  We continue the study of the ultraviolet problem for QED in d=3. The model is
defined on a fine toroidal lattice and we seek control as the lattice spacing
goes to zero. The problem is analyzed using Balaban's formulation of the
renormalization group. This involves a sequence of transformations consisting
of a split into large and small field regions, then block averaging, and then
scaling. The the effective actions generated by this method depend strongly on
certain multi-scale propagators and minimizers. The study of these objects both
for fermions and for gauge fields is content of this paper. Earlier work on the
subject is reviewed. In addition for fermions a polymer expansion is obtained
for the determinants of the fermion propagators. For the gauge field a detailed
local regularity result is obtained for the minimizers.
