[Federal Register Volume 82, Number 49 (Wednesday, March 15, 2017)]
[Rules and Regulations]
[Pages 13759-13765]
[FR Doc No: 2017-04779]

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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 180

[EPA-HQ-OPP-2016-0540; FRL-9957-65]

Streptomycin; Pesticide Tolerances for Emergency Exemptions

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final rule.

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SUMMARY: This regulation establishes time-limited tolerances for
residues of streptomycin in or on fruit, citrus, group 10-10, for both
fresh fruit and dried pulp. This action is in response to EPA's
granting of an emergency exemption under the Federal Insecticide,
Fungicide, and Rodenticide Act (FIFRA) authorizing use of the pesticide
in citrus production. This regulation establishes maximum permissible
levels for residues of streptomycin in or on these commodities. The
time-limited tolerances expire on December 31, 2019.

DATES: This regulation is effective March 15, 2017. Objections and
requests for hearings must be received on or before May 15, 2017, and
must be filed in accordance with the instructions provided in 40 CFR
part 178 (see also Unit I.C. of the SUPPLEMENTARY INFORMATION).

ADDRESSES: The docket for this action, identified by docket
identification (ID) number EPA-HQ-OPP-2016-0540, is available at http://www.regulations.gov or at the Office of Pesticide Programs Regulatory
Public Docket (OPP Docket) in the Environmental Protection Agency
Docket Center (EPA/DC), West William Jefferson Clinton Bldg., Rm. 3334,
1301 Constitution Ave. NW., Washington, DC 20460-0001. The Public
Reading Room is open from 8:30 a.m. to 4:30 p.m., Monday through
Friday, excluding legal holidays. The telephone number for the Public
Reading Room is<PHONE_NUMBER>, and the telephone number for the OPP
Docket is<PHONE_NUMBER>. Please review the visitor instructions and
additional information about the docket available at http://www.epa.gov/dockets.

FOR FURTHER INFORMATION CONTACT: Michael L. Goodis, Registration
Division (7505P), Office of Pesticide Programs, Environmental
Protection Agency, 1200 Pennsylvania Ave. NW., Washington, DC 20460-
0001; main telephone number:<PHONE_NUMBER>; email address:
<EMAIL_ADDRESS>
SUPPLEMENTARY INFORMATION:

I. General Information

A. Does this action apply to me?

    You may be potentially affected by this action if you are an
agricultural producer, food manufacturer, or pesticide manufacturer.
The following list of North American Industrial Classification System
(NAICS) codes is not intended to be exhaustive, but rather provides a
guide to help readers determine whether this document applies to them.
Potentially affected entities may include:
    [emsp14]Crop production (NAICS code 111).
    [emsp14]Animal production (NAICS code 112).
    [emsp14]Food manufacturing (NAICS code 311).
    [emsp14]Pesticide manufacturing (NAICS code 32532).

B. How can I get electronic access to other related information?

    You may access a frequently updated electronic version of 40 CFR
part 180 through the Government Printing Office's e-CFR site at http://www.ecfr.gov/cgi-bin/text-idx?&c=ecfr&tpl=/ecfrbrowse/Title40/40tab_02.tpl.

C. How can I file an objection or hearing request?

    Under section 408(g) of the Federal Food, Drug, and Cosmetic Act
(FFDCA), 21 U.S.C. 346a, any person may file an objection to any aspect
of this regulation and may also request a hearing on those objections.
You must file your objection or request a hearing on this regulation in
accordance with the instructions provided in 40 CFR part 178. To ensure
proper receipt by EPA, you must identify docket ID number EPA-HQ-OPP-
2016-0540 in the subject line on the first page of your submission. All
objections and requests for a hearing must be in writing, and must be
received by the Hearing Clerk on or before May 15, 2017. Addresses for
mail and hand delivery of objections and hearing requests are provided
in 40 CFR 178.25(b).
    In addition to filing an objection or hearing request with the
Hearing Clerk as described in 40 CFR part 178, please submit a copy of
the filing (excluding any Confidential Business Information (CBI)) for
inclusion in the public docket. Information not marked confidential
pursuant to 40 CFR part 2 may be disclosed publicly by EPA without
prior notice. Submit the non-CBI copy of your objection or hearing
request, identified by docket ID number EPA-HQ-OPP-2016-0540, by one of
the following methods:
     Federal eRulemaking Portal: http://www.regulations.gov.
Follow the online instructions for submitting comments. Do not submit
electronically any information you consider to be CBI or other
information whose disclosure is restricted by statute.
     Mail: OPP Docket, Environmental Protection Agency Docket
Center (EPA/DC), (28221T), 1200 Pennsylvania Ave. NW., Washington, DC
20460-0001.
     Hand Delivery: To make special arrangements for hand
delivery or delivery of boxed information, please follow the
instructions at http://www.epa.gov/dockets/contacts.html. Additional
instructions on commenting or visiting the docket, along with more
information about dockets generally, is available at http://www.epa.gov/dockets.

II. Background and Statutory Findings

    EPA, on its own initiative, in accordance with FFDCA sections
408(e) and 408(l)(6), of 21 U.S.C. 346a(e) and 346a(1)(6), is
establishing time-limited tolerances for residues of streptomycin,
expressed as only streptomycin ((4S,4aR,5S,5aR,6S,12aS)-4-
(dimethylamino)-1,4,4a,5,5a,6,11,12a-octahydro-3,5,6,10,12,12a-
hexahydroxy-6-methyl-1,11-dioxo-2-naphthacenecarboxamide), in or on
fruit, citrus, group 10-10 at 2 parts per million (ppm), and the dried
pulp of these commodities at 6 ppm. These time-limited tolerances
expire on December 31, 2019.
    Section 408(l)(6) of FFDCA requires EPA to establish a time-limited
tolerance or exemption from the requirement for a tolerance for
pesticide chemical residues in food that will result from the use of a
pesticide under an emergency exemption granted by EPA under FIFRA
section 18. Such tolerances can be established without providing notice
or period for public comment. EPA does not intend for its actions on
FIFRA section 18 related time-limited tolerances to set binding
precedents for the application of FFDCA

section 408 and the safety standard to other tolerances and exemptions.
Section 408(e) of FFDCA allows EPA to establish a tolerance or an
exemption from the requirement of a tolerance on its own initiative,
i.e., without having received any petition from an outside party.
    Section 408(b)(2)(A)(i) of FFDCA allows EPA to establish a
tolerance (the legal limit for a pesticide chemical residue in or on a
food) only if EPA determines that the tolerance is ``safe.'' Section
408(b)(2)(A)(ii) of FFDCA defines ``safe'' to mean that ``there is a
reasonable certainty that no harm will result from aggregate exposure
to the pesticide chemical residue, including all anticipated dietary
exposures and all other exposures for which there is reliable
information.'' This includes exposure through drinking water and in
residential settings, but does not include occupational exposure.
Section 408(b)(2)(C) of FFDCA requires EPA to give special
consideration to exposure of infants and children to the pesticide
chemical residue in establishing a tolerance and to ``ensure that there
is a reasonable certainty that no harm will result to infants and
children from aggregate exposure to the pesticide chemical residue . .
.''
    Section 18 of FIFRA authorizes EPA to exempt any Federal or State
agency from any provision of FIFRA, if EPA determines that ``emergency
conditions exist which require such exemption.'' EPA has established
regulations governing such emergency exemptions in 40 CFR part 166.

III. Emergency Exemption for Streptomycin on Citrus and FFDCA
Tolerances

    The Florida Department of Agriculture and Consumer Services (FDACS)
asserted that an emergency situation exists in accordance with the
criteria for approval of an emergency exemption, and requested the use
of streptomycin (and oxytetracycline, addressed in a separate document)
in citrus to suppress the Candidatus Liberibacter asiaticus (CLas)
bacterium that causes Huanglongbing (HLB) also known as citrus
greening. HLB is a newly-introduced disease, vectored by the invasive
insect, the Asian citrus psyllid, and is the most serious disease of
citrus worldwide. This disease has rapidly spread throughout Florida's
citrus production area, causing severe losses with an overall decrease
in production of more than 60% primarily due to HLB. Significant losses
have occurred, many producers have gone out of business, and FDACS
asserts that the long-term economic viability of the citrus industry in
Florida is threatened by this disease. Currently there is no cure. The
bacteria reside in the phloem (the circulatory system of the tree),
disrupting circulation of water and nutrients, which ultimately leads
to death of the tree. FDACS states that use of streptomycin, along with
other management measures, may suppress HLB symptoms, and prolong the
productive life of infected trees, allowing citrus producers to remain
in business while researchers continue to explore and evaluate new
treatments for the disease.
    After having reviewed the submission, EPA determined that an
emergency condition exists for this State, and that the criteria for
approval of an emergency exemption are met. EPA has authorized a
specific exemption under FIFRA section 18 for the use of streptomycin
on citrus to suppress the CLas bacterium that causes HLB disease in
Florida.
    As part of its evaluation of the emergency exemption application,
EPA assessed the potential risks presented by residues of streptomycin
in or on citrus fruit commodities. In doing so, EPA considered the
safety standard in FFDCA section 408(b)(2), and EPA decided that the
necessary tolerances under FFDCA section 408(l)(6) would be consistent
with the safety standard and with FIFRA section 18. Consistent with the
need to move quickly on the emergency exemption in order to address an
urgent non-routine situation and to ensure that the resulting food is
safe and lawful, EPA is issuing these tolerances without notice and
opportunity for public comment as provided in FFDCA section 408(l)(6).
Although these time-limited tolerances expire on December 31, 2019,
under FFDCA section 408(l)(5), residues of the pesticide not in excess
of the amounts specified in the tolerances remaining in or on citrus
fruit commodities after that date will not be unlawful, provided the
pesticide was applied in a manner that was lawful under FIFRA, and the
residues do not exceed levels that were authorized by these time-
limited tolerances at the time of that application. EPA will take
action to revoke these time-limited tolerances earlier if any
experience with, scientific data on, or other relevant information on
this pesticide indicate that the residues are not safe.
    Because these time-limited tolerances are being approved under
emergency conditions, EPA has not made any decisions about whether
streptomycin meets FIFRA's registration requirements for use on citrus
fruit or whether permanent tolerances for this use would be
appropriate. Under these circumstances, EPA does not believe that these
time-limited tolerance decisions serve as bases for registrations of
streptomycin by a State for special local needs under FIFRA section
24(c). Nor do these tolerances by themselves serve as the authority for
persons in any State other than Florida to use this pesticide on the
applicable crops under FIFRA section 18 absent the issuance of an
emergency exemption applicable within that State. For additional
information regarding the emergency exemption for streptomycin, contact
the Agency's Registration Division at the address provided under FOR
FURTHER INFORMATION CONTACT.

IV. Aggregate Risk Assessment and Determination of Safety

    Consistent with the factors specified in FFDCA section
408(b)(2)(D), EPA has reviewed the available scientific data and other
relevant information in support of this action. EPA has sufficient data
to assess the hazards of and to make a determination on aggregate
exposure expected as a result of this emergency exemption use and the
time-limited tolerances for residues of streptomycin on fruit, citrus,
group 10-10 at 2 ppm, and the dried pulp of these commodities at 6 ppm.
EPA's assessment of exposures and risks associated with establishing
the time-limited tolerances follows.

A. Toxicological Points of Departure/Levels of Concern

    Once a pesticide's toxicological profile is determined, EPA
identifies toxicological points of departure (POD) and levels of
concern to use in evaluating the risks to humans from exposure to the
pesticide. For hazards that have a threshold below which there is no
appreciable risk, the toxicological POD is used as the basis for
derivation of reference values for risk assessment. PODs are developed
based on a careful analysis of the doses in each toxicological study to
determine the dose at which no adverse effects are observed (the NOAEL)
and the lowest dose at which adverse effects of concern are identified
(the LOAEL). Uncertainty/safety factors are used in conjunction with
the POD to calculate a safe exposure level--generally referred to as a
population-adjusted dose (PAD) or a reference dose (RfD)--and a safe
margin of exposure (MOE). For non-threshold risks, EPA assumes that any
amount of exposure will lead to some degree of risk. Thus, the EPA
estimates risk in terms of the probability of an occurrence of the
adverse effect expected in a lifetime. For more information on the

general principles EPA uses in risk characterization and a complete
description of the risk assessment process, see https://www.epa.gov/pesticide-science-and-assessing-pesticide-risks/assessing-human-health-risk-pesticides.
    A summary of the toxicological endpoints for streptomycin used for
human risk assessment is shown in Table 1 of this unit.

 Table 1--Summary of Toxicological Doses and Endpoints for Streptomycin for Use in Human Health Risk Assessment
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                                    Point of departure
        Exposure/ scenario           and  uncertainty/    RfD, PAD, LOC  for    Study and toxicological effects
                                      safety factors       risk assessment
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Acute dietary (Any population)...  NA..................  NA.................  Toxicity from single dose was not
                                                                               identified.
Chronic dietary (All populations)  NOAEL= 5 mg/kg/day    Chronic RfD =        Two-year feeding study in rats.
                                   UFA = 10............  0.05 mg/kg/day.....  LOAEL = 10 mg/kg/day based on
                                   UFH = 10............  cPAD =.............   reduced body weight in males.
                                   FQPA SF = 1X........  0.05 mg/kg/day.....
Inhalation (All durations).......  NOAEL = 5 mg/kg/day.  LOC <= MOE of 100..  Two-year feeding study in rats.
                                   FQPA SF = 1X........                       LOAEL = 10 mg/kg/day based on
                                                                               reduced body weight in males.
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Cancer...........................  Classification--There is not enough information in line with EPA's guidelines
                                     for toxicological studies of pesticides to classify carcinogenic potential.
                                      The toxicological data requirements have been waived due to the extensive
                                       human database from streptomycin drug use. A 2-year rat carcinogenicity
                                     study, used by FDA and the World Health Organization to set tolerances for
                                       animal drug residues, is available and did not demonstrate evidence of
                                       carcinogenicity. Also, a literature search for streptomycin toxicity in
                                        animals and humans did not result in any data indicating evidence of
                                                                  carcinogenicity.
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FQPA SF = Food Quality Protection Act Safety Factor. LOAEL = lowest-observed-adverse-effect-level. LOC = level
  of concern. mg/kg/day = milligram/kilogram/day. MOE = margin of exposure. NOAEL = no-observed-adverse-effect-
  level. PAD = population adjusted dose (a = acute, c = chronic). RfD = reference dose. UFA = extrapolation from
  animal to human (interspecies). UFH = potential variation in sensitivity among the human population
  (intraspecies).

    The complete human risk assessment for this action can be found at
http://www.regulations.gov in the document ``Streptomycin. Section 18
Emergency Exemption for Citrus Grown in Florida'' in the docket for ID
number EPA-HQ-OPP-2016-0450.

B. Exposure Assessment

    1. Dietary exposure from food and feed uses. In evaluating dietary
exposure to streptomycin, EPA considered exposure under the time-
limited tolerances established by this action as well as all existing
streptomycin tolerances in 40 CFR 180.245. EPA assessed dietary
exposures from streptomycin in food as follows:
    i. Acute exposure. No acute effects were identified in the
toxicological studies for streptomycin; therefore, a quantitative acute
dietary exposure assessment is unnecessary.
    ii. Chronic exposure. In conducting the chronic dietary exposure
assessment EPA used the food consumption data from the 2003-2008 US
Department of Agriculture (USDA) National Health and Nutrition
Examination Survey (NHANES). For residue levels in food, EPA assumed
tolerance level residues for all registered uses plus the new
tolerances of 2 ppm in citrus fruit and 6 ppm in the dried pulp of
these commodities. In addition, default processing factors were used
for all processed commodities, except citrus juice, oil, and tomato
puree since concentration was not observed in these commodities. One
hundred percent crop treated (PCT) was assumed for all commodities.
EPA's exposure assessment included tolerance level residues in
livestock commodities owing to use of streptomycin as an animal drug as
well. No anticipated residue or PCT refinements were used.
    iii. Cancer. Based on the data summarized in Unit IV.A., EPA has
concluded that streptomycin does not pose a cancer risk to humans.
Therefore, a dietary exposure assessment for the purpose of assessing
cancer risk is unnecessary.
    iv. Anticipated residue and percent crop treated (PCT) information.
EPA did not use anticipated residue and/or PCT information in the
dietary assessment for streptomycin. Tolerance level residues and 100%
CT were assumed for all food commodities.
    2. Dietary exposure from drinking water. The Agency used screening
level water exposure models in the dietary exposure analysis and risk
assessment for streptomycin in drinking water. These simulation models
take into account data on the physical, chemical, and fate/transport
characteristics of streptomycin. Further information regarding EPA
drinking water models used in pesticide exposure assessment can be
found at https://www.epa.gov/pesticide-science-and-assessing-pesticide-risks/about-water-exposure-models-used-pesticide.
    Potential residues resulting in surface water and groundwater were
modeled based upon registered and new uses. The estimated drinking
water concentrations (EDWCs) for ground water were higher than for
surface water, and thus were used for estimating exposure from drinking
water consumption, as the most conservative (worst case) estimate.
Based on the Pesticide Root Zone Model, Ground Water, the EDWC in
groundwater (the highest modeled value) for streptomycin for acute
exposures is estimated to be 932 parts per billion (ppb), and for
chronic exposures (non-cancer) is estimated at 760 ppb. No acute
assessment was required as discussed earlier in this document. The
modeled estimate of drinking water concentration for chronic exposure
was directly entered into the dietary exposure model used to estimate
chronic risks presented by potential residues in food and drinking
water.
    3. From non-dietary exposure. The term ``residential exposure'' is
used in this document to refer to non-occupational, non-dietary
exposure (e.g., for lawn and garden pest control,

indoor pest control, termiticides, and flea and tick control on pets).
    Streptomycin is currently registered for uses on residential
gardens and trees which could result in residential exposures. EPA
considered residential exposures from these uses and determined the
following: Since there is no dermal hazard identified for streptomycin,
residential dermal exposures were not assessed. Non-dietary incidental
ingestion and inhalation from post-application residential exposures
are assumed to be negligible, based upon the use scenarios and chemical
properties of streptomycin. However, residential handler inhalation
exposures may occur based on the use sites, equipment, and in
particular, the lack of personal protective equipment (PPE)
requirements on certain product labels for residential uses. Risk was
therefore evaluated from short- and intermediate-term inhalation
exposures for residential (non-professional) handlers/applicators.
Further information regarding EPA standard assumptions and generic
inputs for residential exposures may be found at: https://www.epa.gov/pesticide-science-and-assessing-pesticide-risks/standard-operating-procedures-residential-pesticide.
    4. Cumulative effects from substances with a common mechanism of
toxicity. Section 408(b)(2)(D)(v) of FFDCA requires that, when
considering whether to establish, modify, or revoke a tolerance, the
Agency consider ``available information'' concerning the cumulative
effects of a particular pesticide's residues and ``other substances
that have a common mechanism of toxicity.''
    EPA has not found streptomycin to share a common mechanism of
toxicity with any other substances, and streptomycin does not appear to
produce a toxic metabolite produced by other substances. For the
purposes of this tolerance action, therefore, EPA has assumed that
streptomycin does not have a common mechanism of toxicity with other
substances. For information regarding EPA's efforts to determine which
chemicals have a common mechanism of toxicity and to evaluate the
cumulative effects of such chemicals, see EPA's Web site at http://www.epa.gov/pesticides/cumulative.

C. Safety Factor for Infants and Children

    1. In general. Section 408(b)(2)(C) of FFDCA provides that EPA
shall apply an additional tenfold (10X) margin of safety for infants
and children in the case of threshold effects to account for prenatal
and postnatal toxicity and the completeness of the database on toxicity
and exposure unless EPA determines, based on reliable data, that a
different margin of safety will be safe for infants and children. This
additional margin of safety is commonly referred to as the FQPA Safety
Factor (SF). In applying this provision, EPA either retains the default
value of 10X, or uses a different additional SF when reliable data are
available to EPA which support the choice of a different factor.
    2. Prenatal and postnatal sensitivity. There were no teratogenic
effects noted in a rabbit developmental study at the high dose of 10
mg/kg/day. Although children born to mothers treated with streptomycin
injections have sometimes had hearing loss, no teratogenic effects have
been attributed to streptomycin treatment. The injected dose at which
these effects occurred in humans is equivalent to approximately 150
times higher than the NOAEL from the rabbit study and approximately
30,000 times higher than the dose that produced the reduced body weight
endpoint used in establishing the chronic RfD. Additionally, none of
the available toxicity data for streptomycin indicate any pre- or post-
natal susceptibility. Therefore there are no residual concerns, EPA is
confident that the chronic RfD is sufficiently protective for
teratogenic effects, and the Food Quality Protection Act (FQPA) safety
factor was reduced to 1X.
    3. Conclusion. EPA has determined that reliable data show that the
safety of infants and children would be adequately protected if the
FQPA SF were reduced to 1X. That decision is based on the following
findings:
    i. The toxicity database for streptomycin is complete. An extensive
database exists from drug use of streptomycin in humans and animals and
all guideline toxicity data requirements for streptomycin have been
waived. The toxicity of streptomycin was assessed using toxicity
reviews provided by the FDA and from the published literature on drug
use. Because the dose selected for risk assessment from agricultural
use is based upon a toxicity endpoint (decreased body weight in test
animals) that occurs at a much lower oral dose than the injected dose
at which prenatal hearing effects occurred in humans, there are no
residual concerns and the FQPA safety factor is reduced to 1X.
    ii. The extensive database in animals and humans does not
demonstrate any potential for streptomycin to cause either peripheral
or central nervous system toxicity and there is no need for a
developmental neurotoxicity study or additional UFs to account for
neurotoxicity.
    iii. There is no direct evidence of sensitivity/susceptibility in
the developing or young animal. No teratogenic effects were observed in
the rabbit. As noted previously, children born to mothers treated with
streptomycin injections have sometimes had hearing loss but no
teratogenic effects have been attributed to direct streptomycin
treatment. Chosen points of departure are expected to be protective of
any possible hearing loss effects.
    iv. There are no residual uncertainties identified in the exposure
databases. The dietary food exposure assessments were performed
assuming 100% CT and tolerance-level residues. EPA made conservative
(protective) assumptions in the ground and surface water modeling used
to assess exposure to streptomycin in drinking water. EPA used
similarly conservative assumptions to consider potential for post-
application exposure of children as well as incidental oral exposure of
toddlers. These assessments will not underestimate the exposure and
risks posed by streptomycin.

D. Aggregate Risks and Determination of Safety

    EPA determines whether acute and chronic dietary pesticide
exposures are safe by comparing aggregate exposure estimates to the
acute PAD (aPAD) and chronic PAD (cPAD). For linear cancer risks, EPA
calculates the lifetime probability of acquiring cancer given the
estimated aggregate exposure. Short-, intermediate-, and chronic-term
risks are evaluated by comparing the estimated aggregate food, water,
and residential exposure to the appropriate PODs to ensure that an
adequate MOE exists.
    1. Acute risk. No adverse effect resulting from a single oral
exposure was identified and no acute dietary endpoint was selected.
Therefore, streptomycin is not expected to pose an acute risk.
    2. Chronic risk. Based on the explanation in the unit regarding
residential use patterns, chronic residential exposures to residues of
streptomycin are not expected.
    Therefore chronic aggregate risk was assessed considering only
dietary exposures from potential residues in food and drinking water.
Using the exposure assumptions described in this unit for chronic
exposure, EPA has concluded that chronic exposure to streptomycin from
potential residues in food and drinking water will not result in risks
of concern (i.e., are <100% of the cPAD) for all population groups

considered. The population group with the greatest dietary exposure is
Infants <=1 year old, with 90% of the cPAD occupied by chronic dietary
exposure. Estimates for chronic dietary exposure contributed by
residues in food occupy <=32% of the cPAD for all population subgroups,
indicating that the main contribution to dietary exposure is from
potential residues in drinking water. The most conservative assumptions
were made in the drinking water analysis, which likely resulted in
overestimated exposures. Refinements could be made which would likely
decrease the EDWCs, thereby further reducing the estimates of exposure
and risk from potential residues in drinking water. However, assessment
using these unrefined worst-case exposure scenarios provided chronic
exposure estimates which would not result in risks of concern (i.e.,
were <100% of the cPAD).
    3. Short- and intermediate-term risk. Short- and intermediate-term
aggregate exposures take into account short and intermediate-term
residential exposure plus chronic exposure to food and water
(considered to be a background exposure level). The dermal route of
exposure was not assessed because no dermal hazard exists for
streptomycin. Non-dietary incidental ingestion and inhalation from
post-application residential exposures are assumed to be negligible,
based upon the chemical properties and the use scenarios for
streptomycin. Intermediate-term residential exposure is not expected
from the residential use patterns registered for streptomycin, and
therefore was not assessed. However, short-term inhalation exposures
may occur for residential handlers applying streptomycin, and therefore
this route of exposure was assessed. For all residential handler
scenarios considered, the estimated inhalation exposures did not
present risks of concern (i.e., MOEs >= EPA's LOC of 100). The lowest
calculated MOE was 86,000 from the highest exposure scenario of the
handler using hand wand/backpack and no PPE. The adult population group
with the highest dietary exposure was adults 20 to 49 years old, with
38% of the cPAD occupied. Therefore, aggregate short- and intermediate-
term exposure included dietary (food and water) and inhalation routes
from residential handler exposure. Using these two highest-exposure
scenarios, the short-term exposure estimate resulted in an MOE of 270,
which does not present a risk of concern (MOE >= LOC of 100). Although
residential exposures to children may occur through incidental oral and
inhalation routes during residential application and post-application
activities, they are assumed to be negligible and thus were not
quantitatively assessed. Therefore, the child aggregate assessment
included only contributions from chronic exposure to food and drinking
water, which was previously presented in this document, and did not
result in risks of concern.
    4. Aggregate cancer risk for U.S. population. Based on the lack of
evidence of carcinogenicity in the streptomycin database, no cancer
risk is expected from streptomycin and a cancer risk assessment was not
needed.
    5. Determination of safety. Based on these risk assessments, EPA
concludes that there is reasonable certainty that no harm will result
to the general population, or to infants and children, from aggregate
exposure to streptomycin residues.
    6. Pharmaceutical aggregate risk. Section 408 of the FFDCA requires
EPA to consider potential sources of exposure to a pesticide and
related substances in addition to the dietary sources expected to
result from a pesticide use subject to the tolerance. In order to
determine whether to maintain a pesticide tolerance, EPA must
``determine that there is a reasonable certainty of no harm.'' Under
FFDCA section 505, the Food and Drug Administration reviews human drugs
for safety and effectiveness and may approve a drug notwithstanding the
possibility that some users may experience adverse side effects. EPA
does not believe that, for purposes of the section 408 dietary risk
assessment, it is compelled to assume that combined exposures to
pesticide and pharmaceutical residues that lead to a physiological
effect in the user constitutes ``harm'' under the meaning of section
408 of the FFDCA.
    Rather, EPA believes the appropriate way to consider the
pharmaceutical use of streptomycin in its risk assessment is to examine
the impact that the additional nonoccupational pesticide exposures
would have to a pharmaceutical user exposed to a related (or, in some
cases, the same) compound. Where the additional pesticide exposure has
no more than a minimal impact on the pharmaceutical user, EPA could
make a reasonable certainty of no harm finding for the pesticide
tolerances of that compound under section 408 of the FFDCA. If the
potential impact on the pharmaceutical user as a result of co-exposure
from pesticide use is more than minimal, then EPA would not be able to
conclude that dietary residues were safe, and would need to discuss
with FDA appropriate measures to reduce exposure from one or both
sources.
    Injected drug doses of streptomycin are approximately 15 mg/kg/day.
Because the oral absorption of streptomycin is <1%, this corresponds to
an oral equivalent dose of 1,500 mg/kg/day. This oral equivalent dose
is over 30,000 times the highest dietary exposure estimate of 0.045 mg/
kg/day, the food and water exposure estimate for the highest-exposed
population (infants <1 year old). Therefore, dietary exposure from
pesticide uses of streptomycin is negligible compared to drug exposure
and would not contribute to drug toxicity, so there are no concerns for
risks from dietary exposure contribution of streptomycin from pesticide
use, in patients receiving streptomycin drug injections. Because the
pesticide exposure has no more than a minimal impact on the total dose
to a pharmaceutical user, EPA believes that there is a reasonable
certainty that the potential dietary pesticide exposure will result in
no harm to a user being treated therapeutically with streptomycin.

V. Other Considerations

    A. Analytical Enforcement Methodology. An adequate enforcement
methodology is available to enforce the tolerance expression. The
method uses high performance liquid chromatography with tandem mass
spectrometry for detection (HPLC-MS/MS). The method is detailed in
``Confirmation of Aminoglycosides by HPLC/MS/MS; United States
Department of Agriculture, Food Safety and Inspection Service, Office
of Public Health Science SOP No: CLG-AMG1.02,'' which may be requested
from: Chief, Analytical Chemistry Branch, Environmental Science Center,
701 Mapes Rd., Ft. Meade, MD 20755-5350; telephone number: (410) 305-
2905; email address<EMAIL_ADDRESS>    B. International Residue Limits. In making its tolerance decisions,
EPA seeks to harmonize U.S. tolerances with international standards
whenever possible, consistent with U.S. food safety standards and
agricultural practices. EPA considers the international maximum residue
limits (MRLs) established by the Codex Alimentarius Commission (Codex),
as required by FFDCA section 408(b)(4). The Codex is a joint United
Nations Food and Agriculture Organization/World Health Organization
food standards program, and it is recognized as an international food
safety standards-setting organization in trade agreements to which the
United States

is a party. EPA may establish a tolerance that is different from a
Codex MRL; however, FFDCA section 408(b)(4) requires that EPA explain
the reasons for departing from the Codex level. The Codex has not
established any MRLs for streptomycin in/on citrus fruit commodities.

VI. Conclusion

    Therefore, time-limited tolerances are established for residues of
streptomycin in or on fruit, citrus, group 10-10, at 2 ppm, and the
dried pulp of these commodities at 6 ppm. These tolerances expire on
December 31, 2019.

VII. Statutory and Executive Order Reviews

    This action establishes tolerances under FFDCA sections 408(e) and
408(l)(6). The Office of Management and Budget (OMB) has exempted these
types of actions from review under Executive Order 12866, entitled
``Regulatory Planning and Review'' (58 FR 51735, October 4, 1993).
Because this action has been exempted from review under Executive Order
12866, this action is not subject to Executive Order 13211, entitled
``Actions Concerning Regulations That Significantly Affect Energy
Supply, Distribution, or Use'' (66 FR 28355, May 22, 2001) or Executive
Order 13045, entitled ``Protection of Children from Environmental
Health Risks and Safety Risks'' (62 FR 19885, April 23, 1997). This
action does not contain any information collections subject to OMB
approval under the Paperwork Reduction Act (PRA), 44 U.S.C. 3501 et
seq., nor does it require any special considerations under Executive
Order 12898, entitled ``Federal Actions to Address Environmental
Justice in Minority Populations and Low-Income Populations'' (59 FR
7629, February 16, 1994).
    Since tolerances and exemptions that are established in accordance
with FFDCA sections 408(e) and 408(l)(6), such as the tolerances in
this final rule, do not require the issuance of a proposed rule, the
requirements of the Regulatory Flexibility Act (RFA) (5 U.S.C. 601 et
seq.) do not apply.
    This action directly regulates growers, food processors, food
handlers, and food retailers, not States or tribes, nor does this
action alter the relationships or distribution of power and
responsibilities established by Congress in the preemption provisions
of FFDCA section 408(n)(4). As such, the Agency has determined that
this action will not have a substantial direct effect on States or
tribal governments, on the relationship between the national government
and the States or tribal governments, or on the distribution of power
and responsibilities among the various levels of government or between
the Federal Government and Indian tribes. Thus, the Agency has
determined that Executive Order 13132, entitled ``Federalism'' (64 FR
43255, August 10, 1999) and Executive Order 13175, entitled
``Consultation and Coordination with Indian Tribal Governments'' (65 FR
67249, November 9, 2000) do not apply to this action. In addition, this
action does not impose any enforceable duty or contain any unfunded
mandate as described under Title II of the Unfunded Mandates Reform Act
(UMRA) (2 U.S.C. 1501 et seq.).
    This action does not involve any technical standards that would
require Agency consideration of voluntary consensus standards pursuant
to section 12(d) of the National Technology Transfer and Advancement
Act (NTTAA) (15 U.S.C. 272 note).

VIII. Congressional Review Act

    Pursuant to the Congressional Review Act (5 U.S.C. 801 et seq.),
EPA submitted a report containing this rule and other required
information to the U.S. Senate, the U.S. House of Representatives, and
the Comptroller General of the United States prior to publication of
the rule in the Federal Register. This action is not a ``major rule''
as defined by 5 U.S.C. 804(2).

List of Subjects in 40 CFR Part 180

    Environmental protection, Administrative practice and procedure,
Agricultural commodities, Pesticides and pests, Reporting and
recordkeeping requirements.

    Dated: February 9, 2017.
Michael L. Goodis,
Director, Registration Division, Office of Pesticide Programs.

    Therefore, 40 CFR chapter I is amended as follows:

PART 180--[AMENDED]

0
1. The authority citation for part 180 continues to read as follows:

    Authority: 21 U.S.C. 321(q), 346a and 371.

0
2. In Sec.  180.245, add alphabetically the entries ``Fruit, citrus,
Group 10-10'' and ``Fruit, citrus, Group 10-10, dried pulp'' to the
table in paragraph (b) to read as follows:

Sec.  [emsp14]180.245  Streptomycin; tolerances for residues.

* * * * *
    (b) * * *

----------------------------------------------------------------------------------------------------------------
                                                     Parts per
                    Commodity                         million                     Expiration date
----------------------------------------------------------------------------------------------------------------
Fruit, citrus, Group 10-10......................             2.0   December 31, 2019.
Fruit, citrus, Group 10-10, dried pulp..........             6.0   December 31, 2019.

                                                  * * * * * * *
----------------------------------------------------------------------------------------------------------------

* * * * *
[FR Doc. 2017-04779 Filed 3-14-17; 8:45 am]
 BILLING CODE 6560-50-P


INFORMATION COLLECTION REQUEST Proposed Regulations for Control of Air Pollution;

Emission Standards for New Nonroad Spark Ignition Engines at and Below 19 Kilowatts Production Line Testing Reporting and Recordkeeping Requirements EPA ICR No. 1845.02 September 1999 Engine Programs and Compliance Division Office of Mobile Sources Office of Air and Radiation U. S. Environmental Protection Agency 2 SUPPORTING STATEMENT 1. IDENTIFICATION OF THE INFORMATION COLLECTION 1( a) TITLE Nonroad Spark Ignition Engines at and Below 19 Kilowatts ( Small SI Engines) Manufacturers' Production Line Testing Reporting and Recordkeeping Requirements. This is a new collection.

1( b) SHORT CHARACTERIZATION ( ABSTRACT)

The Small SI Engine Manufacturers' Production Line Testing Program ( PLT) uses this information collection to enforce exhaust emission standards. Section 213( d) of the Clean Air Act as amended ( Act) authorizes the Small SI Engine Manufacturers' PLT Program which is reviewed by the Engine Compliance Programs ( ECP) Group, Engine Programs and Compliance Division, Office of Mobile Sources, Office of Air and Radiation.

The PLT program is an emission compliance program for new production small SI engines in which manufacturers are required to test engines as they leave the assembly line, without EPA oversight. The objective of the self audit program is that manufacturers and EPA will determine, with reasonable statistical certainty, whether or not new engines are in compliance with the Act.

The manufacturers' PLT program would be the main production line emission test program for small SI engines. The Small SI Engine Selective Enforcement Auditing ( SEA) Program would be typically employed when EPA determines that the results of the PLT program reveal noncompliance or when EPA determines that other evidence of suspected noncompliance by the manufacturer exists. SEAs will be utilized as a spot check to enable EPA to evaluate testing practices used by the manufacturer, follow up on concerns reported to EPA and address configurations not covered by manufacturers in their PLT program, if any.

This information collection requires manufacturers of small SI engines, both handheld and nonheldheld, to submit to EPA periodic reports and information from their PLT programs. The ECP Group collects this information and evaluates it to determine if production small SI engines comply with the Act. The PLT information collected specifically includes detailed production information, records for test equipment, test data, statistical analyses to determine compliance level and reports.

The results of the PLT program are used only by the Office of Mobile Sources to verify compliance of production engines; 3 however, the exhaust emission data generated during PLT programs becomes public information after the PLT program is concluded. The data and test facility information from the PLT program may be used by the ECP Group to help evaluate a manufacturer's future model year Applications for Certification, and PLT data will also used by the ECP Group to help target potential future in use nonconformities.

The information is collected by the ECP Group and stored in internal files and databases. Copies of reports from manufacturers listing PLT results are also stored in public information files and are available for individual review.

The ECP Group estimates that the annual cost to industry of the Small SI Production Line Testing Program resulting from this information collection to be $ 7,196,300 for the first year of the program and $ 3,617,100 for subsequent years. The first year estimate includes extra costs to predict a " learning curve" resulting from manufacturers learning how to conduct PLT programs and resulting from the training required with new programs. These costs are divided between the 50 manufacturers of small SI engines which comprise both the handheld and nonhandheld market segments.

2. NEED FOR AND USE OF THE COLLECTION 2( a) NEED/ AUTHORITY FOR THE COLLECTION This information collection is needed by EPA to determine whether engine manufacturers are producing engines that meet the emission requirements of the Act. For small SI engines, the EPA administers a three stage compliance program which consists of pre production ( Certification) testing and required manufacturers' production line testing ( PLT), and in use testing.

The PLT program verifies that prototype designs used in certification have been successfully translated into mass produced engines. By detecting problems through the PLT program, while engines are still in production, nonconformities may be corrected before engines are introduced into commerce or may be corrected soon after production when engines are most easily located.

To ensure that small SI engine manufacturers' new production engines conform with requirements of the Act and emission standards applicable for the model year in which the engines are assembled, the U. S. Environmental Protection Agency ( EPA) is authorized to conduct emission testing of new production small SI engines through the PLT program. 4 Section 213( d) ( also reference Section 206( b)) of the Act authorizes EPA to execute the small SI engine manufacturers' production line emission testing program. Section 208( a) of the Act requires manufacturers to establish and maintain records, make reports, and provide information to enable EPA to promulgate the regulations that are necessary to carry out these functions. EPA therefore proposed regulations at 40 CFR Part 91 to establish the small nonroad SI engine PLT program.

2( b) USE/ USERS OF THE DATA The Office of Mobile Sources uses this information collection to verify that production small SI engines meet Federal emission requirements. The ECP Group uses PLT information to determine compliance of tested engine designs.

PLT results are used by EPA to enforce provisions of the Act. The Administrator may use PLT results as a basis to suspend or revoke a Certificate of Conformity for noncomplying engines and for a noncomplying engine class. The ECP Group may also use PLT results to help evaluate an engine design's emission compliance.

3. NONDUPLICATION, CONSULTATIONS, AND OTHER COLLECTION CRITERIA 3( a) NONDUPLICATION The Office of Mobile Sources is the only Federal office which regulates the emissions of new production small nonroad SI engines. Emissions and sales data differentiated by EPA engine classes are not gathered by other agencies, departments or program offices.

Within the Office of Mobile Sources, the Engine Programs and Compliance Division ( EPCD) obtains emissions data for small SI engines. However, the small SI engine emission data which EPCD collects is information concerning preproduction prototype engines, not the new production small nonroad SI engines to be tested in manufacturers' production line test programs.

3( b) PUBLIC NOTICE REQUIRED PRIOR TO ICR SUBMISSION TO OMB Not Applicable. This is a rule related ICR.

3( c) CONSULTATIONS EPA consulted with four nonroad engine manufacturers regarding the information collection burden of this program. Three of these manufacturers have experience with conducting onhighway heavy duty engine Selective Enforcement Audits, which involves testing production line engines, under 40 CFR Part 86 5 Subpart K. These manufacturers provided hourly pay rates and burden hours for the activities described in this ICR. EPA believes these rates will coincide with hourly pay rates and burden hours for the small nonroad SI industry.

SURVEYED MANUFACTURERS AND CONTACTS:

Cummins Engine Company, Inc., Hugh M. Daugherty ( 812) 377 3263 Caterpillar Inc., Don Dowdall ( 309) 675 5362 Detroit Diesel Corporation, Ed Kohl ( 313) 592 5933 John Deere & Company, Rick Bishop ( 319) 292 8157 3( d) EFFECTS OF LESS FREQUENT COLLECTION The information collection schedules listed in this document are essential for enforcement. Annual production information is necessary to verify the quantities of engines in each engine family. PLT data is needed on a quarterly basis so the ECP Group can evaluate current production emission levels. If PLT data were submitted less frequently, the ECP Group would not be able to efficiently direct its resources toward problem engine families and would not be able to expeditiously determine that production engines conform to emission standards.

3( e) GENERAL GUIDELINES Paperwork Reduction Act Guidelines One PLT information collection activity exceeds the guidelines of the Paperwork Reduction Act, which provides that respondents will have a minimum of 30 days to provide the requested information.

EPA requires ( 90.709 ( d)) that manufacturers notify EPA within ten days if the results of PLT testing indicate noncompliance. EPA needs this requirement to rapidly evaluate PLT program conclusions and occurrences during the program. This item is readily available or generated during the PLT program.

3( f) CONFIDENTIALITY The " projected annual production" information, the " actual quarterly production" and the " production volume at assembly plants" is considered confidential and is therefore protected under 40 CFR Part 2. All other reports are considered public information, as authorized by section 208 ( b) of the Act, and 6 are filed in EPA's Public Information File.

3( g) SENSITIVE QUESTIONS Not applicable. No questions of a sensitive nature are asked.

4. THE RESPONDENTS AND INFORMATION REQUESTED 4( a) RESPONDENTS/ SIC CODES The respondents are engine manufacturers ( SIC 351).

4( b) INFORMATION REQUESTED ( i) Data items Report on these Items:

PLT Information 1. Production Volumes at Assembly Plants 2. Sampling Rates 3. Emission Test Data 4. Significant Events During the PLT program and Engine Information 5. Report of PLT Results 6. Statistical analysis determining compliance level 7. Test Facility Description 8. PLT Laboratory Check Out Data 9. PLT Test Engine Failure Report 10. PLT Failure Report Maintain Records On: 1. Test Facility 2. Reported PLT Information ( ii) Respondent Activities The information collection activities of the small SI engine PLT program include the collection of projected quarterly production and annual sales data. EPA expects that small SI engine manufacturers produce projected annual production estimates routinely as a part of production planning and marketing strategy. EPA requests that all small SI engine manufacturers submit actual production information quarterly and annual projected production information once per model year, prior to the start of that model year's production. Manufacturers might adjust existing production estimates to put them into the categories requested by EPA, but no new information should have to be created.

PLT information collection requirements will require 7 manufacturers to perform a variety of activities. PLT information will require manufacturers to plan activities, train personnel, and maintain records. EPA expects that manufacturers will not have to generate new information to report projected production at assembly plants. EPA expects that manufacturers will have records with production plans, but manufacturers will probably need to assemble this information in a format useful to the ECP Group.

EPA estimates that manufacturers will plan and develop procedures for conducting the PLT program. Manufacturers will need to periodically read regulations that specify PLT emission testing procedures. Manufacturers will probably, prior to ever conducting an production line test, develop company wide and assembly plant procedures for the PLT program. Additionally, manufacturers will need to train engineers, technicians, and mechanics for the PLT program.

Manufacturers will need to both create and gather information during an PLT program. Manufacturers are required to perform emission tests on engines and create documents detailing the test results. Manufacturers are required, under certification regulations, to maintain calibration and maintenance documentation for test equipment. During PLT testing, manufacturers must gather and provide this information to EPA.

Finally, manufacturers must write brief reports listing the results of PLT testing and maintain records of their PLT programs. Manufacturers must submit a quarterly report of PLT results which includes testing information. If engines fail to comply with standards during an PLT program, manufacturers must submit failed engine reports. Manufacturers must maintain PLT records for a period of one year after the conclusion of the PLT program for that model year. These records must include test equipment as well as test engine information. Manufacturers may maintain these records in any format.

5. THE INFORMATION COLLECTED AGENCY ACTIVITIES, COLLECTION METHODOLOGY, AND INFORMATION MANAGEMENT 5( a) AGENCY ACTIVITIES The ECP Group performs the following activities with information collected.

1. Review, Compare & File Projected Annual Production and Actual Quarterly Production Data 2. Review, Check Accuracy and Completeness, and Copy Quarterly PLT Reports 8 3. Gather, Prepare index, and Submit Copies of Reports to Public Files 5( b) Collection Methodology and Management The ECP Group uses information collected to:

( i) Ensure that manufacturers are producing engines that conform to applicable emission standards.

The ECP Group will use the PLT information ( projected annual production and production line test results) to ensure production line engines meet the emission standards to which their prototypes were certified. Manufacturers provide the " Production volume at Assembly Plants" to enable EPA to evaluate the manufacturers' statistical analysis to sample production line engines at a lesser rate. The report contains the number of small nonroad SI engines, by class and assembly plant, scheduled for production at assembly plants during the period designated in the request.

( ii) Ensure that manufacturers precisely follow the emissions test procedures listed in the CFR.

Manufacturers that conduct an PLT program are required to maintain Emission Test Data which includes the Hydrocarbon, Carbon Monoxide and Oxides of Nitrogen emissions and Carbon Dioxide concentrations from each small nonroad SI engine tested, and documentation relating to the conduct of each emissions test and Significant Events and Engine Data which include records relating to the preparation of each engine for testing. This information is provided to EPA in the Report of PLT Results.

( iii) Ensure that manufacturers' test equipment accurately measure emissions.

Manufacturers that conduct an PLT program are required to maintain a Test Facility Description of the equipment used for the PLT program and its calibration. A portion of this information is provided to EPA in the Report of PLT Results.

( iv) Ensure that production small SI engines are in conformity with applicable Federal emission requirements as they come off the assembly line and that individual engines tested during an PLT program conform to applicable emission standards.

Manufacturers that have conducted an PLT program provide a Report of PLT Results to EPA. This report is reviewed to ensure that the small SI engine class that received the PLT testing conforms to applicable requirements. The certificate of conformity is automatically suspended for an individual small SI 9 engine if the engine fails to comply with emission standards during an PLT program. The certificate is reinstated when a manufacturer submits to EPA an PLT Test Failure Report which contains passing test results and a description of the remedy that brought the individual engine into conformity with applicable emission standards.

If an engine family is found to be in noncompliance or the engine manufacturer's submittal revealed that the PLT tests were performed improperly, the EPA may suspend or revoke the certificate of conformity in whole or in part for that engine family. The manufacturer will submit to EPA an PLT Failure Report which identifies the reason for the noncompliance of the small nonroad SI engine class and the proposed remedy.

Manufacturers are expected to electronically submit their PLT reports. The ECP Group currently makes extensive use of computers in evaluating information from engine manufacturers. A significant portion of the ECP Group's PLT activity will be spent reviewing manufacturer PLT reports for accuracy and completeness prior to entering the information into a database. Printed or electronic copies of this information may be made available to the public.

5( c) Small Entity Flexibility Small volume engine manufacturers whose production of engines subject to Phase 2 regulation does not exceed 10,000 units for nonhandheld engines or 25,000 units for handheld engines are exempt from the PLT requirements. Furthermore, both nonhandheld and handheld engine families with an annual production of 5,000 units or less are also exempt from the PLT requirements. The handheld and nonhandheld engine exemption criteria are outlined in 90.701( b).

5( d) Collection Schedule The ECP Group collects the information described in this document at different times throughout the calendar year. The ECP Group requests that manufacturers submit PLT data and actual production data on a quarterly basis. The ECP Group requests from manufacturers projected annual production data prior to the start of each model year.

The ECP Group requires that manufacturers notify EPA within ten days if the results of PLT testing indicate noncompliance and report audit results within forty five working days after the conclusion of each quarter. This requirement enables the EPA to rapidly evaluate PLT program conclusions and occurrences during the program. The ECP Group will permit, on a case bycase basis, limited extensions of these deadlines when justified by a manufacturer. 10 6. ESTIMATING THE BURDEN AND COST OF THE COLLECTION 6( a) ESTIMATING RESPONDENT BURDEN The manufacturers consulted in section 3( c) provided detailed estimates of their work distribution during audits. EPA expects that manufacturers may spend more time preparing for and evaluating results from their PLT audits during the first year of the program. For the first year, EPA expects that the time to conduct a PLT audit may exceed EPA's annual estimate by as much as a learning curve factor of two. Consequently, the first year collection burden estimate below doubles the time estimated by on highway manufacturers in section 3( c) to conduct a PLT audit.

Chart 6( d)( i) lists the Agency's estimate of the respondent's burden for this information collection activity. The estimates listed below are an averaged value from the surveyed manufacturers in section 3( c). Chart 6( d)( i) shows a manufacturers' annual burden estimate after that manufacturer has experience in conducting a PLT program. This chart does not include the learning curve described above. The learning curve estimate is included in the first year recordkeeping and reporting burden calculations below.

NOTES: 1) Number of respondents for annual projected production is 50. 2) Number of respondents for all PLT information is 50. 3) As described in section 6( a), a multiplication factor of 2 is applied to all PLT information for the programs's first year to compensate for a learning curve.

FIRST YEAR RECORDKEEPING BURDEN: LEARNING CURVE FACTOR ( 2) x [ HR. TOT.( 76) x No. Respond. ( 50)] = 7,600 hrs.

REPORTING BURDEN: Projected Production Subtot. ( 13) x No. Respond. ( 50) + LEARNING CURVE FACTOR ( 2) x [ PLT Reporting Subtotal ( 1120) x No. Respond. ( 50)] = 112,650 hrs.

BURDEN TOTAL: ANNUAL TOTAL REC. BURDEN + ANNUAL TOTAL REP. BURDEN = 120,250 hrs.

COST TOTAL: Projected Production Subtotal ($ 758) x No. Respond. ( 50) + 11 LEARNING CURVE FACTOR ( 2) x [ Audit Information Subtotals ($ 67024 + $ 4560) x No. Respond. ( 50)] = $ 7,196,300 SUBSEQUENT YEARS ANNUAL RECORDKEEPING BURDEN: HR. TOT.( 76) x No. Respond. ( 50) = 3,800 hrs.

ANNUAL REPORTING BURDEN: Projected Production Subtot. ( 13) x No. Respond. ( 50) + PLT Reporting Subtotal ( 1120) x No. Respond. ( 50) = 56,650 hrs.

ANNUAL BURDEN TOTAL: ANNUAL TOTAL REC. BURDEN + ANNUAL TOTAL REP. BURDEN = 60,450 hrs.

ANNUAL COST TOTAL: Projected Production Subtotal ($ 758) x No. Respond. ( 50) + Audit Information Subtotals ($ 67024 + $ 4560) x No. Respond. ( 50) = $ 3,617,100 6( b) ESTIMATING RESPONDENT COSTS 6 ( b)( i) Estimating Respondent Labor Costs Reference Chart 6( d)( i).

Regarding hourly pay rates, consulted manufacturers provided pay rates, including benefits and overhead, for the following categories: management, engineer, machinist, mechanic, technician and junior professional/ clerical. Since the average pay rates did not greatly differ for management, engineers, machinists mechanics and technicians, a combined average pay rate of $ 60.00/ hour is used for this category. The average junior professional/ clerical pay rate is $ 38.00/ hour. These pay categories are listed only as management/ technician ( Mgmt/ Tech) and clerical. As described in section 6( b), hourly pay rates are based on a survey of engine manufacturers.

6 ( b)( ii) Estimating Respondent Capital and Operating and Maintenance Costs It is assumed that there are no capital, operating and maintenance costs to the respondents. The information collection burden hours are minuscule compared to the daily routine operations which take place at the manufacturers facilities. These operations ( internal quality audit emissions testing, research and development) would continue on a daily basis even without this above information collection burden. 12 6( c) ESTIMATING AGENCY BURDEN AND COST EPA based its burden estimates on experience from information collection activities performed in the on highway SEA program which involves testing production line engines.

Chart  6( c) Agency Burden/ Cost Estimates Collection Burden Hours Freq. Total Annual Activity Tech Cler. Hours Cost @ $ 21 @ $ 9 1. Review, Compare & File Projected Annual Prod. Data 1 50 50 $ 1,050 2. Review, Check Accuracy and Completeness, and Copy PLT Reports 3 200 600 $ 12,600 3. Gather, Prepare index, and Submit Copies of Reports to Public Files 4 4 16 $ 144 13 14 6( d) ESTIMATING THE RESPONDENT UNIVERSE AND TOTAL BURDEN HOURS AND COSTS CHART  6( d)( i) BOTTOM LINE RESPONDENT BURDEN ESTIMATE Collection Burden Hours Freq. Annual Activity Mgmt./ Tech Cler. Hours Cost @$ 60 @$ 38 1. Projected Production Data ( Reporting Requirements)

1. A Gather Prod. Data 11 1 11 $ 660 1. B Write Report 1 1 1 2 $ 98 SUBTOTAL: 13 $ 758 2. Production Line Testing ( Reporting Requirements)

2. A Read instructions 6 4 24 $ 1440 2. B Testing/ Create 216 4 864 $ 51840 2. C Gather existing information 22 4 88 $ 5280 2. D Write report 34 2 4 144 $ 8464 SUBTOTAL: 1120 $ 67024 3. Production Line Testing ( Recordkeeping Requirements)

3. A Read instructions 4 4 16 $ 960 3. B Plan activities 3 4 12 $ 720 3. C Implement activities 2 4 8 $ 480 3. D Develop record system 1 4 4 $ 240 3. E Enter information 1 4 4 $ 240 3. F Train personnel 7 4 28 $ 1680 15 3. G Misc. Tasks 1 4 4 $ 240 SUBTOTAL: 76 $ 4560 TOTAL: 1209 $ 72342 6( d)( ii) The Agency tally Chart  6( d)( ii) Agency Burden/ Cost Estimates Collection Annual Burden Hours Total Annual Activity Tech Cler. Hours Cost @ $ 21 @ $ 9 1. Review, Compare & File Projected Annual Prod. Data 50 50 $ 1,050 2. Review, Check Accuracy and Completeness, and Copy PLT Reports 600 600 $ 12,600 3. Gather, Prepare index, and Submit Copies of Reports to Public Files 16 16 $ 144 TOTALS 650 + 16 = 666 $ 13,794 AGENCY TOTAL ANNUAL BURDEN: 666 hours AGENCY TOTAL ANNUAL COST: $ 13,794 16 ( iv) Variations in the Annual Bottom Line No annual variations in the respondent reporting/ recordkeeping burden or cost over the course of this clearance period are expected.

6( e) REASONS FOR CHANGE IN BURDEN This is a new collection.

6( f) BURDEN STATEMENT For the first year of the regulation, the industry testing and reporting burden for this collection of information is estimated to average 2,253 hours per respondent and to require an average of 152 hours per respondent for recordkeeping. For subsequent years, the per respondent burden is estimated to average 1,133 hours for testing and reporting, and 76 hours for recordkeeping. This results in an average annual total burden of 80,383 hours. This includes the time for reviewing instructions, training personnel, testing, gathering and maintaining data, and completing and reviewing the collection of information. The first year estimates include extra hours to account for the additional time manufacturers will spend learning audit procedures and developing recordkeeping systems that may be used for this program.

Burden means the total time, effort, or financial resources expended by persons to generate, maintain, retain, or disclose or provide information to or for a Federal agency. This includes the time needed to review instructions; develop, acquire, install, and utilize technology and systems for the purposes of collecting, validating, and verifying information, processing and maintaining information, and disclosing and providing information; adjust the existing ways to comply with any previously applicable instructions and requirements; train personnel to be able to respond to a collection of information; search data sources; complete and review the collection of information; and transmit or otherwise disclose the information. An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless it displays a currently valid OMB control number. The OMB control numbers for EPA's regulations are listed in 40 CFR Part 9 and 48 CFR Chapter 15.

Send comments on the Agency's need for this information, the accuracy of the provided burden estimates, and any suggested methods for minimizing respondent burden, including through the use of automated collection techniques to the Director, OPPE Regulatory Information Division, U. S. Environmental Protection 17 Agency ( 2137), 401 M St., S. W., Washington, D. C. 20500; and to the Office of Information and Regulatory Affairs, Office of Management and Budget, 725 17th Street, NW, Washington, DC 20503, Attention: Desk Officer for EPA. Include the EPA ICR number in any correspondence. 18 INFORMATION REQUIREMENTS AND AUTHORITY DATA SHEET PRODUCTION LINE TESTING REQUIREMENTS  SMALL SI ENGINES 40 CFR PART 90 SUBPART H MANDATORY INFORMATION CITATION  Projected Production Information 90.704 ( c)

 Production Volume at Assembly Plants 90.704 ( c)

 Engine Data 90.704 ( a)

 Report of PLT Results 90.709 ( e)

 Test Facility Description 90.704 ( a)

 Laboratory Check Out Data 90.705 ( b)

 PLT Test Failure Report 90.711 ( g)

 PLT Failure Report 90.711 ( h)

 Record Retention Requirements 90.704 ( b)


[Federal Register: December 16, 2009 (Volume 74, Number 240)]
[Notices]
[Page 66666-66667]
[DOCID:fr16de09-88]

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DEPARTMENT OF HOMELAND SECURITY

Federal Emergency Management Agency

[Internal Agency Docket No. FEMA-1861-DR; Docket ID FEMA-2008-0018]

Arkansas; Major Disaster and Related Determinations

AGENCY: Federal Emergency Management Agency, DHS.

ACTION: Notice.

-----------------------------------------------------------------------

SUMMARY: This is a notice of the Presidential declaration of a major
disaster for the State of Arkansas (FEMA-1861-DR), dated December 3,
2009, and related determinations.

DATES: Effective Date: December 3, 2009.

FOR FURTHER INFORMATION CONTACT: Peggy Miller, Disaster Assistance
Directorate, Federal Emergency Management Agency, 500 C Street, SW.,
Washington, DC 20472,<PHONE_NUMBER>.

SUPPLEMENTARY INFORMATION: Notice is hereby given that, in a letter
dated December 3, 2009, the President issued a major disaster
declaration under the authority of the Robert T. Stafford Disaster
Relief and Emergency Assistance Act, 42 U.S.C. 5121 et seq. (the
``Stafford Act''), as follows:

    I have determined that the damage in certain areas of the State
of Arkansas resulting from severe storms, tornadoes, and flooding
beginning on October 29, 2009, and continuing, is of sufficient
severity and magnitude to warrant a major disaster declaration under
the Robert T. Stafford Disaster Relief and Emergency Assistance Act,
42 U.S.C. 5121 et seq. (the ``Stafford Act''). Therefore, I declare
that such a major disaster exists in the State of Arkansas.
    In order to provide Federal assistance, you are hereby
authorized to allocate from funds available for these purposes such
amounts as you find necessary for Federal disaster assistance and
administrative expenses.
    You are authorized to provide Public Assistance in the
designated areas and Hazard Mitigation throughout the State. Direct
Federal assistance is authorized. Consistent with the requirement
that Federal assistance is supplemental, any Federal funds provided
under the Stafford Act for Public Assistance and Hazard Mitigation
will be limited to 75 percent of the total eligible costs.
    Further, you are authorized to make changes to this declaration
for the approved assistance to the extent allowable under the
Stafford Act.

    The Federal Emergency Management Agency (FEMA) hereby gives notice
that pursuant to the authority vested in the Administrator, under
Executive Order 12148, as amended, W. Michael Moore, of FEMA is
appointed to act as the

Federal Coordinating Officer for this major disaster.
    The following areas of the State of Arkansas have been designated
as adversely affected by this major disaster:

    Boone, Bradley, Calhoun, Carroll, Cleburne, Cleveland, Columbia,
Conway, Cross, Dallas, Franklin, Fulton, Grant, Izard, Jackson,
Johnson, Lafayette, Lawrence, Lincoln, Logan, Marion, Monroe,
Nevada, Newton, Ouachita, Poinsett, Prairie, Pulaski, Randolph,
Saint Francis, Scott, Sharp, Stone, Union, Van Buren, White, and
Woodruff Counties for Public Assistance. Direct Federal Assistance
is authorized.
    All counties within the State of Arkansas are eligible to apply
for assistance under the Hazard Mitigation Grant Program.
    The following Catalog of Federal Domestic Assistance Numbers
(CFDA) are to be used for reporting and drawing funds: 97.030,
Community Disaster Loans; 97.031, Cora Brown Fund; 97.032, Crisis
Counseling; 97.033, Disaster Legal Services; 97.034, Disaster
Unemployment Assistance (DUA); 97.046, Fire Management Assistance
Grant; 97.048, Disaster Housing Assistance to Individuals and
Households in Presidentially Declared Disaster Areas; 97.049,
Presidentially Declared Disaster Assistance--Disaster Housing
Operations for Individuals and Households; 97.050, Presidentially
Declared Disaster Assistance to Individuals and Households--Other
Needs; 97.036, Disaster Grants--Public Assistance (Presidentially
Declared Disasters); 97.039, Hazard Mitigation Grant.

W. Craig Fugate,
Administrator, Federal Emergency Management Agency.
[FR Doc. E9-29953 Filed 12-15-09; 8:45 am]

BILLING CODE 9111-23-P


[Federal Register Volume 83, Number 70 (Wednesday, April 11, 2018)]
[Notices]
[Pages 15655-15658]
[FR Doc No: 2018-07408]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-83002; File No. SR-ISE-2018-27]

Self-Regulatory Organizations; Nasdaq ISE, LLC; Notice of Filing
and Immediate Effectiveness of Proposed Rule Change To Modify the
Rebates Provided to Members That Send Unsolicited Crossing Orders to
the Exchange

April 5, 2018.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that
on March 23, 2018, Nasdaq ISE, LLC (``ISE'' or ``Exchange'') filed with
the Securities and Exchange Commission (``Commission'') the proposed
rule change as described in Items I and II below, which Items have been
prepared by the Exchange. The Commission is publishing this notice to
solicit comments on the proposed rule change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change

    The Exchange proposes to amend the Exchange's Schedule of Fees to
modify the rebates it provides to Members that send unsolicited
Crossing Orders \3\ to the Exchange.
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    \3\ A ``Crossing Order'' is an order executed in the Exchange's
Facilitation Mechanism, Solicited Order Mechanism, Price Improvement
Mechanism (``PIM'') or submitted as a Qualified Contingent Cross
(``QCC'') order. For purposes of this Fee Schedule, orders executed
in the Block Order Mechanism are also considered Crossing Orders.
See Preface to ISE's Schedule of Fees.
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    The text of the proposed rule change is available on the Exchange's
website at http://ise.cchwallstreet.com/, at the principal office of
the Exchange, and at the Commission's Public Reference Room.

II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change

    In its filing with the Commission, the Exchange included statements
concerning the purpose of and basis for the proposed rule change and
discussed any comments it received on the proposed rule change. The
text of these statements may be examined at the places specified in
Item IV below. The Exchange has prepared summaries, set forth in
sections A, B, and C below, of the most significant aspects of such
statements.

A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The purpose of the proposed rule change is to amend ISE's Schedule
of Fees to replace the current Member Order Routing Program (``MORP''),
which provides enhanced rebates to order routing firms that select the
Exchange as the default routing destination for unsolicited Crossing
Orders, and the Customer to Customer Rebate PLUS program,\4\ which
provides an indirect incentive for Members to direct unsolicited
Crossing Orders to the Exchange, with a new rebate program, entitled
the ``PIM and Facilitation Rebate'' program. Through this new program,
the Exchange aims to provide a more accessible, direct, and effective
incentive to Members to direct their unsolicited Crossing Orders to the
Exchange.
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    \4\ See Section IV, A of the Schedule of Fees.
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MORP
    As noted above, the MORP is a program that provides rebates to
firms that select the Exchange as their default routing destination for
unsolicited Crossing Orders. To be eligible to participate in MORP, an
Electronic Access Member (``EAM'') must: (1) Designate to the Exchange,
in writing, those sessions (connections to the Exchange over which the
firm submits orders) that meet the following MORP criteria; (2) provide
systems to its clients that enable the electronic routing of option
orders to all of the U.S. options exchanges, including ISE; (3)
interface with ISE to access the Exchange's electronic options trading
platform; (4) offer to its clients a customized interface and routing
functionality such that ISE will be the default destination for all
unsolicited Crossing Orders entered by the EAM, provided that market
conditions allow the Crossing Order to be executed on ISE; (5)
configure its own option order routing functionality such that ISE will
be the default destination for all unsolicited Crossing Orders,
provided that market conditions

allow the Crossing Order to be executed on ISE, with respect to all
option orders as to which the EAM has routing discretion; and (6)
ensure that the default routing functionality permits users submitting
option orders through such system to manually override the ISE as the
default destination on an order-by-order basis. EAMs that wish to
participate in the program must certify that they meet the foregoing
MORP requirements, in writing, on a monthly basis.
    An EAM that is MORP-eligible currently receives a rebate for all
unsolicited Crossing Orders of $0.05 per originating contract side,
provided that the Member executes a minimum average daily volume
(``ADV'') in unsolicited Crossing Orders of at least 30,000 originating
contract sides. This rebate increases to $0.07 per originating contract
side, provided that the Member executes a higher ADV in unsolicited
Crossing Orders of 100,000 originating contract sides. The rebate for
the highest tier achieved is applied retroactively to all eligible
contracts traded in a given month.
    In addition, any EAM that qualifies for the MORP rebate by
executing an ADV of 30,000 originating contract sides or more is also
eligible for increased Facilitation and Solicitation break-up rebates
\5\ for their Non-ISE Market Maker,\6\ Firm Proprietary,\7\ Broker-
Dealer,\8\ Professional Customer,\9\ and Priority Customer orders.\10\
Currently, MORP eligible members that execute a qualifying ADV in
unsolicited Crossing Orders of at least 30,000 originating contract
sides, receive a Facilitation and Solicitation break-up rebate that is
$0.35 per contract for regular and complex orders in Select
Symbols,\11\ $0.15 per contract for regular orders in Non-Select
Symbols,\12\ $0.80 per contract for complex orders in Non-Select
Symbols, and $0.15 per contract for regular and complex orders in
foreign exchange option classes.
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    \5\ Break-up rebates are provided for contracts that are
submitted to the Facilitation and Solicited Order Mechanisms that do
not trade with their contra order except when those contracts trade
against pre-existing orders and quotes on the Exchange's orderbooks.
The applicable fee for Crossing Orders is applied to any contracts
for which a rebate is provided.
    \6\ A ``Non-ISE Market Maker'' is a market maker as defined in
Section 3(a)(38) of the Securities Exchange Act of 1934, as amended,
registered in the same options class on another options exchange.
    \7\ A ``Firm Proprietary'' order is an order submitted by a
member for its own proprietary account.
    \8\ A ``Broker-Dealer'' order is an order submitted by a member
for a broker-dealer account that is not its own proprietary account.
    \9\ A ``Professional Customer'' is a person or entity that is
not a broker/dealer and is not a Priority Customer.
    \10\ A ``Priority Customer'' is a person or entity that is not a
broker/dealer in securities, and does not place more than 390 orders
in listed options per day on average during a calendar month for its
own beneficial account(s), as defined in ISE Rule 100(a)(37A).
    \11\ ``Select Symbols'' are options overlying all symbols listed
on the ISE that are in the Penny Pilot Program.
    \12\ ``Non-Select Symbols'' are options overlying all symbols
excluding Select Symbols.
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    The MORP program was designed to encourage order routing firms to
execute additional unsolicited Crossing Order volume on the ISE.
However, the Exchange has concluded that the MORP program has not
fulfilled its intended purpose due, in large part, to the fact that the
conditions for participation in the program have proven to be onerous.
Accordingly, the Exchange proposes to eliminate the MORP program and,
as discussed below, the Exchange proposes to replace it with the
proposed PIM and Facilitation Rebate program, described below.
Customer to Customer Rebate PLUS
    As part of the QCC and Solicitation Rebate program, the Exchange
presently offers a set of rebates called ``Customer to Customer''
Rebate PLUS.\13\ These rebates apply to ``Customer to Customer'' Orders
\14\ and in particular, those executed by two Priority Customers with:
(1) A specified volume of QCC \15\ and other solicited Crossing Orders
in a given month; and (2) 175,000 or more unsolicited originating
Facilitation \16\ contract sides per month. Once a Member meets the
volume thresholds described above, the Member receives $0.05 per
contract ``Customer to Customer'' Rebate PLUS for each originating
contract side of their ``Customer to Customer'' Orders.
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    \13\ See Section IV, A of the Schedule of Fees.
    \14\ A ``Customer to Customer'' order is a QCC or other
solicited order between two Priority Customers.
    \15\ A QCC Order is comprised of an originating order to buy or
sell at least 1000 contracts that is identified as being part of a
qualified contingent trade, as that term is defined in Supplementary
Material .01 below, coupled with a contra-side order or orders
totaling an equal number of contracts. See ISE Rule 715(j).
    \16\ The Facilitation Mechanism is a process by which an EAM can
execute a transaction wherein the EAM seeks to facilitate a block-
size order it represents as agent, and/or a transaction wherein the
EAM solicited interest to execute against a block-size order it
represents as agent. See Rule 716(d).
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    As a means of consolidating its incentive programs relating to
unsolicited Crossing orders, and to provide more direct incentives to
encourage such orders, the Exchange proposes to eliminate the Customer
to Customer Rebate PLUS program and replace it with the proposed PIM
and Facilitation Rebate, described below.
PIM and Facilitation Rebate
    In lieu of the MORP and the Customer to Customer Rebate PLUS
program, the Exchange proposes to incentivize the flow of unsolicited
Crossing Orders to the Exchange by establishing a PIM and Facilitation
Rebate program. This proposed program would offer rebates to Members
that use the Facilitation Mechanism or PIM for unsolicited Crossing
Orders whereby the contra-side of those orders: (1) Is either Firm
Proprietary or Broker-Dealer; and (2) has total affiliated ADV \17\ of
250,000 or more contracts. Members whose orders meet these conditions
will be entitled to receive a rebate of $0.02 per originating contract
for up to 199,999 originating contract sides in a month. To the extent
that Members have at least 200,000 originating contract sides in a
given month, then the Members will be entitled to receive a rebate of
$0.03 for all of its originating contract sides in that month that
qualify for the PIM and Facilitation Rebate Program during that month,
including the Members' first qualifying 199,999 originating contract
sides.
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    \17\ Eligible volume from affiliated Members will be aggregated
in determining total affiliated ADV, provided there is at least 75%
common ownership between the Members as reflected on each Member's
Form BD, Schedule A.
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    To the extent that Members qualify for the foregoing rebate, they
may also become eligible for two additional rebates on the originating
contract sides of their unsolicited Crossing Orders. First, if Members
separately achieve, on a cumulative basis, more than 1,000,000 QCC and
Solicitation Order Mechanism \18\ originating contracts sides in a
month, then they will earn an additional $0.01 rebate per originating
contract side. Second, if Members achieve Priority Customer Complex ADV
of between 100,000-224,999 contracts, then they will earn an additional
$0.01 rebate per originating contract side on their unsolicited
Crossing Orders that qualify for the PIM and Facilitation Rebate
program. This second additional rebate will be $0.02 to the extent that
Members achieve Priority Customer Complex ADV Orders of 225,000
contracts or more. For avoidance of doubt, if a Member has 200,000
originating contract sides in a month that qualify for a $0.03 rebate
under the PIM and Facilitation Rebate

program and the Member also achieves Priority Customer Complex Order
ADV of 225,000 contracts in that same month, then the Member will
receive an additional $0.02 rebate on all of its 200,000 originating
contract sides that qualify for the PIM and Facilitation Rebate
program, for a total rebate on such originating contract sides of
$0.05. These two additional rebate opportunities will be cumulative,
meaning that a Member can qualify for both of them and receive an
additional rebate of up to $0.03 per originating contract side.
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    \18\ The Solicited Order Mechanism is a process by which an EAM
can attempt to execute orders of 500 or more contracts it represents
as agent against contra orders that it solicited. Each order entered
into the Solicited Order Mechanism shall be designated as all-or-
none. See ISE Rule 716(e).
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    The combination of the base rebate and the additional rebates will
offer Members that use the Facilitation Mechanism or PIM for
unsolicited Crossing Orders an opportunity to receive as much as $0.06
in rebates per originating contract side.
2. Statutory Basis
    The Exchange believes that its proposal is consistent with Section
6(b) of the Act,\19\ in general, and furthers the objectives of
Sections 6(b)(4) and 6(b)(5) of the Act,\20\ in particular, in that it
provides for the equitable allocation of reasonable dues, fees, and
other charges among members and issuers and other persons using any
facility, and is not designed to permit unfair discrimination between
customers, issuers, brokers, or dealers.
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    \19\ 15 U.S.C. 78f(b).
    \20\ 15 U.S.C. 78f(b)(4) and (5).
---------------------------------------------------------------------------

    The Commission and the courts have repeatedly expressed their
preference for competition over regulatory intervention in determining
prices, products, and services in the securities markets. In Regulation
NMS, while adopting a series of steps to improve the current market
model, the Commission highlighted the importance of market forces in
determining prices and SRO revenues and, also, recognized that current
regulation of the market system ``has been remarkably successful in
promoting market competition in its broader forms that are most
important to investors and listed companies.'' \21\
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    \21\ Securities Exchange Act Release No. 51808 (June 9, 2005),
70 FR 37496, 37499 (June 29, 2005) (``Regulation NMS Adopting
Release'').
---------------------------------------------------------------------------

    Likewise, in NetCoalition v. Securities and Exchange Commission
\22\ (``NetCoalition'') the DC Circuit upheld the Commission's use of a
market-based approach in evaluating the fairness of market data fees
against a challenge claiming that Congress mandated a cost-based
approach.\23\ As the court emphasized, the Commission ``intended in
Regulation NMS that `market forces, rather than regulatory
requirements' play a role in determining the market data . . . to be
made available to investors and at what cost.'' \24\
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    \22\ NetCoalition v. SEC, 615 F.3d 525 (DC Cir. 2010).
    \23\ See NetCoalition, at 534-535.
    \24\ Id. at 537.
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    Further, ``[n]o one disputes that competition for order flow is
`fierce.' . . . As the SEC explained, `[i]n the U.S. national market
system, buyers and sellers of securities, and the broker-dealers that
act as their order-routing agents, have a wide range of choices of
where to route orders for execution'; [and] `no exchange can afford to
take its market share percentages for granted' because `no exchange
possesses a monopoly, regulatory or otherwise, in the execution of
order flow from broker dealers'. . ..'' \25\ Although the court and the
SEC were discussing the cash equities markets, the Exchange believes
that these views apply with equal force to the options markets.
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    \25\ Id. at 539 (quoting Securities Exchange Act Release No.
59039 (December 2, 2008), 73 FR 74770, 74782-83 (December 9, 2008)
(SR-NYSEArca-2006-21)).
---------------------------------------------------------------------------

    The Exchange believes that its proposal to eliminate the MORP is
reasonable because the MORP has proven to be ineffective in achieving
its aim of attracting additional unsolicited Crossing Order flow to the
Exchange. The conditions for participation in the MORP have proven to
be too onerous for Members. Furthermore, the Exchange has limited
resources available to it to devote to the operation of special pricing
programs and as such, it is equitable to allocate those resources to
those programs that are effective and away from those programs that are
ineffective. The proposal to eliminate the MORP is not unfairly
discriminatory because the proposal will apply uniformly to all
similarly situated Members.
    The Exchange's proposal to eliminate the Customer to Customer
Rebate PLUS program is also both reasonable and equitable because this
program provides only an indirect incentive to Members to send
unsolicited Crossing Orders to the Exchange and the Exchange prefers to
re-allocate its limited resources to the provision of a stronger and
more direct incentive. The proposal to eliminate the Customer to
Customer Rebate PLUS program is not unfairly discriminatory because the
proposal will apply uniformly to all similarly situated Members.
    The Exchange's proposal to replace the MORP and the Customer to
Customer Rebate PLUS program with the PIM and Facilitation Rebate
program is also reasonable and equitable. The Exchange expects the PIM
and Facilitation program will complement its QCC and Solicitation
Rebate program for solicited Crossing Orders and it will provide a more
easily accessible, direct, and effective incentive for Members to send
their unsolicited Crossing Orders to the Exchange. In particular, the
proposal will encourage Members to send unsolicited PIM and
Facilitation orders to the Exchange and to meet the 200,000 contract
threshold to obtain the higher $0.03 base rebate.\26\ The Exchange also
believes that it reasonable and equitable to provide an additional
rebate as a reward to Members that achieve high levels of QCC and
Solicitation activity in addition to Facilitation and PIM activity. It
is also reasonable and equitable for the Exchange to provide additional
rebates to Members that achieve high volumes of Priority Customer
complex activity as a means of incentivizing increased use of the
Exchange's Complex Order Book. The Exchange expects that this package
of rebates will be attractive to market participants.
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    \26\ The Exchange believes it is reasonable to determine rebates
with reference to ``total affiliated ADV'' because it applies the
same concept elsewhere, including in calculating its QCC and
Solicitation Rebate program rebates.
---------------------------------------------------------------------------

    Finally, the Exchange believes that the proposed rebates for
unsolicited Crossing Orders in the PIM and Facilitation Mechanism are
not unfairly discriminatory. Although the proposal is focused on
incentives for unsolicited Crossing Orders, it replaces existing
Exchange rebate programs with a similar aim. In any event, the Exchange
already maintains a robust QCC and Solicitation Rebate program of
incentives for members that submit solicited Crossing Orders to the QCC
or the Solicitation, Facilitation, or Price Improvement Mechanisms.
Furthermore, the Exchange's decision to limit program eligibility to
those unsolicited Crossing Orders that involve Firm Proprietary or
Broker Dealer contra-side parties is not unfairly discriminatory
because the Exchange wishes to encourage the direct submission by
Members of Crossing Orders to the Exchange, and as a matter of
practice, Firm Proprietary and Broker-Dealer orders are most likely to
directly submitted by Members as these participant types typically
utilize the crossing fee cap on ISE and have increased incentive to
pre-pay for their Crossing Orders. Finally, the Exchange will apply the
proposed rebates uniformly to all Members' orders that meet the
required volume thresholds.

B. Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange does not believe that the proposed rule change will
impose any burden on competition not necessary or appropriate in
furtherance of the purposes of the Act.
    The proposed changes to the Exchange's rebate programs are intended
to attract additional order flow to ISE. The Exchange believes that the
proposal will enhance the competiveness of the ISE relative to other
options exchanges.
    The Exchange notes that it operates in a highly competitive market
in which market participants can readily favor competing venues if they
deem fee levels at a particular venue to be excessive, or rebate
opportunities available at other venues to be more favorable. In such
an environment, the Exchange must continually adjust its fees to remain
competitive with other exchanges and with alternative trading systems
that have been exempted from compliance with the statutory standards
applicable to exchanges. Because competitors are free to modify their
own fees in response, and because market participants may readily
adjust their order routing practices, the Exchange believes that the
degree to which fee changes in this market may impose any burden on
competition is extremely limited.
    In sum, if the changes proposed herein are unattractive to market
participants, it is likely that the Exchange will lose market share as
a result. Accordingly, the Exchange does not believe that the proposed
changes will impair the ability of Members or competing order execution
venues to maintain their competitive standing in the financial markets.

C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others

    No written comments were either solicited or received.

III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action

    The foregoing rule change has become effective pursuant to Section
19(b)(3)(A)(ii) of the Act,\27\ and Rule 19b-4(f)(2) \28\ thereunder.
At any time within 60 days of the filing of the proposed rule change,
the Commission summarily may temporarily suspend such rule change if it
appears to the Commission that such action is: (i) Necessary or
appropriate in the public interest; (ii) for the protection of
investors; or (iii) otherwise in furtherance of the purposes of the
Act. If the Commission takes such action, the Commission shall
institute proceedings to determine whether the proposed rule should be
approved or disapproved.
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    \27\ 15 U.S.C. 78s(b)(3)(A)(ii).
    \28\ 17 CFR 240.19b-4(f)(2).
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IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Act. Comments may be submitted by any of
the following methods:

Electronic Comments

     Use the Commission's internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to [email protected]. Please include
File Number SR-ISE-2018-27 on the subject line.

Paper Comments

     Send paper comments in triplicate to Secretary, Securities
and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.

All submissions should refer to File Number SR-ISE-2018-27. This file
number should be included on the subject line if email is used. To help
the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's internet website (http://www.sec.gov/rules/sro.shtml).
Copies of the submission, all subsequent amendments, all written
statements with respect to the proposed rule change that are filed with
the Commission, and all written communications relating to the proposed
rule change between the Commission and any person, other than those
that may be withheld from the public in accordance with the provisions
of 5 U.S.C. 552, will be available for website viewing and printing in
the Commission's Public Reference Room, 100 F Street NE, Washington, DC
20549, on official business days between the hours of 10:00 a.m. and
3:00 p.m. Copies of the filing also will be available for inspection
and copying at the principal office of the Exchange. All comments
received will be posted without change. Persons submitting comments are
cautioned that we do not redact or edit personal identifying
information from comment submissions. You should submit only
information that you wish to make available publicly. All submissions
should refer to File Number SR-ISE-2018-27 and should be submitted on
or before May 2, 2018.

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\29\
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    \29\ 17 CFR 200.30-3(a)(12).
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Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2018-07408 Filed 4-10-18; 8:45 am]
BILLING CODE 8011-01-P