, said his organization will try to help get major projects underway as soon as the conformity freeze is no longer holding them up.
“We’re not out of the woods, but we’ve got a really good opportunity right now to update our funding plan and get these paused projects back on track and get as much of this construction done as we can over the next couple years,” he said.