[Federal Register Volume 84, Number 83 (Tuesday, April 30, 2019)]
[Rules and Regulations]
[Pages 18145-18151]
[FR Doc No: 2019-08710]

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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[EPA-R06-OAR-2017-0055; FRL-9992-51-Region 6]

Approval and Promulgation of Implementation Plans; Texas;
Reasonably Available Control Technology in the Houston-Galveston-
Brazoria Ozone Nonattainment Area

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final rule.

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SUMMARY: Pursuant to the Federal Clean Air Act (CAA or the Act), the
Environmental Protection Agency (EPA) is approving revisions to the
Texas State Implementation Plan (SIP) addressing volatile organic
compounds (VOC) revised rules and the State's reasonably available
control technology (RACT) analyses for VOC and nitrogen oxides
(NOX). We are approving the revised VOC rules as assisting
in reaching attainment of the 2008 ozone National Air Quality Ambient
Air Quality Standards (NAAQS or the standard) and as meeting the RACT
requirements in the Houston-Galveston-Brazoria 2008 8-hour ozone
nonattainment area (HGB area). We are also approving negative
declarations for certain VOC source categories subject to RACT in the
HGB area. The EPA is also finding that the State's RACT analyses
demonstrate that the HGB area meets the VOC and NOX RACT
requirements for this standard.

DATES: This rule is effective on May 30, 2019.

ADDRESSES: The EPA has established a docket for this action under
Docket ID No. EPA-R06-OAR-2017-0055. All documents in the docket are
listed on the http://www.regulations.gov website. Although listed in
the index, some information is not publicly available, e.g.,
Confidential Business Information or other information whose disclosure
is restricted by statute. Certain other material, such as copyrighted
material, is not placed on the internet and will be publicly available
only in hard copy form. Publicly available docket materials are
available either electronically through http://www.regulations.gov or
in hard copy at the EPA Region 6, 1445 Ross Avenue, Suite 700, Dallas,
Texas 75202-2733.

FOR FURTHER INFORMATION CONTACT: Robert M. Todd, Infrastructure and
Ozone Section, EPA Region 6, 1445 Ross Avenue, Suite 700, Dallas, TX
75202,<PHONE_NUMBER>, [email protected]. To inspect the hard copy
materials, please schedule an appointment with Mr. Todd or Mr. Bill
Deese at<PHONE_NUMBER>.

SUPPLEMENTARY INFORMATION: Throughout this document ``we,'' ``us,'' and
``our'' means the EPA.

I. Background

    The background for this action is discussed in detail in our June
26, 2018 proposal (83 FR 29727). In that document we proposed to
approve revisions to the Texas SIP pertaining to revised rules for VOC
storage tanks and the RACT analyses for VOC and NOX in the
HGB area. We also proposed approving negative declarations for certain
VOC source categories subject to RACT in the HGB area and finding that
the State's RACT analyses demonstrate that the HGB area meets the VOC
and NOX RACT requirements for this standard.
    We received comments on our proposal. One commenter, the Texas
Commission on Environmental Quality (TCEQ), wrote to support our
proposed action without specific comment on the particulars of our
proposal. Another commenter had generally negative comments that were
not specific to our proposal, but were substantive in nature. A third
commenter had multiple negative comments on what we proposed to
approve. A summary of the comments and our responses are below.

II. Response to Comments

    Comment: TCEQ was supportive of the EPA's proposal to approve the
RACT demonstration and approval into the SIP of changes to the Chapter
115 VOC control regulations.
    Response: We thank the commenter for their support.
    Comment: One commenter urged the agency to lower the ozone standard
below the 2015 ozone NAAQS of 70 ppm. The commenter believes lowering
the standard would result in improved air quality and reduced overall
cost to the nation.
    Response: We understand the commenter's concerns but responding to
the commenter's suggestion is beyond the scope of this rule making.
Since the comment addresses subjects outside the scope of the proposed
action, do not explain (or provide a legal basis for) how the proposed
action should differ in any way, and make no specific mention of the
proposed action, the comment is not germane, and EPA provides no
further response.
    One comment letter submitted on behalf of the Sierra Club, Earth
Justice, Air Alliance Houston, Texas Environmental Justice Advocacy
Service and Public Citizen--Texas Office, provided several comments for
our consideration. Their comments and our responses are listed below.
    Comment: One comment stated a state's RACT implementation plan
``shall provide for the implementation of all reasonably available
control measures as expeditiously as practicable (including such
reductions in emissions from existing sources in the area as may be
obtained through the adoption, at a minimum, of reasonably available
control technology) and shall provide for attainment of the national
primary ambient air quality standards.'' 42 U.S.C. Section 7502(c)(1)l
7511a(b)(2). EPA must disapprove the State's RACT demonstration because
actual monitoring data demonstrates that the HGB area failed to attain
the O3 NAAQS by the attainment date and, therefore, the RACT
implemented failed to meet the statutory mandate to ``provide for
attainment'' (42 U.S.C. Section 7502(C)(1)) and the State must identify
additional and/or stronger controls that are reasonably available and
adequate to assure attainment as expeditiously as practicable. The
State's RACT plan for HGB area provides for no additional controls
beyond what is already required or being achieved. The State's failure
to consider adopting more stringent RACT rules for HGB therefore
violates the CAA, and accordingly, EPA cannot lawfully approve the RACT
plan.
    Response: RACT is one of the requirements for attainment plan
demonstrations under CAA Section 172(c)(1) (42 U.S.C. Section
7502(c)(1)). CAA Section 172(c)(1) titled ``Nonattainment plans
provision in general'' provides that such plan provisions ``shall
provide for the implementation of all reasonable control measures as
expeditiously as practicable . . . and shall provide for attainment of
the primary ambient air quality standards.'' 42 U.S.C. 7502(c)(1). When
the word ``and'' is used with a series of items written together in a
meaningful grouping, it means that all the items listed together must
be addressed. When reading a requirement in a statute and it contains
an ``and'' with a series of requirements, all of the requirements must
be addressed. By taking a strict grammatical approach to the word
``and'', it is faithful to the legislative intent of the statute.
Congress clearly meant that nonattainment plans contain reasonable
control measures, in this case RACT, as well as provide for attainment
of the primary ambient air quality standards.

    The comment cites the requirements of attainment plans in
nonattainment areas (Clean Air Act Section 172(c)(1)) as what is
required to meet RACT under the CAA. The EPA has defined RACT as the
lowest emissions limitation that a particular source is capable of
meeting by the application of control technology that is reasonably
available, considering technological and economic feasibility. See
September 17, 1979 (44 FR 53761). Section 182(b)(2) of the Act requires
states to submit a SIP revision and implement RACT for major stationary
sources in moderate and above ozone nonattainment areas. For a
Moderate, Serious, or Severe area a major stationary source is one that
emits, or has the potential to emit, 100, 50, or 25 tons per year (tpy)
or more of VOCs or NOX, respectively. See CAA sections
182(b), 182(c), and 182(d). The EPA provides states with guidance
concerning what types of controls could constitute RACT for a given
source category through the issuance of Control Technique Guidelines
(CTG) and Alternative Control Techniques (ACT) documents. See https://www.epa.gov/ground-level-ozone-pollution/control-techniques-guidelines-and-alternative-control-techniques for a listing of EPA-issued CTGs and
ACTs.
    Our action is limited to the State's demonstration of RACT for the
HGB area and does not consider whether the HGB area meets any other
requirements for attainment plans for nonattainment areas. As discussed
in our proposal, the EPA's longstanding definition of RACT for ozone
nonattainment areas is the lowest emissions limitation that a
particular source is capable of meeting by the application of control
technology that is reasonably available, considering technological and
economic feasibility. See September 17, 1979 (44 FR 53761). Thus, RACT
is defined in terms of achievable technology and not whether the RACT
requirements in a SIP would result in attainment. Therefore, air
quality monitoring data is not relevant for determining whether a
state's RACT SIP is approvable under the CAA.
    In this action we are only finding that the RACT provisions of
172(c)(1) and 182(b)(2) are being met for the HGB moderate
nonattainment area for the purposes of the 2008 ozone standard. We are
not taking action on whether the Houston area's moderate area
attainment plan is approvable. We note that we have proposed to
reclassify the HGB area to serious which requires a serious area
attainment plan, a more stringent attainment plan than one that is
required for areas classified as moderate (83 FR 56781, November 14,
2018).
    Comment: The commenter stated EPA regulations direct the State to
review and consider RACT measures submitted by the public, including
public comments seeking strengthening of existing measures. 80 FR
12264, 12278-12280 (March 6, 2015). The State failed to adequately
consider public suggestions to impose additional monitoring and control
techniques for certain sources in the HGB area as well as the
suggestion that the State adopt the Federal CTG for oil and natural gas
operations. The EPA unlawfully rationalized the State's refusal to
consider available control techniques for oil and natural gas sources
by citing that the State is not required to meet the CTG for oil and
natural gas until a date after the SIP submittal and the State did not
consider measures identified in comments.
    Response: Per EPA's rulemaking on the requirements for states to
address 2008 ozone NAAQS requirements (80 FR 12264, 12278-12280 (March
6, 2015)), states should refer to the existing CTGs and ACTs for
purposes of meeting their RACT requirements, as well as all relevant
information (including recent technical information and information
received during the public comment period) that is available at the
time that they are developing their RACT SIPs for the 2008 ozone NAAQS.
In some cases, it is appropriate for states to conclude that sources
already addressed by RACT determinations for the 1-hour and/or 1997
ozone NAAQS do not need to implement additional controls to meet the
2008 ozone NAAQS RACT requirement. Id. at 12280. That is because, in
some cases, RACT for the 2008 standard is the same control technology
as the initial RACT determination under the 1-hour or 1997 standard
because the fundamental control techniques, as described in the CTGs
and ACTs, are still what is reasonably available. Id. In cases where
controls were applied as a result of the 1-hour or 1997 ozone NAAQS
RACT requirement, we expect that any incremental emissions reductions
from application of a second round of RACT controls may be small and,
therefore, the cost for advancing that small additional increment of
reduction may not be reasonable. Id. In contrast, a RACT analysis for
uncontrolled sources would be much more likely to find that new RACT-
level controls are economically and technically feasible. Id.
    Our analysis of Texas RACT SIP shows that there would be no
appreciable reduction in VOC or NOX emissions as a result of
a new application of RACT in the HGB area for the existing sources and
the newer declared affected sources. For example, for the Glass
Manufacturing source identified by the State, it would be technically
infeasible to require additional NOX controls on the furnace
since there would be no appreciable NOX reductions from the
addition of NOX controls. Also, the vegetable oil
manufacturing facility already meets the basic control requirements of
both the existing vent gas control requirements in the State SIP and
previous RACT determinations in the U.S. and additional or altered
controls are not available at this time. For other established sources
in the HGB nonattainment area, except for the storage tanks discussed
later in this document, they are already required to meet minimum
efficiency standards set out in the State SIP and additional or new
control requirements would not be technically or economically feasible.
    We do agree with the State's analysis that additional VOC controls
on the storage tanks are feasible and a viable means to reduce
emissions in the HGB area. We find their proposal to increase the
control efficiency requirements for control devices on these sources to
be RACT in this instance. This action will also have the added benefit
of improving compliance with State SIP regulations by making the HGB
requirements synonymous with the requirements in the Dallas-Fort Worth
nonattainment area.
    An examination of the transcript of the public hearing indicates a
representative of the Air Alliance Houston suggested that the State
implement continuous, direct monitoring technology to assist in
compliance with SIP rules. As to oil and gas specifically, the Air
Alliance representative stated, ``So to the extent possible, we prefer
to see continuous emission monitors in place at flares at emission
points generally.'' In its finalized SIP revision, TCEQ responded in
writing to the comment and stated that in the case of the continuous
emission monitoring for flares, the significant technical and cost
constraints associated with post combustion monitoring of flare
emissions precluded inclusion of this monitoring method for this type
of source.\1\ The State acknowledged the value of continuous monitoring
of certain gas streams to flares for sources combusting highly reactive
VOCs, which is currently required, however

the State found such monitoring was not necessary to satisfy RACT for
flares in the current rulemaking. We find that the State adequately
responded to the comment raised at the public hearing with regards to
continuous emission monitoring for flaring and we agree with the State
that RACT for the 2008 ozone NAAQS does not require continuous emission
monitoring for flaring.
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    \1\ The State's analysis and response to comments received at
the State's public hearing is provided by the State in their final
SIP submittal. See EPA-R06-OAR-2017-0054-0004, pages 236-241.
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    As to requiring the State to comply with Oil and Natural Gas CTG,
the EPA acknowledges that the State did not owe us a SIP to address the
Oil and Natural Gas CTG at the time of the SIP submittal. That
obligation will be dealt with in a separate SIP submittal that EPA will
act on in a separate notice and comment rulemaking action. The Draft
CTG for the Oil and Natural Gas Industry (EPA-453/P-15-001) was made
available for comment by the EPA in September 2015. See 80 FR 56577
(Sept. 18, 2015). The final document, Control Technique Guidelines for
the Oil and Natural Gas Industry (EPA-453/B-16-001) was issued, and
published in the Federal Register, October 27, 2016. See 81 FR 74798.
In the final Federal Register notice, EPA required states to submit SIP
revisions addressing the Oil & Natural Gas CTG no later than October
27, 2018, with RACT requirements effective no later than January 1,
2021.\2\ During the time the State performed their RACT analysis for
the 2008 Ozone NAAQS and adopted revisions to their VOC regulations to
implement new control measures in the HGB area, there was no EPA
requirement for the State to consider this CTG as part of their RACT
analysis and thus it was not required to be included at the time of
submittal by the State (December 29, 2016). In a separate rulemaking,
EPA will act upon the State's submittal addressing this October 27,
2016 final rule.
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    \2\ On October 20, 2016 the EPA issued guidance on
implementation of the CTG in the memorandum ``Implementing
Reasonably Available Control Technology Requirements for Sources
Covered by the 2016 Control Techniques guidelines for the Oil and
Natural Gas Industry.'' See the answers to questions 1 and 2 of the
attachment to this memo for details on the timing of implementation
of this CTG.
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    See the TSD for further information on how all the major oil and
gas sources in the HGB area are controlled to meet RACT.
    Comment: The commenter stated that Texas unlawfully allows RACT
sources to avoid enforcement based on claims violations occur during
startup, shutdown and malfunction (SSM) conditions. The commenter also
alleges that the State's control requirements are less protective than
required for RACT because the State affirmative defense provisions
allow sources to emit above RACT levels without sanction. The commenter
stated that Texas is required to conform its RACT regulations to EPA's
2015 SSM SIP Action (80 FR 33840 (June 12, 2015)).
    Response: In our 2015 SSM SIP Action, EPA issued a SIP call to
Texas for affirmative defense provisions included in the SIP (80 FR
33840 (June 12, 2015)). EPA issued a SIP Call to Texas based on an
interpretation that the Texas SIP affirmative defense provisions for
upsets and unplanned maintenance, startup, and shutdown activities
(which EPA considers equivalent to ``malfunctions'') operate to alter
or eliminate the statutory jurisdiction of the courts to assess civil
penalties, contrary to CAA sections 113 and 304. EPA did not find that
the Texas affirmative defense provisions allow sources to ``violate
Clean Air Act emission limitations during startup, shutdown, and
malfunction events without consequences'' or allow ``sources to emit
above RACT levels without sanction,'' and commenter's allegations in
this rulemaking that the Texas affirmative defense provisions do so is
inaccurate. All excess emissions, including those for which a source
owner or operator may assert an affirmative defense, are unauthorized
emissions and violations subject to an enforcement action. An
``emission event'' defined at 30 TAC 101.1 includes upset events that
result in unauthorized emissions. Therefore, commenter is incorrect
that the Texas affirmative defense provisions render the State's
control requirements less protective than RACT because they allow
sources to emit above RACT levels without sanction.
    At the outset, EPA views the Texas affirmative defense provisions
as providing a defense only against the imposition of civil penalties;
they do not bar enforcement actions against RACT sources or limit the
imposition of injunctive relief in such a case, if necessary.
Accordingly, the Texas affirmative defense provisions do not allow RACT
sources in the State to violate RACT or the NAAQS without sanction.
Further, EPA does not believe that the Texas affirmative defense
provisions allow large amounts of emissions that may cause or
contribute to exceedances of NAAQS, as alleged by the commenter. In
fact, one of the criteria that must be proven by a Defendant who
asserts an affirmative defense under the Texas SIP provision is that
the ``unauthorized emissions did not cause or contribute to an
exceedance of the national ambient air quality standards (NAAQS),
prevention of significant deterioration (PSD) increments, or to a
condition of air pollution.'' See, e.g., 30 TAC 101.222(b)(11). The
Texas affirmative defense provisions do not apply to actions for
injunctive relief, including those that may be required to protect the
NAAQS. See. e.g., 30 TAC 101.222(b) (``other than claims for . . .
injunctive relief''). EPA views the Texas affirmative defense
provisions as solely related to the imposition of civil penalties for
violations and not to any expressed air quality concern. Further, the
current EPA-approved Texas SIP does not provide any affirmative defense
for an emissions event or emissions events that are determined to be
excessive emission events. The Texas SIP provides that such events
trigger requirements for the owner or operator of the source to submit
a corrective action plan and are subject to a penalty action. See 30
TAC 101.223. Under 30 TAC 101.222(a), to determine whether an emissions
event or emissions events are excessive, the following factors are
evaluated: (1) The frequency of the facility's emissions events; (2)
the cause of the emissions event; (3) the quantity and impact on human
health or the environment of the emissions event; (4) the duration of
the emissions event; (5) the percentage of a facility's total annual
operating hours during which emissions events occur; and (6) the need
for startup, shutdown, and maintenance activities.
    The commenter also claimed that Texas is required to conform its
RACT regulations to EPA's 2015 SSM SIP Action. The Texas affirmative
defense provisions that were subject to the SIP call issued by EPA in
2015 are general provisions and are not specifically part of Texas's
RACT regulations and as discussed above do not excuse a violator from
enforcement action. Region 6 on April 23, 2019 signed a Federal
Register document in which it considers an alternative interpretation
of affirmative defense provisions in SIPs in states in Region 6 that
departs from the EPA's 2015 policy on this subject. In that same
Federal Register document, Region 6 proposed to make a finding that the
affirmative defense provisions in the Texas SIP are adequately
protective and do not interfere with any applicable requirement of the
CAA and would be consistent with the alternative interpretation if
adopted. Accordingly, Region 6 proposed to withdraw the SIP call issued
to Texas that was published on June 12, 2015. Interested stakeholders
are encouraged to refer to that document for further details.
    Comment: The commenter stated the State unlawfully failed to
revisit and

reevaluate RACT for source categories for which the State previously
found (in its SIPs for the 1997 and/or 1-hour standard) that no
additional controls were needed. The commenter quoted EPA's final rule
implementing the 2008 ozone NAAQS to support its position: ``there are
cases where the initial RACT analysis under the 1-hour standard or the
1997 standard for a specific source or source category concluded that
no additional controls were necessary. In such cases, a new RACT
determination is needed to consider whether more cost-effective control
measures have become available for new sources that were not previously
regulated. A re-analysis may determine that controls are now
economically and technically feasible and are necessary to meet the
RACT requirements.'' 80 FR 12264 at 12280 (March 6, 2015). The State's
RACT determination does not attempt to identify, revisit, or reevaluate
RACT for all source categories where the State found, under the 1-hour
or 1997 standard that no additional controls are necessary.
    Response: We agree with the commenter that Texas needs to
reevaluate RACT for the 2008 ozone standards. We, however, disagree
with the commenter that Texas did not reevaluate RACT for all source
categories for the 2008 ozone standards. As stated in our rulemaking on
the requirements for states to address the 2008 ozone requirements,
states should refer to the existing CTGs and ACTs for purposes of
meeting their RACT requirements, as well as all relevant information
(including recent technical information and information received during
the public comment period) that is available at the time that they are
developing their RACT SIPs for the 2008 ozone NAAQS. In some cases, it
is appropriate for states to conclude that sources already addressed by
RACT determinations for the 1-hour and/or 1997 ozone NAAQS do not need
to implement additional controls to meet the 2008 ozone NAAQS RACT
requirement. Id. at 12280. That is because, in some cases, a new RACT
determination under the 2008 standard would result in the same or
similar control technology as the initial RACT determination under the
1-hour or 1997 standard because the fundamental control techniques, as
described in the CTGs and ACTs, are still applicable. Id. In cases
where controls were applied due to the 1-hour or 1997 NAAQS ozone RACT
requirement, we expect that any incremental emissions reductions from
application of a second round of RACT controls may be small and,
therefore, the cost for advancing that small additional increment of
reduction may not be reasonable. Id. In contrast, a RACT analysis for
uncontrolled sources would be much more likely to find that new RACT-
level controls are economically and technically feasible. Id. In
portions of 2008 nonattainment areas where control technologies for
major sources or source categories were previously reviewed and
controls applied to meet the RACT requirement under the 1-hour or the
1997 ozone NAAQS, states should review and, if appropriate, accept the
initial RACT analysis as meeting the RACT requirements for the 2008
ozone NAAQS. Id. Absent data or public comments indicating that the
previous RACT determination is no longer appropriate, the state need
not adopt additional SIP controls to meet the new RACT requirement for
these sources. Id. In such cases, the state's SIP revision submitted
after notice and comment should contain a certification, with
appropriate supporting information (including consideration of new
data), indicating that these sources are already subject to SIP-
approved requirements that still meet the RACT obligation. Id. There
are cases where the initial RACT analysis under the 1-hour standard or
the 1997 standard for a specific source or source category concluded
that no additional controls were necessary. Id. In such cases, a new
RACT determination is needed to consider whether more cost-effective
control measures have become available for sources that were not
previously regulated. Id. A re-analysis may determine that controls are
now economically and technically feasible and are necessary to meet the
RACT requirement. Id.
    The State received no new data or public comments indicating that
the previous VOC RACT determination is no longer appropriate except for
three source categories: storage tank, Vegetable Oil Manufacturing
Operations, and the Oil and Natural Gas Industry. Two of those three
source categories underwent additional analysis by the State and we are
approving the State's RACT determination resulting from that analysis.
The third category, Oil and Natural Gas, is not addressed in this SIP
submittal. It will be addressed in a separate SIP and we will analyze
this CTG at that time. For a more detailed explanation of each of the
source categories see below.
    For the majority of source categories provided in the State's SIP,
the State kept the same standards approved by EPA as meeting RACT
requirements for the 1-hour and the 1997 8-hour ozone NAAQS.\3\ The
State referred to existing CTG and ACT documents as well as all
relevant technical information including recent technical information
received during the public comment period to determine that the
existing standards were still equivalent to RACT for the 2008 ozone
NAAQS. Except in the case of VOC storage tank sources, the State
concluded, that sources do not need to implement additional controls to
meet the 2008 ozone NAAQS RACT requirement because the control
techniques implemented to meet the RACT requirements of the 1-hour and
1997 standards are still applicable and equivalent to a RACT
determination for the 2008 standard. In addition, the State determined
that the Chapter 115 rules address VOC RACT for all source categories
in the HGB area for the 2008 1-hour ozone standard and provide
appropriate VOC emissions reductions that are equivalent to control
options cited in the CTG and ACT documents and any non-CTG major
sources are sufficiently controlled. See TCEQ's December 29, 2016 SIP,
Table F-1 titled ``State Rules Addressing VOC RACT Requirements in CTG
Reference Documents,'' (listing VOC CTG source categories, its
reference document, and the State rules addressing VOC RACT
requirements). Table F-2 titled ``State Rules Addressing VOC RACT
Requirements in ACT Reference Documents,'' in TCEQ's December 29, 2016
SIP (listing State rules addressing VOC RACT in ACT reference
documents). The EPA has approved the 30 TAC Chapter 115 VOC rules as
RACT for the HGB area under the 1-hour and 1997 8-hour ozone NAAQS (71
FR, 52670, September 6, 2006;78 FR 19599, April 2, 2013; 79 FR 21144,
April 15, 2014; 79 FR 45105, August 4, 2014; and 80 FR 16291, March 27,
2015). The EPA determined that VOC RACT is in place for all CTG and
non-CTG major sources in the HGB area for the 1-hour and 1997 8-hour
ozone NAAQS (71 FR 52676, September 6, 2006 and 79 FR 21144, April 15,
2014). Texas's SIP submittal relies on those EPA-approved Chapter 115
rules for the 1-hour and 1997 8-hour ozone NAAQS to fulfill RACT

requirement for CTG and non-CTG VOC major sources for the 2008 8-hour
ozone NAAQS. See docket EPA-R06-OAR-2005-TX-0018 and EPA- R06-OAR-2012-
0100 (available through the Regulations.gov website at: https://www.regulations.gov/). The rules we approved as meeting RACT for the 1-
hour and 1997 8-hour ozone NAAQS also meet RACT for the 2008 8- hour
ozone NAAQS. We have determined this is appropriate because the
fundamental control techniques described in the CTG and ACT documents,
are still applicable and a new RACT determination by Texas would result
in the same or similar control technology as the RACT determinations
made for the 1-hour or 1997 standard.\4\ The Chapter 115 rules provide
appropriate VOC emissions reductions that are equivalent to control
options cited in the CTG and ACT documents and any non-CTG major
sources are controlled.
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    \3\ EPA previously found that the Texas rules meet VOC and
NOX RACT for major sources using the 25 tpy definition,
as well as VOC RACT requirements for all applicable CTG categories
in the eight county HGB 1997 8-hour ozone NAAQS nonattainment area.
78 FR 19599, April 2, 2013, docket number EPA-R06-OAR-2012-0100, and
reaffirmed at 80 FR 16291, March 27, 2015, docket number EPA-R06-
OAR-2013-0804. We are not proposing to alter this previous
determination. We also found the State's rules met NOX
and VOC RACT for the 1-hour ozone standard. 60 FR 12438, March 7,
1995.
    \4\ See our proposal at 83 FR 29727, page 29728 and our TSD for
the proposal ``TSD 2008 SIP Revision and Oxone VOC-NOX
RACT--HGB NA Area'', page 18, both available through the docket EPA-
R06_OAR-2017-0055.
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    For storage tanks, the State revised the storage tank rules,
Chapter 115, Subchapter B, Division 1, increased the control efficiency
from 90% to 95%; expanded inspection, repair, and recordkeeping
requirements for fixed roof crude oil and condensate storage tanks with
uncontrolled VOC emissions of at least 25 tpy in the HGB area; and
expanded the rule applicability for fixed roof crude oil and condensate
storage tanks. The State found that the storage tank rule revisions
address RACT for CTG and non-CTG major source VOC storage tanks in the
HGB area. The TCEQ requirements controlling VOC emissions from storage
tanks are found in 30 TAC, Chapter 115, Subchapter B, Division 1
(Storage of Volatile Organic Compounds). Texas revised Sections
115.112, 115.114, 115.118 and 115.119 for the HGB area to match
requirements for the DFW area; the EPA previously approved the storage
tank update requirements (increased control efficiency of 95%;
inspection, repair, and recordkeeping requirements; and expanded
applicability for fixed roof crude oil and condensate storage tanks) as
RACT for the 1997 8-hour DFW nonattainment area (79 FR 45105 (August 4,
2014)). The major changes are to Section 115.112, Control Requirements,
which increases control efficiency of control devices, other than vapor
recovery units or flares, from 90% to 95% for VOC storage tanks in the
HGB area and expands the requirement to control VOC emissions to
sources not previously covered; Section 115.114, Inspection
Requirements, which adds the requirement to inspect closure devices on
fixed roofs tanks to prevent VOC flash gassing; Section 115.118,
Recordkeeping Requirements, which expands recordkeeping requirements
for fixed roof crude oil and condensate storage tanks with uncontrolled
VOC emissions of at least 25 tons per year to the HGB area, as well as
extends record retention for affected VOC storage tanks and expands the
rule applicability to include the aggregate of fixed roof crude oil and
condensate storage tanks at pipeline breakout stations in the HGB area;
and, Section 115.119, Compliance Schedules, which clarifies the
responsibility for sources in the HGB area to comply and defines July
20, 2018 as the final date for owners and operators to comply with the
new standards for the area. The increased control efficiency
requirements; inspection, repair, and recordkeeping requirements; and
expanded applicability for fixed roof crude oil and condensate storage
tanks are already in place for VOC storage tanks in the DFW area. We
have approved the rule changes into the State SIP and found they meet
VOC RACT for the DFW area.\5\ We are incorporating by reference the
docket for that decision.\6\ We agree with the State that the adopted
rule revisions address RACT for both CTG and non-CTG major VOC storage
tanks in the HGB area. We are also, approving the submitted revisions
to the storage tank rule for the HGB area, as described in detail in
the TSD to the proposal, as part of the SIP and as meeting VOC RACT for
the HGB area for the 2008 8-hour NAAQS. The modifications to the
storage tank rules will reduce working emissions from these vessels by
requiring an increase in control efficiency of some devices used to
limit VOCs exiting tankage; expanding the number of vessels requiring
controls in the area to include aggregated tankage at pipeline breakout
stations; include oil and condensate tanks as sources required to use
flash emission controls; and, require inspection of closure devices on
fixed roof tanks to prevent flash emissions from crude oil or
condensate transfer tanks in the area. By making these requirements
consistent with previously approved rule requirements in the DFW NA
area, it is expected compliance with the tankage regulations will be
enhanced.
---------------------------------------------------------------------------

    \5\ We approved those rules on December 21, 2017. See 82 FR
60546. The codification of the Texas SIP approved by EPA can be
found at 40 CFR 52.2270(c).
    \6\ See is EPA-R06-OAR-2015-0832, available through the
Regulations.gov website at: https://www.regulations.gov/.
---------------------------------------------------------------------------

    During their RACT analysis, TCEQ also identified a Vegetable Oil
Manufacturing Operations source emitting VOCs in a quantity greater
than the major source definition required under the previous
classification for the HGB area. TCEQ's analysis of the controls in
place at the facility showed that the source met control
recommendations listed in the CTG document for the Vegetable Oil
Manufacturing Operations source category and therefore met RACT.\7\
---------------------------------------------------------------------------

    \7\ See TCEQ NSR # 56114 and 30 TAC Sections 115.420-115.429,
which require control of VOC emissions via a mineral oil scrubber
and condenser that operate with a 90% control efficiency. This limit
is consistent with the withdrawn Vegetable Oil Manufacturing CTG and
a subsequent RACT determination made for a similar source in the San
Juaquin Valley Unified Air Pollution Control District in California.
---------------------------------------------------------------------------

    As we explained at length in our proposal and in the TSD to the
proposal, Texas thoroughly examined the area's emissions inventory to
find any NOX emissions sources covered by the EPA's
NOX ACTs great enough to require control under their RACT
approved NOX rules, as well as any major other sources of
NOX emissions that would need to implement RACT. One result
of their review of NOX sources in the HGB area identified a
facility falling under the Glass Manufacturing ACT category. The State
determined the source's existing controls, required by their State new
source review program, were consistent with RACT.\8\ For a full
discussion of the State's NOX RACT analysis, including this
source and the rationale for including existing controls as RACT for
the HGB area, please see the TSD to the proposal.
---------------------------------------------------------------------------

    \8\ See TCEQ NSR Permit 42623, special condition #9, which
requires use of an oxy-fired furnace and imposes a NOX
emissions performance standard of 1.48 lbs NOX per ton of
glass produced. This is consistent with the control requirements
recommended in the Alternative Control Techniques Guidelines for
NOX Emissions from Glass Manufacturing, EPA-453/R-94-037,
June 1994.
---------------------------------------------------------------------------

    Comment: The commenter stated the threshold for the application of
RACT should be 25 tpy, not 100 tpy, because the HGB area should be
classified as a ``severe'' nonattainment area under both the 1-hour and
1997 NAAQS. The EPA's redesignation of the HGB area as moderate using
the ``redesignation substitute'' method was illegal and is being
challenged in the Fifth Circuit. (1979 and 1997 redesignation
substitute for HGB area: 80 FR 63429 (October 20, 2015) and 81 FR 78691
(November 8, 2016).
    Response: We disagree. This HGB area RACT SIP was submitted to
fulfill RACT

requirements for the 2008 ozone NAAQS for the HGB area. The HGB area is
classified as moderate for the 2008 ozone NAAQS. (81 FR 90207, December
14, 2016). In order to meet the requirements of the 2008 ozone NAAQS
standard, Texas just needs to do RACT for the HGB area at moderate
level requirements for the 2008 ozone NAAQS.

III. Final Action

    We are approving the revisions to 30 TAC Sections 115.112, 115.114,
115.118 and 115.119 adopted by TCEQ on December 15, 2016 and submitted
to the EPA on December 29, 2016, for inclusion into the Texas SIP. We
are also approving the HGB RACT demonstration submitted by the TCEQ on
December 29, 2016. We are also approving negative declarations for
certain VOC source categories subject to RACT in the HGB area and are
finding that the State's RACT analyses demonstrate that the HGB area
meets the VOC and NOX RACT requirements for this standard.
This action is being taken under section 110 of the Act.

IV. Incorporation by Reference

    In this rule, the EPA is finalizing regulatory text that includes
incorporation by reference. In accordance with requirements of 1 CFR
51.5, the EPA is finalizing the incorporation by reference the
revisions to the Texas regulations as described in the Final Action
section above. The EPA has made, and will continue to make, these
materials generally available through www.regulations.gov and at the
EPA Region 6 Office (please contact the person identified in the FOR
FURTHER INFORMATION CONTACT section of this preamble for more
information). Therefore, these materials have been approved by EPA for
inclusion in the SIP, have been incorporated by reference by EPA into
that plan, are fully federally enforceable under sections 110 and 113
of the CAA as of the effective date of the final rulemaking of EPA's
approval, and will be incorporated by reference in the next update to
the SIP compilation.

V. Statutory and Executive Order Reviews

    Under the Clean Air Act, the Administrator is required to approve a
SIP submission that complies with the provisions of the Act and
applicable Federal regulations. 42 U.S.C. 7410(k); 40 CFR 52.02(a).
Thus, in reviewing SIP submissions, the EPA's role is to approve state
choices, provided that they meet the criteria of the Clean Air Act.
Accordingly, this action merely approves state law as meeting Federal
requirements and does not impose additional requirements beyond those
imposed by state law. For that reason, this action:
     Is not a ``significant regulatory action'' subject to
review by the Office of Management and Budget under Executive Orders
12866 (58 FR 51735, October 4, 1993) and 13563 (76 FR 3821, January 21,
2011);
     Is not an Executive Order 13771 (82 FR 9339, February 2,
2017) regulatory action because SIP approvals are exempted under
Executive Order 12866;
     Does not impose an information collection burden under the
provisions of the Paperwork Reduction Act (44 U.S.C. 3501 et seq.);
     Is certified as not having a significant economic impact
on a substantial number of small entities under the Regulatory
Flexibility Act (5 U.S.C. 601 et seq.);
     Does not contain any unfunded mandate or significantly or
uniquely affect small governments, described in the Unfunded Mandates
Reform Act of 1995 (Pub. L. 104-4);
     Does not have federalism implications as specified in
Executive Order 13132 (64 FR 43255, August 10, 1999);
     Is not an economically significant regulatory action based
on health or safety risks subject to Executive Order 13045 (62 FR
19885, April 23, 1997);
     Is not a significant regulatory action subject to
Executive Order 13211 (66 FR 28355, May 22, 2001);
     Is not subject to requirements of section 12(d) of the
National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272
note) because application of those requirements would be inconsistent
with the CAA; and
     Does not provide EPA with the discretionary authority to
address, as appropriate, disproportionate human health or environmental
effects, using practicable and legally permissible methods, under
Executive Order 12898 (59 FR 7629, February 16, 1994).
    In addition, the SIP is not approved to apply on any Indian
reservation land or in any other area where EPA or an Indian tribe has
demonstrated that a tribe has jurisdiction. In those areas of Indian
country, the rule does not have tribal implications and will not impose
substantial direct costs on tribal governments or preempt tribal law as
specified by Executive Order 13175 (65 FR 67249, November 9, 2000).
    The Congressional Review Act, 5 U.S.C. 801 et seq., as added by the
Small Business Regulatory Enforcement Fairness Act of 1996, generally
provides that before a rule may take effect, the agency promulgating
the rule must submit a rule report, which includes a copy of the rule,
to each House of the Congress and to the Comptroller General of the
United States. EPA will submit a report containing this action and
other required information to the U.S. Senate, the U.S. House of
Representatives, and the Comptroller General of the United States prior
to publication of the rule in the Federal Register. A major rule cannot
take effect until 60 days after it is published in the Federal
Register. This action is not a ``major rule'' as defined by 5 U.S.C.
804(2).
    Under section 307(b)(1) of the Clean Air Act, petitions for
judicial review of this action must be filed in the United States Court
of Appeals for the appropriate circuit by July 1, 2019. Filing a
petition for reconsideration by the Administrator of this final rule
does not affect the finality of this action for the purposes of
judicial review nor does it extend the time within which a petition for
judicial review may be filed, and shall not postpone the effectiveness
of such rule or action. This action may not be challenged later in
proceedings to enforce its requirements. (See section 307(b)(2).)

List of Subjects in 40 CFR Part 52

    Environmental protection, Air pollution control, Incorporation by
reference, Nitrogen dioxide, Ozone, Reporting and recordkeeping
requirements, Volatile organic compounds.

    Dated: April 24, 2019.
David Gray,
Acting Regional Administrator, Region 6.

    40 CFR part 52 is amended as follows:

PART 52--APPROVAL AND PROMULGATION OF IMPLEMENTATION PLANS

0
1. The authority citation for part 52 continues to read as follows:

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

Subpart SS--Texas

0
2. In Sec.  52.2270:
0
a. In paragraph (c), the table titled ``EPA Approved Regulations in the
Texas SIP'' is amended by revising the entries for Sections 115.112,
115.114, 115.118 and 115.119.
0
b. In paragraph (e), the second table titled ``EPA Approved
Nonregulatory Provisions and Quasi-Regulatory Measures in the Texas
SIP'' is amended by adding an entry for ``HGB VOC and NOX
RACT Finding, except for the 2016 EPA-issued CTG for the Oil and
Natural

Gas Industry, EPA-453/B-16-001'' at the end of the table.
    The revisions and addition read as follows:

Sec.  52.2270  Identification of plan.

* * * * *
    (c) * * *

                                    EPA Approved Regulations in the Texas SIP
----------------------------------------------------------------------------------------------------------------
                                                   State approval/
       State citation            Title/subject        submittal     EPA approval date          Explanation
                                                        date
----------------------------------------------------------------------------------------------------------------

                                                  * * * * * * *
Section 115.112.............  Control                  12/15/2016  4/30/2019, [Insert   ........................
                               Requirements.                        Federal Register
                                                                    citation].

                                                  * * * * * * *
Section 115.114.............  Inspection               12/15/2016  4/30/2019, [Insert   ........................
                               Requirements.                        Federal Register
                                                                    citation].

                                                  * * * * * * *
Section 115.118.............  Recordkeeping            12/15/2016  4/30/2019, [Insert   ........................
                               Requirements.                        Federal Register
                                                                    citation].
Section 115.119.............  Compliance               12/15/2016  4/30/2019, [Insert   ........................
                               Schedules.                           Federal Register
                                                                    citation].

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

* * * * *
    (e) * * *

              EPA Approved Nonregulatory Provisions and Quasi-Regulatory Measures in the Texas SIP
----------------------------------------------------------------------------------------------------------------
                                     Applicable           State
     Name of SIP provision       geographic or non-    submittal/     EPA approval date          Comments
                                   attainment area   effective date
----------------------------------------------------------------------------------------------------------------

                                                  * * * * * * *
HGB VOC and NOX RACT Finding,    HGB 2008 Ozone          12/29/2016  4/30/2019, [Insert  Vegetable Oil Mfg
 except for the 2016 EPA-issued   NAAQS non-                          FR page number      category, previously
 CTG for the Oil and Natural      attainment area.                    where document      sited under negative
 Gas Industry, EPA-453/B-16-001.                                      begins].            declarations for HGB
                                                                                area, is added to RACT
                                                                                determinations.
----------------------------------------------------------------------------------------------------------------

* * * * *
[FR Doc. 2019-08710 Filed 4-29-19; 8:45 am]
BILLING CODE 6560-50-P


[Federal Register Volume 82, Number 44 (Wednesday, March 8, 2017)]
[Notices]
[Pages 13034-13036]
[FR Doc No: 2017-04479]

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

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-80142]

Order Granting Limited Exemptive Relief, Pursuant to Rule 608(e)
of the Securities Exchange Act of 1934, From the Clock Synchronization
Compliance Deadline Specified in Section 6.7(a)(ii) of the National
Market System Plan Governing the Consolidated Audit Trail

March 2, 2017.
    By letter dated January 17, 2017, Bats BYZ Exchange, Inc., Bats BZX
Exchange, Inc., Bats EDGA Exchange, Inc., Bats EDGX Exchange, Inc., BOX
Options Exchange, LLC, C2 Options Exchange, Incorporated, Chicago Board
Options Exchange, Incorporated, Chicago Stock Exchange, Inc., Financial
Industry Regulatory Authority, Inc. (``FINRA''), International
Securities Exchange, Inc., Investors' Exchange, LLC, ISE Gemini, LLC,
ISE Mercury, LLC, Miami International Securities Exchange LLC, NASDAQ
BX, Inc., NASDAQ PHLX LLC, The NASDAQ Stock Market LLC, National Stock
Exchange, Inc., New York Stock Exchange LLC, NYSE Arca, Inc., and NYSE
MKT, LLC (collectively, the ``Participants'' to the National Market
System (``NMS'') Plan Governing the Consolidated Audit Trail (``CAT NMS
Plan'')) requested that the Securities and Exchange Commission
(``Commission'' or ``SEC'') grant limited exemptive relief to the
Participants, pursuant to its authority under Rule 608(e) of Regulation
NMS under the Securities Exchange Act (``Exchange Act''),\1\ from the
clock synchronization compliance deadline set forth in Section
6.7(a)(ii) of the CAT NMS Plan.\2\
---------------------------------------------------------------------------

    \1\ 17 CFR 242.608(e).
    \2\ See letter from the Participants to Brent J. Fields,
Secretary, Commission, dated January 17, 2017 (``Exemption
Request''). Unless otherwise noted, capitalized terms are used as
defined in Rule 613, in the CAT NMS Plan, or in this letter.
---------------------------------------------------------------------------

    Rule 608(c) of Regulation NMS under the Exchange Act requires that
each self-regulatory organization (``SRO'') comply with and, absent
reasonable justification or excuse, enforce compliance by its members
with, the terms of any effective NMS plan of which it is a sponsor or a
participant.\3\ Section 6.7(a)(ii) of the CAT NMS Plan states that
``[u]nless otherwise ordered by the SEC: . . . within four (4) months
after the Effective Date, each Participant shall, and through its
Compliance Rule shall require its Industry Members to, synchronize its
or their Business Clocks as required by Section 6.8 and certify to the
Chief Compliance Officer (in the case of Participants) or the
applicable Participant (in the case of Industry Members) that such
Participant has met this requirement.'' \4\
---------------------------------------------------------------------------

    \3\ 17 CFR 242.608(c).
    \4\ Securities Exchange Act Release No. 79318 (Nov. 15, 2016),
81 FR 84696, 84963 (Nov. 23, 2016) (Order Approving CAT NMS Plan)
Ex. A, Sec. 6.7(a)(ii).
---------------------------------------------------------------------------

    The Participants request that the Commission extend the clock
synchronization compliance date set forth in Section 6.7(a)(ii) from
within four months after the effective date of CAT NMS Plan, or March
15, 2017, to February 19, 2018 only with respect to Industry Members
with Business Clocks that do not capture time in milliseconds as of the
date of this order. The Participants note that the existing clock
synchronization compliance date under Section 6.7(a)(ii) of March 15,
2017 would remain in effect for those Industry Members with Business
Clocks that capture time in milliseconds.\5\ In support of their
Exemption Request, the Participants state, generally, that the request
is narrowly tailored and would

provide significant costs savings to Industry Members with Business
Clocks that do not capture time in milliseconds, without having any
adverse effect on the consolidated audit trail under the CAT NMS
Plan.\6\ The following outlines the Participants claims in support of
their exemptive request.
---------------------------------------------------------------------------

    \5\ See Exemption Request at 1 n.4.
    \6\ See Exemption Request at 1.
---------------------------------------------------------------------------

    First, the Participants note that their requested alternative
compliance date of February 19, 2018 is consistent with FINRA's
compliance date for FINRA Rule 4590, which was approved last year and
imposed a new clock synchronization standard of 50 milliseconds
applicable to business clocks that are used to record certain events in
NMS securities or OTC equity securities.\7\ Among other things, FINRA
member firms that do not capture time in milliseconds have until
February 19, 2018 to synchronize their business clocks to the new 50
millisecond standard.\8\ The Participants believe that it is
appropriate to have the CAT NMS Plan clock synchronization requirements
also take effect by February 19, 2018 for those Industry Members that
do not capture time in milliseconds as FINRA member firms currently are
preparing for the implementation of clock synchronization requirements
comparable to those set forth in the CAT NMS Plan by February 19,
2018.\9\
---------------------------------------------------------------------------

    \7\ See Securities Exchange Act Release No. 77565 (April 8,
2016), 81 FR 22136 (April 14, 2016) (SR-FINRA-2016-005) (order
approving FINRA's proposed rule change to reduce the synchronization
tolerance for computer clocks that are used to record events in NMS
securities and OTC equity securities).
    \8\ See FINRA Regulatory Notice 16-23 (July 2016) (establishing
for FINRA Rule 4590 a Phase 1 implementation date of February 20,
2017 for systems that capture time in milliseconds and a Phase 2
implementation date of February 19, 2018 systems that do not capture
time in milliseconds).
    \9\ See Exemption Request at 2. Because FINRA's compliance date
for those firms that capture time in milliseconds (February 20,
2017) is one month prior to the CAT clock synchronization compliance
date (March 15, 2017), the Participants are not requesting exemptive
relief with regard to Industry Members that capture time in
milliseconds.
---------------------------------------------------------------------------

    Second, the Participants state that Industry Members are not
required to begin reporting information to the Central Repository for
at least 20 months after the current March 15, 2017 deadline imposed by
the CAT NMS Plan for clock synchronization.\10\ Specifically, large
Industry Members are required to begin reporting to the Central
Repository on November 15, 2018 (20 months after the CAT NMS Plan clock
synchronization deadline),\11\ and Small Industry Members are required
to begin reporting on November 15, 2019 (32 months after the CAT NMS
Plan deadline).\12\ The Participants believe that allowing Industry
Members that do not capture time in milliseconds until February 19,
2018 to synchronize their Business Clocks will result in significant
cost savings for such firms.\13\ The Participants state that during
these 20 and 32 month periods they would not be required to incur the
substantial costs of complying with the more rigorous clock
synchronization requirements, such as updating and testing their clock
technology, documenting and following clock synchronization procedures
that would include performing regular clock synchronizations and
preparing a log that documents each clock synchronization event, far in
advance of the start of reporting obligations.\14\
---------------------------------------------------------------------------

    \10\ See Exemption Request at 2-3.
    \11\ See Order Approving CAT NMS Plan, Ex. A, Sec. 6.7(a)(v), 81
FR at 84963.
    \12\ See Order Approving CAT NMS Plan, Ex. A, Sec. 6.6(a)(v), 81
FR at 84962.
    \13\ See Exemption Request at 2-3.
    \14\ See id. at 3.
---------------------------------------------------------------------------

    Third, the Participants also believe that a compliance date of
February 19, 2018 for Industry Members that do not capture time in
milliseconds will provide Industry Members with sufficient preparation
time to ensure the required level of clock synchronization is achieved
prior to the commencement of their obligations to report to the Central
Repository.\15\ The Participants note that a compliance date of
February 19, 2018 provides a comparable clock synchronization deadline
to that imposed by Rule 613 on the Participants themselves, who are
required to synchronize their own Business Clocks eight months before
they commence reporting data to the Central Repository.\16\ Under the
requested exemption, large Industry Members that do not capture time in
milliseconds would be required to synchronize their Business Clocks
nine months before reporting to the Central Repository, and Small
Industry Members would be required to do so 21 months before
reporting.\17\
---------------------------------------------------------------------------

    \15\ See id.
    \16\ See id. (citing 17 CFR 242.613(a)(3)(ii)).
    \17\ See Exemption Request at 3.
---------------------------------------------------------------------------

    Rule 608(e) of Regulation NMS provides that the Commission may
exempt from the provisions of an NMS plan, either unconditionally or on
specified terms and conditions, any SRO or its members, if the
Commission determines that such exemption is consistent with the public
interest, the protection of investors, the maintenance of fair and
orderly markets, and the removal of impediments to, and perfection of
the mechanisms of, a national market system.\18\
---------------------------------------------------------------------------

    \18\ 17 CFR 242.608(e).
---------------------------------------------------------------------------

    The Commission finds that the requested exemption is consistent
with the requirements set forth in Rule 608(e). The Commission notes
that the Participants have narrowly tailored their exemptive request to
seek such relief for a limited period of time and only with respect to
those Industry Members with Business Clocks that do not capture time in
milliseconds. Given that these Industry Members' obligations to report
to the Central Repository do not commence until November 2018 or
November 2019 (depending on the size of the firm), the Commission
believes that the requested exemption should not result in any adverse
effect on the implementation or operation of the consolidated audit
trail. In addition, because any changes to these Industry Members'
current Business Clocks would require modifications to their firm's
systems and processes, this exemption will allow those Industry Members
with Business Clocks that do not already capture time in milliseconds
additional time to identify and implement the most cost effective clock
synchronization solution to achieve compliance with the new standard.
Further, the Commission believes that allowing less automated Industry
Members to synchronize their clocks by February 19, 2018 is also
consistent with the phased implementation approach set forth by FINRA
in its Rule 4590.\19\ Thus, the exemption would serve the Participants'
stated goal of achieving significant cost savings (from not incurring
ongoing costs from March 15, 2017 to February 19, 2018 as well as a
potential reduction in eventual costs if the delay allows for
identification of lower costs solutions) for certain Industry Members.
Accordingly, the Commission believes that imposing the more aggressive
deadline required by Section 6.7(a)(ii) of CAT NMS Plan on those
Industry Members with Business Clocks that do not capture time in
milliseconds would not otherwise facilitate implementation of the
consolidated audit trail.
---------------------------------------------------------------------------

    \19\ See Securities Exchange Act Release No. 77196 (Feb. 19,
2016), 81 FR 9550, 9553 n.35 (Feb. 25, 2016) (SR-FINRA-2016-005)
(noting that, in FINRA's view, ``a phased implementation could allow
firms, particularly smaller or less automated firms, a greater time
period over which they can identify and implement the most cost
effective clock synchronization solution that meets the standard
required by this proposal'').
---------------------------------------------------------------------------

    Therefore, the Commission believes that this exemption is
consistent with the public interest, the protection of investors, the
maintenance of fair and

orderly markets and the removal of impediments to, and the perfection
of a national market system because it is narrowly tailored, may
provide cost savings to those Industry Members that do not capture time
in milliseconds, allows such Industry Members additional time to
develop cost efficient ways to achieve clock synchronization and will
not adversely affect the implementation of the consolidated audit
trail.
    Accordingly, it is hereby ordered, pursuant to Rule 608(e) of the
Exchange Act,\20\ that the Participants are granted a limited exemption
extending the clock synchronization compliance date set forth in
Section 6.7(a)(ii) of CAT NMS Plan from within four months after the
effective date of CAT NMS Plan, or March 15, 2017, to February 19, 2018
with respect to Industry Members with Business Clocks that do not
capture time in milliseconds as of the date of this order.
---------------------------------------------------------------------------

    \20\ 17 CFR 242.608(e).

    By the Commission.
Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2017-04479 Filed 3-7-17; 8:45 am]
BILLING CODE 8011-01-P


[Federal Register Volume 78, Number 223 (Tuesday, November 19, 2013)]
[Notices]
[Pages 69468-69469]
[FR Doc No: 2013-27628]

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

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-70862; File No. SR-MIAX-2013-51]

Self-Regulatory Organizations; Miami International Securities
Exchange LLC; Notice of Filing and Immediate Effectiveness of Proposed
Rule Change To Amend Exchange Rule 504, Trading Halts

November 13, 2013.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(the ``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given
that on November 1, 2013, Miami International Securities Exchange LLC
(``MIAX'' 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 is filing a proposal to amend Rule 504, Trading Halts.
The text of the proposed rule change is available on the Exchange's Web
site at http://www.miaxoptions.com/filter/wotitle/rule_filing, at
MIAX's principal office, and at the Commission's Public Reference Room.

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

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

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

1. Purpose
    The Exchange proposes to amend Rule 504 in order to provide for an
automated notification between five and twenty seconds prior to the
resumption of trading in an option class (a ``Post-Halt Notification'')
following a regulatory halt, trading pause or market-wide trading halt.
    Currently, the Exchange's Trading Operations staff at the MIAX Help
Desk issues a Post-Halt Notification twenty seconds before trading
resumes in an option class that has been halted pursuant to Rule
504(a). The Post-Halt Notification states the time at which trading in
the option class or classes is expected to resume providing subscribers
of the Exchange's data feeds with a brief notice period (twenty
seconds) to prepare for the beginning or resumption of trading after a
trading system halt has ended. For trading halts initiated by the
System due to a regulatory halt, trading pause or market-wide trading
halt, no Post-Halt Notification currently is provided to market
participants.\3\ Not providing a Post-Halt Notification for these types
of trading halts while providing one for halts pursuant to Rule 504(a)
potentially creates unnecessary confusion on the part of market
participants seeking information about when options trading may restart
following a trading halt. In addition, without the Post-Halt
Notification after a regulatory halt, trading pause or market-wide
trading halt, market participants may not be able to be in a position
to resume quoting and/or submitting orders as soon as such an option
class begins trading following a trading halt, thus delaying reopening.
The Exchange proposes to eliminate any potential confusion that may be
caused by the disparate treatment resulting from providing Post-Halt
Notifications after trading halts pursuant to Rule 504(a), but not
regulatory halts, trading pauses or market-wide trading halts.
---------------------------------------------------------------------------

    \3\ See Exchange Rule 504(d) (specifically carving out
regulatory halts, trading pauses or market-wide trading halts from
the Post-Halt Notification).
---------------------------------------------------------------------------

    The Exchange proposes to amend Rule 504 to provide that in
situations of a regulatory halt, trading pause or market-wide trading
halt, a Post-Halt Notification will be broadcast between five and
twenty seconds before trading will begin or resume. The Post-Halt
Notification period for a regulatory halt, trading pause or market-wide
trading halt will be configurable in the MIAX System for a time period
between five and twenty seconds before trading in the option class
resumes. The MIAX System will send a broadcast message indicating that
trading in the option class will begin or resume within the
configurable Post-Halt Notification period. The Exchange will announce
the duration of the Post-Halt Notification

period through a Regulatory Circular, and will issue a Regulatory
Circular prior to the beginning of trading on any day that the Post-
Halt Notification period is reconfigured.\4\ The Exchange believes that
the new Post-Halt Notification will eliminate potential confusion on
the timing of reopening after a regulatory halt, trading pause or
market-wide trading halt and thus provide market participants with the
opportunity to be in a position to resume quoting and/or submitting
orders as soon as such an option class begins trading in a manner that
facilitates the reopening of trading after a halt and benefits all
market participants on the Exchange.
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    \4\ The Post-Halt Notification period will not be reconfigured
on an intra-day basis. The Exchange does not anticipate changing the
configuration on a frequent basis.
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    The Exchange notes that in the situation of a halt pursuant to Rule
504(a), just as today, the Post-Halt Notification will continue to be
initiated by Help Desk staff and broadcast twenty seconds before
trading will begin or resume.
2. Statutory Basis
    The Exchange believes that its proposed rule change is consistent
with Section 6(b) \5\ of the Act in general, and furthers the
objectives of Section 6(b)(5) \6\ of the Act in particular, in that it
is designed to prevent fraudulent and manipulative acts and practices,
to promote just and equitable principles of trade, to foster
cooperation and coordination with persons engaged in facilitating
transactions in securities, to remove impediments to and perfect the
mechanisms of a free and open market and a national market system and,
in general, to protect investors and the public interest.
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    \5\ 15 U.S.C. 78f(b).
    \6\ 15 U.S.C. 78f(b)(5).
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    The proposal is designed to enhance the Exchange's ability to
notify participants when a previously halted option class will begin or
resume trading, which removes impediments to, and perfects the
mechanisms of, a free and open market and the national market system as
a whole, by ensuring that participants are in a position to resume
quoting and/or submitting orders as soon as such an option class begins
trading following a regulatory halt, trading pause or market-wide
trading halt. The system change also fosters cooperation and
coordination with persons engaged in facilitating transactions in
securities by ensuring that all subscribers to the Exchange's data
feeds receive automatic notification of the trading status of a halted
issue.

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 the
Post-Halt Notification broadcast by the MIAX System actually enhances
competition by expeditiously notifying Members that an affected option
class will begin or resume trading, thus incenting market participants
to resume quoting competitively and/or to submit orders to the Exchange
for execution upon such resumption.

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

    Written comments were neither solicited nor received.

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

    Because the foregoing proposed rule change does not: (i)
Significantly affect the protection of investors or the public
interest; (ii) impose any significant burden on competition; and (iii)
become operative for 30 days from the date on which it was filed, or
such shorter time as the Commission may designate, it has become
effective pursuant to 19(b)(3)(A) of the Act \7\ and Rule 19b-4(f)(6)
\8\ thereunder.
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    \7\ 15 U.S.C. 78s(b)(3)(A).
    \8\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)
requires a self-regulatory organization to give the Commission
written notice of its intent to file the proposed rule change at
least five business days prior to the date of filing of the proposed
rule change, or such shorter time as designated by the Commission.
The Exchange has satisfied this requirement.
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    At any time within 60 days of the filing of the proposed rule
change, the Commission summarily may temporarily suspend such rule
change if it appears to the Commission that such action is necessary or
appropriate in the public interest, for the protection of investors, or
otherwise in furtherance of the purposes of the Act.

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_ADDRESS>Please include
File Number SR-MIAX-2013-51 on the subject line.

Paper Comments

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

All submissions should refer to File Number SR-MIAX-2013-51. 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 Web site (http://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, all
written statements with respect to the proposed rule change that are
filed with the Commission, and all written communications relating to
the proposed rule change between the Commission and any person, other
than those that may be withheld from the public in accordance with the
provisions of 5 U.S.C. 552, will be available for Web site 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; the Commission does
not edit personal identifying information from submissions. You should
submit only information that you wish to make available publicly. All
submissions should refer to File Number SR-MIAX-2013-51 and should be
submitted on or before December 10, 2013.

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\9\
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    \9\ 17 CFR 200.30-3(a)(12).
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Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2013-27628 Filed 11-18-13; 8:45 am]
BILLING CODE 8011-01-P