3/30/01: ON MARCH 29, 2001, REGION VII SENT A REFERRAL PACK AGE TO DEPARTMENT OF JUSTICE FOR VIOLATIONS OF THE CLEAN AIR ACT BY DEFENDANT FARMLAND INDUSTRIES, INC. FARMLAND IS A C OOPERATIVE WHICH OPERATES A REFINERY IN COFFEYVILLE, KANSAS. IN NOVEMBER 1999, FARMLAND NOTIFIED EPA AND KANSAS DEPARTM ENT OF HEALTH AND ENVIRONMENT (KDHE) OF IT VOLUNTARY SELF-DI SCLOSURE OF POTENTIAL VIOLATIONS OF SECTIONS 110 AND 111 OF THE CLEAN AIR ACT, 42 U.S.C. aa 7410 AND 7411, PARTICULARLY THE NEW SOURCE REVIEW AND PREVENTION OF SIGNIFICANT DETERIOR ATION (PSD) REGULATIONS AT K.A.R. 28-19-17A (INCORPORATING 4 0 C.F.R. a 52.21), AND THE NEW SOURCE PERFORMANCE STANDARDS (NSPS) AT 40 C.F.R. PART 60. FARMLAND DISCLOSED THAT THE VI OLATIONS WERE DISCOVERED THROUGH A SELF-AUDIT PROCESS, BUT T HAT FURTHER REVIEW WAS NEEDED TO SORT OUT THE POTENTIAL VIOL ATIONS AND HISTORICAL DATA. FARMLAND SUBMITTED ITS SELF-AUD IT REPORT TO EPA AND KDHE ON SEPTEMBER 19, 2000. AFTER MEETINGS WITH FARMLAND IN DECEMBER 2000 AND FEBRUARY 2 001 IT BECAME CLEAR TO EPA AND KDHE THAT THE AGENCIES HAVE MADE VERY LITTLE PROGRESS WITH FARMLAND SINCE THE SELF-DISCLOSURE PROCESS BEGAN. EPA AND KDHE BELIEVE THAT FARMLAND IS MISCO NSTRUING THE VIOLATIONS AND NECESSARY COMPLIANCE. EPA AND K DHE DRAFTED A LETTER CLEARLY SETTING FORTH THEIR POSITION AN D STEPS NECESSARY FOR THE AGENCIES TO CONTINUE WITH NEGOTIAT IONS UNDER THE AUDIT POLICY. THIS D