[Federal Register: December 29, 2008 (Volume 73, Number 249)]
[Notices]
[Page 79473-79481]
[DOCID:fr29de08-62]

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ENVIRONMENTAL PROTECTION AGENCY

[FRL-8757-3, EPA-HQ-OW-2008-0055]

Final National Pollutant Discharge Elimination System (NPDES)
General Permit for Discharges Incidental to the Normal Operation of a
Vessel

AGENCY: Environmental Protection Agency (EPA).

ACTION: Notice of availability.

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SUMMARY: EPA Regions 1, 2, 3, 4, 5, 6, 7, 8, 9, and 10 are finalizing
an NPDES Vessel General Permit (VGP) to cover discharges incidental to
the normal operation of vessels. This action is in response to a
District Court ruling that vacates, as of December 19, 2008, a long-
standing EPA regulation that excludes discharges incidental to the
normal operation of a vessel from the need to obtain an NPDES permit.
As of December 19, 2008, discharges incidental to the normal operation
of a vessel that had formerly been exempted from NPDES permitting by
the regulation will be subject to the prohibition in CWA Section 301(a)
against the discharge of pollutants without a permit.
    EPA solicited information and data on discharges incidental to
normal vessel operations to assist in developing two NPDES general
permits in a Federal Register Notice published June 21, 2007 (72 FR
32421). The majority of information and data in response to that notice
came from seven different groups: Individual citizens, commercial
fishing representatives, commercial shipping groups, environmental or
outdoor recreation groups, the oil and gas industry, recreational
boating-related businesses, and state governments. EPA considered all
the information and data received along with other publicly available
information in developing two proposed vessel permits.
    EPA published the two proposed permits and accompanying fact sheets
for public comment on June 17, 2008 (73 FR 34296). As proposed, the VGP
would have covered all commercial and non-recreational vessels and
those recreational vessels longer or equal to 79 feet, and the proposed
RGP would have covered recreational vessels less than 79 feet in
length. However, after the permits were proposed, Congress enacted two
new laws that impact the universe of vessels covered under today's
permit. On July 29, 2008, Senate bill S. 2766 (``the Clean Boating Act
of 2008'') was signed into law (Pub. L. 110-288). This law provides
that recreational vessels shall not be subject to the requirement to
obtain an NPDES permit to authorize discharges incidental to their
normal operation. As a result of this legislation, EPA is not
finalizing the proposed recreational vessel NPDES permit and has also
modified the VGP, which included those recreational vessel over 79
feet, to eliminate that coverage. On July 31, 2008, Senate bill S. 3298
was signed into law (Pub. L. 110-299). This law generally imposes a
two-year moratorium during which time neither EPA nor states can
require NPDES permits for discharges (except ballast

water discharges) incidental to the normal operation of vessels of less
than 79 feet and commercial fishing vessels of any length. EPA is not
taking final action on the proposed permit as it would apply to these
vessels and has revised the final VGP to reflect the new law.

DATES: This permit is effective December 19, 2008. This effective date
is necessary to provide affected vessels the necessary permit coverage
under the Clean Water Act in light of the vacatur of the 40 CFR
122.3(a) NPDES permitting exemption. EPA notes that on December 18,
2008, a motion was filed with the U.S. District Court for the Northern
District of California seeking a delay of vacatur of the 40 CFR
122.3(a) exclusion from NPDES permitting until February 6, 2009. As of
the time today's notice was ready for signature, the Court had not
taken action on that motion; thus, EPA could not adjust the effective
date of the permit to coincide with a new vacatur date. EPA advises
that should the court grant the motion to delay the vacatur date, the
effective date of today's permit will not change. In addition,
compliance dates for those permit provisions that require compliance at
some explicit amount of time after the effective date will not be
extended, regardless of whether the Court delays vacatur of the
exclusion. However, because permit authorization is not required until
vacatur of the 40 CFR 122.3(a) permitting exclusion occurs, the
regulated community need not comply with the terms of today's permit
until the date of vacatur ordered by the Court.
    In accordance with 40 CFR Part 23, this permit shall be considered
issued for the purpose of judicial review on the day 2 weeks after
Federal Register Publication. Under section 509(b) of the Clean Water
Act, judicial review of this general permit can be had by filing a
petition for review in the United States Court of Appeals within 120
days after the permit is considered issued for purposes of judicial
review. Under section 509(b)(2) of the Clean Water Act, the
requirements in this permit may not be challenged later in civil or
criminal proceedings to enforce these requirements. In addition, this
permit may not be challenged in other agency proceedings. Deadlines for
submittal of notices of intent are provided in Part 1.5 of the VGP.
This permit also provides additional dates for compliance with the
terms of these permits.

FOR FURTHER INFORMATION CONTACT: For further information on this final
vessel NPDES general permit, contact Ryan Albert at EPA Headquarters,
Office of Water, Office of Wastewater Management, Mail Code 4203M, 1200
Pennsylvania Ave., NW., Washington, DC 20460; or at tel.<PHONE_NUMBER>;
or Juhi Saxena at EPA Headquarters, Office of Water, Office of
Wastewater Management, Mail Code 4203M, 1200 Pennsylvania Ave., NW.,
Washington, DC 20460; or at tel.<PHONE_NUMBER>; or e-mail:
<EMAIL_ADDRESS>
SUPPLEMENTARY INFORMATION:

I. General Information

A. Does This Final Permit Apply To Me?

    This action applies to all vessels operating in a capacity as a
means of transportation, except recreational vessels as defined in CWA
section 502(25), Public Law 110-288, that have discharges incidental to
their normal operations into waters subject to this permit. With
respect to (1) commercial fishing vessels of any size as defined in 46
U.S.C. 2101 and (2) those non-recreational vessels that are less than
79 feet in length, the coverage under this permit is limited to ballast
water discharges only. Unless otherwise excluded from coverage by Part
6 of the permit, waters subject to this permit, means waters of the
U.S. as defined in 40 CFR 122.2.

B. How Can I Get Copies of These Documents and Other Related
Information?

    1. Docket. EPA has established an official public docket for this
action under Docket ID No. EPA-HQ-OW-2008-0055 VGP. The official public
docket is the collection of materials, including the administrative
record, for the final permit, required by 40 CFR 124.18. It is
available for public viewing at the Water Docket in the EPA Docket
Center, (EPA/DC) EPA West, Room 3334, 1301 Constitution Ave., NW.,
Washington, DC 20460. Although all documents in the docket are listed
in an index, some information is not publicly available, i.e., CBI or
other information whose disclosure is restricted by statute. Publicly
available docket materials are available electronically through http://
www.regulations.gov and in hard copy at the EPA Docket Center Public
Reading Room, open from 8:30 a.m. to 4:30 p.m., Monday through Friday,
excluding legal holidays. The telephone number for the Public Reading
Room is<PHONE_NUMBER> and the telephone number for the Water Docket is
(202) 566-2426. In addition, the comments and information that EPA
received in response to its June 21, 2007, Federal Register notice can
be found in the public docket at http://www.regulations.gov by
searching Docket ID No. EPA-HQ-OW-2007-0483.
    2. Electronic Access. You may access this Federal Register document
electronically through the EPA Internet under the Federal Register
listings at http://www.epa.gov/fedrgstr/.
    An electronic version of the public docket is available through the
Federal Docket Management System (FDMS) found at http://
www.regulations.gov. You may use the FDMS to view public comments,
access the index listing of the contents of the official public docket,
and to access those documents in the public docket that are available
electronically. Once at the Web site, enter the appropriate Docket ID
No. in the ``Search'' box to view the docket.
    Certain types of information will not be placed in the EPA dockets.
Information claimed as CBI and other information whose disclosure is
restricted by statute, which is not included in the official public
docket, will not be available for public viewing in EPA's electronic
public docket. EPA policy is that copyrighted material will not be
placed in EPA's electronic public docket but will be available only in
printed, paper form in the official public docket. Although not all
docket materials may be available electronically, you may still access
any of the publicly available docket materials through the docket
facility identified in Section I.A.1.
    Response to public comments. EPA received 173 comments on the
proposed VGP from the shipping industry (108), States (28),
Environmental Groups and the public (37). EPA has responded to all
comments received and has included these responses in a separate
document in the public docket for this permit. See the document titled
Proposed VGP: EPA's Response to Public Comments.

C. Public Outreach: Public Hearing and Public Meetings, Webcast

    Because EPA anticipated a significant degree of public interest in
the draft permit, EPA held a public hearing Monday, July 21, 2008, to
receive public comment and answer questions concerning the proposed
permit. In addition, EPA and the U.S. Coast Guard co-hosted three (3)
public meetings on Thursday, June 19, 2008, in Washington, DC; Tuesday,
June 24, 2008, in Portland, OR; and Thursday, June 26, 2008, in
Chicago, IL; to present the proposed requirements of the VGP and the
basis for those requirements, as well as to answer questions concerning
the proposed permit. The public meetings and public hearing were
attended by a wide variety of

stakeholders including representatives from industry, government
agencies, and environmental organizations.
    In addition, EPA held a Webcast on July 2, 2008, to provide
information on the proposed permits and to answer questions from
interested parties that were unable to attend the public meetings or
hearing.

D. Who Are the EPA Regional Contacts for This Proposed Permit?

    For EPA Region 1, contact Sara Green at USEPA REGION 1, 1 Congress
Street, Suite 1100, Mail Code: CIP, Boston, MA 02114-2023; or at tel.:
(617) 918-1574; or e-mail at<EMAIL_ADDRESS>    For EPA Region 2, contact James Olander at USEPA REGION 2, 290
Broadway, New York, NY 10007-1866; or at tel.:<PHONE_NUMBER>; or e-
mail at<EMAIL_ADDRESS>    For EPA Region 3, contact Mark Smith at USEPA REGION 3, 1650 Arch
Street, Mail Code: 3WP41, Philadelphia, PA 19103-2029; or at tel.:
(215) 814-3105; or e-mail at<EMAIL_ADDRESS>    For EPA Region 4, contact Marshall Hyatt at USEPA REGION 4, 61
Forsyth Street, SW., Atlanta, GA 30303-8960; or at tel.: (404) 562-
9304; or e-mail at<EMAIL_ADDRESS>    For EPA Region 5, contact Sean Ramach at USEPA REGION 5, 77 West
Jackson Boulevard, Mail Code: WN-16J, Chicago, IL 60604-3507; or at
tel.:<PHONE_NUMBER>; or e-mail at<EMAIL_ADDRESS>    For EPA Region 6, contact Paul Kaspar at USEPA REGION 6, 1445 Ross
Avenue, Suite 1200, Mail Code: 6WQPP, Dallas, TX 75202-2733; or at
tel.:<PHONE_NUMBER>; or e-mail at<EMAIL_ADDRESS>    For EPA Region 7, contact Alex Owutaka at USEPA REGION 7, 901 North
Fifth Street, Mail Code: WWPDWIMB, Kansas City, KS 66101; or at tel:
(913) 551-7584; or e-mail at<EMAIL_ADDRESS>    For EPA Region 8, contact Sandy Stavnes, at USEPA REGION 8, 1595
Wynkoop St., Mail Code: 8P-W-WW, Denver, CO 80202-1129; or at tel:
(303) 312-6117; or e-mail at<EMAIL_ADDRESS>    For EPA Region 9, contact Eugene Bromley at USEPA REGION 9, 75
Hawthorne Street, Mail Code: WTR-5, San Francisco, CA 94105; or at
tel.:<PHONE_NUMBER>; or e-mail at<EMAIL_ADDRESS>    For EPA Region 10, contact Cindi Godsey at USEPA Region 10--Alaska
Operations Office, Federal Building Room 537, 222 West 7th Avenue
19, Mail Code: AOO/A, Anchorage, AK 99513-7588; or at tel.:
(907) 271-6561; or e-mail at<EMAIL_ADDRESS>
II. Statutory and Regulatory History

A. The Clean Water Act

    Section 301(a) of the Clean Water Act (CWA) provides that ``the
discharge of any pollutant by any person shall be unlawful'' unless the
discharge is in compliance with certain other sections of the Act. 33
U.S.C. 1311(a). The CWA defines ``discharge of a pollutant'' as ``(A)
any addition of any pollutant to navigable waters from any point
source, (B) any addition of any pollutant to the waters of the
contiguous zone or the ocean from any point source other than a vessel
or other floating craft.'' 33 U.S.C. 1362(12). A ``point source'' is a
``discernible, confined and discrete conveyance'' and includes a
``vessel or other floating craft.'' 33 U.S.C. 1362(14).
    The term ``pollutant'' includes, among other things, ``garbage * *
* chemical wastes * * * and industrial, municipal, and agricultural
waste discharged into water.'' The Act's definition of ``pollutant''
specifically excludes ``sewage from vessels or a discharge incidental
to the normal operation of a vessel of the Armed Forces'' as defined in
Clean Water Act section 312. 33 U.S.C. 1362(6). One way a person may
discharge a pollutant without violating the section 301 prohibition is
by obtaining a section 402 National Pollutant Discharge Elimination
System (NPDES) permit (33 U.S.C. 1342). Under section 402(a), EPA may
``issue a permit for the discharge of any pollutant, or combination of
pollutants, notwithstanding section 1311(a)'' upon certain conditions
required by the Act.

B. The History of the Exclusion of Vessels From the NPDES Program

    Less than one year after the CWA was enacted, EPA promulgated a
regulation that excluded discharges incidental to the normal operation
of vessels from NPDES permitting. 38 FR 13528, May 22, 1973. After
Congress re-authorized and amended the CWA in 1977, EPA invited another
round of public comment on the regulation. 43 FR 37078, August 21,
1978. In 1979, EPA promulgated the final revision that established the
regulation largely in its current form. 44 FR 32854, June 7, 1979. The
regulation identifies several types of vessel discharges as being
subject to NPDES permitting, but specifically excludes discharges
incidental to the normal operation of a vessel.

    The following discharges do not require NPDES permits:
    (a) Any discharge of sewage from vessels, effluent from properly
functioning marine engines, laundry, shower, and galley sink wastes
or any other discharge incidental to the normal operation of a
vessel. This exclusion does not apply to rubbish, trash, garbage, or
other such materials discharged overboard; nor to other discharges
when the vessel is operating in a capacity other than as a means of
transportation such as when used as an energy or mining facility, a
storage facility or a seafood processing facility, or when secured
to a storage facility or a seafood processing facility, or when
secured to the bed of the ocean, contiguous zone or waters of the
United States for the purpose of mineral or oil exploration or
development. 40 CFR 122.3(a).

Although other subsections of 40 CFR 122.3 and its predecessor were the
subject of legal challenges (See NRDC v. Costle, 568 F.2d 1369 (D.C.
Cir. 1977)), following its promulgation, the regulatory text relevant
to discharges incidental to the normal operation of vessels went
unchallenged at that time, and has been in effect ever since.

C. The Legal Challenge

    In December 2003, the long-standing exclusion of discharges
incidental to the normal operation of vessels from the NPDES program
became the subject of a lawsuit in the U.S. District Court for the
Northern District of California. The lawsuit arose from a January 13,
1999, rulemaking petition submitted to EPA by a number of parties
concerned about the effects of ballast water discharges. The petition
asked the Agency to repeal its regulation at 40 CFR 122.3(a) that
excludes certain discharges incidental to the normal operation of
vessels from the requirement to obtain an NPDES permit. The petition
asserted that vessels are ``point sources'' requiring NPDES permits for
discharges to U.S. waters; that EPA lacks authority to exclude point
source discharges from vessels from the NPDES program; that ballast
water must be regulated under the NPDES program because it contains
invasive plant and animal species as well as other materials of concern
(e.g., oil, chipped paint, sediment and toxins in ballast water
sediment); and that enactment of CWA section 312(n) (Uniform National
Discharge Standards, also known as the UNDS program) demonstrated
Congress' rejection of the exclusion.
    In response to the 1999 petition, EPA first prepared a detailed
report for public comment, Aquatic Nuisance Species in Ballast Water
Discharges: Issues and Options (September 10, 2001). See, 66 FR 49381,
September 27, 2001. After considering the comments received, EPA
declined to reopen the exclusion for additional rulemaking, and denied
the petition on September 2, 2003. EPA explained that since enactment
of the CWA, EPA has consistently interpreted the Act to provide for
NPDES regulation of

discharges from industrial operations that incidentally occur onboard
vessels (e.g., seafood processing facilities or oil exploration
operations at sea) and of discharges overboard of materials such as
trash, but not of discharges incidental to the normal operation of a
vessel (e.g., ballast water) subject to the 40 CFR 122.3(a) exclusion.
EPA further explained that Congress had expressly considered and
accepted the Agency's regulation in the years since its promulgation,
and that Congress chose to regulate discharges incidental to the normal
operation of vessels through programs other than CWA section 402
permitting. Thus, it was EPA's understanding that Congress had
acquiesced to EPA's long-standing interpretation of how the CWA applied
to vessels. Denial of the petition did not reflect EPA's dismissal of
the significant impacts of aquatic invasive species, but rather the
understanding that other programs had been enacted to specifically
address the issue and that the CWA does not currently provide an
appropriate framework for addressing ballast water and other discharges
incidental to the normal operation of non-military vessels.
    In the denial of the petition, EPA noted that when Congress
specifically focused on the problem of aquatic nuisance species in
ballast water, it did not look to or endorse the NPDES program as the
means to address the problem. Instead, Congress enacted new statutes
which directed and authorized the Coast Guard, rather than EPA, to
establish a regulatory program for discharges incidental to the normal
operation of vessels, including ballast water (i.e., Nonindigenous
Aquatic Nuisance Prevention and Control Act as amended, 16 U.S.C. 4701
et seq.; Act to Prevent Pollution from Ships, 33 U.S.C. 1901 et seq.).
Furthermore, Congress made no effort to legislatively repeal EPA's
interpretation of the NPDES program or to expressly mandate that
discharges incidental to the normal operation of vessels be addressed
through the NPDES permitting program. EPA reasoned that this
Congressional action and inaction in light of Congress' awareness of
the regulatory exclusion confirmed that Congress accepted EPA's
interpretation and chose the Coast Guard as the lead agency under other
statutes.
    In addition, EPA found significant practical and policy reasons not
to re-open the longstanding CWA regulatory exclusion, reasoning that
there are a number of ongoing activities within the Federal government
related to control of invasive species in ballast water, many of which
are likely to be more effective and efficient than use of NPDES permits
under the CWA. EPA also noted that nothing in the CWA prevents states
from independently regulating ballast water discharges under State law,
should they choose to do so, pursuant to CWA section 510.
    After EPA's September 2003 denial of the petition, a number of
groups filed a complaint in the U.S. District Court for the Northern
District of California. The complaint was brought pursuant to the
Administrative Procedure Act (APA), 5 U.S.C. 701 et seq., and set out
two causes of action. First, the complaint challenged EPA's
promulgation of 40 CFR 122.3(a), an action the Agency took in 1973. The
second cause of action challenged EPA's September 2003 denial of their
petition to repeal the Sec. 122.3(a) exclusion.

D. District Court Decision

    In March 2005, the Court determined that the exclusion exceeded the
Agency's authority under the CWA. Specifically, in March 2005 the Court
granted summary judgment to the plaintiffs:

    The Court DECLARES that EPA's exclusion from NPDES permit
requirements for discharges incidental to the normal operation of a
vessel at 40 CFR 122.3(a) is in excess of the Agency's authority
under the Clean Water Act * * *.

    Northwest Envtl. Advocates v. United States EPA, 2005 U.S. Dist.
LEXIS 5373 (N.D. Cal. 2005). After this ruling, the Court granted
motions to intervene on behalf of the Plaintiffs by the States of
Illinois, New York, Michigan, Minnesota, Pennsylvania, and Wisconsin,
and on behalf of the Government-Defendant by the Shipping Industry
Ballast Water Coalition.
    Following submission of briefs and oral argument by the parties and
interveners on the issue of a proper remedy, the Court issued a final
order in September 2006 providing that:

    The blanket exemption for discharges incidental to the normal
operation of a vessel, contained in 40 CFR 122.3(a), shall be
vacated as of September 30, 2008.

Northwest Envtl. Advocates v. United States EPA, 2006 U.S. Dist. LEXIS
69476 (N.D. Cal. Sept. 18, 2006).
    EPA filed an appeal in the U.S. Court of Appeals for the Ninth
Circuit, and on July 23, 2008, the Court upheld the District Court's
decision, leaving the September 30, 2008 vacatur date intact. Northwest
Envtl. Advocates v. EPA 537 F.3d 1006 (9th Cir. 2008). EPA subsequently
petitioned the District Court to extend the date for vacatur of the 40
CFR 122.3(a) exclusion to December 19, 2008, and the District Court
granted this request. Northwest NW. Envt'l Advocates et al. v. United
States EPA, 2008 U.S. Dist. LEXIS 66738 (N.D. Cal. August 31, 2008)
    This means that, effective December 19, discharges incidental to
the normal operation of vessels currently excluded from NPDES
permitting by that regulation will become subject to CWA section 301's
discharge prohibition, unless covered under an NPDES permit. The CWA
authorizes civil and criminal enforcement for violations of that
prohibition and also allows for citizen suits against violators.
    Additional material related to the lawsuit is contained in the
docket accompanying these proposed permits and fact sheets.

III. Scope and Applicability of the 2008 VGP

A. CWA Section 401 Certification and Coastal Zone Management Act
Concurrence

    EPA may not issue a permit authorizing discharges into the waters
of a State until that State has granted certification under CWA section
401 or has waived its right to certify (or been deemed to have waived).
33 U.S.C. 1341(a)(1); 40 CFR 124.53(a). For this permit, a State was
deemed to have waived its right to certify if it did not exercise that
right within 60 days from the date the State was notified of the draft
permit, unless EPA granted that State more time to certify based on
``unusual circumstances.'' 40 CFR 124.53(c)(3). If a State believed
that any permit condition(s) more stringent than those contained in the
draft permit were necessary to meet the applicable requirements of
either the CWA or State law, the State had an opportunity to include
those condition(s) in its certification. 40 CFR 124.53(e)(1). A number
of States provided such conditions in their certifications, and EPA has
added them to the VGP pursuant to CWA section 401(d). 33 U.S.C.
1341(d).
    Similarly, the EPA may not issue a general permit authorizing
discharges into waters of a State if the State objects, in the case of
this general permit, with EPA's National Consistency Determination,
pursuant to the regulations implementing of the Coastal Zone Management
Act (``CZMA''), specifically the regulations at 15 CFR 930.31(d) and
930.36(e). Several States provided conditions to the VGP, based on
specific enforceable coastal policies of the State, which allowed the
State to concur with EPA's consistency determination. According to the
regulations, EPA incorporated these

conditions to the maximum extent practicable. If a State coastal zone
management agency's conditions are not incorporated into the general
permit or if the State coastal zone management agency objects to the
general permit, then the general permit is not available for use by
potential general permit users in that State unless the applicant who
wants to use the general permit provides the State agency with the
applicant's consistency determination and the State agency concurs. 15
CFR 930.31(d), NOAA has explained that ``a State objection to a
consistency determination for the issuance of a general permit would
alter the form of CZMA compliance required, transforming the general
permit into a series of case by case CZMA decisions and requiring an
individual who wants to use the general permit to submit an individual
consistency certification to the State agency in compliance with 15 CFR
part 930.'' 71 FR 788, 793. In States that have not provided conditions
for incorporation into the permit to allow the State to concur, as well
as States that have not objected to the permit, EPA's CZMA compliance
requirements derive from CZMA section 307(c)(1). Id.

B. Geographic Coverage of VGP

    The VGP applies to discharges incidental to the normal operation of
a vessel identified as being eligible for coverage in the final permit,
into waters subject to the permit. These waters are ``waters of the
United States'' as defined in 40 CFR 122.2 (extending to the reach of
the 3-mile territorial sea as defined in section 502(8) of the CWA).
The final permit covers vessel discharges in the waters of the U.S. in
all States, Territories and Indian Country Land, regardless of whether
a ``state'' is otherwise authorized to implement the NPDES permit
program within its jurisdiction. For more information on this approach,
see the fact sheet accompanying the final permit.
    As of the issuance date of this permit, the following jurisdictions
have not yet granted, denied, waived (or been deemed to have waived)
certifications pursuant to Section 401 of the Clean Water Act and/or
final responses on the national consistency determination required by
section 307(c)(1) of the Coastal Zone Management Act. Therefore, this
permit does not yet provide coverage in the following jurisdictions:
    [ctrcir] The State of Alaska
    [ctrcir] The State of Hawaii
EPA will announce the availability of coverage under the VGP discharges
in these jurisdictions in a separate Federal Register notice as soon as
possible should it receive the appropriate 401 certifications or
waivers, and/or final responses on the national consistency
determination. In addition, the VGP is not effective in the Taos Pueblo
Indian Country Land (New Mexico) because they have denied certification
under CWA section 401.

C. Categories of Vessels Covered Under VGP

    The final vessel general permit (VGP) applies to owners and
operators of non-recreational vessels that are 79 feet (24.08 meters)
and greater in length, as well as to owners and operators of commercial
vessels of less than 79 feet and commercial fishing vessels of any
length which discharge ballast water.
    The final VGP does not apply to recreational vessels of any size,
commercial fishing vessels of any size which do not discharge ballast
water, and non-recreational vessels of less than 79 feet which do not
discharge ballast water. For Commercial fishing vessels and non-
recreational vessels of less than 79 feet in length that discharge
ballast water, the only effluent limit these vessels are subject to are
the VGP standards that apply to ballast water discharges.

D. Summary of VGP Terms and Requirements

    The final VGP addresses 26 vessel discharge streams by establishing
effluent limits, including Best Management Practices (BMPs), to control
the discharge of the waste streams and constituents found in those
waste streams. The discharge streams eligible for coverage under this
final permit are: Deck washdown and runoff and above water line hull
cleaning; bilge water; ballast water; anti-fouling leachate from anti-
fouling hull coatings; aqueous film forming foam (AFFF); boiler/
economizer blowdown; cathodic protection; chain locker effluent;
controllable pitch propeller hydraulic fluid and thruster hydraulic
fluid and other oil sea interfaces including lubrication discharges
from paddle wheel propulsion, stern tubes, thruster bearings,
stabilizers, rudder bearings, azimuth thrusters, and propulsion pod
lubrication; distillation and reverse osmosis brine; elevator pit
effluent; firemain systems; freshwater layup; gas turbine wash water;
graywater; motor gasoline and compensating discharge; non-oily
machinery wastewater; refrigeration and air condensate discharge;
seawater cooling overboard discharge; seawater piping biofouling
prevention; small boat engine wet exhaust; sonar dome discharge,
underwater ship husbandry; welldeck discharges; graywater mixed with
sewage from vessels; and exhaust gas scrubber wash water discharge.
    For each discharge type, among other things, the final permit
establishes effluent limits pertaining to the constituents found in the
effluent, including BMPs designed to decrease the amount of
constituents entering the waste stream. A vessel might not produce all
of these discharges, but a vessel owner or operator is responsible for
meeting the applicable effluent limits and complying with all the
effluent limits for every listed discharge that the vessel produces.
Discharge Authorization Timeframe
    To obtain authorization, the owner or operator of a vessel that is
either 300 or more gross tons or has the capacity to hold or discharge
more than 8 cubic meters (2113 gallons) of ballast water is required to
submit a Notice of Intent (NOI) to receive permit coverage, beginning
June 19, 2009, but no later than September 19, 2009. Until September
19, 2009 these vessels will be automatically authorized upon permit
issuance to discharge according to the permit requirements. For vessels
that were delivered to the owner or operator on or before September 19,
2009, the vessel will receive final permit coverage on the date that
EPA receives the complete NOI. New vessels that are delivered after
September 19, 2009 will receive permit coverage 30 days after EPA
receives the complete NOI. When ownership of a vessel previously
authorized to discharge under this permit is transferred to a new
owner, the discharge authorization date is the later of the date EPA
receives an NOI from the new owner or the date of transfer. In the case
of an existing vessel which was not previously authorized to discharge
under this permit, delivered to the owner after September 19, 2009, the
discharge authorization date is 30 days after EPA receives the complete
NOI.
    Vessels that are less than 300 gross tons or are able to carry or
discharge no more than 8 cubic meters of ballast water capacity will be
automatically authorized upon permit issuance to discharge according to
the permit requirements.
Monitoring and Reporting
    The VGP requires routine self-inspection and monitoring of all
areas of the vessel that the permit addresses. The routine self-
inspection must be documented in the ship's logbook. Analytical
monitoring is required for certain types of vessels. The VGP also
requires comprehensive annual vessel

inspections, to ensure even the hard-to-reach areas of the vessel are
inspected for permit compliance. If the vessel is placed in dry dock
while covered under this permit, a dry dock inspection and report must
be completed. Additional monitoring requirements are imposed on certain
classes of vessels, based on unique characteristics not shared by other
vessels covered under the VGP.
Vessel Type-Specific Requirements
    The permit imposes additional requirements for 8 specific types of
vessels which have unique characteristics resulting in discharges not
shared by other types of vessels. These vessel types are medium cruise
ships, large cruise ships, large ferries, barges, oil or petroleum
tankers, research vessels, rescue boats, and vessels employing
experimental ballast water treatment systems. The permit requirements
are designed to address the discharges from features unique to those
vessels, such as parking decks on ferries and overnight accommodations
for passengers on cruise ships.

E. Summary of Significant Changes From Proposal to Final Permit

    The final VGP differs from the proposed permit in several ways, the
most significant of which are discussed below. These changes include
modifying the graywater discharge requirements for existing medium
cruise ships unable to voyage more than 1 nautical mile (nm) from
shore, adding requirements for the discharge of pool and spa water from
cruise ships, prohibiting the discharge of tetrachloroethylene
degreasers, expanding the prohibition against discharge of Tributyltin
to a prohibition against discharge of any organotin compounds, and the
addition of whole effluent toxicity (WET) testing to the requirements
for vessels employing a ballast water treatment system which discharge
certain biocides. Other changes made include revising the universe of
vessels eligible for coverage of the permit in response to two new laws
(see Summary section above), combining three discharge categories into
a new category that includes all oil to sea interfaces, modifying
discharges and limits for large ferries, and additional clarifications
added to several cruise ship discharges.
    In addition to seeking public comment on all requirements of the
proposed VGP, EPA specifically sought comment on several specific
aspects of the VGP (for more detail on each element see the Permit Fact
Sheet). The following sections summarize each topic for which EPA
requested comment and what, if anything, EPA changed in the final VGP.
For specific and full responses to public comment, please see the
response to comments document included in the docket for this permit.
Tetrachloroethylene (TCE)
    EPA sought information on whether uses of Tetrachloroethylene (TCE)
other than dry cleaning should be explicitly included or excluded from
permit coverage. EPA was also interested in comments on the frequency
and nature of the use of TCE-containing products on vessels. (TCE
discharges associated with dry-cleaning activities on vessels were not
proposed to be eligible for coverage because they are not considered to
be incidental to the normal operation of a vessel).
    Based on public comments received, discharges of TCE degreasers and
other TCE containing products were made ineligible for coverage under
the permit.
Notice of Intent (NOI) Requirements
    EPA specifically requested comment on the approach for requiring
NOIs from vessels. Comments received on this topic were split, with
some in favor of the proposed requirements, and some recommending
changes. The most concern was raised over unmanned barges and the
difficulty of submitting NOIs for an entire fleet of vessels. EPA
acknowledges these comments and is attempting to make its e-NOI system
as user friendly as possible. The Agency intends to consider the needs
of users who must fill in multiple forms when designing the electronic
system. The e-NOI is expected to be operational six months from the
date of permit issuance (June 19, 2009).
    Additionally, based on public comment noting that most regulations
were changing to use ``gross ton'' instead of ``gross registered ton''
as a unit for regulation, EPA has changed the NOI requirements to
require an NOI from those vessels of more than 300 gross tons, rather
than 300 gross registered tons. Vessels that have the ability to hold
or discharge more than 8 cubic meters of ballast are also required to
submit an NOI. The majority of commenters supported EPA's decision to
require NOIs of only a subset of vessels covered by the permit.
Numeric Discharge Limits in Place of Best Management Practices (BMPs)
    EPA specifically requested comment on whether the permit should
establish numeric discharge limits for any of those discharges for
which the proposed permit would have solely imposed best management
practices (BMPs). The proposed permit included numeric discharge limits
for graywater from cruise ships; oily discharges, including oily
mixtures; and residual biocide limits from vessels utilizing
experimental ballast water treatment systems. For the remainder of the
discharges incidental to the normal operation of vessels, the proposed
permit would have imposed BMPs, based on EPA's conclusion that numeric
effluent limitations are not feasible for vessel discharges in this
permit iteration. EPA requested that if commenters provide suggested
numeric limits, that they should also provide any supporting data that
identifies technologies or BMPs available to meet those limits, and if
those limits are more stringent than requirements of the proposed
permit, provide the costs and non-water quality impacts of setting
those limits, and any other relevant information that would be helpful
in setting those limits.
    While several commenters recommended establishing numeric limits
for more discharges than were included in the proposed permit, EPA has
not added additional numeric limits except for experimental ballast
water treatment discharges and for Pool and Spa discharges (see section
titled ``Operational Limits for Large Cruise Ships'' below for
discussion about Pool and Spa discharges). In the proposal for this
general permit, EPA specifically requested comment on whether whole
effluent toxicity (``WET'') tests should be used in addition to, or in
lieu of, analytical monitoring of residual biocides and derivatives and
if so, what appropriate toxicity-based endpoints might be used for this
purpose. Based on public comment, the final VGP establishes WET
testing, as a requirement for VGP coverage for ballast water treatment
systems using biocides, or which have derivatives from such biocides,
for which there are not acute water quality criteria. This approach is
based on existing EPA WET methods and WET testing for ballast water
discharges adopted by the State of Washington, and relies primarily on
the methods specified in 40 CFR Part 136. The principal public comment
on WET referenced the Washington State WET testing provisions for
ballast water, which can be found at http://www.ecy.wa.gov/pubs/
9580.pdf, appendix H. EPA used this manual as a reference in addition
to WET tests consistent with past Agency practice (including Denton et
al. 2007).
    Several commenters noted that EPA should include numeric treatment
standards for Ballast Water. EPA notes that although ballast water
treatment technologies are not currently available

within the meaning of BAT under the CWA, such technologies are rapidly
developing and might become ``available'' using a BAT standard within
this permit term. EPA commits to continuing to review the evolution of
ballast water treatment technologies and may, if appropriate, use the
permit reopener in light of that evolution. See Part 4 of the VGP Fact
Sheet for additional discussion. Additional discussion about ballast
water discharge standards can be found in the fact sheet for this
permit and in the response to comments document.
Bilgewater Discharges in Embayments
    EPA requested comment on whether the permit should limit discharges
of bilgewater in embayments, such as the Chesapeake Bay, for large
vessels that regularly leave waters subject to the permit.
    A few commenters recommended limiting discharges of bilgewater in
embayments, but provided no additional information on which EPA could
base such a decision. EPA notes that defining embayments is difficult
and the information before the Agency does not demonstrate that there
are available and economically achievable approaches for limiting such
discharges in embayments. Hence, EPA has not specifically limited
discharges of bilgewater in embayments. Nonetheless, other proposed
requirements restricting discharge location and concentration for
certain vessels remain in the permit. For instance, vessels greater
than 400 gross tons, which regularly leave waters subject to the VGP,
are subject to additional restrictions on the discharge of bilgewater,
including a prohibition on the discharge of untreated bilgewater and
restrictions when operating in the specially protected waters
referenced in Part 12.1 of the permit, many of which may include bays
and other similarly enclosed areas.
Saltwater Flushing for Vessels with Unpumpable Ballast Water and
Residual Sediment
    EPA requested comment on whether the requirement of mandatory
saltwater flushing for all vessels with unpumpable ballast water and
residual sediment which sail more than 200 nm (nautical mile) from any
shore is appropriate.
    Comments were received which both supported and opposed the
mandatory saltwater flushing requirement. The final VGP retains the
requirement for mandatory saltwater flushing for two classes of
vessels: those defined as ocean-going vessels and those engaged in
Pacific near shore voyages.
Ballast Water Exchange Requirements for Coastwise Trade Vessels on
Atlantic and Gulf Coasts
    EPA requested comment on whether ballast water exchange
requirements similar to those proposed for Pacific near shore voyages
should be applied to vessels engaged in coastwise trade on the Atlantic
or Gulf Coasts that will discharge to waters subject to this permit.
After considering the range of public comment on the issue, which both
supported and opposed inclusion of Atlantic and Gulf ballast water
exchange, EPA has not included Atlantic and Gulf nearshore ballast
water exchange and saltwater flushing requirements. None of the
commenters provided directly applicable data to support their views.
EPA will, however, continue to investigate whether Atlantic and Gulf
coast ballast water exchange is an appropriate best management practice
for vessel owner/operators engaged in nearshore voyages. This
exploration may include several elements such as examining vessel
traffic and operation patterns along the Eastern and Gulf seaboards,
the volume of ballast water transported and released, and the number of
miles traveled by the average Atlantic and Gulf nearshore voyage.
Adequacy of the One-Time Report
    EPA requested comment on whether the questions developed for the
one-time report are appropriate and whether alternative or supplemental
questions should be considered. The proposed permit would have required
owner/operators to submit a one-time report that contains basic
information about the vessel after the 30th month of permit coverage.
    Many commenters suggested that the one-time report was an added
burden on permittees and would not provide useful information to EPA
while other commenters recommended requesting more information in the
report and increasing the frequency of reporting. EPA has decided to
retain the one-time report as it was proposed in the final VGP. EPA
believes it will provide additional, useful information for future
permit decisions without creating a substantial administrative burden
on permittees.
Operational Limits for Large Cruise Ships
    EPA requested comment on whether the proposed operational limits
for large cruise ships are appropriate and whether the discharge
standards proposed for within 1 nm of any shore should be extended to 3
nm from any shore, regardless of the speed of the vessel. For large
cruise ships, the proposed permit would have prohibited the discharge
of graywater within 1 nautical mile of shore unless the graywater has
been treated to treatment standards in part <IP_ADDRESS>.2 of the proposed
permit. The proposed permit would also have required the discharge to
either meet the effluent limits outlined in this proposed permit under
Part <IP_ADDRESS>.2 or be discharged while the vessel is moving at least 6
knots for discharges between 1 nm and 3 nm of shore.
    Several commenters, primarily environmental groups, recommended
extending the discharge standards to 3nm from any shore, regardless of
the speed of the vessel, or to impose even more stringent limits on
cruise ship discharges. Other commenters, including those from the
cruise ship industry, commented that the permit should include the
graywater treatment standards, but should not prohibit the discharge of
treated graywater provided the discharge met those standards. EPA has
clarified in the final permit that discharges of graywater are allowed
within 1 nm of shore, provided that those discharges meet the standards
in Parts 5.1 or 5.2 of the permit.
    As part of comments received, several cruise ship representatives
noted that they must discharge pool and spa water into waters subject
to this permit. The commenters noted that they completely dechlorinate
or debrominate this discharge as applicable. As a result of these
comments, EPA has authorized the direct discharge of pool and spa
water, provided it is dechlorinated and debrominated (as applicable),
the vessel is underway at least 6 knots, and the permittee monitors the
effluent before every discharge event. See Part 7.1 and 7.2 of the VGP
fact sheet for additional discussion of these requirements.
Discharge of Untreated Graywater within 1nm of Shore or Nutrient
Impaired Waters
    EPA requested comment on whether the proposed prohibition on
discharges of untreated graywater within 1 nm of shore for large and
medium cruise ships, and into nutrient-impaired waters such as the
Chesapeake Bay for large cruise ships, is appropriate and whether EPA's
economic analyses are accurate.
    Comments received on this issue were split, with commenters both
supporting the prohibition on discharges of untreated graywater within
1nm of shore and nutrient impaired estuaries as well as opposing the
requirements as too stringent or burdensome. Primarily, several
comments raised concern about

certain medium cruise ships which are unable to travel more than 1nm
from shore, whether due to geographic constraints, such as traveling on
inland waters, or restrictions on the vessel based on the license
issued by the U.S. Coast Guard. In response to these comments, the
final permit changes the permit conditions for medium cruise ships that
are unable to travel outside 1nm. Medium cruise ships constructed after
the issuance of this permit must meet the same permit conditions as
those that are able to travel outside 1nm from shore. Additionally,
medium cruise ships which undergo a major renovation must also meet the
same permit conditions as those able to travel more than 1 nm from
shore.
Graywater Treatment Standards for Large Ferries
    EPA requested comment on whether large ferries should be subject to
additional graywater treatment standards similar to those proposed for
medium and large cruise ships.
    EPA received comments that both supported and opposed adding
graywater treatment standards similar to the requirements for large
cruise ships to the requirements for large ferries. No additional
supporting data for either approach was submitted during the comment
period. In the final permit, EPA has not altered the proposed permit
requirements for large ferries.

IV. Regulatory Flexibility Act

    The Regulatory Flexibility Act (RFA) generally requires an agency
to prepare a regulatory flexibility analysis of any rule subject to
notice and comment rulemaking requirements under the Administrative
Procedure Act or any other statute unless the agency certifies that the
rule will not have a significant economic impact on a substantial
number of small entities. Small entities include small businesses,
small organizations, and small governmental jurisdictions.
    The legal question of whether a general permit (as opposed to an
individual permit) qualifies as a ``rule'' or as an ``adjudication''
under the Administrative Procedure Act (APA) has been the subject of
periodic litigation. In a recent case, the court held that the CWA
Section 404 Nationwide general permit before the court did qualify as a
``rule'' and therefore that the issuance of the general permit needed
to comply with the applicable legal requirements for the issuance of a
``rule.'' National Ass'n of Home Builders v. U.S. Army Corps of
Engineers, 417 F.3d 1272, 1284-85 (DC Cir.2005) (Army Corps general
permits under Section 404 of the Clean Water Act are rules under the
APA and the Regulatory Flexibility Act; ``Each NWP [nationwide permit]
easily fits within the APA's definition `rule' * * * As such, each NWP
constitutes a rule * * * '').
    As EPA stated in 1998, ``the Agency recognizes that the question of
the applicability of the APA, and thus the RFA, to the issuance of a
general permit is a difficult one, given the fact that a large number
of dischargers may choose to use the general permit.'' 63 FR 36489,
36497 (July 6, 1998). At that time, EPA ``reviewed its previous NPDES
general permitting actions and related statements in the Federal
Register or elsewhere,'' and stated that ``[t]his review suggests that
the Agency has generally treated NPDES general permits effectively as
rules, though at times it has given contrary indications as to whether
these actions are rules or permits.'' Id. at 36496. Based on EPA's
further legal analysis of the issue, the Agency ``concluded, as set
forth in the proposal, that NPDES general permits are permits [i.e. ,
adjudications] under the APA and thus not subject to APA rulemaking
requirements or the RFA.'' Id. Accordingly, the Agency stated that
``the APA's rulemaking requirements are inapplicable to issuance of
such permits,'' and thus ``NPDES permitting is not subject to the
requirement to publish a general notice of proposed rulemaking under
the APA or any other law * * * [and] it is not subject to the RFA.''
Id. at 36497.
    However, the Agency went on to explain that, even though EPA had
concluded that it was not legally required to do so, the Agency would
voluntarily perform the RFA's small-entity impact analysis. Id. EPA
explained the strong public interest in the Agency following the RFA's
requirements on a voluntary basis: ``[The notice and comment] process
also provides an opportunity for EPA to consider the potential impact
of general permit terms on small entities and how to craft the permit
to avoid any undue burden on small entities.'' Id. Accordingly, with
respect to the NPDES permit that EPA was addressing in that Federal
Register notice, EPA stated that ``the Agency has considered and
addressed the potential impact of the general permit on small entities
in a manner that would meet the requirements of the RFA if it
applied.'' Id.
    Subsequent to EPA's conclusion in 1998 that general permits are
adjudications, rather than rules, as noted above, the DC Circuit
recently held that nationwide general permits under section 404 are
``rules'' rather than ``adjudications.'' Thus, this legal question
remains ``a difficult one'' (supra). However, EPA continues to believe
that there is a strong public policy interest in EPA applying the RFA's
framework and requirements to the Agency's evaluation and consideration
of the nature and extent of any economic impacts that a CWA general
permit could have on small entities (e.g., small businesses). In this
regard, EPA believes that the Agency's evaluation of the potential
economic impact that a general permit would have on small entities,
consistent with the RFA framework discussed below, is relevant to, and
an essential component of, the Agency's assessment of whether a CWA
general permit would place requirements on dischargers that are
appropriate and reasonable. Furthermore, EPA believes that the RFA's
framework and requirements provide the Agency with the best approach
for the Agency's evaluation of the economic impact of general permits
on small entities. While using the RFA framework to inform its
assessment of whether permit requirements are appropriate and
reasonable, EPA will also continue to ensure that all permits satisfy
the requirements of the Clean Water Act.
    Accordingly, EPA has committed that the Agency will operate in
accordance with the RFA's framework and requirements during the
Agency's issuance of CWA general permits (in other words, the Agency
commits that it will apply the RFA in its issuance of general permits
as if those permits do qualify as ``rules'' that are subject to the
RFA). In satisfaction of this commitment, during the course of this VGP
proceeding, the Agency conducted the analysis and made the appropriate
determinations that are called for by the RFA. In addition, and in
satisfaction of the Agency's commitment, EPA will apply the RFA's
framework and requirements in any future issuance of other NPDES
general permits. EPA anticipates that for most general permits the
Agency will be able to conclude that there is not a significant
economic impact on a substantial number of small entities. In such
cases, the requirements of the RFA framework are fulfilled by including
a statement to this effect in the permit fact sheet, along with a
statement providing the factual basis for the conclusion. A
quantitative analysis of impacts would only be required for permits
that may affect a substantial number of small entities, consistent

with EPA guidance regarding RFA certification.\1\
---------------------------------------------------------------------------

    \1\ EPA's current guidance, entitled Final Guidance for EPA
Rulewriters: Regulatory Flexibility Act as Amended by the Small
Business Regulatory Enforcement and Fairness Act, was issued in
November 2006 and is available on EPA's Web site: http://
www.epa.gov/sbrefa/documents/rfafinalguidance06.pdf. After
considering the Guidance and the purpose of CWA general permits, EPA
concludes that general permits affecting less than 100 small
entities do not have a significant economic impact on a substantial
number of small entities.
---------------------------------------------------------------------------

V. Analysis of Economic Impacts of VGP and RGP

    EPA determined that, in consideration of the discussion in Section
IV above, the issuance of the VGP may have the potential to affect a
substantial number of small entities. Therefore, in order to determine
what, if any, economic impact this permit may have on small businesses,
EPA conducted an economic assessment of these general permits. This
economic analysis is included in the records for these permits. Based
on this assessment, EPA concludes that despite a minimal economic
impact on all entities, including small businesses, this permit is not
likely to have a significant economic impact on a substantial number of
small entities.
    Including the ballast water and other discharge requirements, the
draft economic impact analysis indicates that the best management
practices in this permit would cost between $ 6.7 million and $16.7
million annually. Including paperwork requirements, the permit is
estimated to cost between $7.7 and $21.9 million dollars annually for
domestic vessels. Including estimates of ballast water costs for
foreign vessels, the permit is expected to cost between $8.9 and $23.0
million dollars annually. Depending upon sector (vessel type), median
costs per firm range from $1 to $795 in the low-end assumptions and
from $5 to $1,967 in the high-end assumptions (excluding median values
from commercial fishing vessels which are expected to be $0). Costs for
the 95th percentile range from $7 for the Deep Sea Coastal and Great
Lakes Passenger Vessels to $20,355 for marine cargo handling under low-
end cost estimates and from $88 to $35,190 for the same vessel classes
for high-end cost estimates (see table 7.1 of the economic assessment
cost estimates across vessel classes). EPA applied a cost-to-revenue
test which calculates annualized pre-tax compliance cost as a
percentage of total revenues and used a threshold of 1 and 3 percent to
identify entities that would be significantly impacted as a result of
this Permit. The total number of entities expected to exceed a 1% cost
ratio ranges from 213 under low cost assumptions to 308 under high cost
assumptions. Of this universe, the total number of entities expected to
exceed a 3% cost ratio ranges from 55 under low cost assumptions to 73
under high cost assumptions. The total universe that would be affected
by this permit includes approximately 61,000 domestic flagged vessels
and 8,000 foreign flagged vessels. Accordingly, EPA concludes that this
permit is unlikely to result in a significant economic impact on any
businesses and in particular, small businesses. The economic analyses
are available in the record for these permits.

VI. Paperwork Reduction Act

    The information collection requirements in this permit have been
submitted for approval to the Office of Management and Budget (OMB)
under the Paperwork Reduction Act, 44 U.S.C. 3501 et seq. as part of
the NPDES Consolidated ICR. On September 28, 2008 EPA published the
first public notice of this ICR under the OMB number 2040-0004 and on
December 17, 2008, EPA published the final public notice for a 30 day
comment period. The information collection requirements for this permit
are not enforceable until OMB approves the ICR.
    This information must be collected in order to appropriately
administer and enforce the terms and conditions of the Vessel General
Permit. This information collection is mandatory as authorized by Clean
Water Act Section 308 and all information collected will be treated as
Confidential Business Information (CBI).
    The information collection burden for the paperwork collection
requirements of this permit is estimated to be 135,693 hours per year,
which represents a burden of 0.64 hours per response per year,
multiplied by a total of 210,759 responses per year from 65,625
respondents (Note: to ensure that an adequate number of burden hours
are requested, the number of respondents is slightly higher than the
estimated 61,000 domestically flagged vessels identified in the
economic analysis that would be affected by this permit). The frequency
of responses varies, but includes every five years, annual, quarterly,
and occasionally/as needed, depending on the specific reporting
requirements. No reporting and record keeping costs beyond labor costs
are estimated for this permit.
    An agency may not conduct or sponsor, and a person is not required
to respond to, a collection of information unless it displays a
currently valid OMB control number. The OMB control numbers for EPA's
regulations in 40 CFR are listed in 40 CFR Part 9. When this ICR is
approved by OMB, the Agency will publish a technical amendment to 40
CFR Part 9 in the Federal Register to display the OMB control number
for the approved information collection requirements contained in this
final permit.

    Authority: Clean Water Act, 33 U.S.C. 1251 et seq.

    Dated: December 18, 2008.
Robert W. Varney,
Regional Administrator, EPA Region 1.
    Dated: December 18, 2008.
Barbara A. Finazzo,
Director, Division of Environmental Planning and Protection, EPA Region
2.
    Dated: December 18, 2008.
Carl-Axel P. Soderberg,
Division Director, Caribbean Environmental Protection Division, EPA
Region 2.
    Dated: December 18, 2008.
Jon M. Capacasa,
Director, Water Protection Division, EPA Region 3.
    Dated: December 18, 2008.
James D. Giattina,
Director, Water Protection Division, EPA Region 4.
    Dated: December 18, 2008.
Peter Swenson,
Acting Director, Water Division, Water Division, EPA Region 5.
    Dated: December 18, 2008.
William K. Honker,
Acting Director, Water Quality Protection Division, EPA Region 6.
    Dated: December 18, 2008.
William A. Spratlin,
Director Water, Wetlands and Pesticides Division, EPA Region 7.
    Dated: December 18, 2008.
Eddie A. Sierra,
Acting Assistant Regional Administrator, Office of Partnerships and
Regulatory Assistance, EPA Region 8.
    Dated: December 18, 2008.
Nancy Woo,
Associate Director, Water Division, EPA Region 9.
    Dated: December 18, 2008.
Michael Gearheard,
Director, Office of Water and Watersheds, EPA Region 10.

 [FR Doc. E8-30816 Filed 12-24-08; 8:45 am]

BILLING CODE 6560-50-P


[Federal Register: August 16, 2010 (Volume 75, Number 157)]
[Proposed Rules]
[Page 49866-49868]
[DOCID:fr16au10-28]

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DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

14 CFR Part 71

[Docket No. FAA-2010-0651; Airspace Docket No. 10-ANM-7]

Proposed Amendment of Class D and Class E Airspace; Klamath
Falls, OR

AGENCY: Federal Aviation Administration (FAA), DOT.

ACTION: Notice of proposed rulemaking (NPRM).

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

SUMMARY: This action proposes to amend Class D and Class E airspace at
Klamath Falls, OR. Decommissioning of the Merrill Non-Directional Radio
Beacon (NDB) at Klamath Falls Airport has made this action necessary
for the safety and management of Instrument Flight Rules (IFR)
operations at the airport. This action also would adjust the geographic
coordinates of the airport and a navigation aid, and would change the
name of the airport.

DATES: Comments must be received on or before September 30, 2010.

ADDRESSES: Send comments on this proposal to the U.S. Department of
Transportation, Docket Operations, M-30, West Building Ground Floor,
Room W12-140, 1200 New Jersey Avenue, SE., Washington, DC 20590;
telephone<PHONE_NUMBER>. You must identify FAA Docket No. FAA-2010-
0651; Airspace Docket No. 10-ANM-7, at the beginning of your comments.
You may also submit comments through the Internet at http://
www.regulations.gov.

FOR FURTHER INFORMATION CONTACT: Eldon Taylor, Federal Aviation
Administration, Operations Support Group, Western Service Center, 1601
Lind Avenue, SW., Renton, WA 98057; telephone<PHONE_NUMBER>.

SUPPLEMENTARY INFORMATION:

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-2010-0651 and Airspace Docket No. 10-ANM-7) and be submitted in
triplicate to the Docket Management System (see ADDRESSES section for
address and phone number). You may also submit comments through the
Internet at http://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-2010-0651 and Airspace Docket No. 10-ANM-7''. The
postcard will be date/time stamped and returned to the commenter.
    All communications received on or before the specified closing date
for comments will be considered before taking action on the proposed
rule. The proposal contained in this action may be changed in light of
comments received. All comments submitted will be available for
examination in the public docket both before and after the closing date
for comments. A report summarizing each substantive public contact with
FAA personnel concerned with this rulemaking will be filed in the
docket.

Availability of NPRMs

    An electronic copy of this document may be downloaded through the
Internet at http://www.regulations.gov. Recently published rulemaking
documents can also be accessed through the FAA's Web page at http://
www.faa.gov/airports_airtraffic/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 the ADDRESSES section for the address and phone number)
between 9 a.m. and 5 p.m., Monday through Friday, except federal
holidays. An informal docket may also be examined during normal
business hours at the Northwest Mountain Regional Office of the Federal
Aviation Administration, Air Traffic Organization, Western Service
Center, Operations Support Group, 1601 Lind Avenue, SW., Renton, WA
98057.
    Persons interested in being placed on a mailing list for future
NPRMs should contact the FAA's Office of Rulemaking,<PHONE_NUMBER>,
for a copy of Advisory Circular No. 11-2A, Notice of Proposed
Rulemaking Distribution System, which describes the application
procedure.

The Proposal

    The FAA is proposing an amendment to Title 14 Code of Federal
Regulations (14 CFR) Part 71 by amending the Class E airspace area
extending upward from 700 feet above the surface at Klamath Falls
Airport, Klamath Falls, OR. Decommissioning of the Merrill NDB and
cancellation of the NDB approach has made this action necessary for the
safety and management of IFR operations at the airport. The geographic
coordinates of the Klamath Falls Airport, and the Klamath Falls VHF
Omni-Directional Radio Range Tactical Air Navigation Aid (VORTAC) for
Class E airspace designated as an extension to Class D airspace, and
Class E airspace extending upward from 700 feet above the surface, also
would be adjusted in accordance with the FAA's National Aeronautical
Navigation Services (NANS). The airport name would be corrected from
Klamath Falls International Airport to Klamath Falls Airport.
    Class D and Class E airspace designations are published in
paragraph 5000, 6002, 6004 and 6005, respectively, of FAA Order
7400.9T, signed August 27, 2009, and effective September 15, 2009,
which is incorporated by reference in 14 CFR 71.1. The Class D and
Class E airspace designation listed in this document will be published
subsequently in this Order.
    The FAA has determined this proposed regulation only involves an
established body of technical regulations for which frequent and
routine amendments are necessary to keep them operationally current.
Therefore, this proposed regulation: (1) Is not a ``significant
regulatory action'' under Executive Order 12866; (2) is not a
``significant rule'' under 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 this proposed rule, when
promulgated, would not have a significant economic impact on a
substantial number of small entities under the criteria of the
Regulatory Flexibility Act.
    The FAA's authority to issue rules regarding aviation safety is
found in Title 49 of the U.S. Code. Subtitle 1, section 106, describes
the authority for 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 amend controlled airspace at Klamath Falls Airport, Klamath
Falls, OR.

List of Subjects in 14 CFR Part 71

    Airspace, Incorporation by reference, Navigation (air).

The Proposed Amendment

    Accordingly, pursuant to the authority delegated to me, 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

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

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

Sec.  71.1  [Amended]

    2. The incorporation by reference in 14 CFR 71.1 of the FAA Order
7400.9T, Airspace Designations and Reporting Points, signed August 27,
2009, and effective September 15, 2009 is amended as follows:

Paragraph 5000 Class D Airspace.

* * * * *

ANM OR D Klamath Falls, OR [Amended]

Klamath Falls Airport, OR
    (Lat. 42[deg]09'22'' N., long. 121[deg]44'00'' W.)

    That airspace extending upward from the surface to and including
6,600 feet MSL within a 5.4-mile radius of Klamath Falls Airport.
This Class D airspace area is effective during the specific dates
and times established in advance by a Notice to Airmen. The
effective date and time will thereafter be continuously published in
the Airport/Facility Directory.

Paragraph 6002 Class E Airspace Designated as Surface Areas.

* * * * *

ANM OR E2 Klamath Falls, OR [Amended]

Klamath Falls Airport, OR
    (Lat. 42[deg]09'22'' N., long. 121[deg]44'00'' W.)

    Within a 5.4-mile radius of Klamath Falls Airport. This Class E
airspace area is effective during the specific dates and times
established in advance by a Notice to Airmen. The effective date and
time will thereafter be continuously published in the Airport/
Facility Directory.

Paragraph 6004 Class E Airspace Designated as an Extension to a
Class D Surface Area.

* * * * *

ANM OR E4 Klamath Falls, OR [Amended]

Klamath Falls Airport, OR
    (Lat. 42[deg]09'22'' N., long. 121[deg]44'00'' W.)
Klamath Falls VORTAC
    (Lat. 42[deg]09'11'' N., long. 121[deg]43'39'' W.)

    That airspace extending upward from the surface within 3.5 miles
east and 1.8 miles west of the Klamath Falls VORTAC 171[deg] radial
extending from the 5.4-mile radius of Klamath Falls Airport to 7.4
miles south of the VORTAC, and within 1.8 miles each side of the
Klamath Falls VORTAC 332[deg] radial extending from the 5.4-mile
radius of the airport to 9.6 miles northwest of the VORTAC.

Paragraph 6005 Class E Airspace Areas Extending Upward From 700
Feet or More Above the Surface of the Earth.

* * * * *

ANM OR E5 Klamath Falls, OR [Modified]

Klamath Falls Airport, OR
    (Lat. 42[deg]09'22'' N., long. 121[deg]44'00'' W.)

    That airspace extending upward from 700 feet above the surface
within a 13.1-mile radius of Klamath Falls Airport, and within 4.3
miles east and 8.3 miles west of the 158[deg] bearing from the
airport extending from the 13.1-mile radius to 27.2 miles south of
the airport; that airspace extending upward from 1,200 feet above
the surface between the 13.1-mile radius and the 21.8-mile radius of
the Klamath Falls Airport; that airspace extending upward from 7,500
feet MSL within the area bounded by the 21.8-mile

radius and the 34.8-mile radius of the Klamath Falls Airport
extending clockwise from the airport 095[deg] bearing to a line 4.3
miles east of and parallel to the airport 165[deg] bearing and
within the area bounded by the 21.8-mile radius and the 34.8-mile
radius of the Klamath Falls Airport extending clockwise from the
airport 245[deg] bearing to the airport 295[deg] bearing; that
airspace extending upward from 7,700 feet MSL within the area
bounded by the 21.8-mile radius and the 27.9-mile radius of the
Klamath Falls Airport extending clockwise from the airport 332[deg]
bearing to a line 7.9 miles northeast of and parallel to the airport
332[deg] bearing; that airspace extending upward from 8,600 feet MSL
within the area bounded by the 21.8-mile radius and the 41.8-mile
radius of the Klamath Falls Airport extending clockwise from a line
4.3 miles east of and parallel to the airport 165[deg] bearing to a
line 10.1 miles west of and parallel to the airport 181[deg]
bearing; that airspace extending upward from 9,000 feet MSL within
the area bounded by the 21.8-mile radius and the 34.8-mile radius of
the Klamath Falls Airport extending clockwise from the airport
320[deg] bearing to the airport 095[deg] bearing; that airspace
extending upward from 9,500 feet MSL within the area bounded by the
21.8-mile radius and the 34.8-mile radius of the Klamath Falls
Airport extending clockwise from a line 10.1 miles west of and
parallel to the airport 181[deg] bearing to the airport 245[deg]
bearing, and within the area bounded by the 21.8-mile radius and the
24.4-mile radius of the Klamath Falls Airport extending clockwise
from the airport 295[deg] bearing to the airport 320[deg] bearing;
and that airspace extending from 11,000 feet MSL within the area
bounded by the 24.4-mile radius and the 34.8-mile radius of the
Klamath Falls Airport extending clockwise from the airport 295[deg]
bearing to the airport 320[deg] bearing.

    Issued in Seattle, Washington, on August 10, 2010.
Lori Andriesen,
Acting Manager, Operations Support Group, Western Service Center.
[FR Doc. 2010-20214 Filed 8-13-10; 8:45 am]
BILLING CODE 4910-13-P


MEMORANDUM
TO: Air Docket EPA-HQ-OAR-2017-0655
SUBJECT: Supporting Documentation for the Renewable Fuel Standard Program; Renewables Enhancement and Growth Support Rule; Availability of Supplemental Information and Request for Further Comment
This memorandum accompanies information related to EPA's analysis of lifecycle greenhouse gas (GHG) emissions from biofuel produced from distillers sorghum oil. To facilitate public review, below is a brief description of the informational materials which accompany this memorandum.

1. Summary of Net Energy Impacts of Reduced-Oil Sorghum Dried Distillers Grains with Solubles (DDGS) on Livestock

This memorandum provides information on the net energy values for livestock from the use full-oil and reduced-oil sorghum DDGS in livestock feed.

2. Summary of Key Assumptions of the Lifecycle Greenhouse Gas Emissions Associated with Biofuels Produced from Distillers Sorghum Oil
This memorandum provides an overview of key assumptions used in the EPA lifecycle greenhouse gas emissions analysis.


[Federal Register: June 12, 2009 (Volume 74, Number 112)]
[Notices]
[Page 28075-28076]
[DOCID:fr12jn09-103]

=======================================================================
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SECURITIES AND EXCHANGE COMMISSION

Proposed Extension of Existing Collection; Comment Request

Upon Written Request, Copies Available From: U.S. Securities and
Exchange Commission, Office of Investor Education and Advocacy,
Washington, DC 20549-0213.

Extension:
    Rule 17a-11; OMB Control No. 3235-0085; SEC File No. 270-94.

    Notice is hereby given that pursuant to the Paperwork Reduction Act
of 1995 (44 U.S.C. 3501 et seq.), the Securities and Exchange
Commission (``Commission'') is soliciting comments on the existing
collection of information provided for in the following rule: Rule 17a-
11 (17 CFR 240.17a-11) under the Securities Exchange Act of 1934 (15
U.S.C. 78a et seq.) (``Exchange Act''). The Commission plans to submit
this existing collection of information to the Office of Management and
Budget (``OMB'') for extension and approval.
    In response to an operational crisis in the securities industry
between 1967 and 1970, the Commission adopted Rule 17a-11 (17 CFR
240.17a-11) under the Exchange Act on July 11, 1971. The Rule requires
broker-dealers that are experiencing financial or operational
difficulties to provide notice to the Commission, the broker-dealer's
designated examining authority (``DEA''), and the Commodity Futures
Trading Commission (``CFTC'') if the broker-dealer is registered with
the CFTC as a futures commission merchant. Rule 17a-11 is an integral
part of the Commission's financial responsibility program which enables
the Commission, a broker-dealer's DEA, and the CFTC to increase
surveillance of a broker-dealer experiencing difficulties and to obtain
any additional information necessary to gauge the broker-dealer's
financial or operational condition.
    Rule 17a-11 also requires over-the-counter (``OTC'') derivatives
dealers and broker-dealers that are permitted to compute net capital
pursuant to Appendix E to Exchange Act Rule 15c3-1 to notify the
Commission when their tentative net capital drops below certain levels.
OTC derivatives dealers must also provide notice to the Commission of
backtesting exceptions identified pursuant to Appendix F of Rule 15c3-1
(17 CFR 15c3-1f).
    Compliance with the Rule is mandatory. The Commission will
generally not publish or make available to any person notice or reports
received pursuant to Rule 17a-11. The Commission believes that
information obtained under Rule 17a-11 relates to a condition report
prepared for the use of the Commission, other federal governmental
authorities, and securities industry self-regulatory organizations
responsible for the regulation or supervision of financial
institutions.
    Only broker-dealers whose capital declines below certain specified
levels or who are otherwise experiencing financial or operational
problems have a reporting burden under Rule 17a-11. In 2008, the
Commission received approximately 400 notices under this Rule. The
Commission did not receive any Rule 17a-11 notices from OTC derivatives
dealers or broker-dealers that are permitted to compute net capital
pursuant to Appendix E to Exchange Act Rule 15c3-1.
    Each broker-dealer reporting pursuant to Rule 17a-11 will spend
approximately one hour preparing and transmitting the notice required
by the rule. Accordingly, the total estimated annualized burden under
Rule 17a-11 is 400 hours.
    Written comments are invited on: (a) Whether the proposed
collection of information is necessary for the proper performance of
the functions of the Commission, including whether the information has
practical utility; (b) the accuracy of the Commission's estimate of the
burden of the proposed collection of information; (c) ways to enhance
the quality, utility, and clarity of the information to be collected;
and (d) ways to minimize the burden of the collection of information on
respondents, including through the use of automated collection
techniques or other forms of information technology. Consideration will
be given to comments and suggestions submitted in

writing within 60 days of this publication.
    Comments should be directed to Charles Boucher, Director/Chief
Information Officer, Securities and Exchange Commission, c/o Shirley
Martinson, 6432 General Green Way, Alexandria, VA 22312 or send an e-
mail to<EMAIL_ADDRESS>
    Dated: June 8, 2009.
Florence E. Harmon,
Deputy Secretary.
[FR Doc. E9-13814 Filed 6-11-09; 8:45 am]

BILLING CODE 8010-01-P


[Federal Register Volume 83, Number 119 (Wednesday, June 20, 2018)]
[Notices]
[Pages 28681-28684]
[FR Doc No: 2018-13161]

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

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-83431; File No. SR-ISE-2018-51]

Self-Regulatory Organizations; Nasdaq ISE, LLC; Notice of Filing
and Immediate Effectiveness of Proposed Rule Change To Amend the
Schedule of Fees Related to Complex Orders

June 14, 2018.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that
on June 1, 2018, Nasdaq ISE, LLC (``ISE'' or ``Exchange'') filed with
the Securities and Exchange Commission (``Commission'') the proposed
rule change as described in Items I and II below, which Items have been
prepared by the Exchange. The Commission is publishing this notice to
solicit comments on the proposed rule change from interested persons.
---------------------------------------------------------------------------

    \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 proposes to amend the Schedule of Fees related to
Complex Orders traded on the Exchange.
    The text of the proposed rule change is available on the Exchange's
website at http://ise.cchwallstreet.com/, at the principal office of
the Exchange, and at the Commission's Public Reference Room.

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

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

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

1. Purpose
    The purpose of the proposed rule change is to amend the Schedule of
Fees related to Complex Orders traded on the Exchange. Specifically,
the Exchange

proposes to: (1) Reduce the volume requirements for Priority Customer
\3\ Complex Tier 9, and (2) eliminate the discount for Market Maker \4\
Complex Orders that trade against Priority Customer Complex Orders
preferenced to them in the complex order book.
---------------------------------------------------------------------------

    \3\ A ``Priority Customer'' is a person or entity that is not a
broker/dealer in securities, and does not place more than 390 orders
in listed options per day on average during a calendar month for its
own beneficial account(s), as defined in Nasdaq ISE Rule
100(a)(37A).
    \4\ ``Market Maker'' refers to ``Competitive Market Makers'' and
``Primary Market Makers'' collectively. See ISE Rule 100(a)(28).
---------------------------------------------------------------------------

I. Priority Customer Complex Order Rebates

    Currently, the Exchange has a fee structure in place for Complex
Orders that provides rebates to Priority Customer Complex Orders in
order to encourage Members to bring that order flow to the Exchange.
Specifically, Priority Customer Complex Orders that trade with non-
Priority Customer orders in the complex order book or trade with quotes
and orders on the regular order book are provided rebates in Select
Symbols \5\ and Non-Select Symbols \6\ (other than NDX and MNX) based
on nine volume tiers, as shown in the table below. The Priority
Customer Complex Tiers are based on Total Affiliated Member \7\ Complex
Order Volume (Excluding Crossing Orders \8\ and Responses to Crossing
Orders \9\) Calculated as a Percentage of Customer Total Consolidated
Volume \10\ (hereinafter, ``Complex Order Volume Percentage''). All
Complex Order volume executed on the Exchange, including volume
executed by Affiliated Members, is included in the volume calculation,
except for volume executed as Crossing Orders and Responses to Crossing
Orders. Rebates are provided per contract per leg, and once the
threshold has been reached the rebate for the highest tier is applied
retroactively to all eligible Priority Customer Complex volume.\11\
---------------------------------------------------------------------------

    \5\ ``Select Symbols'' are options overlying all symbols listed
on the Nasdaq ISE that are in the Penny Pilot Program.
    \6\ ``Non-Select Symbols'' are options overlying all symbols
excluding Select Symbols.
    \7\ An ``Affiliated Member'' is a Member that shares at least
75% common ownership with a particular Member as reflected on the
Member's Form BD, Schedule A.
    \8\ A ``Crossing Order'' is an order executed in the Exchange's
Facilitation Mechanism, Solicited Order Mechanism, Price Improvement
Mechanism (PIM) or submitted as a Qualified Contingent Cross order.
For purposes of the Fee Schedule, orders executed in the Block Order
Mechanism are also considered Crossing Orders.
    \9\ A ``Response to a Crossing Order'' is any contra-side
interest submitted after the commencement of an auction in the
Exchange's Facilitation Mechanism, Solicited Order Mechanism, Block
Order Mechanism or PIM.
    \10\ ``Customer Total Consolidated Volume'' means the total
national volume cleared at The Options Clearing Corporation in the
Customer range in equity and ETF options in that month.
    \11\ Members will not receive rebates for net zero complex
orders. For purposes of determining which complex orders qualify as
``net zero'' the Exchange will count all complex orders that leg in
to the regular order book and are executed at a net price per
contract that is within a range of $0.01 credit and $0.01 debit.
    \12\ 15 U.S.C. 78f(b).

----------------------------------------------------------------------------------------------------------------
                                                                                Rebate for    Rebate for non-
       Priority customer complex tier          Complex order volume percentage    select symbols  select symbols
----------------------------------------------------------------------------------------------------------------
Tier 1.....................................  0.000-0.200........................         ($0.25)         ($0.40)
Tier 2.....................................  Above 0.200-0.400..................          (0.30)          (0.55)
Tier 3.....................................  Above 0.400-0.600..................          (0.35)          (0.70)
Tier 4.....................................  Above 0.600-0.800..................          (0.40)          (0.75)
Tier 5.....................................  Above 0.800-1.000..................          (0.45)          (0.80)
Tier 6.....................................  Above 1.000-1.600..................          (0.46)          (0.80)
Tier 7.....................................  Above 1.600-2.000..................          (0.48)          (0.80)
Tier 8.....................................  Above 2.000-3.500..................          (0.50)          (0.85)
Tier 9.....................................  Above 3.500........................          (0.50)          (0.85)
----------------------------------------------------------------------------------------------------------------

    Currently, a Member must execute a Complex Order Volume Percentage
of above 3.5% to qualify for Priority Customer Complex Tier 9. The
Exchange now proposes to reduce the Complex Order Volume Percentage
requirement to above 3.25%, thereby making Priority Customer Complex
Order Tier 9 easier for Members to achieve. As proposed, Members with a
Complex Order Volume Percentage above 2% and up to 3.25% will qualify
for Priority Customer Complex Tier 8, while Members with a Complex
Order Volume Percentage above 3.25% will qualify for Priority Customer
Complex Tier 9. Although Priority Customer Complex Order Tier 8 and 9
are currently eligible for the same $0.50 per contract rebate in Select
Symbols and $0.85 per contract rebate in Non-Select Symbols, the lower
proposed volume requirements for Priority Customer Complex Tier 9 will
benefit Market Makers that currently receive discounted Complex Order
fees in Select Symbols if they achieve this Priority Customer Complex
Tier. Specifically, Market Maker Complex Orders in Select Symbols are
charged a fee of $0.44 per contract for either taking liquidity, or
providing liquidity to a Priority Customer Complex Order, provided that
the firm achieves Priority Customer Complex Tier 9. This fee is
discounted from the regular taker fee of $0.50 per contract (reduced to
$0.47 per contract for Priority Customer Complex Tier 8) and the maker
fee of $0.47 per contract for trading against a Priority Customer.
Thus, reducing the volume requirements for achieving Priority Customer
Complex Tier 9 will make it easier for Market Makers to achieve the
discounted $0.44 per contract rate.

II. Preferenced Market Maker Complex Order Discount

    Currently, Market Makers making or taking liquidity in Select
Symbols or Non-Select Symbols receive a discount of $0.02 when trading
against Priority Customer orders preferenced to them in the complex
order book in equity options that are able to be listed and traded on
more than one options exchange. This discount does not apply to FX
Options Symbols or to option classes designated by the Exchange to
receive a guaranteed allocation pursuant to Nasdaq ISE Rule
722(b)(3)(i)(B). The Exchange now proposes to eliminate this discount.
With the recent introduction of new pricing incentives for Complex
Orders, which include the discounted Market Maker fees described in the
section above, the Exchange does not believe that an additional
incentive for preferenced orders is necessary to attract Complex Order
flow.
2. Statutory Basis
    The Exchange believes that its proposal is consistent with Section
6(b) of the Act,\12\ in general, and furthers the objectives of
Sections 6(b)(4) and 6(b)(5)

of the Act,\13\ in particular, in that it provides for the equitable
allocation of reasonable dues, fees, and other charges among members
and issuers and other persons using any facility, and is not designed
to permit unfair discrimination between customers, issuers, brokers, or
dealers.
---------------------------------------------------------------------------

    \13\ 15 U.S.C. 78f(b)(4) and (5).
---------------------------------------------------------------------------

I. Priority Customer Complex Order Rebates

    The Exchange believes it is reasonable and equitable to reduce the
volume requirements for Priority Customer Complex Order Tier 9 as this
change will make it easier for Members to achieve this tier. The
proposed change is designed to incentivize Members to trade Complex
Orders on the Exchange. While the proposed change will not have any
impact on Priority Customer Complex Order rebates since the rebates are
currently the same for Priority Customer Complex Tier 8 and 9, the
Exchange also offers discounted Complex Order fees in Select Symbols
for Market Makers that achieve higher Priority Customer Complex Tiers.
With the proposed change, Market Makers may find it easier to achieve
the higher tier of discounted fee, and thereby lower their execution
costs when trading on the Exchange. Furthermore, the Exchange believes
that the proposed change to the Priority Customer Complex Order Tiers
is equitable and not unfairly discriminatory as this change is designed
to increase trading by Market Makers, which may benefit other market
participants that will have an increased opportunity to trade in
Complex Orders. Market Makers are subject to additional requirements
and obligations (such as quoting requirements) that other market
participants are not. The Exchange believes that the mix of incentives
that it provides will encourage an active market in Complex Orders from
Market Makers and other market participants.

II. Preferenced Market Maker Complex Order Discount

    The Exchange believes that it is reasonable and equitable to
eliminate the preferenced Market Maker Complex Order discount as the
Exchange has recently introduced new incentives for Market Makers that
trade Complex Orders. Specifically, Market Makers are now eligible for
tiered Complex Order taker fees based on achieving Priority Customer
Complex Tier 8 or 9. With the changes to the Priority Customer Complex
Tier 9 volume requirements discussed above, the highest tier of
discount will be even easier for Market Makers to achieve. The Exchange
therefore believes that an additional discount based on receiving
preferenced Priority Customer Complex Orders is no longer necessary.
Furthermore, the Exchange believes that eliminating this fee discount
is equitable and not unfairly discriminatory as this discount will no
longer be available for any Market Makers. Market Makers may instead
qualify for the other Complex Order discounts based on meeting the
applicable volume requirements.

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

    The Exchange does not believe that the proposed rule change will
impose any burden on competition not necessary or appropriate in
furtherance of the purposes of the Act. The Exchange believes that its
Complex Order fees and rebates remain competitive with those on other
options markets, and will continue to attract order flow to the
Exchange, thereby encouraging additional volume and liquidity to the
benefit of all market participants. The Exchange operates in a highly
competitive market in which market participants can readily direct
their order flow to competing venues. In such an environment, the
Exchange must continually review, and consider adjusting, its fees and
rebates to remain competitive with other exchanges. For the reasons
described above, the Exchange believes that the proposed fee changes
reflect this competitive environment.

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

    No written comments were either solicited or received.

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

    The foregoing rule change has become effective pursuant to Section
19(b)(3)(A)(ii) of the Act,\14\ and Rule 19b-4(f)(2) \15\ thereunder.
At any time within 60 days of the filing of the proposed rule change,
the Commission summarily may temporarily suspend such rule change if it
appears to the Commission that such action is: (i) Necessary or
appropriate in the public interest; (ii) for the protection of
investors; or (iii) otherwise in furtherance of the purposes of the
Act. If the Commission takes such action, the Commission shall
institute proceedings to determine whether the proposed rule should be
approved or disapproved.
---------------------------------------------------------------------------

    \14\ 15 U.S.C. 78s(b)(3)(A)(ii).
    \15\ 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]v. Please include
File Number SR-ISE-2018-51 on the subject line.

Paper Comments

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

All submissions should refer to File Number SR-ISE-2018-51. This file
number should be included on the subject line if email is used. To help
the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's internet website (http://www.sec.gov/rules/sro.shtml).
Copies of the submission, all subsequent amendments, all written
statements with respect to the proposed rule change that are filed with
the Commission, and all written communications relating to the proposed
rule change between the Commission and any person, other than those
that may be withheld from the public in accordance with the provisions
of 5 U.S.C. 552, will be available for website viewing and printing in
the Commission's Public Reference Room, 100 F Street NE, Washington, DC
20549, on official business days between the hours of 10:00 a.m. and
3:00 p.m. Copies of the filing also will be available for inspection
and copying at the principal office of the Exchange. All comments
received will be posted without change. Persons submitting comments are
cautioned that we do not redact or edit personal identifying
information from comment submissions. You should submit only
information that you wish to make available publicly. All submissions
should refer to File Number SR-ISE-2018-51 and should be submitted on
or before July 11, 2018.

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\16\
---------------------------------------------------------------------------

    \16\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2018-13161 Filed 6-19-18; 8:45 am]
 BILLING CODE 8011-01-P