[Federal Register Volume 79, Number 98 (Wednesday, May 21, 2014)]
[Proposed Rules]
[Pages 29142-29148]
[FR Doc No: 2014-11787]

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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[EPA-R03-OAR-2013-0211, EPA-R03-OAR-2013-0510]; FRL-9911-26-Region 3]

Approval and Promulgation of Air Quality Implementation Plans;
Virginia; Section 110(a)(2) Prevention of Significant Deterioration
Requirements for the 2008 Ozone and 2010 Nitrogen Dioxide National
Ambient Air Quality Standards

AGENCY: Environmental Protection Agency (EPA).

ACTION: Proposed rule.

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SUMMARY: The Environmental Protection Agency (EPA) is proposing to
approve revisions to the Virginia State Implementation Plan (SIP)
pursuant to the Clean Air Act (CAA). Whenever new or revised National
Ambient Air Quality Standards (NAAQS) are promulgated, the CAA requires
states to submit a plan for the implementation, maintenance, and
enforcement of such NAAQS. The plan is required to address basic
program elements, including, but not limited to regulatory structure,
monitoring, modeling, legal authority, and adequate resources necessary
to assure attainment and maintenance of the standards. These elements
are referred to as infrastructure requirements. The Commonwealth of
Virginia has made two separate submittals addressing the infrastructure
requirements for the 2008 ozone and 2010 nitrogen dioxide
(NO2) NAAQS. This action proposes approval of the prevention
of significant deterioration (PSD) portions of the infrastructure
requirements of the CAA for the Commonwealth's SIP submittals for the
2008 ozone and 2010 NO2 NAAQS.

DATES: Written comments must be received on or before June 20, 2014.

ADDRESSES: Submit your comments, identified by Docket ID Number EPA-
R03-OAR-2013-0211 for the 2008 ozone docket and EPA-R03-OAR-2013-0510
for the 2010 NO2 docket by one of the following methods:
    A. www.regulations.gov. Follow the on-line instructions for
submitting comments.
    B. Email<EMAIL_ADDRESS>    C. Mail: EPA-R03-OAR-2013-0211 and EPA-R03-OAR-2013-0510, Cristina
Fernandez, Associate Director, Office of Air Program Planning, Air
Protection Division, Mailcode 3AP30, U.S. Environmental Protection
Agency, Region III, 1650 Arch Street, Philadelphia, Pennsylvania 19103.

    D. Hand Delivery: At the previously-listed EPA Region III address.
Such deliveries are only accepted during the Docket's normal hours of
operation, and special arrangements should be made for deliveries of
boxed information.
    Instructions: Direct your comments to Docket ID Nos. EPA-R03-OAR-
2013-0211 and EPA-R03-OAR-2013-0510. EPA's policy is that all comments
received will be included in the public docket without change, and may
be made available online at www.regulations.gov, including any personal
information provided, unless the comment includes information claimed
to be Confidential Business Information (CBI) or other information
whose disclosure is restricted by statute. Do not submit information
that you consider to be CBI or otherwise protected through
www.regulations.gov or email. The www.regulations.gov Web site is an
``anonymous access'' system, which means EPA will not know your
identity or contact information unless you provide it in the body of
your comment. If you send an email comment directly to EPA without
going through www.regulations.gov, your email address will be
automatically captured and included as part of the comment that is
placed in the public docket and made available on the Internet. If you
submit an electronic comment, EPA recommends that you include your name
and other contact information in the body of your comment and with any
disk or CD-ROM you submit. If EPA cannot read your comment due to
technical difficulties and cannot contact you for clarification, EPA
may not be able to consider your comment. Electronic files should avoid
the use of special characters, any form of encryption, and be free of
any defects or viruses.
    Docket: All documents in the electronic docket are listed in the
www.regulations.gov index. Although listed in the index, some
information is not publicly available, i.e., CBI or other information
whose disclosure is restricted by statute. Certain other material, such
as copyrighted material, is not placed on the Internet and will be
publicly available only in hard copy form. Publicly available docket
materials are available either electronically in www.regulations.gov or
in hard copy during normal business hours at the Air Protection
Division, U.S. Environmental Protection Agency, Region III, 1650 Arch
Street, Philadelphia, Pennsylvania 19103. Copies of the State submittal
are available at the Virginia Department of Environmental Quality, 629
East Main Street, Richmond, Virginia 23219.

FOR FURTHER INFORMATION CONTACT: Ellen Schmitt,<PHONE_NUMBER>, or by
email at<EMAIL_ADDRESS>
SUPPLEMENTARY INFORMATION:

I. Background

    On July 23, 2012, the Commonwealth of Virginia submitted a formal
revision to its SIP addressing certain infrastructure requirements for
the 2008 ozone NAAQS (2008 ozone submittal). EPA published a Notice of
Proposed Rulemaking (NPR) on July 2, 2013 which proposed approval of
the 2008 ozone submittal for the following infrastructure elements:
Section 110(a)(2)(A), (B), (C) (for enforcement and regulation of minor
sources and minor modifications), (D)(i)(II) (for visibility
protection), (D)(ii), (E)(i), (E)(iii), (F), (G), (H), (J) (relating to
consultation, public notification, and visibility protection
requirements), (K), (L), and (M), or portions thereof. See 78 FR 39651.
Subsequently, EPA published a Final Rulemaking Notice (FRN) on March
27, 2014 which approved the Virginia 2008 ozone submittal for those
specific elements. See 79 FR 17043.
    On May 30, 2013, Virginia submitted an infrastructure SIP
submission for the 2010 NO2 NAAQS (2010 NO2
submittal). On August 5, 2013, EPA published a NPR which proposed
approval of the 2010 NO2 submittal for the following
infrastructure elements: Section 110(a)(2)(A), (B), (C) (for
enforcement and regulation of minor sources and minor modifications),
(D)(i)(II) (for visibility protection), (D)(ii), (E)(i), (E)(iii), (F),
(G), (H), (J) (relating to consultation, public notification, and
visibility protection requirements), (K), (L), and (M), or portions
thereof. See 78 FR 47264. Subsequently, on March 18, 2014, EPA
published a FRN which approved the Virginia 2010 NO2
submittal for those specific elements. See 79 FR 15012.
    In both EPA's March 27, 2014 FRN for the 2008 ozone submittal and
the March 18, 2014 FRN for the 2010 NO2 submittal, EPA
indicated that it was taking separate action on certain infrastructure
elements as they relate to PSD and section 128 of the CAA. This
rulemaking action proposes approval of the section 110(a)(2)(C),
(D)(i)(II), and (J) infrastructure elements as they relate to
Virginia's PSD program for the 2008 ozone NAAQS and 2010 NO2
NAAQS. EPA will take later separate action on 110(a)(2)(E)(ii) as it
relates to section 128.

II. EPA's Approach To Review Infrastructure SIPs

    The requirement for states to make a SIP submission of this type
arises out of section 110(a)(1). Pursuant to section 110(a)(1), states
must make SIP submissions ``within 3 years (or such shorter period as
the Administrator may prescribe) after the promulgation of a national
primary ambient air quality standard (or any revision thereof),'' and
these SIP submissions are to provide for the ``implementation,
maintenance, and enforcement'' of such NAAQS. The statute directly
imposes on states the duty to make these SIP submissions, and the
requirement to make the submissions is not conditioned upon EPA's
taking any action other than promulgating a new or revised NAAQS.
Section 110(a)(2) includes a list of specific elements that ``[e]ach
such plan'' submission must address.
    EPA has historically referred to these SIP submissions made for the
purpose of satisfying the requirements of section 110(a)(1) and (2) as
``infrastructure SIP'' submissions. Although the term ``infrastructure
SIP'' does not appear in the CAA, EPA uses the term to distinguish this
particular type of SIP submission from submissions that are intended to
satisfy other SIP requirements under the CAA, such as ``nonattainment
SIP'' or ``attainment plan SIP'' submissions to address the
nonattainment planning requirements of part D of title I of the CAA,
``regional haze SIP'' submissions required by EPA rule to address the
visibility protection requirements of CAA section 169A, and
nonattainment new source review permit program submissions to address
the permit requirements of CAA, title I, part D.
    Section 110(a)(1) addresses the timing and general requirements for
infrastructure SIP submissions and section 110(a)(2) provides more
details concerning the required contents of these submissions. The list
of required elements provided in section 110(a)(2) contains a wide
variety of disparate provisions, some of which pertain to required
legal authority, some of which pertain to required substantive program
provisions, and some of which pertain to requirements for both
authority and substantive program provisions.\1\ EPA therefore believes
that while the timing requirement in section 110(a)(1) is unambiguous,
some of the other statutory provisions are ambiguous. In particular,
EPA believes that the list of

required elements for infrastructure SIP submissions provided in
section 110(a)(2) contains ambiguities concerning what is required for
inclusion in an infrastructure SIP submission.
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    \1\ For example, section 110(a)(2)(E)(i) provides that states
must provide assurances that they have adequate legal authority
under state and local law to carry out the SIP, section 110(a)(2)(C)
provides that states must have a SIP-approved program to address
certain sources as required by part C of title I of the CAA, and
section 110(a)(2)(G) provides that states must have legal authority
to address emergencies as well as contingency plans that are
triggered in the event of such emergencies.
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    The following examples of ambiguities illustrate the need for EPA
to interpret some section 110(a)(1) and section 110(a)(2) requirements
with respect to infrastructure SIP submissions for a given new or
revised NAAQS. One example of ambiguity is that section 110(a)(2)
requires that ``each'' SIP submission must meet the list of
requirements therein, while EPA has long noted that this literal
reading of the statute is internally inconsistent and would create a
conflict with the nonattainment provisions in part D of title I of the
CAA, which specifically address nonattainment SIP requirements.\2\
Section 110(a)(2)(I) pertains to nonattainment SIP requirements and
part D addresses when attainment plan SIP submissions to address
nonattainment area requirements are due. For example, section 172(b)
requires EPA to establish a schedule for submission of such plans for
certain pollutants when the Administrator promulgates the designation
of an area as nonattainment, and section 107(d)(1)(B) allows up to two
years or in some cases three years, for such designations to be
promulgated.\3\ This ambiguity illustrates that rather than apply all
the stated requirements of section 110(a)(2) in a strict literal sense,
EPA must determine which provisions of section 110(a)(2) are applicable
for a particular infrastructure SIP submission.
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    \2\ See, e.g., ``Rule To Reduce Interstate Transport of Fine
Particulate Matter and Ozone (Clean Air Interstate Rule); Revisions
to Acid Rain Program; Revisions to the NOx SIP Call; Final Rule,''
70 FR 25162, at 25163-65, May 12, 2005, (explaining relationship
between timing requirement of section 110(a)(2)(D) versus section
110(a)(2)(I)).
    \3\ EPA notes that this ambiguity within section 110(a)(2) is
heightened by the fact that various subparts of part D set specific
dates for submission of certain types of SIP submissions in
designated nonattainment areas for various pollutants. Note, e.g.,
that section 182(a)(1) provides specific dates for submission of
emissions inventories for the ozone NAAQS. Some of these specific
dates are necessarily later than three years after promulgation of
the new or revised NAAQS.
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    Another example of ambiguity within section 110(a)(1) and (2) with
respect to infrastructure SIPs pertains to whether states must meet all
of the infrastructure SIP requirements in a single SIP submission, and
whether EPA must act upon such SIP submission in a single action.
Although section 110(a)(1) directs states to submit ``a plan'' to meet
these requirements, EPA interprets the CAA to allow states to make
multiple SIP submissions separately addressing infrastructure SIP
elements for the same NAAQS. If states elect to make such multiple SIP
submissions to meet the infrastructure SIP requirements, EPA can elect
to act on such submissions either individually or in a larger combined
action.\4\ Similarly, EPA interprets the CAA to allow it to take action
on the individual parts of one larger, comprehensive infrastructure SIP
submission for a given NAAQS without concurrent action on the entire
submission. For example, EPA has sometimes elected to act at different
times on various elements and sub-elements of the same infrastructure
SIP submission.\5\
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    \4\ See, e.g., ``Approval and Promulgation of Implementation
Plans; New Mexico; Revisions to the New Source Review (NSR) State
Implementation Plan (SIP); Prevention of Significant Deterioration
(PSD) and Nonattainment New Source Review (NNSR) Permitting,'' 78 FR
4339, January 22, 2013 (EPA's final action approving the structural
PSD elements of the New Mexico SIP submitted by the State separately
to meet the requirements of EPA's 2008 PM2.5 NSR rule),
and ``Approval and Promulgation of Air Quality Implementation Plans;
New Mexico; Infrastructure and Interstate Transport Requirements for
the 2006 PM2.5 NAAQS,'' 78 FR 4337, January 22, 2013
(EPA's final action on the infrastructure SIP for the 2006
PM2.5 NAAQS).
    \5\ On December 14, 2007, the State of Tennessee, through the
Tennessee Department of Environment and Conservation, made a SIP
revision to EPA demonstrating that the State meets the requirements
of sections 110(a)(1) and (2). EPA proposed action for
infrastructure SIP elements (C) and (J) on January 23, 2012 (77 FR
3213) and took final action on March 14, 2012 (77 FR 14976). On
April 16, 2012 (77 FR 22533) and July 23, 2012 (77 FR 42997), EPA
took separate proposed and final actions on all other section
110(a)(2) infrastructure SIP elements of Tennessee's December 14,
2007 submittal.
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    Ambiguities within section 110(a)(1) and (2) may also arise with
respect to infrastructure SIP submission requirements for different
NAAQS. Thus, EPA notes that not every element of section 110(a)(2)
would be relevant, or as relevant, or relevant in the same way, for
each new or revised NAAQS. The states' attendant infrastructure SIP
submissions for each NAAQS therefore could be different. For example,
the monitoring requirements that a state might need to meet in its
infrastructure SIP submission for purposes of section 110(a)(2)(B)
could be very different for different pollutants, for example because
the content and scope of a state's infrastructure SIP submission to
meet this element might be very different for an entirely new NAAQS
than for a minor revision to an existing NAAQS.\6\
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    \6\ For example, implementation of the 1997 PM2.5
NAAQS required the deployment of a system of new monitors to measure
ambient levels of that new indicator species for the new NAAQS.
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    EPA notes that interpretation of section 110(a)(2) is also
necessary when EPA reviews other types of SIP submissions required
under the CAA. Therefore, as with infrastructure SIP submissions, EPA
also has to identify and interpret the relevant elements of section
110(a)(2) that logically apply to these other types of SIP submissions.
For example, section 172(c)(7) requires that attainment plan SIP
submissions required by part D have to meet the ``applicable
requirements'' of section 110(a)(2). Thus, for example, attainment plan
SIP submissions must meet the requirements of section 110(a)(2)(A)
regarding enforceable emission limits and control measures and section
110(a)(2)(E)(i) regarding air agency resources and authority. By
contrast, it is clear that attainment plan SIP submissions required by
part D would not need to meet the portion of section 110(a)(2)(C) that
pertains to the Prevention of Significant Deterioration (PSD) program
required in part C of title I of the CAA, because PSD does not apply to
a pollutant for which an area is designated nonattainment and thus
subject to part D planning requirements. As this example illustrates,
each type of SIP submission may implicate some elements of section
110(a)(2) but not others.
    Given the potential for ambiguity in some of the statutory language
of section 110(a)(1) and section 110(a)(2), EPA believes that it is
appropriate to interpret the ambiguous portions of section 110(a)(1)
and section 110(a)(2) in the context of acting on a particular SIP
submission. In other words, EPA assumes that Congress could not have
intended that each and every SIP submission, regardless of the NAAQS in
question or the history of SIP development for the relevant pollutant,
would meet each of the requirements, or meet each of them in the same
way. Therefore, EPA has adopted an approach under which it reviews
infrastructure SIP submissions against the list of elements in section
110(a)(2), but only to the extent each element applies for that
particular NAAQS.
    Historically, EPA has elected to use guidance documents to make
recommendations to states for infrastructure SIPs, in some cases
conveying needed interpretations on newly arising issues and in some
cases conveying interpretations that have already been developed and
applied to individual SIP submissions for particular elements.\7\ EPA
most recently

issued guidance for infrastructure SIPs on September 13, 2013 (2013
Guidance).\8\ EPA developed this document to provide states with up-to-
date guidance for infrastructure SIPs for any new or revised NAAQS.
Within this guidance, EPA describes the duty of states to make
infrastructure SIP submissions to meet basic structural SIP
requirements within three years of promulgation of a new or revised
NAAQS. EPA also made recommendations about many specific subsections of
section 110(a)(2) that are relevant in the context of infrastructure
SIP submissions.\9\ The guidance also discusses the substantively
important issues that are germane to certain subsections of section
110(a)(2). Significantly, EPA interprets section 110(a)(1) and (2) such
that infrastructure SIP submissions need to address certain issues and
need not address others. Accordingly, EPA reviews each infrastructure
SIP submission for compliance with the applicable statutory provisions
of section 110(a)(2), as appropriate.
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    \7\ EPA notes, however, that nothing in the CAA requires EPA to
provide guidance or to promulgate regulations for infrastructure SIP
submissions. The CAA directly applies to states and requires the
submission of infrastructure SIP submissions, regardless of whether
or not EPA provides guidance or regulations pertaining to such
submissions. EPA elects to issue such guidance in order to assist
states, as appropriate.
    \8\ ``Guidance on Infrastructure State Implementation Plan (SIP)
Elements under Clean Air Act Sections 110(a)(1) and 110(a)(2),''
Memorandum from Stephen D. Page, September 13, 2013.
    \9\ EPA's September 13, 2013, guidance did not make
recommendations with respect to infrastructure SIP submissions to
address section 110(a)(2)(D)(i)(I). EPA issued the guidance shortly
after the U.S. Supreme Court agreed to review the DC Circuit
decision in EME Homer City, 696 F.3d 7 (D.C. Cir. 2012) which had
interpreted the requirements of section 110(a)(2)(D)(i)(I). In light
of the uncertainty created by ongoing litigation, EPA elected not to
provide additional guidance on the requirements of section
110(a)(2)(D)(i)(I) at that time. As the guidance is neither binding
nor required by statute, whether EPA elects to provide guidance on a
particular section has no impact on a state's CAA obligations.
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    As an example, section 110(a)(2)(E)(ii) is a required element of
section 110(a)(2) for infrastructure SIP submissions. Under this
element, a state must meet the substantive requirements of section 128,
which pertain to state boards that approve permits or enforcement
orders and heads of executive agencies with similar powers. Thus, EPA
reviews infrastructure SIP submissions to ensure that the state's SIP
appropriately addresses the requirements of section 110(a)(2)(E)(ii)
and section 128. The 2013 Guidance explains EPA's interpretation that
there may be a variety of ways by which states can appropriately
address these substantive statutory requirements, depending on the
structure of an individual state's permitting or enforcement program
(e.g., whether permits and enforcement orders are approved by a multi-
member board or by a head of an executive agency). However they are
addressed by the state, the substantive requirements of section 128 are
necessarily included in EPA's evaluation of infrastructure SIP
submissions because section 110(a)(2)(E)(ii) explicitly requires that
the state satisfy the provisions of section 128.
    As another example, EPA's review of infrastructure SIP submissions
with respect to the PSD program requirements in section 110(a)(2)(C),
(D)(i)(II), and (J) focuses upon the structural PSD program
requirements contained in part C and EPA's PSD regulations. Structural
PSD program requirements include provisions necessary for the PSD
program to address all regulated sources and NSR pollutants, including
Green House Gases (GHGs). By contrast, structural PSD program
requirements do not include provisions that are not required under
EPA's regulations at 40 CFR 51.166 but are merely available as an
option for the state, such as the option to provide grandfathering of
complete permit applications with respect to the 2013 PM2.5
NAAQS. Accordingly, the latter optional provisions are types of
provisions EPA considers irrelevant in the context of an infrastructure
SIP action.
    For other section 110(a)(2) elements, however, EPA's review of a
state's infrastructure SIP submission focuses on assuring that the
state's SIP meets basic structural requirements. For example, section
110(a)(2)(C) includes, inter alia, the requirement that states have a
program to regulate minor new sources. Thus, EPA evaluates whether the
state has an EPA-approved minor new source review program and whether
the program addresses the pollutants relevant to that NAAQS. In the
context of acting on an infrastructure SIP submission, however, EPA
does not think it is necessary to conduct a review of each and every
provision of a state's existing minor source program (i.e., already in
the existing SIP) for compliance with the requirements of the CAA and
EPA's regulations that pertain to such programs.
    With respect to certain other issues, EPA does not believe that an
action on a state's infrastructure SIP submission is necessarily the
appropriate type of action in which to address possible deficiencies in
a state's existing SIP. These issues include: (i) Existing provisions
related to excess emissions from sources during periods of startup,
shutdown, or malfunction that may be contrary to the CAA and EPA's
policies addressing such excess emissions (SSM); (ii) existing
provisions related to ``director's variance'' or ``director's
discretion'' that may be contrary to the CAA because they purport to
allow revisions to SIP-approved emissions limits while limiting public
process or not requiring further approval by EPA; and (iii) existing
provisions for PSD programs that may be inconsistent with current
requirements of EPA's ``Final NSR Improvement Rule,'' 67 FR 80186,
December 31, 2002, as amended by 72 FR 32526, June 13, 2007 (``NSR
Reform''). Thus, EPA believes it may approve an infrastructure SIP
submission without scrutinizing the totality of the existing SIP for
such potentially deficient provisions and may approve the submission
even if it is aware of such existing provisions.\10\ It is important to
note that EPA's approval of a state's infrastructure SIP submission
should not be construed as explicit or implicit re-approval of any
existing potentially deficient provisions that relate to the three
specific issues just described.
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    \10\ By contrast, EPA notes that if a state were to include a
new provision in an infrastructure SIP submission that contained a
legal deficiency, such as a new exemption for excess emissions
during SSM events, then EPA would need to evaluate that provision
for compliance against the rubric of applicable CAA requirements in
the context of the action on the infrastructure SIP.
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    EPA's approach to review of infrastructure SIP submissions is to
identify the CAA requirements that are logically applicable to that
submission. EPA believes that this approach to the review of a
particular infrastructure SIP submission is appropriate, because it
would not be reasonable to read the general requirements of section
110(a)(1) and the list of elements in 110(a)(2) as requiring review of
each and every provision of a state's existing SIP against all
requirements in the CAA and EPA regulations merely for purposes of
assuring that the state in question has the basic structural elements
for a functioning SIP for a new or revised NAAQS. Because SIPs have
grown by accretion over the decades as statutory and regulatory
requirements under the CAA have evolved, they may include some outmoded
provisions and historical artifacts. These provisions, while not fully
up to date, nevertheless may not pose a significant problem for the
purposes of ``implementation, maintenance, and enforcement'' of a new
or revised NAAQS when EPA evaluates adequacy of the infrastructure SIP
submission. EPA believes that a

better approach is for states and EPA to focus attention on those
elements of section 110(a)(2) of the CAA most likely to warrant a
specific SIP revision due to the promulgation of a new or revised NAAQS
or other factors.
    For example, EPA's 2013 Guidance gives simpler recommendations with
respect to carbon monoxide than other NAAQS pollutants to meet the
visibility requirements of section 110(a)(2)(D)(i)(II), because carbon
monoxide does not affect visibility. As a result, an infrastructure SIP
submission for any future new or revised NAAQS for carbon monoxide need
only state this fact in order to address the visibility prong of
section 110(a)(2)(D)(i)(II).
    Finally, EPA believes that its approach with respect to
infrastructure SIP requirements is based on a reasonable reading of
section 110(a)(1) and (2) because the CAA provides other avenues and
mechanisms to address specific substantive deficiencies in existing
SIPs. These other statutory tools allow EPA to take appropriately
tailored action, depending upon the nature and severity of the alleged
SIP deficiency. Section 110(k)(5) authorizes EPA to issue a ``SIP
call'' whenever the Agency determines that a state's SIP is
substantially inadequate to attain or maintain the NAAQS, to mitigate
interstate transport, or to otherwise comply with the CAA.\11\ Section
110(k)(6) authorizes EPA to correct errors in past actions, such as
past approvals of SIP submissions.\12\ Significantly, EPA's
determination that an action on a state's infrastructure SIP submission
is not the appropriate time and place to address all potential existing
SIP deficiencies does not preclude EPA's subsequent reliance on
provisions in section 110(a)(2) as part of the basis for action to
correct those deficiencies at a later time. For example, although it
may not be appropriate to require a state to eliminate all existing
inappropriate director's discretion provisions in the course of acting
on an infrastructure SIP submission, EPA believes that section
110(a)(2)(A) may be among the statutory bases that EPA relies upon in
the course of addressing such deficiency in a subsequent action.\13\
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    \11\ For example, EPA issued a SIP call to Utah to address
specific existing SIP deficiencies related to the treatment of
excess emissions during SSM events. See ``Finding of Substantial
Inadequacy of Implementation Plan; Call for Utah State
Implementation Plan Revisions,'' 74 FR 21639, April 18, 2011.
    \12\ EPA has used this authority to correct errors in past
actions on SIP submissions related to PSD programs. See ``Limitation
of Approval of Prevention of Significant Deterioration Provisions
Concerning Greenhouse Gas Emitting-Sources in State Implementation
Plans; Final Rule,'' 75 FR 82536, December 30, 2010. EPA has
previously used its authority under CAA section 110(k)(6) to remove
numerous other SIP provisions that the Agency determined it had
approved in error. See, e.g., 61 FR 38664, July 25, 1996 and 62 FR
34641, June 27, 1997 (corrections to American Samoa, Arizona,
California, Hawaii, and Nevada SIPs); 69 FR 67062, November 16, 2004
(corrections to California SIP); and 74 FR 57051, November 3, 2009
(corrections to Arizona and Nevada SIPs).
    \13\ See, e.g., EPA's disapproval of a SIP submission from
Colorado on the grounds that it would have included a director's
discretion provision inconsistent with CAA requirements, including
section 110(a)(2)(A). See, e.g., 75 FR 42342 at 42344, July 21, 2010
(proposed disapproval of director's discretion provisions); 76 FR
4540, January 26, 2011 (final disapproval of such provisions).
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III. Summary of SIP Revision

    Section 110(a)(2)(C) of the CAA requires each state's SIP to
``include a program to provide for the enforcement of the measures
described in subparagraph (A) [CAA Section 110(a)(2)(A)], and
regulation of the modification and construction of any stationary
source within the areas covered by the plan as necessary to ensure that
national ambient air quality standards are achieved, including a permit
program as required in parts C [PSD], and D [nonattainment NSR] of this
subchapter.'' Similarly, section 110(a)(2)(J) requires that for each
NAAQS the state's SIP must ``meet the applicable requirements of. .
.part C of this subchapter (relating to prevention of significant
deterioration of air quality).''
    As discussed in Section II, ``EPA's Approach to Review
Infrastructure SIPs,'' when reviewing infrastructure SIP submittals EPA
focuses on the structural PSD program requirements contained in part C
as well as EPA's PSD regulations. These structural requirements call
for the PSD program to address all NSR pollutants, including GHGs.
    On August 5, 2011, Virginia submitted a proposed SIP revision which
incorporated preconstruction permitting requirements for sources of
PM2.5 into Virginia's PSD and nonattainment NSR programs.
Subsequent to Virginia's submittal, two decisions by the U.S Court of
Appeals for the D.C Circuit related to the Federal PM2.5
program impacted EPA's ability to fully approve the revisions as
submitted by Virginia. Virginia consequently submitted revisions to
their PSD program pertaining to preconstruction permitting requirements
for sources of PM2.5 and on February 25, 2014 (79 FR 10377),
EPA fully approved these revisions to Virginia's PSD program. With
these revisions fully approved, Virginia's SIP approved PSD program now
contains all of the emission limitations, control measures, and other
program elements required by 40 CFR 51.165 and 40 CFR 51.166 for all
required pollutants, including PM2.5. Therefore, EPA finds
Virginia's SIP meets the statutory obligations relating to its PSD
permit program set forth in section 110(a)(2)(C) and (J) of the CAA for
the 2008 ozone NAAQS and 2010 NO2 NAAQS.\14\
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    \14\ On January 4, 2013, the United States Court of Appeals for
the District of Columbia Circuit, in Natural Resources Defense
Council v. EPA, issued a decision that remanded EPA's 2007 and 2008
rules implementing the 1997 fine particulate matter
(PM2.5) NAAQS. See 706 F.3d 428 (D.C. Cir. 2013). The
court found that EPA erred in implementing the PM2.5
NAAQS pursuant to the general implementation provisions of subpart 1
of part D of title I of the CAA, rather than pursuant to the
additional implementation provisions specific to particulate matter
nonattainment areas in subpart 4. Id. at 437. As the requirements of
subpart 4 only pertain to nonattainment areas, it is EPA's position
that the portions of the PM2.5 implementation rules that
address requirements for PM2.5 attainment and
unclassifiable areas are not affected by the court's opinion in NRDC
v. EPA. EPA does not anticipate the need to revise any PSD permit
requirements promulgated in the PM2.5 implementation
rules to comply with the court's decision. Therefore, it is EPA's
position that approval of the PSD portions of Virginia's
infrastructure SIP submittals for the 2008 ozone and 2010
NO2 NAAQS as meeting PSD requirements in Section
110(a)(2)(C), (D)(i)(II), and (J) does not conflict with the court's
remand of the PM2.5 implementation rules. See also 79 FR
10377 (February 25, 2014) (approving portions of Virginia's
infrastructure SIP submittals as meeting PSD requirements for
section 110(a)(2) for 1997 and 2006 PM2.5 NAAQS and 2008
lead NAAQS).
---------------------------------------------------------------------------

    Section 110(a)(2)(D)(i)(II) of the CAA requires each state's SIP to
include provisions which will prevent emissions from interfering with
the measures required by another state for implementing PSD. Each
state's SIP must, under 40 CFR 51.166(k)(1), include a source impact
analysis which requires the owner/operator of each proposed source or
modification to demonstrate that the allowable emissions increase from
the proposed project will not ``cause or contribute to air pollution in
violation of: (i) Any national ambient air quality standard in any air
quality control region.'' The requirements set forth at 40 CFR
51.166(k)(l) are consistent with, and sufficient to meet, the
requirements of section 110(D)(i)(II) of the CAA. In Virginia, the
equivalent requirement to 40 CFR 51.166(k)(1) is codified at 9VAC5-80-
1715, and this requirement is incorporated into the Virginia SIP.
Therefore, EPA finds Virginia's SIP meets the statutory obligation
relating to its PSD permit program set forth in section
110(a)(2)(D)(i)(II) of the CAA for

the 2008 ozone NAAQS and 2010 NO2 NAAQS.\15\
---------------------------------------------------------------------------

    \15\ In addition, Virginia's existing SIP also includes Article
8 (Permits for Major Stationary Sources and Major Modifications
Located in Prevention of Significant Deterioration Areas) of Part II
of 9VAC5 Chapter 80, which provides that construction and
modification of major stationary sources in PSD areas will not cause
or contribute to a violation of any NAAQS. Virginia's SIP approved
PSD program also applies to greenhouse gases through 9VAC5 Chapter
85, (Permits for Stationary Sources of Pollutants Subject to
Regulation), which implements EPA's greenhouse gas tailoring
requirements.
---------------------------------------------------------------------------

    Therefore, EPA concludes that Virginia's approved SIP meets
obligations pursuant to CAA section 110(a)(2)(C), (D)(i)(II), and (J)
with respect to the part C permit program for the 2008 ozone NAAQS and
2010 NO2 NAAQS. EPA is proposing approval of a revision to
the Virginia SIP for Virginia's 2008 ozone and 2010 NO2
submittals for the following infrastructure elements with respect to
the Part C PSD permit program: Section 110(a)(2)(C), (D)(i)(II), and
(J).

IV. General Information Pertaining to SIP Submittals From the
Commonwealth of Virginia

    In 1995, Virginia adopted legislation that provides, subject to
certain conditions, for an environmental assessment (audit)
``privilege'' for voluntary compliance evaluations performed by a
regulated entity. The legislation further addresses the relative burden
of proof for parties either asserting the privilege or seeking
disclosure of documents for which the privilege is claimed. Virginia's
legislation also provides, subject to certain conditions, for a penalty
waiver for violations of environmental laws when a regulated entity
discovers such violations pursuant to a voluntary compliance evaluation
and voluntarily discloses such violations to the Commonwealth and takes
prompt and appropriate measures to remedy the violations. Virginia's
Voluntary Environmental Assessment Privilege Law, Va. Code Sec. 10.1-
1198, provides a privilege that protects from disclosure documents and
information about the content of those documents that are the product
of a voluntary environmental assessment. The Privilege Law does not
extend to documents or information that: (1) Are generated or developed
before the commencement of a voluntary environmental assessment; (2)
are prepared independently of the assessment process; (3) demonstrate a
clear, imminent and substantial danger to the public health or
environment; or (4) are required by law.
    On January 12, 1998, the Commonwealth of Virginia Office of the
Attorney General provided a legal opinion that states that the
Privilege law, Va. Code Sec. 10.1-1198, precludes granting a privilege
to documents and information ``required by law,'' including documents
and information ``required by Federal law to maintain program
delegation, authorization or approval,'' since Virginia must ``enforce
Federally authorized environmental programs in a manner that is no less
stringent than their Federal counterparts . . .'' The opinion concludes
that ``[r]egarding Sec.  10.1-1198, therefore, documents or other
information needed for civil or criminal enforcement under one of these
programs could not be privileged because such documents and information
are essential to pursuing enforcement in a manner required by Federal
law to maintain program delegation, authorization or approval.''
    Virginia's Immunity law, Va. Code Sec. 10.1-1199, provides that
``[t]o the extent consistent with requirements imposed by Federal
law,'' any person making a voluntary disclosure of information to a
state agency regarding a violation of an environmental statute,
regulation, permit, or administrative order is granted immunity from
administrative or civil penalty. The Attorney General's January 12,
1998 opinion states that the quoted language renders this statute
inapplicable to enforcement of any Federally authorized programs, since
``no immunity could be afforded from administrative, civil, or criminal
penalties because granting such immunity would not be consistent with
Federal law, which is one of the criteria for immunity.''
    Therefore, EPA has determined that Virginia's Privilege and
Immunity statutes will not preclude the Commonwealth from enforcing its
PSD program consistent with the Federal requirements. In any event,
because EPA has also determined that a state audit privilege and
immunity law can affect only state enforcement and cannot have any
impact on Federal enforcement authorities, EPA may at any time invoke
its authority under the CAA, including, for example, sections 113, 167,
205, 211 or 213, to enforce the requirements or prohibitions of the
state plan, independently of any state enforcement effort. In addition,
citizen enforcement under section 304 of the CAA is likewise unaffected
by this, or any, state audit privilege or immunity law.

V. Proposed Action

    EPA is proposing to approve the following infrastructure elements
of Virginia's July 23, 2012 SIP submittal for the 2008 ozone NAAQS and
May 30, 2013 SIP submittal for the 2010 NO2 NAAQS with
respect to PSD: Section 110(a)(2)(C), (D)(i)(II), and (J). EPA is
soliciting public comments on the issues discussed in this document.
These comments will be considered before taking final action.

VI. Statutory and Executive Order Reviews

    Under the CAA, the Administrator is required to approve a SIP
submission that complies with the provisions of the CAA and applicable
Federal regulations. 42 U.S.C. 7410(k); 40 CFR 52.02(a). Thus, in
reviewing SIP submissions, EPA's role is to approve state choices,
provided that they meet the criteria of the CAA. Accordingly, this
action merely approves state law as meeting Federal requirements and
does not impose additional requirements beyond those imposed by state
law. For that reason, this proposed action:
     Is not a ``significant regulatory action'' subject to
review by the Office of Management and Budget under Executive Order
12866 (58 FR 51735, October 4, 1993);
     does not impose an information collection burden under the
provisions of the Paperwork Reduction Act (44 U.S.C. 3501 et seq.);
     is certified as not having a significant economic impact
on a substantial number of small entities under the Regulatory
Flexibility Act (5 U.S.C. 601 et seq.);
     does not contain any unfunded mandate or significantly or
uniquely affect small governments, as described in the Unfunded
Mandates Reform Act of 1995 (Pub. L. 104-4);
     does not have Federalism implications as specified in
Executive Order 13132 (64 FR 43255, August 10, 1999);
     is not an economically significant regulatory action based
on health or safety risks subject to Executive Order 13045 (62 FR
19885, April 23, 1997);
     is not a significant regulatory action subject to
Executive Order 13211 (66 FR 28355, May 22, 2001);
     is not subject to requirements of Section 12(d) of the
National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272
note) because application of those requirements would be inconsistent
with the CAA; and
     does not provide EPA with the discretionary authority to
address, as appropriate, disproportionate human health or environmental
effects, using practicable and legally permissible methods, under
Executive Order 12898 (59 FR 7629, February 16, 1994).

    In addition, this proposed rule, approving Virginia's July 23, 2012
SIP submission for the 2008 ozone NAAQS and May 30, 2013 SIP submission
for the 2010 NO2 NAAQS as meeting the PSD elements in
Section 110(a)(2) of the CAA, does not have tribal implications as
specified by Executive Order 13175 (65 FR 67249, November 9, 2000),
because the SIP is not approved to apply in Indian country located in
the state, and EPA notes that it will not impose substantial direct
costs on tribal governments or preempt tribal law.

List of Subjects in 40 CFR Part 52

    Environmental protection, Air pollution control, Nitrogen dioxide,
Ozone, Reporting and recordkeeping requirements.

    Authority: 42 U.S.C. 7401 et seq.

    Dated: May 8, 2014.
W.C. Early,
Acting, Regional Administrator, Region III.
[FR Doc. 2014-11787 Filed 5-20-14; 8:45 am]
BILLING CODE 6560-50-P


[Federal Register: December 31, 2008 (Volume 73, Number 251)]
[Notices]
[Page 80502-80504]
[DOCID:fr31de08-116]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-59144; File No. SR-NYSEALTR-2008-12]

Self-Regulatory Organizations; NYSE Alternext US LLC; Notice of
Filing of Proposed Rule Change To Establish Its New Risk Management
Gateway Service

December 22, 2008.
    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 December 12, 2008, NYSE Alternext US LLC (``NYSE Alternext'' or
``Exchange'') filed with the Securities and Exchange Commission
(``Commission'') the proposed rule change as described in Items I, II,
and III 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.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------

I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change

    The Exchange, formerly the American Stock Exchange LLC, is
proposing to establish its new Risk Management Gateway (``RMG'')
service.

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

    In its filing with the Commission, NYSE Alternext 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. NYSE Alternext 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 Exchange proposes to offer, through NYSE Euronext Advanced
Trading Solutions, Inc., the RMG service to NYSE Alternext members and
member organizations. NYSE Transact Tools, Inc, a division of the NYSE
Euronext Advanced Trading Solutions Group (``NYXATS''), owns RMG. RMG
is a part of the NYSE Alternext Trading Systems (defined below)
operated on behalf of the Exchange by New York Stock Exchange LLC
(``NYSE'').\3\
---------------------------------------------------------------------------

    \3\ NYXATS similarly seeks to offer the same services to the
NYSE through a separate filing, SR-NYSE-2008-101.
---------------------------------------------------------------------------

Background
    As described more fully in a related rule filing,\4\ NYSE Euronext
acquired The Amex Membership Corporation (``AMC'') pursuant to an
Agreement and Plan of Merger, dated January 17, 2008 (the ``Merger'').
In connection with the Merger, the Exchange's predecessor, the American
Stock Exchange LLC (``Amex''), a subsidiary of AMC, became a subsidiary
of NYSE Euronext called NYSE Alternext US LLC, and continues to operate
as a national securities exchange registered under Section 6 of the
Securities Exchange Act of 1934, as amended (the ``Act'').\5\ The
effective date of the Merger was October 1, 2008.
---------------------------------------------------------------------------

    \4\ See Securities Exchange Act Release No. 58673 (September 29,
2008), 73 FR 57707 (October 3, 2008) (SR-NYSE-2008-60 and SR-Amex
2008-62) (approving the Merger).
    \5\ 15 U.S.C. 78f.
---------------------------------------------------------------------------

    In connection with the Merger, on December 1, 2008, the Exchange
relocated all equities trading conducted on the Exchange legacy trading
systems and facilities located at 86 Trinity Place, New York, New York
(the ``86 Trinity Trading Systems''), to trading systems and facilities
located at 11 Wall Street, New York, New York (the ``Equities
Relocation''). The Exchange's trading systems and facilities at 11 Wall
Street (the ``NYSE Alternext Trading Systems'') are operated by the
NYSE on behalf of the Exchange.\6\
---------------------------------------------------------------------------

    \6\ See Securities Exchange Act Release No. 58705 (October 1,
2008), 73 FR 58995 (October 8, 2008) (SR-Amex 2008-63) (approving
the Equities Relocation).
---------------------------------------------------------------------------

    In order to implement the Equities Relocation, the Exchange adopted
NYSE Rules 1-1004 as the NYSE Alternext Equities Rules to govern
trading on the NYSE Alternext Trading Systems. Rule 54--NYSE Alternext
Equities provides that only members are permitted to ``* * * make or
accept bids or offers, consummate transactions, or otherwise transact
business on the Floor for any security admitted to dealings on the
[Exchange] * * *.'' \7\
---------------------------------------------------------------------------

    \7\ See also Rule 2--NYSE Alternext Equities.
---------------------------------------------------------------------------

    Pursuant to Rule 123B--NYSE Alternext Equities, however, the
Exchange permits NYSE Alternext members and member organizations (a
``Sponsoring Member Organization'') to sponsor access to Exchange
systems by non-member firms or customers (``Sponsored Participants'').
Rule 123B--NYSE Alternext Equities is a general sponsored access rule
that permits a Sponsoring Member Organization to sponsor a Sponsored
Participant's access to Exchange systems for the Sponsored
Participant's entry and execution of orders on the Exchange. Rule
123B--NYSE Alternext Equities reflects the Exchange's general policy
regarding sponsored access to the Exchange; it does not govern access
to NYSE Alternext Bonds.\8\ NYSE Arca, Inc. and other market centers
similarly permit sponsored access to their trading systems.
---------------------------------------------------------------------------

    \8\ That is, currently, the provisions of Rule 123B--NYSE
Alternext Equities do not apply to Rule 86--NYSE Alternext Equities
as that rule independently contains provisions related to how a user
gains sponsored access to the NYSE Alternext Bonds system.
---------------------------------------------------------------------------

RMG
    Traditionally, the customers of a member or member organization
gave orders to the member or member organization and the member or
member organization then submitted those orders to the Exchange on
behalf of the customer. By means of sponsored access, a member or
member organization will allow its customers to enter orders directly
into the trading systems of the Exchange as Sponsored Participants,
without the Sponsoring Member Organization acting as an intermediary.
    To facilitate the ability of Sponsoring Member Organizations to
monitor and oversee the sponsored access activity of their Sponsored
Participants, NYXATS will offer an order-verification service to
Sponsoring Member Organizations. This service will act as a risk filter
by causing the orders of Sponsored Participants to pass through RMG
prior to entering the

Exchange's trading systems for execution. When a Sponsored
Participant's order passes through RMG, RMG software determines whether
the order complies with order criteria that the Sponsoring Member
Organization has established for that Sponsored Participant. The order
criteria pertain to such matters as the size of the order (per order or
daily quantity limits) or the credit limit (per order or daily value)
that the Sponsoring Member Organization has established for the
Sponsored Participant. Additional risk filters may also be selected by
the Sponsoring Member Organization relating to specific symbols or end
users.
    If the order is consistent with the parameters set by the
Sponsoring Member Organization, then RMG allows the order to continue
along its path to the Exchange's trading systems. If the order falls
outside of those parameters, then RMG returns the order to the
Sponsored Participant. RMG will only return an order to the Sponsored
Participant when the order fails to comply with the criteria set by the
Sponsoring Member Organization.
    RMG software interacts with orders only prior to the orders' entry
into the Exchange's trading system for execution. RMG does not have
order execution or trade reporting capabilities (though it will allow a
Sponsoring Member Organization to monitor the orders of its Sponsored
Participants). RMG maintains a record of all messages relating to
Sponsored Participants' transactions and supplies a copy of such
messages to the applicable Sponsoring Member Organization.
    The Sponsoring Member Organization, and not RMG, will have full
responsibility for ensuring that Sponsored Participants' sponsored
access to the Exchange complies with the Exchange's sponsored access
rules. The use of RMG by a Member Organization does not automatically
constitute compliance with Exchange rules.
    NYXATS will host RMG software on NYXATS' infrastructure. After
passing through RMG software, each order will enter the NYSE Common
Customer Gateway (CCG) \9\ for connectivity to the Exchange's matching
engine. In the future NYXATS may integrate RMG into the NYSE CCG for
more direct access to the Exchange's matching engine.
---------------------------------------------------------------------------

    \9\ The NYSE CCG is a part of the NYSE Alternext Trading
Systems, operated on behalf of the Exchange by NYSE.
---------------------------------------------------------------------------

    The Exchange does not require Sponsoring Member Organizations to
use RMG (even when it is integrated into NYSE CCG in the future).
Sponsoring Member Organizations are free to use a competing risk-
management service or to use none at all. The Exchange will not provide
preferential treatment to Sponsoring Member Organizations using RMG.
    The Exchange proposes to make RMG available to its members and
member organizations pursuant to contractual arrangements. The Exchange
believes that RMG will offer its members and member organizations
another option in the efficient risk management of its Sponsored
Participant's access to the NYSE Alternext Trading Systems.
2. Statutory Basis
    The basis under the Act for this proposed rule change is the
requirement under section 6(b)(5) \10\ that an Exchange have rules that
are designed to promote just and equitable principles of trade, to
remove impediments to and perfect the mechanism of a free and open
market and a national market system and, in general, to protect
investors and the public interest. The proposed rule change also is
designed to support the principles of section 11A(a)(1) \11\ in that it
seeks to assure economically efficient execution of securities
transactions, make it practicable for brokers to execute investors'
orders in the best market and provide an opportunity for investors'
orders to be executed without the participation of a dealer. The
Exchange believes that RMG is consistent with all the aforementioned
principles because it fosters competition by providing another option
in the efficient risk management of trading on the Exchange without the
participation of a dealer.
---------------------------------------------------------------------------

    \10\ 15 U.S.C. 78f(b)(5).
    \11\ 15 U.S.C. 78k-1(a)(1).
---------------------------------------------------------------------------

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 that is not necessary or appropriate
in furtherance of the purposes of the Act.

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

    No written comments were solicited or received with respect to the
proposed rule change.

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

    Within 35 days of the date of publication of this notice in the
Federal Register or within such longer period (i) as the Commission may
designate up to 90 days of such date if it finds such longer period to
be appropriate and publishes its reasons for so finding or (ii) as to
which the Exchange consents, the Commission will:
    (A) By order approve the proposed rule change, or
    (B) Institute proceedings to determine whether the proposed rule
change should be disapproved.

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 e-mail to<EMAIL_ADDRESS>Please include
File No. SR-NYSEALTR-2008-12 on the subject line.

Paper Comments

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

All submissions should refer to File Number SR-NYSEALTR-2008-12. This
file number should be included on the subject line if e-mail 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 Web site (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 inspection
and copying in the Commission's Public Reference Room, on official
business days between the hours of 10 a.m. and 3 p.m. Copies of such
filing also will be available for inspection and copying at the
principal office of the Exchange. All comments received will be posted
without change; the Commission does not edit personal identifying
information from submissions. You should submit only information that
you wish to make

available publicly. All submissions should refer to File Number SR-
NYSEALTR-2008-12 and should be submitted on or before January 21, 2009.
---------------------------------------------------------------------------

    \12\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\12\
Florence E. Harmon,
Acting Secretary.
[FR Doc. E8-31101 Filed 12-30-08; 8:45 am]

BILLING CODE 8011-01-P


[Federal Register Volume 87, Number 166 (Monday, August 29, 2022)]
[Proposed Rules]
[Pages 52710-52712]
[FR Doc No: 2022-18484]

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DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

14 CFR Part 71

[Docket No. FAA-2022-1027; Airspace Docket No. 21-AEA-33]
RIN 2120-AA66

Proposed Amendment and Revocation of VOR Federal Airways; Eastern
United States

AGENCY: Federal Aviation Administration (FAA), DOT.

ACTION: Notice of proposed rulemaking (NPRM).

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

SUMMARY: This action proposes to amend five VHF Omnidirectional Range
(VOR) Federal airways, and remove five VOR Federal airways. This action
supports the FAA's VOR Minimum Operational Network (MON) program.

DATES: Comments must be received on or before October 13, 2022.

ADDRESSES: Send comments on this proposal to the U.S. Department of
Transportation, Docket Operations, 1200 New Jersey Avenue SE, West
Building Ground Floor, Room W12-140, Washington, DC 20590; telephone:
(800) 647-5527 or<PHONE_NUMBER>. You must identify FAA Docket No. FAA-
2022-1027; Airspace Docket No. 21-AEA-33 at the beginning of your
comments. You may also submit comments through the internet at
www.regulations.gov.
    FAA Order JO 7400.11F, Airspace Designations and Reporting Points,
and subsequent amendments can be viewed online at www.faa.gov/air_traffic/publications/. For further information, you can contact the
Rules and Regulations Group, Federal Aviation Administration, 800
Independence Avenue SW, Washington, DC 20591; telephone: (202) 267-
8783.

FOR FURTHER INFORMATION CONTACT: Paul Gallant, Rules and Regulations
Group, Office of Policy, Federal Aviation Administration, 800
Independence Avenue SW, Washington, DC 20591; telephone: (202) 267-
8783.

SUPPLEMENTARY INFORMATION:

Authority for This Rulemaking

    The FAA's authority to issue rules regarding aviation safety is
found in Title 49 of the United States Code. Subtitle I, Section 106
describes the authority of the FAA Administrator. Subtitle VII,
Aviation Programs, describes in more detail the scope of the agency's
authority. This rulemaking is promulgated under the authority described
in Subtitle VII, Part A, Subpart I, Section 40103. Under that section,
the FAA is charged with prescribing regulations to assign the use of
the airspace necessary to ensure the safety of aircraft and the
efficient use of airspace. This regulation is within the scope of that
authority as it would modify the VOR Federal airway route structure in
the eastern United States to maintain the efficient flow of air
traffic.

Comments Invited

    Interested parties are invited to participate in this proposed
rulemaking by submitting such written data, views, or arguments as they
may desire. Comments that provide the factual basis supporting the
views and suggestions presented are particularly helpful in developing
reasoned regulatory decisions on the proposal. Comments are
specifically invited on the overall regulatory, aeronautical, economic,
environmental, and energy-related aspects of the proposal.
    Communications should identify both docket numbers (FAA Docket No.
FAA-2022-1027; Airspace Docket No. 21-AEA-33) and be submitted in
triplicate to the Docket Management Facility (see ADDRESSES section for
address and phone number). You may also submit comments through the
internet at www.regulations.gov.
    Commenters wishing the FAA to acknowledge receipt of their comments
on this action must submit with those comments a self-addressed,
stamped postcard on which the following statement is made: ``Comments
to FAA Docket No. FAA-2022-1027; Airspace Docket No. 21-AEA-33.'' The
postcard will be date/time stamped and returned to the commenter.
    All communications received on or before the specified comment
closing date will be considered before taking action on the proposed
rule. The proposal contained in this action may be changed in light of
comments received. A report summarizing each substantive public contact
with FAA personnel concerned with this rulemaking will be filed in the
docket.

Availability of NPRM's

    An electronic copy of this document may be downloaded through the
internet at www.regulations.gov. Recently published rulemaking
documents can also be accessed through the FAA's web page at
www.faa.gov/air_traffic/publications/airspace_amendments/.
    You may review the public docket containing the proposal, any
comments received and any final disposition in person in the Dockets
Office (see ADDRESSES section for address and phone number) between
9:00 a.m. and 5:00 p.m., Monday through Friday, except Federal
holidays. An informal docket may also be examined during normal
business hours at the office of the Eastern Service Center, Federal
Aviation Administration, Room 210, 1701 Columbia Ave., College Park,
GA, 30337.

Availability and Summary of Documents for Incorporation by Reference

    This document proposes to amend FAA Order JO 7400.11F, Airspace
Designations and Reporting Points, dated August 10, 2021, and effective
September 15, 2021. FAA Order JO 7400.11F is publicly available as
listed in the ADDRESSES section of this proposed rule. FAA Order JO
7400.11F lists Class A, B, C, D, and E airspace areas, air traffic
service routes, and reporting points.

The Proposal

    The FAA is proposing an amendment to 14 CFR part 71 to amend five
VOR Federal airways, and remove five VOR Federal airways. This action
supports the FAA's VOR MON program.
    V-46: V-46 extends from Deer Park, NY to Nantucket, MA. The FAA
proposes to remove V-46 in its entirety to support the decommissioning
of the Hampton, NY (HTO), VHF Omnidirectional Range and Tactical Air
Navigational System (VORTAC) and the Norwich, CT (ORW). VHF
Omnidirectional Range/Distance Measuring Equipment (VOR/DME). RNAV
route T-705 would be extended as a partial overlay of the route.
    V-91: V-91 extends from the intersection of the Calverton, NY
180[deg] and the Hampton, NY 223[deg] radials to Albany, NY. This
action proposes to remove the entire route in support of the
decommissioning of the Bridgeport, CT (BDR), VOR/DME, Carmel, NY (CMK),
VOR/DME, and the Pawling, NY (PWL), VOR/DME. RNAV route T-463 is being
published as a partial overlay.
    V-123: V-123 extends from the intersection of the Washington, DC
065[deg] and the Baltimore, MD 197[deg] radials to Cambridge, NY. This
action would remove the segments from the intersection of the above
Washington and Baltimore radials to Woodstown, NJ. This would support
the decommissioning of the Woodstown, NJ (OOD), VORTAC. As amended, V-
123 would extend from Robbinsville, NJ to Cambridge, NY.
    V-157: V-157 extends from Key West, FL, to Albany, NY. This action
proposes to remove the segments from the intersection of the Richmond,
VA 039[deg] and the Patuxent, MD 238[deg] radials, to

Woodstown, NJ. As a result, V-157 would consist of two parts: From Key
West, FL, to Richmond, VA; and From Robbinsville, NJ to Albany, NY.
This would support the decommissioning of the Nottingham, MD (OTT), and
the Patuxent, MD (PXT), VORTACs. With the remove of the above segments,
the words excluding the airspace within R-4005, R-4006, and R-4007A are
no longer required in the description. The exclusion of R-6602A is
amended to read ``R-6602A, B, and C when active.''
    V-213: V-213 extends from Grand Strand, SC, to Albany, NY. This
action proposes to remove segment that extends between the intersection
of the Hopewell, VA 019[deg] and the Brooke, VA 132[deg] radials, and
Patuxent River, MD. As a result, V-213 would consist of two parts: From
Grand Strand, SC to Hopewell, VA; and from Smyrna, DE to Albany, NY.
    V-270: V-270 extends, in two parts, From Erie, PA, to Jamestown,
NY; and From Elmira, NY, to Boston, MA. The FAA proposes to remove the
entire route as it is no longer used for air traffic purposes. This
would support the decommissioning of the Elmira, NY (ULM), VOR/DME and
the Delancey, NY (DNY), VOR/DME. RNAV route T-460 would provide a
partial overlay.
    V-273: V-273 extends from the intersection of the Huguenot, NY
134[deg] and the Solberg, NJ 044[deg] radials to Hancock, NY. This
action proposes to remove the entire route in support of the
decommissioning of the Hancock, NY (HNK), VOR/DME and the Huguenot, NY
(HOU), VOR/DME. RNAV route T-391 will be extended as a partial overlay.
    V-433: V-433 extends from Nottingham, MD, to Syracuse, NY. This
action proposes to remove the segment from Nottingham, MD, to
Bridgeport, CT, is support of the decommissioning of the Nottingham, MD
(OTT), VORTAC; Patuxent, MD (PXT),VORTAC; and the Bridgeport, CT (BDR),
VOR/DME. As amended, V-433 would extend from Bridgeport, CT to
Syracuse, NY, as currently charted.
    V-483: V-483 extends from Deer Park, NY, to Rochester, NY. This
action would remove the segments from Deer Park, NY, to the
intersection of the Rockdale, NY 325[deg] and the Syracuse, NY 100[deg]
radials. This would support the decommissioning of the Delancy, NY
(DNY), VOR/DME, Carmel, NY (CMK), VOR/DME, Pawling, NY (PWL), VOR/DME,
and Hancock, NY (HNK), VOR/DME. As amended, V-483 would extend from
Syracuse, NY, to Rochester, NY. RNAV route T-634 would be extended as a
partial overlay.
    V-499: V-499 extends from Baltimore, MD, to Binghamton, NY. The FAA
proposes to remove the entire route. The airway is no longer used for
air traffic purposes.
    The full descriptions of the above routes are listed in the
amendments to part 71 set forth below.
    Domestic VOR Federal airways are published in paragraph 6010(a) of
FAA Order JO 7400.11F, dated August 10, 2021, and effective September
15, 2021, which is incorporated by reference in 14 CFR 71.1. The VOR
Federal airways listed in this document would be subsequently published
in and removed from FAA Order JO 7400.11.
    FAA Order JO 7400.11, Airspace Designations and Reporting Points,
is published yearly and effective on September 15.

Regulatory Notices and Analyses

    The FAA has determined that this proposed regulation only involves
an established body of technical regulations for which frequent and
routine amendments are necessary to keep them operationally current.
It, therefore: (1) is not a ``significant regulatory action'' under
Executive Order 12866; (2) is not a ``significant rule'' under
Department of Transportation (DOT) Regulatory Policies and Procedures
(44 FR 11034; February 26, 1979); and (3) does not warrant preparation
of a regulatory evaluation as the anticipated impact is so minimal.
Since this is a routine matter that will only affect air traffic
procedures and air navigation, it is certified that this proposed rule,
when promulgated, will not have a significant economic impact on a
substantial number of small entities under the criteria of the
Regulatory Flexibility Act.

Environmental Review

    This proposal will be subject to an environmental analysis in
accordance with FAA Order 1050.1F, ``Environmental Impacts: Policies
and Procedures'' prior to any FAA final regulatory action.

List of Subjects in 14 CFR Part 71

    Airspace, Incorporation by reference, Navigation (air).

The Proposed Amendment

    In consideration of the foregoing, the Federal Aviation
Administration proposes to amend 14 CFR part 71 as follows:

PART 71--DESIGNATION OF CLASS A, B, C, D, AND E AIRSPACE AREAS; AIR
TRAFFIC SERVICE ROUTES; AND REPORTING POINTS

0
1. The authority citation for 14 CFR part 71 continues to read as
follows:

    Authority:  49 U.S.C. 106(f), 106(g); 40103, 40113, 40120; E.O.
10854, 24 FR 9565, 3 CFR, 1959-1963 Comp., p. 389.

Sec.  71.1   [Amended]

0
2. The incorporation by reference in 14 CFR 71.1 of FAA Order JO
7400.11F, Airspace Designations and Reporting Points, dated August 10,
2021, and effective September 15, 2021, is amended as follows:

Paragraph 6010(a) Domestic VOR Federal Airways.

* * * * *

V-46 [Removed]

* * * * *

V-91 [Removed]

* * * * *

V-123 [Amended]

    From Robbinsville, NJ; INT Robbinsville 044[deg] and LaGuardia,
NY, 213[deg] radials; LaGuardia; INT LaGuardia 032[deg] and Carmel,
NY, 157[deg] radials; Carmel; INT Carmel 344[deg] and Albany, NY,
181[deg] radials; Albany; to Cambridge, NY.
* * * * *

V-157 [Amended]

    From Key West, FL; INT Key West 038[deg] and Dolphin, FL,
244[deg] radials; Dolphin; INT Dolphin 331[deg] and La Belle, FL,
113[deg] radials; La Belle; Lakeland, FL; Ocala, FL; INT Ocala
346[deg] and Taylor, FL, 170[deg] radials; Taylor, FL; Waycross, GA;
Alma, GA; Allendale, SC; Vance, SC; Florence, SC; Fayetteville, NC;
Kinston, NC; Tar River, NC; Lawrenceville, VA; to Richmond, VA. From
Robbinsville, NJ; INT Robbinsville 044[deg] and LaGuardia, NY,
213[deg] radials; LaGuardia; INT LaGuardia 032[deg]and Deer Park,
NY, 326[deg] radials; INT Deer Park 326[deg] and Kingston, NY,
191[deg] radials; Kingston, NY; to Albany, NY. The airspace within
R-6602A, B, and C is excluded when active.
* * * * *

V-213 [Amended]

    From Grand Strand, SC, via Wilmington, NC; INT Wilmington
352[deg] and Tar River, NC, 191[deg] radials; Tar River; to
Hopewell, VA; From Smyrna, DE; INT Smyrna 035[deg] and Robbinsville,
NJ, 228[deg] radials; Robbinsville; INT Robbinsville 014[deg] and
Sparta, NJ, 174[deg] radials; Sparta; to Albany, NY. The airspace
within R-4005 and R-4006 is excluded.
* * * * *

V-270 [Removed]

* * * * *

V-273 [Removed]

* * * * *

V-433 [Amended]

    From Bridgeport, CT; INT Bridgeport 324[deg] and Pawling, NY,
160[deg] radials; Pawling; INT Pawling 304[deg] and Rockdale, NY,
116[deg] radials; Rockdale; INT Rockdale 325[deg] and Syracuse, NY,
100[deg] radials; to Syracuse.
* * * * *

V-483 [Amended]

    From Syracuse, NY; Rochester, NY; INT Syracuse 283[deg] and
Rochester 064[deg] radials; Rochester.
* * * * *

V-499 [Removed]

* * * * *

    Issued in Washington, DC, on August 23, 2022.
Scott M. Rosenbloom,
Manager, Airspace Rules and Regulations.
[FR Doc. 2022-18484 Filed 8-26-22; 8:45 am]
BILLING CODE 4910-13-P


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Confidential Business Information located at EPA headquarters 1310 L St NW.


[Federal Register Volume 88, Number 30 (Tuesday, February 14, 2023)]
[Notices]
[Pages 9576-9579]
[FR Doc No: 2023-03056]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-96836; File No. SR-PEARL-2023-02]

Self-Regulatory Organizations: MIAX PEARL, LLC; Notice of Filing
and Immediate Effectiveness of a Proposed Rule Change by MIAX PEARL,
LLC To Amend the MIAX Pearl Options Fee Schedule

February 8, 2023.
    Pursuant to the provisions of 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 January 31, 2023, MIAX PEARL, LLC (``MIAX
Pearl'' or ``Exchange'') filed with the Securities and Exchange
Commission (``Commission'') a proposed rule change as described in
Items I, II, and III 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.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------

I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change

    The Exchange is filing a proposal to amend the MIAX Pearl Options
Fee Schedule (the ``Fee Schedule'').
    The text of the proposed rule change is available on the Exchange's
website at http://www.miaxoptions.com/rule-filings/pearl at MIAX
Pearl's principal office, 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 Exchange proposes to amend the Add/Remove Tiered Rebates/Fees
set forth in Section 1(a) of the Fee Schedule that apply to the MIAX
Pearl Market Maker \3\ origin to modify the volume threshold for the
alternative volume criteria (described below) in Tier 2 (defined
below).
---------------------------------------------------------------------------

    \3\ ``Market Maker'' means a Member registered with the Exchange
for the purpose of making markets in options contracts traded on the
Exchange and that is vested with the rights and responsibilities
specified in Chapter VI of Exchange Rules. See the Definitions
Section of the Fee Schedule.
---------------------------------------------------------------------------

Background
    The Exchange currently assesses transaction rebates and fees to all
market participants which are based upon the total monthly volume
executed by the Member \4\ on MIAX Pearl in the relevant, respective
origin type (not including Excluded Contracts) \5\ (as the numerator)
expressed as a percentage of (divided by) TCV \6\ (as the denominator).
In addition, the per contract transaction rebates and fees are applied
retroactively to all eligible volume for that origin type once the
respective threshold tier (``Tier'') has been reached by the Member.
The Exchange aggregates the volume of Members and their Affiliates.\7\
Members that place resting liquidity, i.e., orders resting on the book
of the MIAX Pearl System,\8\ are paid the specified ``maker'' rebate
(each a ``Maker''), and Members that execute against resting liquidity
are assessed the specified ``taker'' fee (each a ``Taker''). For
opening transactions and ABBO \9\ uncrossing transactions, per contract
transaction rebates and fees are waived for all market participants.
Finally, Members are assessed lower transaction fees and receive lower
rebates for order executions in standard option classes in the Penny
Interval Program \10\ (``Penny Classes'') than for order executions in
standard option classes which are not in the Penny Interval Program
(``Non-Penny Classes''), where Members are assessed higher transaction
fees and receive higher rebates.
---------------------------------------------------------------------------

    \4\ ``Member'' means an individual or organization that is
registered with the Exchange pursuant to Chapter II of Exchange
Rules for purposes of trading on the Exchange as an ``Electronic
Exchange Member'' or ``Market Maker.'' Members are deemed
``members'' under the Exchange Act. See the Definitions Section of
the Fee Schedule and Exchange Rule 100.
    \5\ ``Excluded Contracts'' means any contracts routed to an away
market for execution. See the Definitions Section of the Fee
Schedule.
    \6\ ``TCV'' means total consolidated volume calculated as the
total national volume in those classes listed on MIAX PEARL for the
month for which the fees apply, excluding consolidated volume
executed during the period time in which the Exchange experiences an
``Exchange System Disruption'' (solely in the option classes of the
affected Matching Engine (as defined below)). The term Exchange
System Disruption, which is defined in the Definitions section of
the Fee Schedule, means an outage of a Matching Engine or collective
Matching Engines for a period of two consecutive hours or more,
during trading hours. The term Matching Engine, which is also
defined in the Definitions section of the Fee Schedule, is a part of
the MIAX PEARL electronic system that processes options orders and
trades on a symbol-by-symbol basis. Some Matching Engines will
process option classes with multiple root symbols, and other
Matching Engines may be dedicated to one single option root symbol
(for example, options on SPY may be processed by one single Matching
Engine that is dedicated only to SPY). A particular root symbol may
only be assigned to a single designated Matching Engine. A
particular root symbol may not be assigned to multiple Matching
Engines. The Exchange believes that it is reasonable and appropriate
to select two consecutive hours as the amount of time necessary to
constitute an Exchange System Disruption, as two hours equates to
approximately 1.4% of available trading time per month. The Exchange
notes that the term ``Exchange System Disruption'' and its meaning
have no applicability outside of the Fee Schedule, as it is used
solely for purposes of calculating volume for the threshold tiers in
the Fee Schedule. See the Definitions Section of the Fee Schedule.
    \7\ ``Affiliate'' means (i) an affiliate of a Member of at least
75% common ownership between the firms as reflected on each firm's
Form BD, Schedule A, or (ii) the Appointed Market Maker of an
Appointed EEM (or, conversely, the Appointed EEM of an Appointed
Market Maker). An ``Appointed Market Maker'' is a MIAX PEARL Market
Maker (who does not otherwise have a corporate affiliation based
upon common ownership with an EEM) that has been appointed by an EEM
and an ``Appointed EEM'' is an EEM (who does not otherwise have a
corporate affiliation based upon common ownership with a MIAX PEARL
Market Maker) that has been appointed by a MIAX PEARL Market Maker,
pursuant to the following process. A MIAX PEARL Market Maker
appoints an EEM and an EEM appoints a MIAX PEARL Market Maker, for
the purposes of the Fee Schedule, by each completing and sending an
executed Volume Aggregation Request Form by email to
[email protected] no later than 2 business days prior to
the first business day of the month in which the designation is to
become effective. Transmittal of a validly completed and executed
form to the Exchange along with the Exchange's acknowledgement of
the effective designation to each of the Market Maker and EEM will
be viewed as acceptance of the appointment. The Exchange will only
recognize one designation per Member. A Member may make a
designation not more than once every 12 months (from the date of its
most recent designation), which designation shall remain in effect
unless or until the Exchange receives written notice submitted 2
business days prior to the first business day of the month from
either Member indicating that the appointment has been terminated.
Designations will become operative on the first business day of the
effective month and may not be terminated prior to the end of the
month. Execution data and reports will be provided to both parties.
See the Definitions Section of the Fee Schedule.
    \8\ The term ``System'' means the automated trading system used
by the Exchange for the trading of securities. See Exchange Rule
100.
    \9\ ``ABBO'' means the best bid(s) or offer(s) disseminated by
other Eligible Exchanges (defined in Exchange Rule 1400(g)) and
calculated by the Exchange based on market information received by
the Exchange from OPRA. See the Definitions Section of the Fee
Schedule and Exchange Rule 100.
    \10\ See Securities Exchange Act Release No. 88992 (June 2,
2020), 85 FR 35142 (June 8, 2020) (SR-PEARL-2020-06).
---------------------------------------------------------------------------

Alternative Volume Criteria Threshold Change in Tier 2
    The Exchange proposes to amend the Add/Remove Tiered Rebates/Fees
set forth in Section 1(a) of the Fee Schedule that apply to the MIAX
Pearl Market Maker origin, to modify the volume threshold for the
alternative Volume Criteria in Tier 2. The Market Maker origin
currently provides an alternative volume criteria in Tier 2, which is
based upon the total monthly volume executed by a MIAX Pearl Market
Maker collectively in SPY/QQQ/IWM options on the Exchange, expressed as
a percentage of total consolidated national volume in SPY/QQQ/IWM
options.\11\ Pursuant to this alternative volume criteria, a Market
Maker is able to reach the Tier 2 threshold if the Market Maker's total
executed monthly volume, not including Excluded Contracts, in SPY/QQQ/
IWM options on MIAX Pearl is above 0.75% of total consolidated national
monthly volume in SPY/QQQ/IWM options. For this calculation, volume
that is from resting liquidity (Maker) and taking liquidity (Taker) in
SPY/QQQ/IWM options is counted towards the alternative volume criteria,
and the 0.75% threshold does not have to be reached individually in
each of the three symbols. A Market Maker is able to qualify for Tier 2
rebates and fees, which will then be applicable to all volume executed
by the MIAX Pearl Market Maker on MIAX Pearl. The two

volume criteria available for Tier 2 is based upon either: (a) the
total monthly volume executed by the Market Maker in all options
classes on MIAX Pearl, not including Excluded Contracts, (as the
numerator), expressed as a percentage of (divided by) TCV (as the
denominator); or (b) the total monthly volume executed by the MIAX
Pearl Market Maker collectively in SPY/QQQ/IWM options on MIAX Pearl,
not including Excluded Contracts, (as the numerator), expressed as a
percentage of (divided by) SPY/QQQ/IWM TCV \12\ (as the denominator).
Once either volume criteria threshold in Tier 2 is reached by the
Market Maker, the Tier 2 per contract rebates and fees apply to all
volume in all options classes executed by that MIAX Pearl Market Maker
on MIAX Pearl.
---------------------------------------------------------------------------

    \11\ See Fee Schedule, Section 1(a), explanatory paragraph below
the tables and footnotes. See also Securities Exchange Act Release
Nos. 84592 (November 14, 2018), 83 FR 58646 (November 20, 2018) (SR-
PEARL-2018-23); 90906 (January 21, 2021), 86 FR 5296 (January 19,
2021) (SR-PEARL-2020-38).
    \12\ ``SPY/QQQ/IWM TCV'' means total consolidated volume in SPY,
QQQ, and IWM calculated as the total national volume in SPY, QQQ,
and IWM for the month for which the fees apply, excluding
consolidated volume executed during the period of time in which the
Exchange experiences an Exchange System Disruption (solely in SPY,
QQQ, or IWM options). See the Definitions Section of the Fee
Schedule.
---------------------------------------------------------------------------

    The Exchange now proposes to modify the threshold for the
alternative volume criteria in Tier 2 from 0.75% to 0.55% of total
consolidated national monthly volume in SPY/QQQ/IWM options. With the
proposed change, a Market Maker will be able to reach the alternative
Volume Criteria in Tier 2 if the Market Maker's total executed monthly
volume, not including Excluded Contracts, in SPY/QQQ/IWM options on
MIAX Pearl is above 0.55% of total consolidated national monthly volume
in SPY/QQQ/IWM options. The Exchange is not modifying the calculation
method for a Market Maker to reach the alternative volume criteria in
Tier 2, only the threshold percentage. The Exchange proposes to make
the corresponding change to the volume threshold percentage described
in the explanatory paragraph for the alternative volume criteria for
Tier 2 that is below the tables in Section 1(a) of the Fee Schedule.
    The purpose of this proposed change is for business and competitive
reasons. In order to attract order flow, the Exchange initially set its
volume threshold for the alternative volume criteria in Tier 2 at a
meaningful low level.\13\ In 2021, the Exchange then increased the
volume threshold for the alternative volume criteria in Tier 2.\14\ The
Exchange now believes that it is appropriate to adjust this volume
threshold so that it is more in line with the volume threshold that
Market Makers currently achieve in SPY/QQQ/IWM options on MIAX Pearl by
reducing the volume threshold for the alternative volume criteria in
Tier 2 from 0.75% to 0.55% in SPY/QQQ/IWM options. Further, the
Exchange believes that with the proposed change, the Exchange will
attract additional SPY/QQQ/IWM option order flow from Market Makers,
which should benefit all Exchange participants by providing more
trading opportunities and tighter spreads. The Exchange cannot predict
with certainty how many Market Makers will achieve the alternative
volume criteria in Tier 2 with the decreased threshold percentage.
---------------------------------------------------------------------------

    \13\ See Securities Exchange Act Release No. 84592 (November 14,
2018), 83 FR 58646 (November 20, 2018) (SR-PEARL-2018-23).
    \14\ See Securities Exchange Act Release No. 90906 (January 21,
2021), 86 FR 5296 (January 19, 2021) (SR-PEARL-2020-38).
---------------------------------------------------------------------------

Implementation
    The proposed change will be effective beginning February 1, 2023.
2. Statutory Basis
    The Exchange believes that its proposal to amend its Fee Schedule
is consistent with section 6(b) of the Act \15\ in general, and
furthers the objectives of section 6(b)(4) of the Act,\16\ in that it
is an equitable allocation of reasonable dues, fees and other charges
among Exchange members and issuers and other persons using its
facilities, and 6(b)(5) of the Act,\17\ in that it is designed to
prevent fraudulent and manipulative acts and practices, to promote just
and equitable principles of trade, to foster cooperation and
coordination with persons engaged in facilitating transactions in
securities, to remove impediments to and perfect the mechanisms of a
free and open market and a national market system and, in general, to
protect investors and the public interest.
---------------------------------------------------------------------------

    \15\ 15 U.S.C. 78f(b).
    \16\ 15 U.S.C. 78f(b)(4).
    \17\ 15 U.S.C. 78f(b)(1) and (b)(5).
---------------------------------------------------------------------------

    The Commission has repeatedly expressed its preference for
competition over regulatory intervention in determining prices,
products, and services in the securities markets. In Regulation NMS,
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.'' \18\
---------------------------------------------------------------------------

    \18\ See Securities Exchange Act Release No. 51808 (June 9,
2005), 70 FR 37496 (June 29, 2005).
---------------------------------------------------------------------------

    There are currently 16 registered options exchanges competing for
order flow. Based on publicly-available information, and excluding
index-based options, as of January 26, 2023, no single exchange has
more than approximately 12-13% equity options market share for the
month of January 2023.\19\ Therefore, no exchange possesses significant
pricing power. More specifically, as of January 26, 2023, the Exchange
had a market share of approximately 6.71% of executed volume of
multiply-listed equity options for the month of January 2023.\20\
---------------------------------------------------------------------------

    \19\ See ``The market at a glance,'' (last visited January 26,
2023), available at https://www.miaxoptions.com/.
    \20\ See id.
---------------------------------------------------------------------------

    The Exchange believes that the ever-shifting market share among the
exchanges from month to month demonstrates that market participants can
discontinue or reduce use of certain categories of products and
services, terminate an existing membership or determine to not become a
new member, and/or shift order flow, in response to transaction fee
changes. For example, on February 28, 2019, the Exchange filed with the
Commission a proposal to increase Taker fees in certain Tiers for
options transactions in certain Penny classes for Priority Customers
and decrease Maker rebates in certain Tiers for options transactions in
Penny classes for Priority Customers (which fee was to be effective
March 1, 2019).\21\ The Exchange experienced a decrease in total market
share for the month of March 2019, after the proposal went into effect.
Accordingly, the Exchange believes that its March 1, 2019, fee change,
to increase certain transaction fees and decrease certain transaction
rebates, may have contributed to the decrease in MIAX Pearl's market
share and, as such, the Exchange believes competitive forces constrain
the Exchange's, and other options exchanges, ability to set transaction
fees and market participants can shift order flow based on fee changes
instituted by the exchanges.
---------------------------------------------------------------------------

    \21\ See Securities Exchange Act Release No. 85304 (March 13,
2019), 84 FR 10144 (March 19, 2019) (SR-PEARL-2019-07).
---------------------------------------------------------------------------

    The Exchange believes its proposal to decrease the threshold for
the alternative volume criteria in Tier 2 from 0.75% to 0.55% of total
consolidated national monthly volume in SPY/QQQ/IWM options is
reasonable, equitably allocated and not unfairly discriminatory because
the reduced threshold percentage should attract additional SPY/QQQ/IWM
option order flow from Market Makers, which will benefit all Exchange
participants by providing more trading opportunities and tighter
spreads.

    The Exchange believes its proposal is reasonable, equitable and not
unfairly discriminatory because all similarly situated market
participants in the same origin type (MIAX Pearl Market Makers) are
subject to the same tiered Maker rebates and access to the Exchange is
offered on terms that are not unfairly discriminatory. The Exchange
believes its proposal will incentivize Market Makers to increase their
posted liquidity in SPY/QQQ/IWM options to the benefit of the entire
market, which will increase order flow sent to the Exchange, benefiting
all market participants through increased liquidity, tighter markets
and order interaction.

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

    The Exchange does not believe that the proposed rule changes will
impose any burden on competition not necessary or appropriate in
furtherance of the purposes of the Act. The Exchange believes that the
proposed change should continue to encourage the provision of liquidity
in SPY/QQQ/IWM options that enhances the quality of the Exchange's
market and increases the number of trading opportunities on the
Exchange for all participants who will be able to compete for such
opportunities. The proposed rule changes should enable the Exchange to
continue to attract and compete for order flow with other exchanges.
However, this competition does not create an undue burden on
competition but rather offers all market participants the opportunity
to receive the benefit of competitive pricing.
    The proposed change to the threshold criteria for the alternative
volume criteria in Tier 2 for the Market Maker origin is intended to
keep the Exchange's rebates highly competitive with those of other
exchanges, and to encourage liquidity and should enable the Exchange to
continue to attract and compete for order flow with other 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. In such an
environment, the Exchange must continually adjust its rebates and fees
to remain competitive with other exchanges and to attract order flow.
The Exchange believes that the proposed rule changes reflect this
competitive environment because the proposal modifies the Exchange's
fees in a manner that encourages market participants to continue to
provide liquidity and to send order flow to the Exchange.

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

    Written comments were neither solicited nor 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,\22\ and Rule 19b-4(f)(2) \23\ 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 necessary or appropriate
in the public interest, for the protection of investors, or 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.
---------------------------------------------------------------------------

    \22\ 15 U.S.C. 78s(b)(3)(A)(ii).
    \23\ 17 CFR 240.19b-4(f)(2).
---------------------------------------------------------------------------

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-PEARL-2023-02 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-PEARL-2023-02. 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 such 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-PEARL-2023-02 and should be submitted on
or before March 7, 2023.

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\24\
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    \24\ 17 CFR 200.30-3(a)(12).
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Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2023-03056 Filed 2-13-23; 8:45 am]
BILLING CODE 8011-01-P