[Federal Register Volume 75, Number 221 (Wednesday, November 17, 2010)]
[Notices]
[Page 70226]
[FR Doc No: 2010-28908]

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DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

 [Project No. 13875-000]

Clean River Power 16, LLC; Notice of Preliminary Permit
Application Accepted for Filing and Soliciting Comments, Motions To
Intervene, and Competing Applications

November 8, 2010.
    On October 22, 2010, Clean River Power 16, LLC filed an application
for a preliminary permit, pursuant to section 4(f) of the Federal Power
Act, proposing to study the feasibility of the Kitano Water Power
Project, located in Kauai County, in the state of Hawaii. The sole
purpose of a preliminary permit, if issued, is to grant the permit
holder priority to file a license application during the permit term. A
preliminary permit does not authorize the permit holder to perform any
land disturbing activities or otherwise enter upon lands or waters
owned by others without the owners' express permission.
    The proposed project would consist of the following developments:
    (1) The existing Kokee Ditch Irrigation System comprised of
multiple intakes, two reservoirs, and a series of ditches and tunnels;
(2) a new upper intake including a trashrack and control gate; (3) a
new 26,700-foot-long, 36-inch-diameter steel penstock; (4) a proposed
40-foot-long and 75-foot-wide upper powerhouse made with reinforced
concrete; (5) a 4 MVA 4.16/695kV three-phase step-up transformer
located in a switchyard 50 feet from the powerhouse; (6) dependent on
the results of the proposed studies, a new 2-mile transmission line
interconnecting with the existing utility transmission line between the
Kahaka switchyard and the Kaumakani substation; (7) The proposed
development would have an average annual generation of 23,100 megawatt-
hours.
    Applicant Contact: Daniel Irvin, CEO, Free Flow Power Corporation,
33 Commercial Street, Gloucester, MA 01930; phone:<PHONE_NUMBER>.
    FERC Contact: Mary Greene,<PHONE_NUMBER>.
    Deadline for filing comments, motions to intervene, competing
applications (without notices of intent), or notices of intent to file
competing applications: 60 days from the issuance of this notice.
Comments, motions to intervene, notices of intent, and competing
applications may be filed electronically via the Internet. See 18 CFR
385.2001(a)(1)(iii) and the instructions on the Commission's Web site
(http://www.ferc.gov/docs-filing/ferconline.asp) under the ``eFiling''
link. For a simpler method of submitting text only comments, click on
``eComment.'' For assistance, please contact FERC Online Support at
<EMAIL_ADDRESS>call toll-free at<PHONE_NUMBER>; or, for
TTY, contact<PHONE_NUMBER>. Although the Commission strongly
encourages electronic filing, documents may also be paper-filed. To
paper-file, mail an original and eight copies to: Kimberly D. Bose,
Secretary, Federal Energy Regulatory Commission, 888 First Street, NE.,
Washington, DC 20426.
    More information about this project, including a copy of the
application, can be viewed or printed on the ``eLibrary'' link of
Commission's Web site at http://www.ferc.gov/docs-filing/elibrary.asp.
Enter the docket number (P-13875) in the docket number field to access
the document. For assistance, contact FERC Online Support.

Kimberly D. Bose,
Secretary.
[FR Doc. 2010-28908 Filed 11-16-10; 8:45 am]
BILLING CODE 6717-01-P


[Federal Register: October 24, 2007 (Volume 72, Number 205)]
[Notices]
[Page 60356]
[DOCID:fr24oc07-82]

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DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

[Project No. 2101-084; Project No. 2155-024]

Sacramento Municipal Utility District, California; Pacific Gas &
Electric Company, California; Notice of Intent To Hold a Public Meeting
To Discuss the Draft Environmental Impact Statement for the Upper
American River Hydroelectric Projects

October 15, 2007.
    On September 21, 2007, the Commission issued the Upper American
River Hydroelectric Project and Chili Bar Hydroelectric Project Draft
Environmental Impact Statement (draft EIS) and mailed it to resource
and land management agencies, interested organizations, and
individuals.
    The Environmental Protection Agency noticed the draft EIS in the
Federal Register on September 28, 2007 (72 FR 55201); comments are due
November 13, 2007. The draft EIS evaluates the environmental
consequences and developmental benefits of issuing new licenses for
operating and maintaining the Upper American River Project and the
Chili Bar Project, which are located in El Dorado and Sacramento
Counties, California. Besides evaluating the projects as they now
operate, the draft EIS evaluates the projects with the Settlement
Agreement and with staff-recommended measures.
    The public meeting, which will be recorded by an official
stenographer, is scheduled as follows.
    Date: Monday, November 5, 2007.
    Time: 7-9:30 p.m. (PST).
    Place: Best Western Placerville Inn, 6850 Green Leaf Drive,
Placerville, CA, 95667-6228, Phone:<PHONE_NUMBER>.
    At the meeting, resource agency personnel and other interested
persons will have the opportunity to provide oral and written comments
and recommendations regarding the draft EIS for the Commission's public
record.
    For further information, contact James Fargo at<PHONE_NUMBER> or
at<EMAIL_ADDRESS>
Kimberly D. Bose,
Secretary.
 [FR Doc. E7-20878 Filed 10-23-07; 8:45 am]

BILLING CODE 6717-01-P


[Federal Register Volume 83, Number 171 (Tuesday, September 4, 2018)]
[Notices]
[Pages 44929-44937]
[FR Doc No: 2018-19062]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-83970; File No. SR-FICC-2017-022]

Self-Regulatory Organizations; Fixed Income Clearing Corporation;
Order Approving a Proposed Rule Change, as Modified by Amendment No. 1,
To Amend the Loss Allocation Rules and Make Other Changes

August 28, 2018.
    On December 18, 2017, Fixed Income Clearing Corporation (``FICC'')
filed with the Securities and Exchange Commission (``Commission'')
proposed rule change SR-FICC-2017-022 pursuant to Section 19(b)(1) of
the Securities Exchange Act of 1934 (``Act'') \1\ and Rule 19b-4
thereunder \2\ to amend its loss allocation rules and make other
conforming and technical changes.\3\ The proposed rule change was
published for comment in the Federal

Register on January 8, 2018.\4\ On February 8, 2018, the Commission
designated a longer period within which to approve, disapprove, or
institute proceedings to determine whether to approve or disapprove the
proposed rule change.\5\ On March 20, 2018, the Commission instituted
proceedings to determine whether to approve or disapprove the proposed
rule change.\6\ On June 25, 2018, the Commission designated a longer
period for Commission action on the proceedings to determine whether to
approve or disapprove the proposed rule change.\7\ On June 28, 2018,
FICC filed Amendment No. 1 to the proposed rule change to amend and
replace in its entirety the proposed rule change as originally filed on
December 18, 2017.\8\ The Commission did not receive any comments. This
order approves the proposed rule change, as modified by Amendment No. 1
(hereinafter, ``Proposed Rule Change'').
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ On December 18, 2017, FICC filed the proposed rule change as
advance notice SR-FICC-2017-806 with the Commission pursuant to
Section 806(e)(1) of Title VIII of the Dodd-Frank Wall Street Reform
and Consumer Protection Act entitled the Payment, Clearing, and
Settlement Supervision Act of 2010 (``Clearing Supervision Act'')
and Rule 19b-4(n)(1)(i) of the Act (``Advance Notice''). 12 U.S.C.
5465(e)(1) and 17 CFR 240.19b-4(n)(1)(i), respectively. The Advance
Notice was published for comment in the Federal Register on January
30, 2018. In that publication, the Commission also extended the
review period of the Advance Notice for an additional 60 days,
pursuant to Section 806(e)(1)(H) of the Clearing Supervision Act. 12
U.S.C. 5465(e)(1)(H); Securities Exchange Act Release No. 82583
(January 24, 2018), 83 FR 4358 (January 30, 2018) (SR-FICC-2017-
806). On April 10, 2018, the Commission required additional
information from FICC pursuant to Section 806(e)(1)(D) of the
Clearing Supervision Act, which tolled the Commission's period of
review of the Advance Notice until 60 days from the date the
information required by the Commission was received by the
Commission. 12 U.S.C. 5465(e)(1)(D); see 12 U.S.C. 5465(e)(1)(E)(ii)
and (G)(ii); see Memorandum from the Office of Clearance and
Settlement Supervision, Division of Trading and Markets, titled
``Commission's Request for Additional Information,'' available at
https://www.sec.gov/rules/sro/ficc-an.htm. On June 28, 2018, FICC
filed Amendment No. 1 to the Advance Notice to amend and replace in
its entirety the Advance Notice as originally filed on December 18,
2017, which was published in the Federal Register on August 6, 2018.
Securities Exchange Act Release No. 83747 (July 31, 2018), 83 FR
38393 (August 6, 2018) (SR-FICC-2017-806). FICC submitted a courtesy
copy of Amendment No. 1 to the Advance Notice through the
Commission's electronic public comment letter mechanism.
Accordingly, Amendment No. 1 to the Advance Notice has been publicly
available on the Commission's website at https://www.sec.gov/rules/sro/ficc-an.htm since June 29, 2018. On July 6, 2018, the Commission
received a response to its request for additional information in
consideration of the Advance Notice, which, in turn, added a further
60 days to the review period pursuant to Section 806(e)(1)(E) and
(G) of the Clearing Supervision Act. 12 U.S.C. 5465(e)(1)(E) and
(G); see Memorandum from the Office of Clearance and Settlement
Supervision, Division of Trading and Markets, titled ``Response to
the Commission's Request for Additional Information,'' available at
https://www.sec.gov/rules/sro/ficc-an.htm. The Commission did not
receive any comments. The proposal, as set forth in both the Advance
Notice and the proposed rule change, each as modified by Amendments
No. 1, shall not take effect until all required regulatory actions
are completed.
    \4\ Securities Exchange Act Release No. 82427 (January 2, 2018),
83 FR 854 (January 8, 2018) (SR-FICC-2017-022).
    \5\ Securities Exchange Act Release No. 82670 (February 8,
2018), 83 FR 6626 (February 14, 2018) (SR-DTC-2017-022, SR-FICC-
2017-022, SR-NSCC-2017-018).
    \6\ Securities Exchange Act Release No. 82909 (March 20, 2018),
83 FR 12990 (March 26, 2018) (SR-FICC-2017-022).
    \7\ Securities Exchange Act Release No. 83510 (June 25, 2018),
83 FR 30791 (June 29, 2018) (SR-DTC-2017-022, SR-FICC-2017-022, SR-
NSCC-2017-018).
    \8\ Securities Exchange Act Release No. 83631 (July 13, 2018),
83 FR 34193 (July 19, 2018) (SR-FICC-2017-022) (``Notice of
Amendment No. 1''). FICC submitted a courtesy copy of Amendment No.
1 to the proposed rule change through the Commission's electronic
public comment letter mechanism. Accordingly, Amendment No. 1 to the
proposed rule change has been publicly available on the Commission's
website at https://www.sec.gov/rules/sro/ficc-an.htm since June 29,
2018.
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I. Description

    The Proposed Rule Change consists of proposed changes to FICC's
Government Securities Division (``GSD'') Rulebook (``GSD Rules'') and
Mortgage-Backed Securities Division (``MBSD'' and, together with GSD,
the ``Divisions'' and, each, a ``Division'') Clearing Rules (``MBSD
Rules,'' and collectively with the GSD Rules, the ``Rules'') \9\ in
order to (1) modify each Division's loss allocation process; (2) align
the Divisions' loss allocation rules among the three clearing agencies
of The Depository Trust & Clearing Corporation (``DTCC'')--The
Depository Trust Company (``DTC''), National Securities Clearing
Corporation (``NSCC''), and FICC (collectively, the ``DTCC Clearing
Agencies''); \10\ (3) amend the MBSD Rules regarding the use of the
MBSD's Clearing Fund; and (4) make conforming and technical changes.
Each of these proposed changes is described below. A detailed
description of the specific rule text changes proposed in this Advance
Notice can be found in the Notice of Amendment No. 1.\11\
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    \9\ Each capitalized term not otherwise defined herein has its
respective meaning as set forth in the GSD Rules, available at
http://www.dtcc.com/~/media/Files/Downloads/legal/rules/
ficc_gov_rules.pdf, and the MBSD Rules, available at www.dtcc.com/~/
media/Files/Downloads/legal/rules/ficc_mbsd_rules.pdf.
    \10\ DTCC is a user-owned and user-governed holding company and
is the parent company of DTC, FICC, and NSCC. DTCC operates on a
shared services model with respect to the DTCC Clearing Agencies.
Most corporate functions are established and managed on an
enterprise-wide basis pursuant to intercompany agreements under
which it is generally DTCC that provides a relevant service to a
DTCC Clearing Agency.
    \11\ See Notice of Amendment No. 1, supra note 8.
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A. Changes to the Loss Allocation Process

    The GSD Rules and the MBSD Rules each currently provide for a loss
allocation process through which both FICC (by applying up to 25
percent of its retained earnings in accordance with Section 7(b) of GSD
Rule 4 and Section 7(c) of MBSD Rule 4) and its members \12\ would
share in the allocation of a loss resulting from the default of a
member for whom a Division has ceased to act pursuant to the Rules.\13\
The GSD Rules and the MBSD Rules also recognize that FICC may incur
losses outside the context of a defaulting member that are otherwise
incident to each Division's clearance and settlement business.
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    \12\ The term ``Member'' is defined in both the GSD Rules and
the MBSD Rules, and has a different meaning under each. See supra
note 9. In the Notice of Amendment No. 1, FICC used ``member'' to
refer to both the Members of GSD and MBSD. See Notice of Amendment
No. 1, supra note 8.
    \13\ GSD is permitted to cease to act for (1) a GSD Member
pursuant to GSD Rule 21 (Restrictions on Access to Services) and GSD
Rule 22 (Insolvency of a Member), (2) a Sponsoring Member pursuant
to Section 14 and Section 16 of GSD Rule 3A (Sponsoring Members and
Sponsored Members), and (3) a Sponsored Member pursuant to Section
13 and Section 15 of GSD Rule 3A (Sponsoring Members and Sponsored
Members). MBSD is permitted to cease to act for an MBSD Member
pursuant to MBSD Rule 14 (Restrictions on Access to Services) and
MBSD Rule 16 (Insolvency of a Member). GSD Rule 22A (Procedures for
When the Corporation Ceases to Act) and MBSD Rule 17 (Procedures for
When the Corporation Ceases to Act) set out the types of actions
FICC may take when it ceases to act for a member. Supra note 9.
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    The current GSD and MBSD loss allocation rules provide that, in the
event the Division ceases to act for a member, the amount on deposit to
the Clearing Fund from the defaulting member, along with any other
resources of, or attributable to, the defaulting member that FICC may
access under the GSD Rules or the MBSD Rules (e.g., payments from
Cross-Guaranty Agreements), are the first source of funds the Division
would use to cover any losses that may result from the closeout of the
defaulting member's guaranteed positions. If these amounts are not
sufficient to cover all losses incurred, then each Division will apply
the following available resources, in the following order: (1) As
provided in the current Section 7(b) of GSD Rule 4 and Section 7(c) of
MBSD Rule 4, FICC's corporate contribution of up to 25 percent of
FICC's retained earnings existing at the time of the failure of a
defaulting member to fulfill its obligations to FICC, or such greater
amount as the Board of Directors may determine; and (2) if a loss still
remains, use of the Clearing Fund of the Division and assessing the
Division's Members in the manner provided in GSD Rule 4 and MBSD Rule
4, as the case may be. Specifically, FICC will divide the loss ratably
between Tier One Netting Members and Tier Two Members with respect to
GSD, or between Tier One Members and Tier Two Members with respect to
MBSD, based on original counterparty activity with the defaulting
member. Then the loss allocation process applicable to Tier One Netting
Members or Tier One Members, as applicable, and Tier Two Members will
proceed in the manner provided in GSD Rule 4 and MBSD Rule 4, as the
case may be.
    Pursuant to current Rules, the applicable Division will first
assess each Tier One Netting Member or Tier One Member, as applicable,
an amount up to $50,000, in an equal basis per such member. If a loss
remains, the Division will allocate the remaining loss ratably among
Tier One Netting Members or Tier One Members, as applicable, in
accordance with the amount of each Tier One Netting Member's or Tier
One Member's respective average daily Required Fund Deposit over the
prior 12 months. If a Tier One Netting Member or Tier One Member, as
applicable, did not maintain a Required Fund Deposit for 12 months, its
loss allocation amount will be based on its average daily Required Fund
Deposit over the time period during which such member did maintain a
Required Fund Deposit.
    Pursuant to current Section 7(g) of GSD Rule 4 and MBSD Rule 4, if,
as a result of the Division's application of the Required Fund Deposit
of a member, a member's actual Clearing Fund deposit is less than its
Required Fund Deposit, the member will be required to eliminate such
deficiency in order to satisfy its Required Fund Deposit amount. In
addition to losses that may result from the closeout of the defaulting
member's guaranteed

positions, Tier One Netting Members or Tier One Members, as applicable,
can also be assessed for non-default losses incident to each Division's
clearance and settlement business, pursuant to current Section 7(f) of
GSD Rule 4 and MBSD Rule 4.
    The Rules of both Divisions currently provide that Tier Two Members
are only subject to loss allocation to the extent they traded with the
defaulting member and their trades resulted in a liquidation loss. FICC
will assess Tier Two Members ratably based on their loss as a
percentage of the entire remaining loss attributable to Tier Two
Members.\14\ Tier Two Members are required to pay their loss allocation
obligations in full and replenish their Required Fund Deposits as
needed and as applicable. The current Rule provisions which provide for
loss allocation of non-default losses incident to each Division's
clearance and settlement business (i.e., Section 7(f) of GSD Rule 4 and
MBSD Rule 4) do not apply to Tier Two Members.
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    \14\ GSD Rule 3B, Section 7 (Loss Allocation Obligations of CCIT
Members) provides that CCIT Members will be allocated losses as Tier
Two Members and will be responsible for the total amount of loss
allocated to them. With respect to CCIT Members with a Joint Account
Submitter, loss allocation will be calculated at the Joint Account
level and then applied pro rata to each CCIT Member within the Joint
Account based on the trade settlement allocation instructions. Supra
note 9.
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    FICC proposes to change the manner in which each of the aspects of
the loss allocation process described above would be employed. GSD and
MBSD would clarify or adjust certain elements and introduce certain new
loss allocation concepts, as further discussed below. In addition, the
proposal would address the loss allocation process as it relates to
losses arising from or relating to multiple default or non-default
events in a short period of time, also as described below.
    FICC proposes six key changes to enhance each Division's loss
allocation process. Specifically, FICC proposes to make changes to each
Division regarding (1) the Corporate Contribution, (2) the Event
Period, (3) the loss allocation round and notice, (4) the look-back
period, (5) the loss allocation withdrawal notice and cap, and (6) the
governance around non-default losses, each of which is discussed below.
(1) Corporate Contribution
    As stated above, Section 7(b) of GSD Rule 4 and Section 7(c) of
MBSD Rule 4 currently provide that FICC will contribute up to 25
percent of its retained earnings (or such higher amount as the Board of
Directors shall determine) to a loss or liability that is not satisfied
by the defaulting member's Clearing Fund deposit. Under the proposal,
FICC would amend the calculation of its corporate contribution from a
percentage of its retained earnings to a mandatory amount equal to 50
percent of the FICC General Business Risk Capital Requirement.\15\
FICC's General Business Risk Capital Requirement, as defined in FICC's
Clearing Agency Policy on Capital Requirements,\16\ is, at a minimum,
equal to the regulatory capital that FICC is required to maintain in
compliance with Rule 17Ad-22(e)(15) under the Act.\17\ The proposed
Corporate Contribution would be held in addition to FICC's General
Business Risk Capital Requirement.
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    \15\ FICC calculates its General Business Risk Capital
Requirement as the amount equal to the greatest of (1) an amount
determined based on its general business profile, (2) an amount
determined based on the time estimated to execute a recovery or
orderly wind-down of FICC's critical operations, and (3) an amount
determined based on an analysis of FICC's estimated operating
expenses for a six month period.
    \16\ See Securities Exchange Act Release No. 81105 (July 7,
2017), 82 FR 32399 (July 13, 2017) (SR-DTC-2017-003, SR-NSCC-2017-
004, SR-FICC-2017-007).
    \17\ 17 CFR 240.17Ad-22(e)(15).
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    Currently, the Rules do not require FICC to contribute its retained
earnings to losses and liabilities other than those from member
defaults. Under the proposal, FICC would apply its Corporate
Contribution to non-default losses as well. The proposed Corporate
Contribution would apply to losses arising from Defaulting Member
Events and Declared Non-Default Loss Events, and would be a mandatory
contribution by FICC prior to any allocation of the loss among the
applicable Division's members.\18\ As proposed, if the Corporate
Contribution is fully or partially used against a loss or liability
relating to an Event Period by one or both Divisions, the Corporate
Contribution would be reduced to the remaining unused amount, if any,
during the following 250 Business Days in order to permit FICC to
replenish the Corporate Contribution.\19\ To ensure transparency, all
GSD Members and MBSD Members would receive notice of any such reduction
to the Corporate Contribution.
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    \18\ The proposed change would not require a Corporate
Contribution with respect to the use of each Division's Clearing
Fund as a liquidity resource; however, if FICC uses a Division's
Clearing Fund as a liquidity resource for more than 30 calendar
days, as set forth in proposed Section 5 of GSD Rule 4 and MBSD Rule
4, then FICC would have to consider the amount used as a loss to the
respective Division's Clearing Fund incurred as a result of a
Defaulting Member Event and allocate the loss pursuant to proposed
Section 7 of Rule 4, which would then require the application of
FICC's Corporate Contribution.
    \19\ FICC states that 250 Business Days would be a reasonable
estimate of the time frame that FICC would be required to replenish
the Corporate Contribution by equity in accordance with FICC's
Clearing Agency Policy on Capital Requirements, including a
conservative additional period to account for any potential delays
and/or unknown exigencies in times of distress.
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    There would be one FICC Corporate Contribution, the amount of which
would be available to both Divisions and would be applied against a
loss or liability in either Division in the order in which such loss or
liability occurs. In other words, FICC would not have two separate
Corporate Contributions for each Division. In the event of a loss or
liability relating to an Event Period, whether arising out of or
relating to a Defaulting Member Event or a Declared Non-Default Loss
Event, attributable to only one Division, the Corporate Contribution
would be applied to that Division up to the amount then available. If a
loss or liability relating to an Event Period, whether arising out of
or relating to a Defaulting Member Event or a Declared Non-Default Loss
Event, occurs simultaneously at both Divisions, the Corporate
Contribution would be applied to the respective Divisions in the same
proportion that the aggregate Average RFDs of all members in that
Division bear to the aggregate Average RFDs of all members in both
Divisions.\20\
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    \20\ FICC states that if a loss or liability relating to an
Event Period, whether arising out of or relating to a Defaulting
Member Event or a Declared Non-Default Loss Event, occurs
simultaneously at both Divisions, allocating the Corporate
Contribution ratably between the two Divisions based on the
aggregate Average RFDs of their respective members is appropriate
because the aggregate Average RFDs of all members in a Division
represent the amount of risks that those members bring to FICC over
the look-back period of 70 Business Days.
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    As compared to the current approach of applying ``up to'' a
percentage of retained earnings to defaulting member losses, the
proposed Corporate Contribution would be a fixed percentage of FICC's
General Business Risk Capital Requirement, which would provide greater
transparency and accessibility to members. The proposed Corporate
Contribution would apply not only towards losses and liabilities
arising out of or relating to Defaulting Member Events but also those
arising out of or relating to Declared Non-Default Loss Events.
    Under current Section 7(b) of GSD Rule 4 and Section 7(c) of MBSD
Rule 4, FICC has the discretion to contribute amounts higher than the
specified percentage of retained earnings, as determined by the Board
of Directors, to any loss or liability incurred by FICC as

result of the failure of a Defaulting Member to fulfill its obligations
to FICC. This option would be retained and expanded under the proposal
so that it would be clear that FICC can voluntarily apply amounts
greater than the Corporate Contribution against any loss or liability
(including non-default losses) of the Divisions, if the Board of
Directors, in its sole discretion, believes such to be appropriate
under the factual situation existing at the time.
(2) Event Period
    FICC states that in order to clearly define the obligations of each
Division and its respective members regarding loss allocation and to
balance the need to manage the risk of sequential loss events against
members' need for certainty concerning their maximum loss allocation
exposures, FICC proposes to introduce the concept of an Event Period to
the GSD Rules and the MBSD Rules to address the losses and liabilities
that may arise from or relate to multiple Defaulting Member Events and/
or Declared Non-Default Loss Events that arise in quick succession in a
Division. Specifically, the proposal would group Defaulting Member
Events and Declared Non-Default Loss Events occurring within a period
of 10 Business Days (``Event Period'') for purposes of allocating
losses to members of the respective Divisions in one or more rounds,
subject to the limitations of loss allocation as explained below.\21\
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    \21\ FICC states that having a 10 Business Day Event Period
would provide a reasonable period of time to encompass potential
sequential Defaulting Member Events or Declared Non-Default Loss
Events that are likely to be closely linked to an initial event and/
or a severe market dislocation episode, while still providing
appropriate certainty for members concerning their maximum exposure
to mutualized losses with respect to such events.
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    In the case of a loss or liability arising from or relating to a
Defaulting Member Event, an Event Period would begin on the day one or
both Divisions notify their respective members that FICC has ceased to
act for the GSD Defaulting Member and/or the MBSD Defaulting Member (or
the next Business Day, if such day is not a Business Day). In the case
of a loss or liability arising from or relating to a Declared Non-
Default Loss Event, an Event Period would begin on the day that FICC
notifies members of the respective Divisions of the Declared Non-
Default Loss Event (or the next Business Day, if such day is not a
Business Day). If a subsequent Defaulting Member Event or Declared Non-
Default Loss Event occurs during an Event Period, any losses or
liabilities arising out of or relating to any such subsequent event
would be resolved as losses or liabilities that are part of the same
Event Period, without extending the duration of such Event Period. An
Event Period may include both Defaulting Member Events and Declared
Non-Default Loss Events, and there would not be separate Event Periods
for Defaulting Member Events or Declared Non-Default Loss Events
occurring during overlapping 10 Business Day periods.
    The amount of losses that may be allocated by each Division,
subject to the required Corporate Contribution, and to which a Loss
Allocation Cap would apply for any Member that elects to withdraw from
membership in respect of a loss allocation round, would include any and
all losses from any Defaulting Member Events and any Declared Non-
Default Loss Events during the Event Period, regardless of the amount
of time, during or after the Event Period, required for such losses to
be crystallized and allocated.\22\
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    \22\ Under the proposal, each Tier One Netting Member or Tier
One Member, as applicable, that is a Tier One Netting Member or Tier
One Member on the first day of an Event Period would be obligated to
pay its pro rata share of losses and liabilities arising out of or
relating to each Defaulting Member Event (other than a Defaulting
Member Event with respect to which it is the Defaulting Member) and
each Declared Non-Default Loss Event occurring during the Event
Period.
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(3) Loss Allocation Round and Loss Allocation Notice
    Under the proposal, a loss allocation ``round'' would mean a series
of loss allocations relating to an Event Period, the aggregate amount
of which is limited by the sum of the Loss Allocation Caps of affected
Tier One Netting Members or Tier One Members, as applicable (a ``round
cap''). When the aggregate amount of losses allocated in a round equals
the round cap, any additional losses relating to the applicable Event
Period would be allocated in one or more subsequent rounds, in each
case subject to a round cap for that round. FICC may continue the loss
allocation process in successive rounds until all losses from the Event
Period are allocated among Tier One Netting Members or Tier One
Members, as applicable, that have not submitted a Loss Allocation
Withdrawal Notice in accordance with proposed Section 7b of GSD Rule 4
or MBSD Rule 4.
    Each loss allocation would be communicated to each Tier One Netting
Member or Tier One Member, as applicable, by the issuance of a notice
that advises the Tier One Netting Member or Tier One Member, as
applicable, of the amount being allocated to it (``Loss Allocation
Notice''). Each Tier One Netting Member's or Tier One Member's, as
applicable, pro rata share of losses and liabilities to be allocated in
any round would be equal to (1) the average of its Required Fund
Deposit for the 70 Business Days preceding the first day of the
applicable Event Period or such shorter period of time that the Tier
One Netting Member or Tier One Member, as applicable, has been a member
(each member's ``Average RFD''), divided by (2) the sum of Average RFD
amounts of all Tier One Netting Members or Tier One Members, as
applicable, subject to loss allocation in such round.
    Each Loss Allocation Notice would specify the relevant Event Period
and the round to which it relates. The first Loss Allocation Notice in
any first, second, or subsequent round would expressly state that such
Loss Allocation Notice reflects the beginning of the first, second, or
subsequent round, as the case may be, and that each Tier One Netting
Member or Tier One Member, as applicable, in that round has five
Business Days from the issuance of such first Loss Allocation Notice
for the round to notify FICC of its election to withdraw from
membership with GSD or MBSD, as applicable, pursuant to proposed
Section 7b of GSD Rule 4 or MBSD Rule 4, as applicable, and thereby
benefit from its Loss Allocation Cap.\23\ In other words, the proposed
change would link the Loss Allocation Cap to a round in order to
provide Tier One Netting Members or Tier One Members, as applicable,
the option to limit their loss allocation exposure at the beginning of
each round. After a first round of loss allocations with respect to an
Event Period, only Tier One Netting Members or Tier One Members, as
applicable, that have not submitted a Loss Allocation Withdrawal Notice
in accordance with proposed Section 7b of

GSD Rule 4 or MBSD Rule 4, as applicable, would be subject to further
loss allocation with respect to that Event Period.
---------------------------------------------------------------------------

    \23\ Pursuant to current Section 7(g) of GSD Rule 4 and MBSD
Rule 4, the time period for a member to give notice, pursuant to
Section 13 of GSD Rule 3 and MBSD Rule 3, of its election to
terminate its membership in GSD or MBSD, as applicable, in respect
of an allocation arising from any Remaining Loss allocated by FICC
pursuant to Section 7(d) of GSD Rule 4 or Section 7(e) of MBSD Rule
4, as applicable, and any Other Loss, is the Close of Business on
the Business Day on which the loss allocation payment is due to
FICC. Current Section 13 of GSD Rule 4 and MBSD Rule 4 requires a
10-day notice period. Supra note 9.
    FICC states that it is appropriate to shorten such time period
from 10 days to five Business Days because FICC needs timely notice
of which Tier One Netting Members or Tier One Members, as
applicable, would remain in its membership for purpose of
calculating the loss allocation for any subsequent round. FICC
states that five Business Days would provide Tier One Netting
Members or Tier One Members, as applicable, with sufficient time to
decide whether to cap their loss allocation obligations by
withdrawing from their membership in GSD or MBSD, as applicable.
---------------------------------------------------------------------------

    Currently, pursuant to Section 7(g) of GSD Rule 4 and MBSD Rule 4,
if notification is provided to a member that an allocation has been
made against the member pursuant to GSD Rule 4 or MBSD Rule 4, as
applicable, and that application of the member's Required Fund Deposit
is not sufficient to satisfy such obligation to make payment to FICC,
the member is required to deliver to FICC by the Close of Business on
the next Business Day, or by the Close of Business on the Business Day
of issuance of the notification if so determined by FICC, that amount
which is necessary to eliminate any such deficiency, unless the member
elects to terminate its membership in FICC. Under the proposal, members
would receive two Business Days' notice of a loss allocation, and be
required to pay the requisite amount no later than the second Business
Day following the issuance of such notice.\24\
---------------------------------------------------------------------------

    \24\ FICC states that allowing members two Business Days to
satisfy their loss allocation obligations would provide members
sufficient notice to arrange funding, if necessary, while allowing
FICC to address losses in a timely manner.
---------------------------------------------------------------------------

(4) Look-Back Period
    Currently, the GSD Rules and the MBSD Rules calculate a Tier One
Netting Member's or a Tier One Member's pro rata share for purposes of
loss allocation based on the member's average daily Required Fund
Deposit over the prior 12 months or such shorter period as may be
available in the case of a member which has not maintained a deposit
over such time period.
    GSD and MBSD propose to calculate each Tier One Netting Member's or
Tier One Member's, as applicable, pro rata share of losses and
liabilities to be allocated in any round to be equal to (1) the Tier
One Netting Member's or Tier One Member's, as applicable, Average RFD
divided by (2) the sum of Average RFD amounts for all Tier One Netting
Members or a Tier One Members, as applicable, that are subject to loss
allocation in such round. Additionally, if a Tier One Netting Member or
Tier One Member, as applicable, withdraws from membership pursuant to
proposed Section 7b of GSD Rule 4 or MBSD Rule 4, as applicable, GSD
and MBSD are proposing that such member's Loss Allocation Cap be equal
to the greater of (1) its Required Fund Deposit on the first day of the
applicable Event Period or (2) its Average RFD.
    FICC states that employing a revised look-back period of 70
Business Days instead of 12 months to calculate a Tier One Netting
Member's or a Tier One Member's, as applicable, loss allocation pro
rata share and Loss Allocation Cap is appropriate because FICC states
that the current look-back period of 12 months is a very long period
during which a member's business strategy and outlook could have
shifted significantly, resulting in material changes to the size of its
portfolios. FICC states that a look-back period of 70 Business Days
would minimize that issue yet still would be long enough to enable FICC
to capture a full calendar quarter of such members' activities and
smooth out the impact from any abnormalities and/or arbitrariness that
may have occurred.
(5) Loss Allocation Withdrawal Notice and Loss Allocation Cap
    Currently, pursuant to Section 7(g) of GSD Rule 4 and MBSD Rule 4,
a member can withdraw from membership in order to avail itself of a
member's cap on loss allocation if the member notifies FICC via a
written notice, in accordance with Section 13 of GSD Rule 3 or MBSD
Rule 3, as applicable, of its election to terminate its membership.
Current Section 13 of GSD Rule 3 and MBSD Rule 3 require a member to
provide FICC with 10 days written notice of the member's termination;
however, FICC, in its discretion, may accept such termination within a
shorter notice period. Such notice must be provided by the Close of
Business on the Business Day on which the loss allocation payment is
due to FICC and, if properly provided to FICC, would limit the member's
liability for a loss allocation to its Required Fund Deposit for the
Business Day on which the notification of allocation is provided to the
member.
    Under the proposal, a Tier One Netting Member or Tier One Member,
as applicable, would be able to limit its loss allocation exposure to
its Loss Allocation Cap by providing notice of its election to withdraw
from membership within five Business Days from the issuance of the
first Loss Allocation Notice in any round of an Event Period. Each
round would allow a Tier One Netting Member or Tier One Member, as
applicable, the opportunity to notify FICC of its election to withdraw
from membership after satisfaction of the losses allocated in such
round. Multiple Loss Allocation Notices may be issued with respect to
each round to allocate losses up to the round cap. As proposed, if a
member timely provides notice of its withdrawal from membership in
respect of a loss allocation round, the maximum amount of losses it
would be responsible for would be its Loss Allocation Cap,\25\ provided
that the member complies with the requirements of the withdrawal
process in proposed Section 7b of GSD Rule 4 and Section 7b of MBSD
Rule 4. The proposed Section 7b of GSD Rule 4 or MBSD Rule 4, as
applicable, would provide that the Tier One Netting Member or Tier One
Member, as applicable, must (1) specify in its Loss Allocation
Withdrawal Notice an effective date of withdrawal, which date shall not
be prior to the scheduled final settlement date of any remaining
obligations owed by the member to FICC, unless otherwise approved by
FICC; and (2) as of the time of such member's submission of the Loss
Allocation Withdrawal Notice, cease submitting transactions to FICC for
processing, clearance or settlement, unless otherwise approved by FICC.
---------------------------------------------------------------------------

    \25\ If a member's Loss Allocation Cap exceeds the member's
then-current Required Fund Deposit, it must still cover the excess
amount.
---------------------------------------------------------------------------

    As stated above, under the current Rules, the cap of a Tier One
Netting Member or Tier One Member, as applicable, that provided a
withdrawal notice would be its Required Fund Deposit for the Business
Day on which the notification of allocation is provided to the member.
Under the proposal, the Loss Allocation Cap of a Tier One Netting
Member or Tier One Member, as applicable, would be equal to the greater
of (1) its Required Fund Deposit on the first day of the applicable
Event Period and (2) its Average RFD. Specifically, the first round and
each subsequent round of loss allocation would allocate losses up to a
round cap of the aggregate of all Loss Allocation Caps of those Tier
One Netting Members or Tier One Members, as applicable, included in the
round. If a Tier One Netting Member or Tier One Member, as applicable,
provides notice of its election to withdraw from membership, it would
be subject to loss allocation in that round, up to its Loss Allocation
Cap. If the first round of loss allocation does not fully cover FICC's
losses, a second round will be noticed to those members that did not
elect to withdraw from membership in the previous round; however, the
amount of any second or subsequent round cap may differ from the first
or preceding round cap because there may be fewer Tier One Netting
Members or Tier One Members, as applicable, in a second or subsequent
round if Tier One Netting Members or Tier One Members, as applicable,
elect to withdraw from membership with GSD or MBSD, as applicable, as
provided in proposed Section 7b of GSD Rule 4 or MBSD Rule

4, as applicable, following the first Loss Allocation Notice in any
round.
    As proposed, a Tier One Netting Member or a Tier One Member, as
applicable, that withdraws in compliance with proposed Section 7b of
GSD Rule 4 or MBSD Rule 4, as applicable, would remain obligated for
its pro rata share of losses and liabilities with respect to any Event
Period for which it is otherwise obligated under GSD Rule 4 or MBSD
Rule 4, as applicable; however, its aggregate obligation would be
limited to the amount of its Loss Allocation Cap as fixed in the round
for which it withdrew.
    FICC states that the proposed changes are designed to enable FICC
to continue the loss allocation process in successive rounds until all
of FICC's losses are allocated. To the extent that the Loss Allocation
Cap of a Tier One Netting Member or Tier One Member, as applicable,
exceeds such member's Required Fund Deposit on the first day of an
Event Period, FICC may in its discretion retain any excess amounts on
deposit from the member, up to the Loss Allocation Cap of a Tier One
Netting Member or Tier One Member, as applicable.
(6) Declared Non-Default Loss Event
    Aside from losses that FICC might face as a result of a Defaulting
Member Event, FICC could incur non-default losses incident to each
Division's clearance and settlement business.\26\ The GSD Rules and the
MBSD Rules currently permit FICC to apply Clearing Fund to non-default
losses.\27\ Section 5 of GSD Rule 4 and MBSD Rule 4 provides that the
use of the Clearing Fund deposits is limited to satisfaction of losses
or liabilities of FICC, which includes losses or liabilities that are
otherwise incident to the operation of the clearance and settlement
business of FICC, although the application of the Clearing Fund to such
losses or liabilities is more limited under MBSD Rule 4 when compared
to GSD Rule 4.\28\ Section 7(f) of GSD Rule 4 and MBSD Rule 4 provides
that any loss or liability incurred by the Corporation incident to its
clearance and settlement business arising other than from a Remaining
Loss shall be allocated among Tier One Netting Members or Tier One
Members, as applicable, ratably, in accordance with their Average
Required Clearing Fund Deposits.\29\
---------------------------------------------------------------------------

    \26\ Non-default losses may arise from events such as damage to
physical assets, a cyber-attack, or custody and investment losses.
    \27\ The first paragraph of Section 7 in both GSD Rule 4 and
MBSD Rule 4 is not clear and may suggest that losses or liabilities
may only be allocated in a member default scenario, while Section 5
in both GSD Rule 4 and MBSD Rule 4 makes it clear that the
applicable Division's Clearing Fund may be used to satisfy non-
default losses.
    \28\ Section 5 of GSD Rule 4 provides that ``The use of the
Clearing Fund deposits shall be limited to satisfaction of losses or
liabilities of the Corporation . . . otherwise incident to the
clearance and settlement business of the Corporation . . .'' Supra
note 9.
    Section 5 of MBSD Rule 4 provides that ``The use of the Clearing
Fund deposits and assets and property on which the Corporation has a
lien on shall be limited to satisfaction of losses or liabilities of
the Corporation . . . otherwise incident to the clearance and
settlement business of the Corporation with respect to losses and
liabilities to meet unexpected or unusual requirements for funds
that represent a small percentage of the Clearing Fund . . .'' Supra
note 9.
    \29\ Section 7(f) of GSD Rule 4 and MBSD Rule 4 provides that
``Any loss or liability incurred by the Corporation incident to its
clearance and settlement business . . . arising other than from a
Remaining Loss (hereinafter, an ``Other Loss'') shall be allocated
among [Tier One Netting Members/Tier One Members], ratably, in
accordance with the respective amounts of their Average Required
[FICC Clearing Fund Deposits/Clearing Fund Deposits]''. Supra note
9.
---------------------------------------------------------------------------

    For both the GSD Rules and the MBSD Rules, FICC proposes to enhance
the governance around non-default losses that would trigger loss
allocation to Tier One Netting Members or Tier One Members, as
applicable, by specifying that the Board of Directors would have to
determine that there is a non-default loss that may be a significant
and substantial loss or liability that may materially impair the
ability of FICC to provide clearance and settlement services in an
orderly manner and would potentially generate losses to be mutualized
among the Tier One Netting Members or Tier One Members, as applicable,
in order to ensure that FICC may continue to offer clearance and
settlement services in an orderly manner. The proposed change would
provide that FICC would then be required to promptly notify members of
this determination (a ``Declared Non-Default Loss Event''). In
addition, FICC proposes to specify that a mandatory Corporate
Contribution would apply to a Declared Non-Default Loss Event prior to
any allocation of the loss among members. Additionally, FICC proposes
language to clarify members' obligations for Declared Non-Default Loss
Events.
    Under the proposal, FICC would clarify the Rules of both Divisions
to make clear that Tier One Netting Members or Tier One Members, as
applicable, are subject to loss allocation for non-default losses
(i.e., Declared Non-Default Loss Events under the proposal) and Tier
Two Members are not subject to loss allocation for non-default losses.

B. Changes To Align the Loss Allocation Rules

    The proposed changes would align the loss allocation rules, to the
extent practicable and appropriate, of the three DTCC Clearing Agencies
so as to provide consistent treatment for firms that are participants
of multiple DTCC Clearing Agencies. As proposed, the loss allocation
process and certain related provisions would be consistent across the
DTCC Clearing Agencies to the extent practicable and appropriate.

C. Use of MBSD Clearing Fund

    The proposed change would delete language currently in Section 5 of
MBSD Rule 4 that limits certain uses by FICC of the MBSD Clearing Fund
to ``unexpected or unusual'' requirements for funds that represent a
``small percentage'' of the MBSD Clearing Fund. FICC states that these
limiting phrases (which appear in connection with FICC's use of MBSD
Clearing Fund to cover losses and liabilities incident to its clearance
and settlement business outside the context of an MBSD Defaulting
Member Event as well as to cover certain liquidity needs) are vague,
imprecise, and should be replaced in their entirety. Specifically, FICC
proposes to delete the limiting language with respect to FICC's use of
MBSD Clearing Fund to cover losses and liabilities incident to its
clearance and settlement business outside the context of an MBSD
Defaulting Member Event so as to not have such language be interpreted
as impairing FICC's ability to access the MBSD Clearing Fund in order
to manage non-default losses. FICC proposes to delete the limiting
language with respect to FICC's use of MBSD Clearing Fund to cover
certain liquidity needs because the effect of the limitation in this
context is confusing and unclear.

D. Conforming and Technical Changes

    FICC proposes to make various conforming and technical changes
necessary to harmonize the remaining current Rules with the proposed
changes. Such changes include, but are not limited to: (1) Amending
Rule 1 (Definitions; Governing Law) to add cross-references to proposed
terms that would be defined in Rule 4; (2) inserting, deleting, or
changing various terms for clarity and consistency; (3) modifying the
voluntary termination provisions to ensure that termination provisions
in the GSD Rules and the MBSD Rules are consistent, whether voluntary
or in response to a loss allocation, are consistent with one another to
the extent appropriate; and

(4) deleting obsolete sections due to the proposal.

II. Discussion and Commission Findings

    Section 19(b)(2)(C) of the Act \30\ directs the Commission to
approve a proposed rule change of a self-regulatory organization if it
finds that the proposed rule change is consistent with the requirements
of the Act and the rules and regulations thereunder applicable to such
organization. After careful review, the Commission finds that the
Proposed Rule Change is consistent with the requirements of the Act and
the rules and regulations thereunder applicable to FICC. In particular,
the Commission finds that the Proposed Rule Change is consistent with
Section 17A(b)(3)(F) of the Act,\31\ Rule 17Ad-22(e)(4)(viii) under the
Act,\32\ Rule 17Ad-22(e)(13) under the Act,\33\ and Rules 17Ad-
22(e)(23)(i) and (ii) under the Act.\34\
---------------------------------------------------------------------------

    \30\ 15 U.S.C. 78s(b)(2)(C).
    \31\ 15 U.S.C. 78q-1(b)(3)(F).
    \32\ 17 CFR 240.17Ad-22(e)(4)(viii).
    \33\ 17 CFR 240.17Ad-22(e)(13).
    \34\ 17 CFR 240.17Ad-22(e)(23)(i) and (ii).
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A. Consistency With Section 17A(b)(3)(F) of the Act

    Section 17A(b)(3)(F) of the Act requires, in part, that a
registered clearing agency have rules designed to promote the prompt
and accurate clearance and settlement of securities transactions, to
assure the safeguarding of securities and funds which are in the
custody or control of the clearing agency, and to remove impediments to
and perfect the mechanism of a national system for the prompt and
accurate clearance and settlement of securities transactions.\35\
---------------------------------------------------------------------------

    \35\ 15 U.S.C. 78q-1(b)(3)(F).
---------------------------------------------------------------------------

    The Commission believes that the proposal to change the loss
allocation process is designed to assure the safeguarding of securities
and funds which are in the custody or control of the clearing agency.
As described above, FICC proposes to make the following changes to its
loss allocation process. First, for both the GSD Rules and the MBSD
Rules, the proposed changes would modify the calculation of FICC's
Corporate Contribution so that FICC would apply a mandatory fixed
percentage of its General Business Risk Capital Requirement as compared
to the current Rules which provide for a ``up to'' percentage of
retained earnings. The proposed changes also would clarify that the
proposed Corporate Contribution would apply to Declared Non-Default
Loss Events, as well as Defaulting Member Events, on a mandatory basis
prior to any allocation of the loss among Tier One Netting Members or
Tier One Members, as applicable. The proposal would specify how the
Corporate Contribution would be applied between Divisions. Moreover,
the proposal specifies that if the Corporate Contribution is applied to
a loss or liability relating to an Event Period, then for any
subsequent Event Periods that occur during the 250 business days
thereafter, the Corporate Contribution would be reduced to the
remaining, unused portion of the Corporate Contribution. The Commission
believes that these changes set clear expectations about how and when
FICC's Corporate Contribution would be applied to help address a loss,
and allow FICC to better anticipate and prepare for potential risk
exposures that may arise during an Event Period.
    Second, as described above, FICC proposes to determine a member's
loss allocation obligation based on the average of its Required Fund
Deposit over a look-back period of 70 Business Days and to determine
its Loss Allocation Cap based on the greater of its Required Fund
Deposit or the average thereof over a look-back period of 70 Business
Days. Currently, the GSD Rules and the MBSD Rules calculate a Tier One
Netting Member's or a Tier One Member's pro rata share for purposes of
loss allocation based on the member's average daily Required Fund
Deposit over the prior 12 months or such shorter period as may be
available in the case of a member which has not maintained a deposit
over such time period. These proposed changes are designed to allow
FICC to calculate a member's pro rata share of losses and liabilities
based on the amount of risk that the member brings to FICC, and cover a
sufficient amount of time to measure the risk. The look-back period of
70 Business Days is designed to be long enough to enable FICC to
capture a full calendar quarter of members' activities and to smooth
out the impact from any abnormalities that may have occurred, but not
excessively long such that members' business strategy and outlook could
have shifted significantly during the time period, resulting in
material changes to the size of its portfolios. As a result of these
changes, the Commission believes that FICC should be in a better
position to manage its risk by using a look-back period that more
accurately reflects the amount of risk that the member brings to FICC.
    Third, as described above, FICC proposes to introduce the concept
of an Event Period, which would group Defaulting Member Events and
Declared Non-Default Loss Events occurring within a period of 10
Business Days for purposes of allocating losses to members in one or
more rounds. Under the current Rules, every time each Division incurs a
loss or liability, FICC will initiate its current loss allocation
process by applying its retained earnings and allocating losses.
However, the current Rules do not contemplate a situation where loss
events occur in quick succession. Accordingly, even if multiple losses
occur within a short period, the current Rules dictate that FICC start
the loss allocation process separately for each loss event. Having
multiple loss allocation calculations and notices from FICC and
withdrawal notices from members after multiple sequential loss events
could cause heighten operational complexity and, therefore, risk for
FICC, since FICC would have to process and track multiple notices while
performing its other critical operations during a time of significant
stress.
    Therefore, the Commission believes that the proposed change to
introduce an Event Period would provide a more defined and transparent
structure, compared to the current loss allocation process described
immediately above, helping to reduce complexity in and the resources
needed to effectuate the process, thus mitigating operational risk.
Overall, such an improved structure should enable both FICC and each
member to more effectively manage the risks and potential financial
obligations presented by sequential Defaulting Member Events and/or
Declared Non-Default Loss Events that are likely to arise in quick
succession and could be closely linked to an initial event and/or
market dislocation episode. In other words, the proposed Event Period
structure should help clarify and define for both FICC and its members
how FICC would initiate a single defined loss allocation process to
cover all loss events within 10 Business Days. As a result, all loss
allocation calculation and notices from FICC and potential withdrawal
notices from members would be tied back to one Event Period instead of
each individual loss event.
    Fourth, as described above, the proposal would improve upon the
current loss allocation approach laid out in FICC's Rules by providing
for a loss allocation round, a Loss Allocation Notice process, a Loss
Allocation Withdrawal Notice process, and a Loss Allocation Cap, for
both the GSD Rules and the MBSD Rules. A loss allocation round would be
a series of loss allocations relating to an Event Period, the aggregate
amount of which would be

limited by the round cap. When the losses allocated in a round equals
the round cap, any additional losses relating to the Event Period would
be allocated in subsequent rounds until all losses from the Event
Period are allocated among members. Each loss allocation would be
communicated to members by the issuance of a Loss Allocation Notice.
Each member in a loss allocation round would have five Business Days
from the issuance of such first Loss Allocation Notice for the round to
notify FICC of its election to withdraw from membership with FICC, and
thereby benefit from its Loss Allocation Cap. The Loss Allocation Cap
of a member would be equal to the greater of its Required Fund Deposit
on the first day of the applicable Event Period and its Average RFD.
Members would have two Business Days after FICC issues a first round
Loss Allocation Notice to pay the amount specified in the notice.
    The Commission believes that the changes to (1) establish a
specific Event Period, (2) continue the loss allocation process in
successive rounds, (3) clearly communicate with its members regarding
their loss allocation obligations, and (4) effectively identify
continuing members for the purpose of calculating loss allocation
obligations in successive rounds, are designed to make FICC's loss
allocation process more certain. In addition, the changes are designed
to provide members with a clear set of procedures that operate within
the proposed loss allocation structure, and provide increased
predictability and certainty regarding members' exposures and
obligations. Furthermore, by grouping all loss events within 10
Business Days, the loss allocation process relating to multiple loss
events can be streamlined. With enhanced certainty, predictability, and
efficiency, FICC would then be able to better manage its risks from
loss events occurring in quick succession, and members would be able to
better manage their risks by deciding whether and when to withdraw from
membership and limit their exposures to FICC. Furthermore, the proposed
changes are designed to reduce liquidity risk to members by providing a
two-day window to arrange funding to pay for loss allocation, while
still allowing FICC to address losses in a timely manner.
    Fifth, as described above, for both the GSD Rules and the MBSD
Rules, FICC proposes to clarify the governance around Declared Non-
Default Loss Events by providing that the Board of Directors would have
to determine that there is a non-default loss that may be a significant
and substantial loss or liability that may materially impair the
ability of FICC to provide its services in an orderly manner. FICC also
proposes to provide that FICC would then be required to promptly notify
members of this determination. In addition, FICC proposes to apply a
mandatory Corporate Contribution to a Declared Non-Default Loss Event
prior to any allocation of the loss among members. The Commission
believes that these changes should provide an orderly and transparent
procedure to allocate a non-default loss by requiring the Board of
Directors to make a definitive decision to announce an occurrence of a
Declared Non-Default Loss Event, and requiring FICC to provide a notice
to members of the decision. The Commission further believes that an
orderly and transparent procedure should result in a risk management
process at FICC that is more robust as a result of enhanced governance
around FICC's response to non-default losses.
    Collectively, the Commission believes that the proposed changes to
FICC's loss allocation process would provide greater transparency,
certainty, and efficiency to FICC regarding the amount of resources and
the instances in which FICC would apply the resources to address risks
arising from Defaulting Member Events and Declared Non-Default Loss
Events, which could occur in quick succession. The Commission believes
that the transparency, certainty, and efficiency would afford FICC
better predictability regarding its risk exposure, and in turn, would
allow a risk management process at FICC that is more effectively
responsive to such events and would improve FICC's ability to continue
to operate in a safe and sound manner during such events. Therefore,
the Commission believes that these proposed changes would better equip
FICC to assure the safeguarding of securities and funds which are in
the custody or control of FICC.
    The Commission believes that the proposed rule change to modify the
use of MBSD Clearing Fund is designed to promote the prompt and
accurate clearance and settlement of securities transactions. As
described above, FICC proposes to delete the limiting language with
respect to FICC's use of MBSD Clearing Fund to cover losses and
liabilities incident to its clearance and settlement business outside
the context of an MBSD Defaulting Member Event so as to not have such
language be interpreted as impairing FICC's ability to access the MBSD
Clearing Fund in order to manage non-default losses. Further, FICC
proposes to delete the limiting language with respect to FICC's use of
MBSD Clearing Fund to cover certain liquidity needs because the effect
of the limitation in this context is confusing and unclear. The
Commission believes that the proposed change to delete certain vague
and imprecise limiting language that could impair FICC's ability to
access the MBSD Clearing Fund to cover losses and liabilities incident
to its clearance and settlement business outside the context of an MBSD
Defaulting Member Event, as well as to cover certain liquidity needs,
is designed to establish a clearer right of FICC to use MBSD Clearing
Fund in such situations. By establishing a more explicit right of FICC
to access the funds at such times, FICC should be better positioned to
manage risks presented by non-default losses and, thus, continue
offering its services. Accordingly, the Commission believes that the
change is designed to promote the prompt and accurate clearance and
settlement of securities transactions by enhancing FICC's ability to
ensure that it can continue its operations and clearance and settlement
services in an orderly manner in the event that it would be necessary
or appropriate for FICC to access MBSD Clearing Fund deposits to manage
its non-default losses.
    Finally, the Commission believes that the proposed rule changes to
align FICC's loss allocation rules with the loss allocation rules of
the other DTCC Clearing Agencies, to the extent practicable and
appropriate, are designed to remove impediments to and perfect the
mechanism of a national system for the prompt and accurate clearance
and settlement of securities transactions. As described above, the
alignment of FICC's loss allocation rules with the other DTCC Clearing
Agencies is designed to help provide consistent treatment for firms
that are participants of multiple DTCC Clearing Agencies. The
Commission believes that providing consistent treatment through
consistent procedures among the DTCC Clearing Agencies would help firms
that participate in multiple DTCC Clearing Agencies from encountering
unnecessary complexities and confusion stemming from differences in
procedures regarding loss allocation processes, particularly at times
of significant stress. Accordingly, by removing potential unnecessary
complexities and confusion due to different loss allocation rules of
the DTCC Clearing Agencies, the Commission believes that the proposal
is designed to remove impediments to and perfect the mechanism of a
national system for the prompt and accurate clearance and settlement of
securities transactions.

    For the reasons above, the Commission believes that the Proposed
Rule Change is consistent with Section 17A(b)(3)(F) of the Act.\36\
---------------------------------------------------------------------------

    \36\ 15 U.S.C. 78q-1(b)(3)(F).
---------------------------------------------------------------------------

B. Consistency With Rule 17Ad-22(e)(4)(viii)

    Rule 17Ad-22(e)(4)(viii) under the Act requires, in part, that a
covered clearing agency \37\ establish, implement, maintain and enforce
written policies and procedures reasonably designed to effectively
identify, measure, monitor, and manage its credit exposures to
participants and those arising from its payment, clearing, and
settlement processes, including by addressing allocation of credit
losses the covered clearing agency may face if its collateral and other
resources are insufficient to fully cover its credit exposures.\38\
---------------------------------------------------------------------------

    \37\ A ``covered clearing agency'' means, among other things, a
clearing agency registered with the Commission under Section 17A of
the Exchange Act (15 U.S.C. 78q-1 et seq.) that is designated
systemically important by the Financial Stability Oversight Counsel
(``FSOC'') pursuant to the Clearing Supervision Act (12 U.S.C. 5461
et seq.). See 17 CFR 240.17Ad-22(a)(5) and (6). On July 18, 2012,
FSOC designated FICC as systemically important. U.S. Department of
the Treasury, ``FSOC Makes First Designations in Effort to Protect
Against Future Financial Crises,'' available at https://www.treasury.gov/press-center/press-releases/Pages/tg1645.aspx.
Therefore, FICC is a covered clearing agency.
    \38\ 17 CFR 240.17Ad-22(e)(4)(viii).
---------------------------------------------------------------------------

    As described above, the proposal would revise the loss allocation
process to address how FICC would manage loss events, including
Defaulting Member Events. Under the proposal, if losses arise out of or
relate to a Defaulting Member Event, FICC would first apply its
Corporate Contribution. If those funds prove insufficient, the proposal
provides for allocating the remaining losses to the remaining members
through the proposed process. Accordingly, the Commission believes that
the proposal is reasonably designed to manage FICC's credit exposures
to its members, by addressing allocation of credit losses.
    Therefore, the Commission believes that FICC's proposal is
consistent with Rule 17Ad-22(e)(4)(viii) under the Act.\39\
---------------------------------------------------------------------------

    \39\ Id.
---------------------------------------------------------------------------

C. Consistency With Rule 17Ad-22(e)(13)

    Rule 17Ad-22(e)(13) under the Act requires, in part, that a covered
clearing agency establish, implement, maintain and enforce written
policies and procedures reasonably designed to ensure the covered
clearing agency has the authority to take timely action to contain
losses and liquidity demands and continue to meet its obligations.\40\
---------------------------------------------------------------------------

    \40\ 17 CFR 240.17Ad-22(e)(13).
---------------------------------------------------------------------------

    As described above, the proposal would establish a more detailed
and structured loss allocation process by (1) modifying the calculation
and application of the Corporate Contribution; (2) introducing an Event
Period; (3) introducing a loss allocation round and notice process; (4)
implementing a look-back period to calculate a member's loss allocation
obligation; (5) modifying the withdrawal process and the cap of
withdrawing member's loss allocation exposure; and (6) providing the
governance around a non-default loss. The Commission believes that each
of these proposed changes helps establish a more transparent and clear
loss allocation process and authority of FICC to take certain actions,
such as announcing a Declared Non-Default Loss Event, within the loss
allocation process. Further, having a more transparent and clear loss
allocation process as proposed would provide clear authority to FICC to
allocate losses from Defaulting Member Events and Declared Non-Default
Loss Events and take timely actions to contain losses, and continue to
meet its clearance and settlement obligations.
    Therefore, the Commission believes that FICC's proposal is
consistent with Rule 17Ad-22(e)(13) under the Act.\41\
---------------------------------------------------------------------------

    \41\ Id.
---------------------------------------------------------------------------

D. Consistency With Rule 17Ad-22(e)(23)(i) and (ii)

    Rule 17Ad-22(e)(23)(i) under the Act requires that a covered
clearing agency establish, implement, maintain and enforce written
policies and procedures reasonably designed to publicly disclose all
relevant rules and material procedures, including key aspects of its
default rules and procedures.\42\ Rule 17Ad-22(e)(23)(ii) under the Act
requires that a covered clearing agency establish, implement, maintain
and enforce written policies and procedures reasonably designed to
provide sufficient information to enable participants to identify and
evaluate the risks, fees, and other material costs they incur by
participating in the covered clearing agency.\43\
---------------------------------------------------------------------------

    \42\ 17 CFR 240.17Ad-22(e)(23)(i).
    \43\ 17 CFR 240.17Ad-22(e)(23)(ii).
---------------------------------------------------------------------------

    As described above, the proposal would publicly disclose how FICC's
Corporate Contribution would be calculated and applied. In addition,
the proposal would establish and publicly disclose a detailed procedure
in the Rules for loss allocation. More specifically, the proposed
changes would establish an Event Period, loss allocation rounds, a
look-back period to calculate each member's loss allocation obligation,
a withdrawal process followed by a loss allocation process, and a Loss
Allocation Cap that would apply to members after withdrawal.
Additionally, the proposal would align the loss allocation rules across
the DTCC Clearing Agencies to help provide consistent treatment, and
clarify that non-default losses would trigger loss allocation to
members. The proposal would also provide for and make known to members
the procedures to trigger a loss allocation procedure, contribute
FICC's Corporate Contribution, allocate losses, and withdraw and limit
member's loss exposure. Accordingly, the Commission believes that the
proposal is reasonably designed to (1) publicly disclose all relevant
rules and material procedures concerning key aspects of FICC's default
rules and procedures, and (2) provide sufficient information to enable
members to identify and evaluate the risks by participating in FICC.
    Therefore, the Commission believes that FICC's proposal is
consistent with Rules 17Ad-22(e)(23)(i) and (ii) under the Act.\44\
---------------------------------------------------------------------------

    \44\ 17 CFR 240.17Ad-22(e)(23)(i) and (ii).
---------------------------------------------------------------------------

III. Conclusion

    On the basis of the foregoing, the Commission finds that the
proposal is consistent with the requirements of the Act and in
particular with the requirements of Section 17A of the Act \45\ and the
rules and regulations thereunder.
---------------------------------------------------------------------------

    \45\ 15 U.S.C. 78q-1.
---------------------------------------------------------------------------

    It is therefore ordered, pursuant to Section 19(b)(2) of the
Act,\46\ that proposed rule change SR-FICC-2017-022, as modified by
Amendment No. 1, be, and it hereby is, approved \47\ as of the date of
this order or the date of a notice by the Commission authorizing FICC
to implement advance notice SR-FICC-2017-806, as modified by Amendment
No. 1, whichever is later.
---------------------------------------------------------------------------

    \46\ 15 U.S.C. 78s(b)(2).
    \47\ In approving the Proposed Rule Change, the Commission has
considered the Proposed Rule Change's impact on efficiency,
competition, and capital formation. See 15 U.S.C. 78c(f).

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\48\
---------------------------------------------------------------------------

    \48\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2018-19062 Filed 8-31-18; 8:45 am]
 BILLING CODE 8011-01-P


[Federal Register Volume 81, Number 214 (Friday, November 4, 2016)]
[Rules and Regulations]
[Pages 76866-76867]
[FR Doc No: 2016-26655]

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DEPARTMENT OF HOMELAND SECURITY

Coast Guard

33 CFR Part 117

[Docket No. USCG-2016-0963]
RIN 1625-AA09

Drawbridge Operation Regulations; Tchefuncta River, Madisonville,
LA

AGENCY: Coast Guard, DHS.

ACTION: Notice of temporary deviation from regulations; request for
comments.

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

SUMMARY: The Coast Guard has issued a temporary deviation from the
operating schedule that governs the State Route 22 Bridge (Madisonville
(SR22) swing span bridge) across the Tchefuncta River, mile 2.5, at
Madisonville, St. Tammany Parish, Louisiana. This deviation will test a
change to the drawbridge operation schedule to determine whether a
permanent change to the schedule is needed. This deviation will allow
the bridge to only open for vessels on the hour during the day and to
not open for vessels during the weekday peak traffic hours.

DATES: This deviation is effective from 6 a.m. on November 21, 2016
through midnight on May 18, 2017.
    Comments and related material must reach the Coast Guard on or
before January 18, 2017.

ADDRESSES: You may submit comments identified by docket number USCG-
2016-0963 using the Federal eRulemaking Portal at http://www.regulations.gov. See the ``Public Participation and Request for
Comments'' portion of the SUPPLEMENTARY INFORMATION section below for
instructions on submitting comments.

FOR FURTHER INFORMATION CONTACT: If you have questions on this test
deviation, call or email David Frank, Bridge Administrator at 504-671-
2128, email<EMAIL_ADDRESS>
SUPPLEMENTARY INFORMATION:

I. Background, Purpose and Legal Basis

    The State Route 22 (SR 22) swing span bridge across Tchefuncta
River, mile 2.5, at Madisonville, St. Tammany Parish, Louisiana
presently operates under 33 CFR 117.500. The SR 22 swing bridge has a
vertical clearance of 6.2 feet above Mean High Water (MHW) in the
closed-to-navigation position and unlimited clearance in the open-to-
navigation position.
    Local governmental officials from St. Tammany Parish and the City
of Madisonville, in conjunction with the Louisiana Department of
Transportation and Development (LDOTD) have requested that the
operating regulation of the SR 22 swing span bridge be changed in order
to better accommodate the increased vehicular traffic crossing the
bridge especially during the peak, weekday rush hours. A traffic study
conducted by the LDOTD has determined that the existing vehicular
traffic at the intersection of SR 22 and SR 21/SR 1077 is over capacity
at peak hours and causes unacceptable levels of delay to roadway
traffic. This situation is compounded by the opening of the bridge
during these peak hours. A combination of modifications to the
operating schedule of the bridge and modifications to the traffic
controls at this intersection will improve traffic flow and reduce
traffic delays.
    Approximately 7,500 vehicles cross the bridge daily between the
hours of 6 a.m. and 7 p.m. Vessel openings for the month of July
indicate that the bridge opened to pass vessels 118 times during the
week and 202 times during the weekend. Vessel openings for the month of
August dropped to 68 openings during the week and 85 openings during
the weekend.
    Concurrent with the publication of the Test Deviation, a Notice of
Proposed Rulemaking (NPRM) [USCG-2016-0963] has been issued to allow
the LDOTD to test the proposed schedule and to obtain data and public
comments. The test period will be in effect during the entire NPRM
comment period. The Coast Guard will review the logs of the drawbridge,
the traffic counts provided by LDOTD, and evaluate public comments from
this NPRM and the above referenced Temporary Deviation to determine if
the requested change to the permanent special drawbridge operating
regulation is warranted.
    The deviation to test the proposed schedule will allow the SR 22
Bridge, mile 2.5 at Madisonville to operate as follows: The draw of the
SR22 Bridge shall open on signal from 7 p.m. to 6 a.m. From 6 a.m. to 7
p.m., the draw need only open on the hour, except that the draw need
not open for the passage of vessels at 8 a.m., 5 p.m. and 6 p.m. Monday
through Friday except federal holidays. The bridge will open at any
time an emergency.
    During the 180-day deviation, LDOTD will continue to monitor
vehicular traffic counts and work to make roadway traffic control
improvements to further reduce vehicular traffic delays.
    There are no alternate routes available for vessels that wish to
transit the bridge site; however, if vessels have a vertical clearance
requirement of less than 6.2 feet above MHW, they may transit the
bridge site at any time.

II. Public Participation and Request for Comments

    We view public participation as essential to effective rulemaking,
and will consider all comments and material received during the comment
period. Your comment can help shape the outcome of this rulemaking. If
you submit a comment, please include the docket number for this
rulemaking, indicate the specific section of this document to which
each comment applies, and provide a reason for each suggestion or
recommendation.
    We encourage you to submit comments through the Federal eRulemaking
Portal at http://www.regulations.gov. If your material cannot be
submitted using http://www.regulations.gov, contact the person in the
FOR FURTHER INFORMATION CONTACT section of this document for alternate
instructions.

    We accept anonymous comments. All comments received will be posted
without change to http://www.regulations.gov and will include any
personal information you have provided. For more about privacy and the
docket, you may review a Privacy Act notice regarding the Federal
Docket Management System in the March 24, 2005, issue of the Federal
Register (70 FR 15086).
    Documents mentioned in this notice of temporary deviation from
regulations, and all public comments, are in our online docket at
http://www.regulations.gov and can be viewed by following that Web
site's instructions. Additionally, if you go to the online docket and
sign up for email alerts, you will be notified when comments are posted
or a final rule is published.

    Dated: October 31, 2016.
David M. Frank,
Bridge Administrator, Eighth Coast Guard District.
[FR Doc. 2016-26655 Filed 11-3-16; 8:45 am]
 BILLING CODE 9110-04-P


[Federal Register Volume 77, Number 194 (Friday, October 5, 2012)]
[Notices]
[Pages 61047-61048]
[FR Doc No: 2012-24657]

=======================================================================
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DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

Public Notice for Waiver of Aeronautical Land-Use Assurance:
Bolton Field Airport; Columbus, OH

AGENCY: Federal Aviation Administration, DOT.

ACTION: Notice of intent of waiver with respect to land.

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

SUMMARY: The Federal Aviation Administration (FAA) is considering a
proposal to change a portion of the Bolton Field Airport from
aeronautical use to non-aeronautical use and to authorize the sale of
the airport property. The proposal consists of the sale of unimproved
land owned by the Columbus Regional Airport Authority (CRAA) for use as
an office/warehouse/distribution facility.
    The CRAA has requested from FAA a ``Release from Federal agreement
obligated land covenants'' to sell 60.282 acres of property acquired by
the CRAA with Federal funding under Grant Number 8-39-0026-01.
    The above mentioned land is not needed for aeronautical use, as
shown on the Airport Layout Plan. There are no impacts to the airport
by allowing the CRAA to dispose of the property. Approval does not
constitute a commitment by the FAA to financially assist in the
disposal of the airport property nor a determination of eligibility for
grant-in-aid funding from the FAA. The disposition of proceeds from the
disposal of the airport property will be in accordance with FAA's
Policy and Procedures Concerning the Use of Airport Revenue, published
in the Federal Register on February 16, 1999.
    In accordance with section 47107(h) of title 49, United States
Code, this notice is required to be published in the Federal Register
30 days before modifying the land-use assurance that requires the
property to be used for an aeronautical purpose.

DATES: Comments must be received on or before November 5, 2012.

ADDRESSES: Documents reflecting this FAA action may be reviewed at the
Detroit Airports District Office, 11677 South Wayne Road, Suite 107,
Romulus, Michigan 48174.

FOR FURTHER INFORMATION CONTACT: Mr. David J. Welhouse, Program
Manager, Detroit Airports District Office, 11677 South Wayne Road,
Suite 107, Romulus, Michigan 48174. Telephone Number<PHONE_NUMBER>/FAX
Number<PHONE_NUMBER>.

SUPPLEMENTARY INFORMATION: Following is a legal description of the
property located in the City of Columbus, Franklin County, Ohio, and
described as follows:

Description of Property Being Released (60.282 Acres)

    Situate in the State of Ohio, Franklin County, City of Columbus,
lying in Virginia Military Survey Number 1462, being 4.473 acres out of
that original 108.301 acre tract (Tract 26) and 55.809 acres out of
that 82.98 acre tract (Tract 27) as conveyed to Columbus Regional
Airport Authority by deed of record in Instrument Number<PHONE_NUMBER>1193
(all records herein are from the Recorder's Office, Franklin County,
Ohio) and being further described as follows:
    Begin, for reference, at Franklin County Engineer's Monument 5146
at the centerline intersection of Holt Road (70 feet in width) and
Alkire Road (width varies);
    Thence North 87[deg]12'43'' West a distance of 1221.21 feet, long
the centerline of Alkire Road to a PK nail found at the southeasterly
corner of said 82.98 acre tract, and being the southwesterly corner of
that 7.846 acre tract as conveyed to M & J Development and Storage
Systems, LLC by deed of record in Instrument Number<PHONE_NUMBER>60149;
    Thence North 02[deg]02'58'' East, a distance of 737.67 feet along
the line common to said 82.98 and 7.846 acre tracts passing a \3/4\
inch iron pipe found with cap stamped ``STANTEC'' at 50.00 feet to a
\3/4\ inch iron pipe set at the True Point of Beginning;
    Thence the following five (5) courses and distances across said
82.98 and 108.301 acre tracts;
    North 87[deg]57'02'' West, a distance of 159.01 feet to a \3/4\
inch iron pipe set;
    North 57[deg]37'01'' West, a distance of 1204.85 feet to a \3/4\
inch iron pipe set;
    North 00[deg]45'58'' East, a distance of 687.54 feet to a \3/4\
inch iron pipe set;
    North 39[deg]30'41'' West, a distance of 102.52 feet to a \3/4\
inch iron pipe set;
    North 66[deg]08'30'' West, a distance of 447.78 feet to a \3/4\
inch iron pipe set on the easterly line of that 13.6672 acre tract as
conveyed to the City of Columbus by deed of record in Instrument Number
200712310221202;
    Thence North 01[deg]09'32'' East, a distance of 306.65 feet along
the line common to said 108.301 and 13.6672 acre tracts to a \3/4\ inch
iron pipe found with a yellow cap stamped ``S5669'' on a corner common
to said 108.301 and 13.6672 acre tracts, and being on the southerly
line of that 16.715 acre tract as conveyed to Robert Eickholt by deed
of record in Instrument Number<PHONE_NUMBER>98299;
    Thence South 88[deg]50'02'' East, a distance of 474.90 feet along
the line common to said 108.301 and 16.715 acre tracts to a \5/8\ inch
rebar found with cap stamped ``Thomas Engr. & Surveying'' on the line
common to said 108.301 and 82.98 acre tracts;
    Thence North 00[deg]55'10'' East, a distance of 404.87 feet,
continuing along the line common to said 82.98 and 16.715 acre tracts,
passing a \5/8\ rebar found at 96.85 feet, to a \3/4\ inch iron pipe
set at the southwesterly corner Lot 18 of Georgesville Square
Subdivision and Dedication of Holt Road of record in Plat Book 87,
Pages 11-15, and that original 17.449 acre tract as conveyed to
Glimcher Properties LP by deeds of record in Official Record 30163 F05
and Official Record 30328 D19;
    Thence South 88[deg]37''05'' East, a distance of 1236.05 feet,
along the southerly line of said Lot 18 and original 17.449 acre tract
to a 1 inch iron pipe found at the northeasterly corner of said 82.98
acre tract, and being the corner common to Lot 18 and Lot 17;
    Thence South 02[deg]02'58'' West, a distance of 2272.05 feet along
the line common to said 82.98 acre tract, and that 1.400 acre tract as
conveyed to Ashland Inc. by deed of record in Instrument Number
200211250301573, the Second Amendment to The Villas at Holt Run
Condominium, Instrument Number<PHONE_NUMBER>12257, that original 10.799
acre tract conveyed to Scioto Land Development, LLC by deed of record
in Instrument Number<PHONE_NUMBER>09093, that original 22.839 acre tract
as conveyed to Scioto Land

Development, LLC by deed of record in Instrument Number
200104130077279, the First Amendment to The Villas at Holt Run
Condominium, Instrument Number<PHONE_NUMBER>08781, the line common to Holt
Run, a subdivision of record in Plat Book 98, Page 33 and said 7.846
acre tract, and Lot 17, passing a \3/4\ inch iron pipe found with a cap
stamped ``R.D. ZANDE'' at 1568.50 feet, a \3/4\ inch iron pipe found at
2100.23 feet to the True Point of Beginning, containing 60.282 acres,
more or less, of which 4.473 acres are out of Auditor's Parcel Number
570-154749 and 55.809 acres are out of Auditor's Parcel Number 570-
154767, and being subject to all easements, restrictions and rights-of-
way of record.
    The bearings shown above are based on the grid bearing of North
87[deg]12'43'' West for the centerline of Alkire Road between Franklin
County Engineer's Monuments FCGS 5146 and FCGS 4448 as determined by a
GPS network of field observations performed in September, 2007, State
Plane Coordinate System, South Zone, NAD 83 (NSRS 2007).

    Issued in Romulus, Michigan, on September 21, 2012.
John L. Mayfield, Jr.,
Manager, Detroit Airports District Office FAA, Great Lakes Region.
[FR Doc. 2012-24657 Filed 10-4-12; 8:45 am]
BILLING CODE 4910-13-P